High property values bad news for taxpayers
Property values on Oahu have increased about 26 percent over the last year.
WITH property values up an astonishing 26 percent
, homeowners on Oahu will see their tax bills climb significantly if the City Council does not reduce rates next year.
The Council has set caps on taxes for those whose annual incomes fall below $50,000, but the increased values will surely squeeze more middle-income owners.
Mayor Hannemann's proposal to cut $200 off the tax bills for residents 62 and older may be well intended, but the break isn't enough to make much of a difference for low-income individuals and rewards high-income homeowners indiscriminately.
He and the Council need to look for other ways to soften the blow equitably.
Though Hawaii has savored a booming economy, the wealth hasn't trickled down much to ordinary people. U.S. Bureau of Labor reports that wages in Honolulu averaged $693 a week, about $82 below the national average. When adjusted for inflation, workers are actually falling behind as the cost of living continues to rise.
City officials plead poverty as debt service and costs for roads, sewers and salaries grow. But if rates remain the same, the higher valuations should fetch the city tens of millions of dollars more than last year.
Hannemann wants to bank $50 million for a "rainy day" fund, which now stands at $5 million. That may be difficult to stomach for many of the 273,550 property owners who were mailed assessments this week, particularly those with apartments in Wahiawa where valuations shot up nearly 52 percent, and in rural Kaaawa and Kahuku where the average increase is 48 percent.
They likely have their own financial storms to weather.
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