3 property tax cuts offered
City Council proposals target low-income and longtime owners
Three more proposals for property tax reduction were introduced yesterday at the City Council.
Bill 3 proposes exempting from tax 20 percent of a property's assessed value for owners of low-income rental housing. It also proposes the minimum $100 property tax payment for owners of homes with renters in the Section 8 federal housing assistance program.
"Hopefully, this is enough of an incentive for people who want to provide rental housing for those on fixed incomes," said Council Chairman Donovan Dela Cruz, who introduced the measure along with Budget Chairwoman Ann Kobayashi.
The pair also introduced Bill 4, which would increase the homeowner's exemption for low-income owner-occupants. The current exemption would be increased to $100,000 for those making 160 percent of Oahu's median income as determined by the U.S. Department of Housing and Urban Development. The lower the income, the greater the exemption, up to $200,000.
Dela Cruz said that both young and old would benefit from the bill because the exemption is based not on age, but income.
"If you're on a downhill slope, this bill is going to help you because you're going to be making less," Dela Cruz said. "These bills target the middle class and those on fixed income."
Dela Cruz and Kobayashi said that basing an exemption solely on age means wealthy older homeowners would qualify for the tax break, and that is not the group they are targeting.
"If Bill Gates was here, after age 65 he would qualify, too," Kobayashi said of the founder of software giant Microsoft.
Councilman Rod Tam, meanwhile, is proposing Bill 5, which aims to cap assessment increases based on how long homeowners live in their primary residence.
"This will provide longtime homeowners with more financial stability and less property tax increases based on investments and speculation," Tam said in a news release.
The proposals are among several that have been offered by Council members and Mayor Mufi Hannemann since rising property values pushed tax assessments for this year up 26 percent.
The City Council plans to begin discussing the issue Jan. 26.