Maui County

Maui plan to hike tax
on rentals is criticized

The move would force rents to
be raised, a taxpayers group says

WAILUKU >> A Valley Isle group has criticized a proposal to raise taxes on rental properties while lowering them for owner-occupied homes.

The West Maui Taxpayers Association said the proposal along with assessment increases would effectively raise apartment owners' taxes by more than 31 percent.

"This is just not acceptable," association President Joseph Pluta said. "It's really not good."

Pluta said if the proposed budget passes with the property tax hikes, the higher cost of owning an apartment unit would cause a rent increase.

The suggested property tax increases, included in the proposed 2003-2004 budget, is scheduled for first reading before the Maui County Council at 10 a.m. Tuesday.

The proposed budget calls for a property tax rate increase for apartments and improved residential and unimproved residential properties to $5.86 from $4.93 per $1,000 of assessed valuation. For homeowners who occupy their own homes, the property tax rate would decrease to $3.55 from $3.63 per $1,000 of assessed valuation.

As a policy, the Council is moving toward giving tax breaks to owner-occupants but drawing the line on owners of residential property used for generating income.

The Council's Budget and Finance Committee also has suggested raising the gasoline and diesel tax to 18 cents from 13 cents a gallon, motor vehicle registration fee to $14.50 from $9.50, and trash collection fees to $12 a month from $6.

The committee agreed with Mayor Alan Arakawa's proposal to increase the motor vehicle beautification fund fee to $5 from $2 and to increase residential sewer rates on an average of $3 a month.

Other fee changes supported by the Council committee and Arakawa include creating a three-tiered rate for commercial refuse and abandoning the $41-per-truck commercial refuse fee. Under the proposal, the county would charge $30.50 for trucks weighing less than a ton, $41 for trucks weighing between 1 and 5 tons, and $82 for 5 tons and more.

Committee Chairman Riki Hokama said the increases are needed to meet rising costs, including several million not included in Arakawa's annual budget on March 14. He said the Council's budget of $318.8 million was $13.7 million less than Arakawa's.

Arakawa said while he supported fee increases seeking to make services self-sufficient, he did not support property tax rate increases, especially those affecting renters.

"I'm very concerned about people renting, just surviving day to day," he said. "In general, it's a bad time to be raising rates."

County of Maui

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