Big Isle Council defers
property tax relief
HILO >> Big Island Mayor Harry Kim is proposing a series of measures to lower property taxes for homeowners with moderate incomes.
The intent is to help people who have found the value of their home inflating because of growth in their area, those who are on fixed incomes, and first-time homeowners, Kim told the Finance Committee of the Hawaii County Council yesterday.
West Hawaii residents are especially in need of relief because of inflated property values there, he said.
Council members voted yesterday to defer action on the proposals.
Finance chairman Aaron Chung questioned whether Kim's proposals are truly fair.
"Until I know what we're trying to achieve, I can't vote for any specific proposal," he said.
The centerpiece of Kim's proposals is increasing a present tax exemption from the first $40,000 of value in an owner-occupied home to as high as $80,000.
A second proposal would limit the increase in the assessed value of an owner-occupied house to no more than 3 percent a year until the house is sold.
The proposal is important because property taxes often balloon when property values go up.
But Councilman Michael Tulang noted that a 1978 property tax limit in California caused unexpected problems.
He said he wanted more information before approving a limit here.
An existing ordinance allows owner-occupants to avoid increases in valuation by dedicating their homes to "nonspeculative residential use" for 10 years.
Any change of heart during those years and owners have to pay tax money they saved.
But 10 years is too long for some people, Kim said. He's proposing five years.
The benefits would apply only to a "principal home."
Kim also wants a tighter definition of that term, including documentation, when requested by the county.
