Kauai tax rollback
overturned

The group behind the property
tax measure passed by voters
vows to appeal the ruling

LIHUE » Circuit Judge George Masuoka has nullified a Kauai County Charter amendment on tax reform for resident homeowners passed by voters in 2004.

The amendment would have returned property taxes for resident homeowners to 1998-1999 levels and mandated annual increases at a fixed rate.

Deputy County Attorney Carmen Wong applauded yesterday's ruling by Masuoka. "No one disputes the need for tax relief," she said, "but it has to be done in an orderly way, with care."

But Walter Lewis, spokesman for Kauai Ohana, which proposed the amendment, said, "We intend to appeal promptly and vigorously to the Hawaii Supreme Court to reverse the Circuit Court's opinion and to protect the interests of the many Kauai citizens who will be affected by the decision."

Frustrated by escalating property taxes, the Kauai Ohana got the Charter amendment on the November ballot. After voters overwhelmingly signaled approval, Mayor Bryan Baptiste and the County Council issued a statement saying they would implement the amendment.

But county attorneys perceived the amendment as unconstitutional, arguing that the state Constitution says tax policy and reform are the responsibility of county government, not residents. County attorneys then took the unusual step of seeking a motion against the mayor, the director of finance and County Council.

Wong said she hoped the county government could now move forward and seek equitable relief.

Mayor Bryan Baptiste concurred. "The lawsuit has never been about providing tax relief to the people of Kauai. It has been about the appropriateness of using a Charter amendment to affect the real property tax system."

Four members of Kauai Ohana petitioned the court as intervenors speaking for homeowner residents. Lewis, Ming Fang, Monroe Richman and Gordon Smith argued the validity of the amendment.

Council Chairman Bill "Kaipo" Asing expressed relief that the suit is over. "The court's ruling reminds both the Council and the administration that our sworn duty demands that we uphold the state Constitution. ... We must arrive to balance the obligation of providing services for this county in the best interest of the entire community."

But Kauai Ohana feels it is only the beginning, and intends to pursue the issue. "If we don't, it will cause great damage to the county," said Richman.

For Wong it is time to get busy "and find equitable tax relief for all our citizens.

"It has to be fair for everyone. As Judge Masuoka said when he made his decision, 'One cannot do indirectly what one cannot do directly.'"