Property tax
plan on horizon

The mayor and the City Council
want relief for taxes, but it would
not come until next year

If you have received a shocking property tax bill, don't expect any relief for a while.

While Mayor Mufi Hannemann and the City Council are considering extraordinary tax relief packages -- including a proposal to peg taxes to a homeowner's annual salary instead of property values -- help would not come until next year.

By then, city officials hope tax relief will be available to the elderly and lower-income residents.

Hannemann announced yesterday that he plans to put together a comprehensive tax relief package "that will be fair, will be equitable and that will address the concerns that people have."

"I'd like to do something that goes beyond just the seniors, that we do it for all homeowners that have a very difficult time given their present salary in meeting their property taxes," the mayor said.

Today, the City Council's Budget Committee is expected to approve for a final vote a bill that would give relief to those with moderate to lower incomes.

"That really helps people on fixed incomes," said Budget Chairwoman Ann Kobayashi, whose taxes went up to $2,400 from $1,700.

Kobayashi has been working on property tax relief legislation since December, when valuations for the coming tax year jumped by 26 percent overall, with some areas experiencing up to 48 percent increase in assessments.

The Council tax bill under consideration today would base property taxes on income instead of property value for owners making less than $50,000 a year. Property taxes then would be calculated at 4 percent of the owners' annual income.

For an income of $30,000, the taxes for that property would be $1,200, she said.

If the income doesn't change, then the taxes won't change even if valuations continue to rise, she said. "This way, you don't have to worry about property values."

She said the tax relief would go to any owner who meets the income levels.

"There's no age limit," she said. "There are a lot of young people who are not making much and they are having a hard time paying their mortgage and raising children."

Hannemann said his administration did not propose property tax relief for the current year because it did not want to severely affect revenues.

"Rather than sit back and base our budgetary ... priorities on what we're collecting in real property taxes and fees, I'm trying to do this other side, revenue enhancement," Hannemann said.

Yesterday, he announced the formation of a revenue enhancement team that will look at new ways to generate revenues.

Among the ideas: renting rooftops and street lights for wireless Internet networks, and charging more user fees at the McCoy Pavilion and Central Oahu Regional Park for large sports and international events.

Terry Lee, chairman of the Lee Financial Group who is heading up the team, said the panel will also look at increasing attendance at places like the Honolulu Zoo.