Sleight of hand won't lower property taxes

As long as officials continue to calculate the value of property by the inflated sale prices of homes, residents will see persistent increases in their taxes. The cycle won't be broken until a more equitable method for assessments is established.

The City Council is considering cutting 30 cents from the current residential tax rate of $3.59 per $1,000 in property values. But even with proposals to take the smaller pinch, to increase exemptions from $40,000 to $80,000 and to grant a onetime $200 tax credit, higher valuations will result in taxpayers paying about the same amount -- until the next jump in valuations.

The Council's adoption of Mayor Mufi Hannemann's proposal would bump up the rate for commercial, hotel, resort and industrial property by 53 cents, from $11.97 to $12.50. The increase would neutralize the shortfall from residential decreases, somewhat of a shell game to keep revenues at a certain level.

The only sensible proposal in the Council's package is one to pare the rate for agricultural land actually in production from $8.57 to $5.70, which encourages large landowners to put farmers on their property while reducing costs for farmers who lease the acreage. However, the Council should not lower rates for vacant agricultural land.

As expected, commercial and hotel property owners aren't happy. Murray Towill of the Hawaii Hotel and Lodging Association complained about the jockeying of rates in different categories. "The key, obviously, to this whole dilemma is to control spending." Indeed.