Three bills on property taxes to be discussed

By Treena Shapiro
Advertiser Staff Writer

The City Council Budget Committee discussed real property taxes for several hours at a special meeting yesterday, trying to determine how to assist low-income homeowners and make the system fairer for everyone.

"The purpose of the whole thing is to make sure that no one is taxed out of their home or taxed out of their business," said Council Budget Chairwoman Ann Kobayashi.

After discussing eight bills and resolutions related to real property taxes — including both reducing and increasing the number of property classifications — the committee decided that it will take up three bills at its July 23 meeting.

Kobayashi said that any changes the council may make to the real property tax rates will not take effect until next July.

Bill 30 gives a real property tax credit to low-income elderly households. The bill would help people who have lived in their homes for a long time or perhaps inherited the property.

Over the years, "their property taxes have gone up, but their incomes have not gone up," Kobayashi said.

The bill would give a credit to retired homeowners who have incomes less than $20,000 a year to prevent them from paying more than 5 percent of their incomes in property taxes.

Kobayashi said introducing the tax credit in the middle of the fiscal year would not have much impact on the budget the council passed last month.

"There are very few people who qualify for this circuit breaker," she said.

Bill 63 would put preservation property in the same tax bracket as residential property, instead of making preservation owners pay the same property taxes as hotels and resorts, Kobayashi said.

Under Bill 43, the city would formalize its practice of classifying condominiums used as transient vacation units or for time-sharing as "hotel and resort" for the following year.

"The city does that already, but it's not in the ordinance," Kobayashi said.

Reach Treena Shapiro at tshapiro@honoluluadvertiser.com or 525-8070.