Lawyer says tax agency 'rotten'
By Johnny Brannon
Advertiser Staff Writer
The kind of faulty property tax assessments alleged in a former city appraiser's lawsuit are "very widespread," and many Honolulu residents are likely being overcharged by the city, according to the plaintiff's lawyer.
"This is a case that really affects a lot of property owners," attorney Roger Moseley said. "The kind of things that go on at the Assessment Division are really shocking."
The federal lawsuit filed by Philip E. English charges that division officials knowingly sent out incorrect property tax bills and retaliated against English after he challenged the practice.
Moseley said the division is chronically understaffed, leaving many employees overworked, demoralized and afraid to complain about problems.
"It's just rotten to the core," he said. "That's not to say there aren't some good people over there, but they're absolutely intimidated by the rotten apples."
City budget director Ivan Lui-Kwan said the allegations in the lawsuit "are unsubstantiated and we will vigorously defend the lawsuit in court."
The lawsuit says that improper assessments were sent out for the 2001-2003 tax years, even though specific errors were pointed out to top officials.
"We stand by the assessments made by the Real Property Assessment Division during those years," said Lui-Kwan, whose office oversees the division. "The assessments are based on market sales within the geographic area. Checks of actual sales data and the assessments are made prior to notices being sent to property owners."
Assessment Division administrator Gary Kurokawa did not return calls yesterday or Tuesday.
The suit charges that city employees did work for a company owned partly by Kurokawa while they were supposed to be doing city work. Moseley said it was not clear how much work was done or how much city time was involved.
City Ethics Commission director Chuck Totto said a complaint that English filed with his agency last year remains pending. Totto said he could not comment on details of the case, but that it is very clear that city employees can't use public resources for private projects.
"That may or may not relate to this case," he said. "We have to take a look at the facts to see if there's been any wrongdoing."
The city sent property tax bills totalling more than $400 million for 2003, and assessments increased 6.6 percent over 2002, to $95.1 billion from $89.2 billion.
By November, about $1.4 million in refunds had been returned to 447 property owners who successfully challenged their assessments. More than 1,600 more appeals were pending at that time; updated figures were not immediately available.
Less than 1 percent of the city's residential property owners contested their assessments for last year. Assessments are sent out in December, and property owners have a month to appeal them.
The city generally receives about 2,500 appeals a year, and review boards hear about 50 cases a week between July 1 and June 30. On average, 40 percent of appeals result in property taxes adjusted downward by more than 50 percent of the difference in dispute.
Reach Johnny Brannon at jbrannon@honoluluadvertiser.com or 525-8070.
