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The Honolulu Advertiser

Updated at 7:18 p.m., Wednesday, April 11, 2007

Tax break for certain Hawaiian landowners approved

Advertiser Staff

Despite concerns about its unknown cost to Honolulu's treasury, the City Council today unanimously approved a tax break for properties tied to 19th-century Hawaiian kingdom land grants.

The council first removed a reference to Hawaiians from the measure, to help ward off any legal challenges that might allege it unjustly discriminates against non-Hawaiians.

The council also agreed informally to revisit the issue in a year or so to determine whether the tax break is effective or becomes abused.

The measure sets annual property taxes for agricultural or residential land on O'ahu at $100 for lineal descendants of anyone who received title to the land from the kingdom after the 1848 Mahele, which created Hawai'i's first system of private land ownership.

Several council members said it might later be necessary to limit the tax break to needy owners.

State Office of Hawaiian Affairs trustee Rowena Akana said the agency had identified only two families that appear to qualify for the measure. The tax break is necessary to prevent Hawaiian families from losing land due to skyrocketing property values and taxes, she said.

But neither she nor city tax officials could say how many families, or how much property, might eventually qualify, or how much revenue the city would be giving up.

The $100 tax would apply to property that includes any portion of kuleana lands — parcels awarded by the kingdom to native farmers — owned wholly or partly by a lineal descendant of the original land award.