As both a business and individual real-property taxpayer, I have long been uneasy with the way our City Council manages the revenue side of its budgetary process. Even so, because I recognize the challenges faced by our elected officials, who must balance a wide range of competing objectives and needs for resources, I have generally kept my thoughts to myself.

However, I feel I must now speak out against the current effort by some members of the City Council to peg our property taxes to the Honolulu consumer price index, such that taxes would rise at the same rate as our cost of living.

This misguided proposal would result in an immediate and unreasonably large tax increase for Honolulu residents. Even worse, it would permanently insulate our elected officials from being accountable for the cost of our city government.

It seems to me that a responsible city government sets property tax rates to provide the revenue necessary to pay for those services and expenditures our elected officials, in their best collective judgment, determine to be appropriate in balancing the needs of its residents. For this reason, it has always disturbed me that our City Council has routinely allowed tax collections to increase with real estate valuations over many decades and then claimed that they were not really raising taxes, because tax rates were unchanged.

As a result of this practice, pegging our property taxes to the CPI now will cause an immediate and unnecessarily large tax increase. Why? Because economists are saying Honolulu real estate values are at a peak and will not start rising again for five to 10 years. Under the current system, this would mean our City Council members would have to vote for higher tax rates if they wanted to increase tax collections.

But the economists are forecasting higher than average inflation during that same period, perhaps dramatically higher, which will be reflected in the Honolulu CPI. So, if the property tax indexing measure is enacted, our city government will have taken advantage of increased taxes based on inflated real estate values over the past several years and, with the prospect of flat or declining property tax revenues in coming years, would then replace the existing system with one that is certain to continue to increase taxes over the next several years.

While this approach would hurt residential property owners, its effects on businesses would be even worse.

Already, O'ahu's people suffer from the flawed policy of charging businesses a higher tax rate than residences. Although they receive fewer city services, businesses pay a tax rate 277 percent higher than owners of private residences based on appraised value. (On the Big Island this disparity is only 11 percent.)

My view may be jaded, but it seems that the only plausible rationale for this policy is to hide from voters the real size of the property-tax burden on our community and its economy and to avoid taking responsibility for its impacts.

As both a businessman and a resident, I am appalled that our elected officials would so easily dismiss the importance of businesses to the well-being and vibrancy of our great city by imposing such a disproportionate burden of taxes on them. This approach jeopardizes the ability of business to provide jobs and economic well-being to O'ahu residents.

The CPI-indexed approach to setting property taxes may seem logical. However, by making tax increases automatic, it would relieve our elected officials of having to take responsibility for the amount we are taxed. They would be able to simply shrug their shoulders as taxes rise, saying, "We can't do anything about it — it's the law."

I have always admired the way our City Council gives of its time and energy to be responsive to Honolulu residents and to be responsible for providing for their needs. It is my sincere hope that the council will extend this same diligence to the revenue side of its job and accept responsibility for the taxes needed to pay for our government.

Robert F. Maynard is president and chief executive officer of Aloha Petroleum Ltd. He wrote this commentary for The Advertiser.