COM 0315.002 1996-1998 - Laserfiche WebLink

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Mondav, Mav 12, 1997 11:08:38 AM (8081 967-8295 THE HO\IEO\~-\ERS' T.al' CL.~SS SHOL-LD BE REPS.-SLED. Bonnie Goodelh ~ iet~•point The Homeowners• Tax Class is a special propert} tar class, established in 1993. imddirionto the Homeowners• Exemption. The Homeowners' Exemption deducts 540.000 (or 580,000 for the elderly) from the assessed t clue of ott•ner-occupied homes before taxes are calculated. The Homeowners• Class then drops the tar rate on t~•hat is left from SIO or 58.50 per thousand dollars of assessed ~ alue (called mils) to 54.45 mils. less than half. The Homeowners' Class is unfair. B} ewer} measure. this is tery bad government. It is a subsid} of the well-off b} the poor. It means that the more people move here, ow•n homes and need sen~ices, the less tive collect in tares. It discourages home-based businesses. tt•hich w~e desperate]}' need. The home-Uusiness aspect is impossible to fain} enforce so it punishes honest}'. It encourages a "free lunch'• mentalit}', and shackles the poorest communities. The actual cost for parks. police and fire protection for each home, according to our standards, is ove 51,000 dollars a }ear. \~-hen homeowners are not pa}'ing that much, someone else must subsidize them. exactl} as if the}' w ere collecting welfare. }'ear after }•ear. Homeowners tar breaks are a sped interest w elfare entitlement for people teho can afford to bu}• homes, paid for b} renters, young working families and the elderl}• in 1~'est Hawaii. b} people trying to start home businesses, and b}• vacant lots-tahich get no current services. but get a huge IOU, payable b} our children. The Homeowners Rate is especiall}• unfair to renters, tvho w ere alread}'. because of the Homeowners Exemption. subsidizing people who can afford to bu}•. For example. in a Puna subdivision, the lot ma}' he worth 520,000 and the home 560,000. For a rental landlord, the tax t+ill be 5800. which means that S67 per month of the rent must go to propert}' tax. If the rent cannot absorb that along w~i the other costs, renters go out of business. until the rents are pushed up to absorb that cost. For a homeowner under the same circumstances. with the 540.000 exemption and the 4.45 mils rate, the ta: bill comes down to 5178 a }ear. or if retired. the w hole assessed value is w iped out and the minimum S25 is the bill. For vacant lots. about -10,000 of them. t~•hich receive ~~irtuall} no ser~~ices, the tax bil is around 5200 each. Thaf s more than the bill for a homeowner. In Kona. a home might be worth S1UU,000 on land worth SiUU,000, so the tax bill for a rental unit could be 52.000. or S167 per month to be absorbed b} the rent. For a homeowner, it would be 5712, or S534 if elderly.. vacant lot would pay 51,000, again more than a homeowner. ytany renters are elderl}•, and usually less well-off than homeo~eners. Can an} one tell me why the tar on a rental unit in Kona should he 100 rimes the tax on a home in Hilo? In East Hawaii, where propert} values are much less. onl} around 25CC of residents are renters, while in ~~-est Hawaii. w here land values are much higher, more than 50CO are renters. So the extra burden Submitted by Bonnie Goodell