Laserfiche WebLink
August 2, 2004 <br /> <br /> The Honorable Aaron Chung and Committee Members <br /> Page 3 <br /> Unresolved issues <br /> Two major issues remain unresolved, and we look forward to working with the Council to <br /> arrive at the best way of handling them. <br /> <br /> Subsistence vs. commercial use This bill as proposed restricts the maximum benefits to <br /> commercial agricultural operations on agricultural-zoned land, demonstrated by $2,000 gross <br /> income or following recognized agricultural practices. Those who farm for subsistence will <br /> not qualify for maximum benefits, and those whose activities are not on agriculture-zoned <br /> land will not qualify for any benefits. Whether subsistence farmers should be eligible for <br /> maximum benefits, and whether agricultural activity on non-agricultural zoned land should <br /> receive benefits are policy issues that we look forward to discussing with you before Bill No. <br /> 49 is finalized. <br /> Farm dwellings rented to farm workers A bill recently adopted by the Council allows persons <br /> who live on their farm in a farm dwelling that is valued at mazket as a homesite to receive the <br /> benefit of paying tax on the homesite at the lower homeowners tax rate. However, farmers <br /> who rent a farm dwelling to persons who work on the farm have the farm dwelling valued at <br /> market as a homesite but cannot be taxed at the homeowners rate because the dwelling is <br /> rented out. This is a situation that exists especially (but not exclusively) in Kona on coffee <br /> farms. We recognize this is a situation that needs to be discussed further to arrive at what is <br /> fair and equitable. <br /> Conclusion <br /> The attached Draft 3 of Bill No. 49 addresses issues of concern to Hawai`i's farmers, as well <br /> as fulfilling the goals stated above by giving appropriate real property tax incentives to <br /> persons involved in agriculture. <br /> Again, I thank you for bringing this bill up for consideration, ask for your support of Draft 3, <br /> and look forward to working with you on issues that remain unresolved. The end product of <br /> our joint efforts will be a bill that will support our agricultural industry and make our tax code <br /> fairer. <br /> Aloha, <br /> Harry Kim William Takaba <br /> MAYOR DIRECTOR OF FINANCE <br /> <br />