COM 0118.020 2002-2004 - Laserfiche WebLink

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8-23-04: 9: 4~AM: ~BOB5283463 +BON5283483 a 2i a i { ~ Honorable Aaron S.Y. Chung, Chair, and Members Finance Cpmmittee ~ August 24, 2004 Page 2 i ~ I u~ [or] planted with crops primarily for home use would be excluded from the area d icated for commercial agricultural use. Land not so dedicated would be assessed at Tuazket value. The minimum lot size for feed crops, pasture, and fast and slow rotation j fgrestry would be provided by administrative rule (cuaentlyl0 acres]. • F~iminates the 20-year dedication period with assessment at 50 percent of productivity i t/~lue, although the 10.yeaz dedication period remains. Lands under existing 20-yeaz i dedication may continue to be assessed at 50 percent of agricultural use value, subject to the conditions and provisions of commercial agricultural use dedication. • Reduces the rollback tax look-back period for breach of agricultural use to 2 years plus current yeaz, scaled up to 5 years for dedicated lands, depending on how long the dedication has been in effect [if less than 8 years]. The period of breach reduced from 12 to 6 consecutive months, unless non-use is part of an approved farm plan. i Allows breach exceptions for natural disasters, land no longer usable for dedicated I agricultural use, and death or severe disability. • Provides for breach of dedication upon sale of the property, unless the buyer expressly assumes the dedication; assumption will no longer be automatic. i , I Draft 3 albpeazs to inadvertently omit the existing subsection of HCC § 19-53 relating to native ~ forests. c We sham the concerns of others that Bi1149 will be anti-agricultural in effect and will amount to a prop tax increase for small farmers. This effect will make itself felt primarily through the change assessment basis from productivity value to mazket value. New or developing farms i would n~o qualify for dedication until they meet the $2,000 commercial threshold for ptoduc 'ty assessment, and until then they will be taxed at twice productivity value. Farm lessees ~v th less than 5-year leases would also be assessed and taxed at this higher value if they aze una l to dedicate their land. Finally, vacant or unusable portions of agricultural pazcels would br;'~assessed at market value if they aze not committed or dedicated to agricultural use. We are concerned that there maybe few if any true "market value" compazables for such lands. We respectfully suggest that the Hawaii County Council review and consider the implemer}tation of Ordinance 02-39 in the City and County of Honolulu before acting on Bi1149. Ordinance 02-39 has created serious problems for farmers and agricultural landowners because the assessed value of agricultural lands on Oahu is now determined at "fair mazket value," generally~based on conveyances of properties zoned for agriculture which reflect not actual agriculturtal use, but rather other restricted and atypical uses (e.g., antenna or utility sites and "gentlem farmer estates")permitted under the AG-1 and AG-2 zoning districts. This flaw has erroneously inflated the value of agricultural lands on Oahu to approximately $40,000 per acre. li This flaw d "mazket value" assessment has resulted in tax revenues from agricultural lands going ' from'app oximately $4 million in 2003-2004 to approximately $14 million in 2004-2005. i i I