COM 0915.004 2004-2006 - Laserfiche WebLink

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Peter Melone, melonep@hawaiiantel.net 73-1309 Kaiminani Drive, Kailua Kona, Hawaii 96740, Open Letter to Hawaii County Council, May 18, 2006 An ordinance was recently passed by the County Council that limits the annual property assessment increase to three percent for owner occupant homeowners, while allowing other properties to be assessed at full market value. Thus, non owner occupied properties are assessed at full market value regardless of the amount of increase due to the market valuation. The current market valued assessment increases for this year is almost 501/6. While the Ordinance has a desirable goal, it is misguided, seriously flawed and will have undesirable outcomes. The Ordinance is regressive. The more wealthy homeowners have expensive homes and will benefit the most while the less wealthy homeowners have less expensive homes and will benefit the least. There are owner occupied homes with market values greater than a million dollars while many struggle to find and purchase affordable housing. The large dollar amounts of tax breaks for expensive homes will continue to increase each and every year. The 3% limit is a flat rate, but its difference in tax breaks for higher priced home owners will be far greater than those of lower priced home owners. This difference will be greater each and every year. This is not property tax reform. It is welfare for the wealthy. It does not contribute to affordable housing and it will make matters worse in the long run. It is a scam disguised as tax reform. Additional problems are created for the new home owners and for our children and their children's children, etc. If a resident buys a house from a non-owner occupant this year, then that property is assessed at 40% more then the home owner with a similar home with the same market value just because it was purchased before January First 2006. That is significant for this year and it will become worse every year since the problem is compounded each and every year. That is the opposite of affordable housing, especially for the future. Affordable housing is a hoax for those who work hard, but still earn only $10.00 per hour. Even two full time jobs will total just $41,600 before taxes. The County's median income of $52,500 does not leave room for saving or for buying a house. This is a big problem for current renters and future home buyers, especially those families consisting of three or four generations who live together. Welfare for the wealthy may attract votes, but it does nothing for affordable housing. The Ordnance has fallen short; it has missed its mark. Vacant lots also increased by a large amount. Those who bought a vacant lot while planning to build up equality, increase their credit rating and save for future home construction will also experience inequality. Worse yet are the children who's parents put land and lots aside so that housing could be affordable for them in the future. They will own property with land assessed and taxed at a much higher amount than other owner occupants with similar properties having the same market value. Long term rentals will be negatively affected. Whenever there is an assessment decrease in one property, or one class of property, then all of the other properties must make up the difference in order to meet the County Tax Levy (Budget). The increased taxes will cause owners to pass it on to Conran. No. AISA Ref. Tor ft~W« CIAMWI Ref. Dote MAY 18 7006