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<br /> <br /> <br /> <br /> <br /> the tenants with higher rents. Thus there will be higher rents and less affordable rentals units will <br /> be available. <br /> <br /> It appears to be a win-win situation for residents at the expense of wealthy out of town owners. <br /> Beware! Not all is as it seems. Vacation rental rates will need to increase to cover the higher taxes. <br /> This will not happen on the other islands because Hawaii (County) is the only one to adapt this <br /> ordinance. Thus, the Big Island will have higher vacation rental rates while the other islands will <br /> have lower rates. Other island occupancy rates will go up, ours will go down. Some of the vacation <br /> rental property owners are corporations and individual non-residents; but some are planning to be <br /> future residents and some are current resident investors. <br /> <br /> The tourism industry will suffer a little; the individuals who directly or indirectly depend on the <br /> tourist industry for their livelihood will suffer a lot more. <br /> <br /> According to the West Hawaii today, page one, 5-17-06, the Mayor has indicated that he wants to <br /> reduce the tax rate from $9.85 to $8.10. What a sham. The property tax on a property that had a 46 <br /> percent assessment increase will pay about 20 percent more in taxes this year with an $8.10 tax rate <br /> than last year with the $9.85 tax rate. <br /> <br /> The Mayor also indicated that he wants tax savings for apartments and unimproved residential <br /> classes. That's like chopping a hole in the bottom of your boat and then trying to fix it with <br /> patchwork. If the hole is going to be fixed, then why make the hole in the first place? If you can't <br /> make it right, at least don't make it worse. <br /> <br /> There are also legal concerns. The three percent limit is arbitrary. Courts across the land have <br /> ruled that assessments at less then full market value are allowable, if and only if there is consistency <br /> within each class. Obviously that consistency no longer exists, so the inconsistency is illegal. <br /> <br /> A special class has been created for non-owner occupied properties; most of which are believed to <br /> be out of town property owners. This non-legal class is created solely for the purpose of tax <br /> collection. That is discrimination. True, they are not a protected class, so anti discrimination laws <br /> might not apply. But there are parts of the Hawaii State Constitution and State Laws as well as the <br /> Equal Rights Protection and the Commerce Clause of the U. S. Constitution and case law that will <br /> apply. The County is setting itself up for a long and costly suit that it can not win (even if the `yes <br /> sir' County Attorneys say it isn't so). While the County has deep pockets, so do the resorts and <br /> hotels who are also adversely affected by years assessment. The resorts and hotels try to be good <br /> community citizens; they provide employment, pay a lot of taxes, provide improvements and <br /> contribute to local charities and non-profit organizations. While they are not all good, they also are <br /> not all bad. <br /> <br /> The suit may take many years to be settled. Can you imagine what will happen when it's settled? <br /> The County may be ordered to pay back the illegally collected taxes covering many years, plus <br /> interest. If the money has been spent, where will the money come from for repayment? The <br /> County Council will get it from the same place they always get the money, our pockets. Why <br /> should we pay for the council's stupid mistakes? <br /> <br /> <br /> Sincerely, Peter Melone, MBA/Finance <br />