2017-03-14 Letter to Mark Nakashima & Richard Onishi re SB 1292 SD 2 Relating to the Hilo Community Economic District

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Nakashima/Onishi March 14, 2017 Page 2 3. We cannot afford to jeopardize or divert the real property tax revenue that comes from the affected parcels and currently goes into the County general fund (we estimate that for the properties in SB 1292, tax revenue exceeds $3M). SB 1292, SD2 says that §206E-D Hilo community economic revolving fund. (a) There is established in the state treasury the Hilo community economic revolving fund, into which shall be deposited: (1) Notwithstanding any law to the contrary, including section 206E-16,all revenue, income, and receipts of the authority for the district; It also seems, theoretically, that the Authority could issue leases that provide for the lessee to be exempt from property taxes for the term of the lease. We do not think that SB 1292, SD2 is intended to affect real property taxes, so ask for language that makes it crystal clear that real property taxes are not part of"revenues, income, and receipts...", that leases cannot affect property tax obligations, and that all property taxes will continue to flow to the County general fund. 4. The bill says its purpose is to deal with State-owned land, so perhaps language should be inserted that says that it applies only to land within the district boundaries that is State-owned. We have not determined how much non- State owned land might be affected. We appreciate the attention that the Legislature has placed on the disposition of State lands within and proximate to the Banyan Drive peninsula and the Kanoelehua Industrial Area, where opportunities exist to partner with private sector businesses to carry out important economic revitalization efforts and to optimize the use of these lands for the benefit of the entire community. Our ongoing efforts with the BDHRA reflect that such benefits are not simply economic, but social and cultural as well. It is with this comprehensive approach that we support the intent and purpose of SB1292, SD2 and other bills introduced during this legislative session that seek to explore opportunities regarding the use and management of State-owned lands within the core economic section of Hilo. Re • -ctfully submitted, 1 Harry K Mayor County of Hawaii is an Equal Opportunity Provider and Employer.