2017-03-16 Letter to Glenn Wakai and Karl Rhoads RE HB 1310 HD 1 AND HB 1479 hd 2

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Wakai/Rhoads March 16, 2017 Page 2 In terms of most of the technical details in these bills, I would appreciate if you would consider the testimony of my Planning Department, which is being submitted separately. But I do want to offer the following comments: 1. The lessees in the Kanoelehua Industrial Area are caught in an economic bind, unable to improve their properties because their leases are close to expiration. We therefore believe that the broader scope of HB 1479 (and S131292) is preferable to the more narrow scope of HB 1310. If one of these bills becomes law, the Hilo Community Economic District (HCED) will be the only redevelopment district outside of the City and County of Honolulu. For this reason, we ask that consideration be given to providing that the District have a voting majority of members from the Hilo community. I think this could be accomplished if the County Planning Director was a voting member, the cultural specialist was a cultural practitioner from the Hilo community, and the Director of Transportation was dropped or made ex officio, non-voting (I don't think transportation will be as significant an issue as it has been on Oahu). The idea of having a local cultural specialist is important, separate and apart from the issue of majority control. Current statutory language provides for just one cultural specialist for all redevelopment districts. We hope you will change that to provide for a separate cultural specialist for the Hilo redevelopment district, even if one specialist for all the Oahu districts has been satisfactory. 4. 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 $3M). There are two concerns here. First, 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; Second, it seems, at least in theory, 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 the Legislature intends to affect real property taxes, so we ask for language that makes it crystal clear that real property taxes are not part of County of Hawaii is an Equal Opportunity Provider and Employer.