2018-02-12 Letter to Richard H.K. Onishi re HB 2605 Relating to TAP

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Uarry Kim itlayor Couttfil of Paittail ffirr of Itir ir alor Wil Okabe Managing Director Barbara J. Kossow Deputy illanaging Director 25 Aupuni Street, Suite 2603 • Hilo, Hawaii 96720 • (808) 961-8211 • Fax (808) 961-6553 KONA: 74-5044 Ane Keohokalole Hwy., dg C • Kailua-Kona, Hawaii 96740 (808) 323-4444 • Fax (808) 323-4440 February 12, 2018 epresentative Richard H.K. Onishi, Chair Committee on Tourism Hawail State Capitol, Room 429 Honolulu, HI 96813 Dear Chair Onishi and Committee Members: Re: HB 2605 Relating to TAT Hearing Date: 02/13/18 — 9:00 am; House Conference Room 429 Thank you for this opportunity to testify on HB 2605, offering the counties $1M each to enforce applicable laws and ordinances relating to transient accommodations." Given our county's financial difficulties, it is hard not to support an opportunity to acquire $1M. But whether that sum could be wisely used for the limited purpose stated might depend on how long we would have to spend the funds. We would not receive the money until we have met the conditions set out in the bill, which could take quite a bit of time, especially for Hawaii County. We do not have a current vacation rental permit or specific appeal process for it, so we would have to design a system that would fit the criteria; where other islands need to tweak their systems, we would have to create them and then implement. Also, we do not have a separate real property tax class for vacation rentals yet. The class cannot be created for the fiscal year 2019 - it will be in FY 2020. We may set a rate in FY2019, but it won't be effective until 2020. In any event, assuming we can fulfill our obligations under Section 1 of HB 2605, it is unclear from the bill whether we would have to expend the money we receive by June 30, 2019, or whether that is only the lapsing date for the Governor to make payments to the counties. In either case, there would then be the question of a mechanism for determining that the funds are used for the stated purposes, how misspent funds would be recovered, what the appeal process would be, etc. Perhaps a cleaner bill would se one that provides $1M per county for meeting the criteria laid out, with a time frame longer than one year to accomplish the task. If and when a county meets the criteria, it would then receive the money without any restriction on how it is spent. The State will have met its main objective of getting the counties to deal with transit accommodations in the manner you deem approlloriate, and the counties would have additional funds to serve their constituents. Thank you for your consideration. Respectful, itted, Harry Kim Mayor, County of Hawaii County of Hawaii is an Equal Opportunity Provider and Employer.