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Mr. Nakamae made a proposal that the, debt <br /> limit should be 5% of the actual market value of the real <br /> property in : he county. At the present time this would put <br /> a limit‘ of $83 million on the debt as of the last actual <br /> market value of property fiigure that I was able to obtain. <br /> Now this is over twice our present debt and says that we <br /> are going to have a large increase in debt service if that <br /> limitation were perm` tted to be in there. So I don ' t think <br /> that-- as a practical proposal is any limitation whatsoever. <br /> Then we come to property taxes. Our real <br /> objecttve here is to keep long time residents from being taxed <br /> out of their property. As a personal example, I lived in Long <br /> Island , New York for 24 years and on one piece of property for <br /> 22 years. When I went there my taxes were $200 a year and <br /> this continued for several years and then things began expanding <br /> around there and before I left my taxes were $1 , 700 a year and <br /> they were going up 15% a year. This is beginning to happen. <br /> Particularly over in the Kona area where the value of real <br /> estate is rising rapidly. The long time residents find that <br /> they are staying on one piece of property and yet their taxes <br /> are going up 10% and 15% a year. Not just because you are <br /> changing the tax rate at all but because the valuation of the <br /> property rises. So their actual tax bill is going up. <br /> If we go to some kind of a formol+a like <br /> Proposition13 in California, this is one way of preventing <br /> that® Whereby you set a limit and in our case we are proposing <br /> 1% of the assessed value of the property. Let me, clarify that, <br /> Actually, what we are saying is that right now we want to put <br /> a limit of 1%-that the total tax on a piece of property shall <br /> not exceed 1% of its fair market value at this time and that <br /> value. . .excuse me, I 'm getting all messed up here. What I 'm <br /> really saying is that we want to keep the ':tax on property right <br /> now bout, Ohere it is because the county,, realizes just very, <br /> very slightly over 1% of the fair marketYkvalue of property <br /> today. This is after taking into account the exemptions, home <br /> owners exemptions and the exemptions for age. Actually, the <br /> county average is just about 1% of the• fair market value. So <br /> if we freeze the taxes where they are today and say they cannot <br /> rise more than 2% a year until the property is sold at which <br /> time the assessed value will become the fair market value and <br /> the same 2% limitation applies from thena on ® So that whenever <br /> property changes hands the person who gets it finds that his <br /> taxes are based on the fair market value at the time he buys <br /> it and the person who has his property today and keeps it finds <br /> that he is paying a slightly greater tax rate but not anything <br /> of the order of 10% or 15% rise per year. <br /> You can 't exactly write a limitation in our <br /> charterOwordafor word to Proposition 13 because the situation <br /> over .hereSlls different with the home owners exemption and things <br /> like that. <br /> To me, I would like to stress , that all three <br /> of the limitations that we propose do not pose any county <br /> problem now but they are designed to put a gentle brake on <br /> continued growth of big government. Basically, by cutting down <br /> the amount of money that is available to be spent. <br /> - 5 - <br />