HomeMy WebLinkAboutCOM 0600.011 2022-2024Jennifer Kagiwada
Council Member District 2 South Hilo
Office: (808) 961-8272
jennifer. kagiwada(ei .Maivaiieounly.gov
HAWAFI COUNTY COUNCIL - DISTRICT 2
25 Aupuni Street Hilo, Hawaii 96720
DATE: December 13, 2023
TO: Heather L. Kimball, Council Chair
and Members of the Hawaii County Council
FROM: Jennifer Kagiwada, Council Member
SUBJECT: Proposed Amendments to Bill No. 104, Draft 2; an Ordinance Amending Chapter
19, Article 1, Section 19-2; Chapter 19, Article 7, Section 19-53; and Chapter 19,
Article 11, Section 19-90, of the Hawaii County Code 1983 (2016 Edition, as
amended), Relating to the Creation of a Long -Term Rental Class for Real Property
Taxes.
Please see the below proposed amendments to Bill No. 104, Draft 2. The proposed amendments
are illustrated in Ramseyer format with respect to the contents of Bill No. 104, Draft 2; material
to be deleted is bracketed and stricken, and material to be added is underscored. A copy of the
draft of this bill, that would result if the proposed amendments are adopted, is attached with the
amendments incorporated therein.
1. SECTION I of Bill No. 104, Draft 2 is amended to read as follows:
"SECTION 1. Chapter 19, article 1, section 19-2, of the Hawaii County Code 1983 (2016
Edition, as amended), is amended by adding a new definition of "long-term rental" to be
appropriately inserted and to read as follows:
"Long-ten-n rental" means property occupied and under a signed lease for
ten consecutive months or more to the same tenant(s)[, with the exeeption
that sheftef lease tefms may be pfevided to frittitiple tenants who afe
students, traveling physieians of nufses so long as the eunittlative numbef elf
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days undef the lease meets of exeeeds ten months pef ealend15af y-e-ff j.
2. SECTION 3 of Bill No. 104, Draft 2 is amended to read as follows:
"SECTION 3. Chapter 19, article 7, section 19-53, of the Hawaii County Code 1983
(2016 Edition, as amended), is amended by adding new subsections designated (k), (1), and (m),
to be appropriately inserted and to read as follows:
Comm. NO.
Ref. To: V
Ref. Date DEC 1 .9 2021,
Hawaii County Is an Equal Opportunity Provider and Employer
"(k) Eligibility for long-term rental class.
(1) Real property occupied and under a signed lease for ten consecutive months or more
to the same tenant(s) [ with the exeeptio that Jh t ' � ' � �
ii Vi Vi 1VUJV LV1t11J 111U j' VV �.1IV41RLCl Ceumulative numbef of days undef lease meets of exeeeds ten inenths per- ealendaf
y—e t .] shall be eligible.
(2) All dwelling units on long-term rental properties must be leased.
(3) A long-term rental classification shall not be disallowed or ineligible by sole reason
that the owner's principal residence is located on the same property.
(4) The long-term rental class is exclusively reserved for properties that meet the eligible
requirements for this class and have the annual required application timely filed. Real
property that is used for commercial or income -producing purposes shall not qualify
as "long-term rental," except:
(A) Real property with uses legally permitted as a home occupation in accordance
with the zoning code; or
(B) Real property with agricultural use pursuant to sections 19-57, 19-59, or
19-60.
(1) Application for long-term rental class.
No long-term rental classification shall be granted unless the claimant shall annually have
filed with the department of finance a claim for such classification in such form as shall be
prescribed by the department. The claim shall include, but not be limited to, a signed lease
or excise tax returns, or both. For the 2025 tax year, claims shall be accepted from July 1,
2024 through December 31, 2024. For tax years thereafter, claims shall be accepted from
January 1 through December 31 for the next applicable tax year.
(m) Breach of long-term rental class.
(1) Failure of the property owner to maintain a lease for at least ten cumulative months to
the same tenant(s)[; ,
physieians, of inff ses, whefe the eumulative number of da�,s under lease meets of
] shall breach the classification.
(2) Any conveyance of the property or portion of the property subject to conveyance tax
under chapter 247, Hawaii Revised Statutes, as amended, shall breach the
classification.
(3) Upon breach of the classification as stated in (1) or (2) of this subsection, the tax
assessment shall be cancelled retroactive to the date of the classification, but for not
more than the current year, and all difference in the amount of taxes that were paid
and those that would have been due from the assessment in the higher classification
shall be payable with a ten percent penalty."
3. SECTION 4 of Bill No. 104, Draft 2 is amended to read as follows:
"SECTION 4. Chapter 19, article 11, section 19-90, of the Ilawai`i County Code 1983
(2016 Edition, as amended), is amended by adding a new subsection designated (g), to be
appropriately inserted and to read as follows:
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(g) Long-term rental tax rate.
In determining the tax rate for a property that is classified as long-term rental, the tax rate
shall be [125-%] one hundred thirty percent of the affordable rental housing tax rate
rounded to the nearest five cents."
Thank you.
JLK:slm
Att.
ATTACHMENT
AN ORDINANCE AMENDING CHAPTER 19, ARTICLE 1, SECTION 19-2; CHAPTER
19, ARTICLE 7, SECTION 19-53; AND CHAPTER 19, ARTICLE 11, SECTION 19-90,
OF THE HAWAIJ COUNTY CODE 1983 (2016 EDITION, AS AMENDED), RELATING
TO THE CREATION OF A LONG-TERM RENTAL CLASS FOR REAL PROPERTY
TAXES.
BE IT ORDAINED BY THE COUNCIL OF THE COUNTY OF HAWAVI:
SECTION 1. Chapter 19, article 1, section 19-2, of the Hawaii County Code 1983 (2016
Edition, as amended), is amended by adding a new definition of "long-term rental" to be
appropriately inserted and to read as follows:
""Long-term rental" means property occupied and tinder a signed lease for
ten consecutive months or more to the same tenant(s)."
SECTION 2. Chapter 19, article 7, section 19-53, of the Hawaii County Code 1983 (2016
Edition, as amended), is amended by amending paragraph 19-53(e)(1) to read as follows:
"(1) Except as otherwise provided in subsection (e)(2) of this section, land shall be
classified, upon consideration of its highest and best use, into the following general
classes:
(A) Residential;
(13) Affordable rental housing;
(C) Apartment;
(D) Hotel and resort;
(E) Commercial;
(F) Industrial;
(G) Agricultural or native forests;
(H) Conservation; [and]
(1) Homeowner[-.], and
(J) Long-term rental."
SECTION 3. Chapter 19, article 7, section 19-53, of the Hawaii County Code 1983 (2016
Edition, as amended), is amended by adding new subsections designated (k), (1), and (m), to be
appropriately inserted and to read as follows:
"(k) Eligibility for long-term rental class.
(1) Real property occupied and under a signed lease for ten consecutive months or more
to the same tenant(s) shall be eligible.
(2) All dwelling units on long-term rental properties must be leased.
(3) A long-term rental classification shall not be disallowed or ineligible by sole reason
that the owner's principal residence is located on the same property,
(4) The long-term rental class is exclusively reserved for properties that meet the eligible
requirements for this class and have the annual required application timely filed. Real
property that is used for commercial or income -producing purposes shall not qualify
as "long-term rental," except:
(A) Real property with uses legally permitted as a home occupation in accordance
with the zoning code; or
(B) Real property with agricultural use pursuant to sections 19-57 19-59 or 19-60.
(1) Application for long-term rental class
No long-term rental classification shall be granted unless the claimant shall annually
filed with the department of finance a claim for such classification in such form as shall be
prescribed by the department. The claim shall include, but not be limited to a signed lease
or excise tax returns, or both. For the 2025 tax year, claims shall be accepted from July 1
2024 through December 31, 2024. For tax years thereafter, claims shall be accepted from
January 1 through December 31 for the next applicable tax year.
(m) Breach of long-term rental class.
(1) Failure of the property owner to maintain a lease for at least ten cumulative months to
the same tenant(s) shall breach the classification.
(2) Any conveyance of the property or portion of the property subject to conveyance tax
under chapter 247, Hawaii Revised Statutes, as amended, shall breach the
classification.
(3) Upon breach of the classification as stated in (1) or 2) of this subsection the tax
assessment shall be cancelled retroactive to the date of the classification but for not
more than the current year, and all difference in the amount of taxes that were paid
and those that would have been due from the assessment in the higher classification
shall be payable with a ten percent penalty."
SECTION 4. Chapter 19, article 11, section 19-90, of the Hawaii County Code 1983
(2016 Edition, as amended), is amended by adding a new subsection designated (g), to be
appropriately inserted and to read as follows:
"(g,) Long-term rental tax rate.
In determining the tax rate for a property that is classified as long-term rental the tax rate
shall be one hundred thirty percent of the affordable rental housing tax rate rounded to the
nearest five cents."
SECTION 5. Material to be repealed is bracketed and stricken. New material is
underscored. In printing this ordinance, the brackets, bracketed and stricken material, and
underscoring need not be included.
SECTION 6. Severability. If any provision of this ordinance, or the application thereof to
any person or circumstance, is held invalid, the invalidity does not affect other provisions or
applications of the ordinance which can be given effect without the invalid provision or
application, and to this end the provisions of this ordinance are severable.
SECTION 7. This ordinance shall take effect on January 1, 2025.
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