HomeMy WebLinkAboutCOM 0600.053 2022-2024d 1cor .,-fLsIij, i + '.:rfD8I z
Sept. 17, 2024, 9 a.m.
Hawai'i County Building
To: Hawai'i County Council �.-
Heather Kimball, Chair
Holeka Goro Inaba, Vice -Chair
From: Grassroot Institute of Hawaii
Jonathan Helton, Policy Researcher
RE: BILL 104 — RELATING TO THE CREATION OF A LONG-TERM RENTAL CLASS FOR REAL PROPERTY TAXES
Aloha Chair Kimball, Vice -Chair Inaba and other Council members,
The Grassroot Institute of Hawaii offers comments on Bill 104, draft 7, which would create a new real property
tax class specifically for long-term rental properties that do not currently fall into the "affordable rental
housing" class.
To qualify for the new class, a property would have to be leased for at least six consecutive months by the
same tenants.
Properties moving into the new class would presumably move out of the existing residential class, provided no
property in the residential class valued at $2 million or more would be eligible to move, according to the bill.
Finally, the bill would set the rate of the long-term rental class at a rate that would be no lower than the
affordable rental housing tax rate, rounded to the nearest five cents. At current rates, this would entail a tax
levy of no less than $5.95 per $1,000 in assessed value for the new class.
We appreciate the intent of the bill. Using the property tax to incentivize property owners to rent long term is
a good goal that could help with the county's housing shortage. For example, moving an $800,000 property
from the residential class to the long-term rental class could save the owner as much as $4,120 a year.
We would caution the Council, however, against increasing tax rates on other classes to pay for whatever
revenue loss could come about as a result of this bill — especially in the near term.
1050 Bishop St. #508 Honolulu, HI 96813 808-864-1776 info@grassrootinstitute.org ,t
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A higher tax rate on the residential class, for example, could unintentionally penalize long-term rental owners
who might not know about the new class or who did not file for it because of special lease circumstances that
could make compliance difficult.
Thank you for the opportunity to testify.
Jonathan Helton
Policy Researcher
Grassroot Institute of Hawaii
1050 Bishop St. #508 Honolulu, HI 96813 808-864-1776 info@grassrootinstitute.org