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HomeMy WebLinkAboutCOM 0183.088 2006-2008 Lynn F. Wolfe, 75-5865 Walua Rd E633, Kailua Kona HI 96740 808-295-5109 - dreamtime(a~hawaii.rr.com Concerns and Suggestions for Bill No. 55 Draft 2 and the District Plan Bill No. 55 Draft 2 SECTION 1. Purpose. A business district typically taxes only commercial business within a defined area. It does not tax (assess) residential properties. A community improvement district is used to tax and to provide services to residential areas. The hallmazk of a special tax district is that those being taxed receive a direct benefit from the district. As proposed the Kailua Village Business Improvement District No. 1 does not meet the direct benefit criteria when it comes to the residential areas of the proposed district. A suggestion is to do away with Zones 1 and 2 and only assess commercial business within the proposed district's boundary. Residential properties, including vacation and long term rentals, second homes, owner occupied condos and grivate homes, would not be assessed. SECTION 2. Establishment of District No. 1. #4 "proposed district ...automatically renewed" Suggestion: Afler ten years the proposed district must be reauthorized by vote of the council or those persons being taxed "all debt service on bonds aze fully paid" Can the proposed district issue bonds? See SECTION 2. (8) "No bonds will be issued EXHIBIT "A" KAULUA VILLAGE BUSINESS IMPROVEMENT DISTRICT PLAN 2. The District Association and District Boazd b) Suggestion: State in Bill 55 or the Plan that the Board will be elected by a direct vote of the fee simple owners and lessees who have property is the proposed district. Currently this is only stated in the Bylaws which can be altered at arrytime. The rules for the election of the board was just changed last Friday. b) ii) Must the Mayor and Councilmember or their representatives own for lease property in the proposed district to be eligible to vote as a board member? See Corporat law Comm. No. • Ref. To• tea w-tc.;l Ref. Date 5 2007 Article IV.• The corporation shall have members who shall be the fee simple owners and lessees of land within the district The Board of Directors may provide for associates who share an interest in the purposes of the corporation but shall have no right to vote or power to affect the corporation's business. " 5. Incidental Expenses & 6. Budeet (b) "incidental expenses shall be paid ...expenses incurred by the Kona-Kohala Chamber of Commerce and the District Association in the establishment of the District (including, without limitation, enabling legislation and this District Plan.)" Mr. Eric Von Platen Luder stated at the informational meeting on May 30"' that $75.000 has been spent so far in the process the establishing the proposed district. Ten thousand of which came from the Chamber of Commerce. Is this $75, 000 amount going to be taken from the assessments and be used to reimburse the chamber and individuals who have funded the establishment of the proposed district? If so, this dollar amount is not shown in the first year proposed budget. 7. Sources of Fundine (b) Assessments (iii) Section 35-21 of the Hawaii County Code allows the proposed district to increase the assessment by 10% annually after the first year. Someone paying $500 the first year could be paying $761 per year in the frith year. This increase does not need the approval of those being taxed or the approval the County Council. This fact should be clearly stated in the Exhibit "A" and not just be a reference to Section 35-21 of the Hawaii County Code. Finally: The proposed ordinance does not require any audit of the proposed district An audit should be periodically done by an independent accounting fum or by the county financial department It should be an audit of the following items: 1. Money collected and spent 2. Performance of the proposed district -achieving stated goals and proposed services 3. Compliance with applicable laws -employment rules: nonprofit standards: Federal, state and county codes; etc. 4. Adherence to standard business practices Bill 55 (Draft 2), Exhibit "A,"Articles of Incorporation and the Corporote Bylaws need to be reviewed and made compatible with each other. Will board meeting be open to the public? Do sunshine taws apply?