HomeMy WebLinkAboutBIL 276 Draft 02 1998-2000
COUNTY OF HAWAII STATE OF HAWAII
BILL NO. 276
(Draft 2)
ORDINANCE NO.
AN ORDINANCE AMENDING CHAPTER 19, OF THE HAWAII COUNTY CODE 1983
(1995 EDITION), RELATING TO REAL PROPERTY TAXES.
BE IT ORDAINED BY THE COUNCIL OF THE COUNTY OF HAWAII:
SECTION 1. The County Council deleted the public utilities tax exemptions in
Ordinance No. 99-159. The County has been pursuing revenues from the State that are collected
by the State through the public service company tax, a portion of which is collected based on the
language of the statute, collected in lieu of real property taxes. The State's position is that the
real property tax portions of the public service company tax are repealed and the County had no
standing since it had never attempted to tax the utilities. In order to tax the utilities in an orderly
and equitable fashion, the following method of valuation should be followed.
SECTION 2. Chapter 19, article 7, of the Hawaii County Code 1983 (1995 Edition), is
amended by adding a new section to read as Follows:
"Section 19-53.1. Valuation of public utilities.
~ Notwithstanding_any section to the contrary, the director of finance, in determining the
mazket value assessment of the pronertv of the public utilities, may use the values for real
Rronerty as set forth in the annual financial reports of the public utilities as filed with the
Public Utilities Commission, pursuant to chapter 269, Hawaii Revised Statutes, as the
basis for his assessment, which shall be deemed prima facie correct. Due to the unique
nature of the public utility and its equ~ment, assissment of values to individual tax man
keys is not required.
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Lb,2 For the pumoses of this section, the following definitions are also adopted:
Public utilities. Public utilities are as defined in section 269-1, Hawaii Revised
Statutes.
Outside plant. Outside plant is public utility real propertypredominantly
production, transmission, collection, switching, and distribution facilities, that
may consist of one or more of the following:
Units that have physical and functional characteristics that are so similar
that they are accounted for as a group or class and azegenerally installed
on easements.
Transmission cable, wire or pipes, including support or conduit structures.
u Substation equipment.
D~ Measuring and re ug lating equipment.
Generation eq~ment.
Storage equ~ment.
Switching equipment.
Plant Structures. Public utility_real property improvements that aze not outside
plant such as buildings generating stations, production plants, gas compressor
stations boilers, switching plants, dams and reservoirs, circuit equipment, radio
systems terminals, satellite facilities, storage, wells, pumping facilities, and
including those items which are included in the outside plant definition above.
Property Property is the same as defined in section 19-53, Hawaii County Code.
~ Valuations are determined as follows:
I11 Land. Land values are determined by the market value approach in accordance
with section 19-53, Hawaii County Code.
Public utility real pronertv generally classed as outside plant, as set forth in
section 19-53.1(bl(21 including but not limited to, production, transmission,
collection switching or distribution substation equipment or measuring,
regulating generation storage or switching equipment or improved pronertv is
appraised on the basis of its reproduction cost new less allowances for physical
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depreciation, functional obsolescence and economic obsolescence, if any. The
reproduction cost new is determined b~plving reported inventory original
cost by appropriate price indices and/or by multiplying_physical inventories by
appropriate unit prices. The rate of depreciation is a function of the appraised
property's aee, estimated service life and salva¢e factor. Such determinations and
assessments of fair market value shall be made, to the extent possible, in
accordance with the annual financial reports as filed with the Public Utilities
Commission pursuant to chapter 269, Hawaii Revised Statutes, which shall be
deemed~rima facie correct. For all lands of public utilities not categorized by
section 19-53L1, Hawaii County Code, said improvements shall be taxed at a rate
assigned to the industrial classification.
Plant. Structure. The value of improvements that are plant or structure as set
forth in section 19-53.1(131, including but not limited to, buildings, generating
stations gas compressor stations, switchine plants, dams and reservoirs, circuit
equipment radio systems terminals satellite facilities storaee, wells, and
pum~ne stations is determined usine the same methodology as is used in
appraising outside plant properties.
1~ For the puroose of liens and foreclosure any outside plant ~ropertv shall be
considered a part of an~vstem or plant to which it is a part of and to which a tax
map key has been assi igied."
SECTION 3. Material to be repealed is bracketed. New material is underscored.
In printing this ordinance, the brackets, bracketed material and underscoring need not be
included.
SECTION 4. If any provision of this ordinance, or the application thereof to any
person or circumstance, is held invalid, such invalidity shall not affect other provisions or
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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 declared to be severable.
SECTION 5. This ordinance shall be effective January 1, 2001.
INTRODUCED BY:
~
COUNCIL MEMBER, COUNT OF HAWAII
Hilo, Hawaii
Date of Introduction:
Date of 1st Reading:
Date of 2nd Reading:
Effective Date:
kEFERENCE: Comm, _ 81~ (11l
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