HomeMy WebLinkAboutREP FC 313 11/17/1998 1998-2000REPORT OF THE
COMMITTEE ON FINANCE
DATE: August 8, 2000
PLACE: Council Chambers
TIME: 10:10 A.M.
Council Chair and Members
Hawaii County Council
Hilo, Hawaii 96720
Re: Comm. No. 813 /Bill No. 276
Your Committee on Finance, to which was referred Bill No. 276, reports as follows:
Bill No.276, transmitted by Deputy Corporation Counsel Gerald Takase, via Communication
No. 813, dated June 9, 2000, amends Chapter 19, Hawaii County Code, by adding a new section
relating to real property taxes.
Prior to December 23, 1999, the County granted all public utility companies real property tax
exemptions pursuant to Chapter 239, HRS. However, this exemption prohibited the County from
collecting its share of the public service company tax collected by the State in lieu of the County
real property taxes. Therefore, the County Council deleted the public utilities tax exemption in
Ordinance No. 99 -159.
The County filed suit against the State, Civil No. 99 -194, to seek a portion of those taxes
collected pursuant to Chapter 239. The County, along with the utilities, also proposed legislation
to amend Chapter 239 to pay the counties their fair share of the public service company tax.
With the help of the utilities, the other counties and the Council Chair, the bill passed the House
and Senate before dying in the final conference committee.
Furthermore, the County's lawsuit was dismissed with final judgment entered on May 5, 2000.
The court upheld the position of the State that the references to real property taxes in the public
service company tax were repealed by implication with the passage of the Constitutional
amendments. Thus, the court held that since the County had made no attempt to tax the utilities,
the case was premature and there was no case or controversy until attempts to tax utilities are
denied.
Therefore, in order to collect real property taxes from utility companies, Bill No. 276 proposes to
add a new section to Chapter 19, HCC, which establishes a method of valuation for the
properties owned by public utility companies.
Members of Your Committee were concerned that the utility companies would be double taxed
and ultimately higher utility rates would be passed on to the consumer.
FC REPORT NO. 313
r
Originally heard on June 25, 2000, this measure was held back in committee due to a tie vote,
pursuant to Section 10(a) of Rule 11 of the Rules of Procedure of the Council of the County of
Hawai' i.
Your Committee, during its discussion of Bill No. 276, made the following amendments:
Section 2, section 19 -53.1 (a) - "... may use the values for real property as set
forth in the annual financial reports..."
2. Section 5 - "This ordinance shall be [retroactive] effective to [January 1, 2000]
January 1, 2001
For informational purposes, Mr. Tyler voted kanalua twice.
Your Committee on Finance is in accord with the purposes and intent of Bill No. 276, as
amended to Draft 2, and recommends it pass first reading.
smc
Respectfully submitted
COMMITTEE ON FINANCE
AARON S.Y. CHUNG, CHAIR
FC REPORT 3
ADOPTED:
AYES
NOES
A &E
EX
CHUNG
X
ELARIONOFF
X
JACOBSON
X
LEITHEAD -TODD
X
PISICCHIO
X
SMITH
X
TYLER
X
YAGONG
X
ARAKAKI, E.O.M.
X
Respectfully submitted
COMMITTEE ON FINANCE
AARON S.Y. CHUNG, CHAIR
FC REPORT 3
ADOPTED: