HomeMy WebLinkAboutCOM 0739.019 2016-2018Re: Proposed Bill 108
Dear Members of the Hawai'i County Council:
I respectfully oppose this Bill and request the members hold the Bill for further study and
consideration. This Bill may have unanticipated negative consequences for the County of
Hawaii. 4
This Bill sends a very strong message to nonresident property owners. While STR regulations
have been in place in the other counties, County of Hawaii has, in the past welcomed
nonresident investment. This Bill, although allowing STR in resorts and commercial zones,
sends a very strong message that nonresident investment is no longer welcome on the island.
While this Bill grandfathers in all currently operating STR, it provides no pathway of
succession of operation for nonconforming STR, nor for any new applications. The Bill also
is very restrictive in identifying permissible zoning areas resulting in most of the island
needing a nonconforming permit. This is a clear indication of the future of STR in the
County.
Unlike the other counties in the State, the County of Hawaii does not benefit significantly
from hotel/resort (timeshare) property tax revenue. For example: Maui county receives
40.1 % and Kauai receives 40.7% of their property tax REVENUE from hotel/resort compared
to 5% for County of Hawaii. (DBEDT)
Why is that? The number of hotel/resort properties for the neighbor islands are as follows:
County of Hawaii .4%
Maui 18.9%
Kauai 20.4%
County of Hawaii has the least inventory of hotel properties of the four major islands and yet
CONN N.' GLERA
From: John Chana
Y 0F HAWA �
To: Council Testimony
Subject: Re: Testimony Bill 108
� } APRI 27 WA 04
Date: Monday, April 23, 2018 11:29:29 AM
1##
Re: Proposed Bill 108
Dear Members of the Hawai'i County Council:
I respectfully oppose this Bill and request the members hold the Bill for further study and
consideration. This Bill may have unanticipated negative consequences for the County of
Hawaii. 4
This Bill sends a very strong message to nonresident property owners. While STR regulations
have been in place in the other counties, County of Hawaii has, in the past welcomed
nonresident investment. This Bill, although allowing STR in resorts and commercial zones,
sends a very strong message that nonresident investment is no longer welcome on the island.
While this Bill grandfathers in all currently operating STR, it provides no pathway of
succession of operation for nonconforming STR, nor for any new applications. The Bill also
is very restrictive in identifying permissible zoning areas resulting in most of the island
needing a nonconforming permit. This is a clear indication of the future of STR in the
County.
Unlike the other counties in the State, the County of Hawaii does not benefit significantly
from hotel/resort (timeshare) property tax revenue. For example: Maui county receives
40.1 % and Kauai receives 40.7% of their property tax REVENUE from hotel/resort compared
to 5% for County of Hawaii. (DBEDT)
Why is that? The number of hotel/resort properties for the neighbor islands are as follows:
County of Hawaii .4%
Maui 18.9%
Kauai 20.4%
County of Hawaii has the least inventory of hotel properties of the four major islands and yet
many jobs in the County of Hawaii depend on tourism, either directly or indirectly. It should
also be pointed out that the County has the highest poverty level in the State - double the rate
on the other islands.
County of Hawaii has an opportunity to generate jobs and economic benefit through STR that
is not available through the hotel industry as it is in other counties. This Bill is a step in the
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wrong direction for the economic benefits of tourism and sends a very chilling message to
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nonresidents property owners and tourist alike.
As the Council already knows, the County relies almost exclusively on residential property tax
to fund its operation of which 54% or $93,222,000 was paid by nonresident residential
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property owners (DBEDT 2016).
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Only last year, property taxes for nonresidents were again raised. With the increased
_ assessment and rate, over the past four years it has risen approximately 20%. As you are also
probably aware, nonresidents in the County of Hawaii pay the highest property tax rate among
all the counties and condo owners pay higher than even hotels.
Rates for non-homeowners Co. of Hawaii Maui Kauai
exemption properties:
Residential (Single family home) 11.10 5.54 6.05
Condo 11.70 6.32 8.85 (vacation rental)
Hotel 11.55 9.37 10.85
As illustrated, County of Hawaii is dependent upon and receives far more property tax
and operational funds from its nonresident owners than the other neighbor islands.
Please view the nonresident property owners as a partner in providing a benefit to the,County.
Many owners chose the County of Hawaii because it is less heavy handed in its regulations
and allows owners to enjoy their properties - please do not change that. Many nonresidents
have owned their properties for years with the intention of retiring here. Many have already
retired and spend part of the year on the mainland with family and part of the year in their
Hawaii home. Contrary to the stereotyping, not all nonresident property owners are flush with
money. STR provides the means to pay the high property tax.
Thank you for the opportunity to testify.
John Chang