HILO — Lawmakers quizzed an independent tax assessment expert about his recommendations to make Hawaii County’s property tax policies more efficient and fair. HILO — Lawmakers quizzed an independent tax assessment expert about his recommendations to make Hawaii County’s property
HILO — Lawmakers quizzed an independent tax assessment expert about his recommendations to make Hawaii County’s property tax policies more efficient and fair.
Members of the County Council’s Finance Committee appeared receptive to the idea of creating an ad hoc committee to study the document, which ran to more than a hundred pages and featured 40 specific recommendations. Many of the recommendations called for action by the council to improve efficient administration of the taxes.
Some of the recommendations, if implemented, would improve fiscal practices but might not be politically popular.
“The council should implement code changes to require the Finance Department to analyze tax loss, shifting, and other effects of property tax exemptions, including the cap on assessed value increases for certain residential property,” said one recommendation. Another called for more frequent property tax inspections.
Richard Almy, one of two people contracted to prepare the report at a cost of $40,000 for the county, presented his recommendations before the County Council’s Finance Committee.
The report took a look at other jurisdictions around the country and concluded that the county’s property tax rates were unusual for a couple of reasons.
For one thing, of the 3,141 counties in the nation, Hawaii’s counties were unique in that they are largely independent of the state government to implement tax policy. Another distinction is that the tax rates are on the lower end of the spectrum. Asked by Councilman Pete Hoffmann whether Almy had considered that local municipalities are not charged with funding public schools, Almy said he had not.
“We do think we identified issues that were worthy of further concern,” Almy said. “We believe that the recommendations should be considered, addressed deliberately, and to the best extent, implemented.”
Almy’s report found some things that were good, and some that were less so.
“The system is not broken,” he said, and said “the division does a good job of evaluating the quality of its appraisals.”
On the other hand, he hit at the “insufficient fiscal analysis” that did not closely consider how the tax burden is being distributed.
“I don’t think the system is broken” either, Hoffmann said. He agreed that the current 3 percent cap on assessed property value increases, enacted when those values were soaring, “has a tendency not to do exactly when it’s supposed to do.” Almy agreed.
“We think there should be changes,” Almy said, speaking generally. “But we don’t know what should be changed.”
Hoffmann said he was “a little bit surprised with the number of recommendations that you came up with.”
Almy replied that 40 recommendations is “not an unusually large number.”
Council Vice Chairman Dominic Yagong thanked Almy for the study.
“At $40,000 we certainly owe the taxpayers a progress report,” he said.
Nancy Crawford, in a letter to Legislative Auditor Colleen Schrandt, called the review by the International Association of Assessing Officers “a useful outside perspective to the system as it currently stands.”
Crawford offered specific comments on the report’s 15 areas of major concern, including a limited review of exemptions, including those that apply to agricultural land; complex multi-tiered tax rates; lack of formal complaint and reporting system; limited training opportunities for staff; vague property class definitions; and limited use of digital maps and photographs.
