Council panel mulls property tax structure changes

  • Lisa Miura

HILO — County Council members on Tuesday heard a host of recommendations from a task force charged with making the property tax code more equitable, but they stressed there’s a long way to go before any recommendation becomes law.

“There is a perception of abuse of the system,” said Kohala Councilman Tim Richards. “I like the direction, but I have concerns especially about the small farmer.”


Members of the public testifying about the final report by the Real Property Tax Review Working Group were also concerned about changes to agriculture programs that give substantial tax breaks to active farms, ranches, nurseries and orchards.

One suggested change likely to have a huge impact is the requirement for a minimum size parcel for those taking the non-dedicated agriculture property valuation benefit. The change would add about $6.5 million to county taxes annually by affecting 3,000 of the 8,400 parcels currently in the program. The affected parcels now pay about $580,000 in taxes.

That drew opposition from several testifiers.

“Commercial farms are not the only ones that are contributing food to the people of this island,” said small farmer Brittany Anderson, testifying from Kona. “The size of our lot does not dictate the amount of our contribution.”

Shannon Matson, a member of the task force, defended the recommendations.

“Of course nobody wants more taxes but at the same time, what we’re trying to do, we are actually encouraging a level just beyond a backyard garden that’s just going to feed yourself, but to go beyond that to really provide food for our community,” Matson said.

The task force decided not to make vacation rentals a separate property tax classification. It did, however, recommend the acceptance of electronic signatures on documents and push to put more apartments into the affordable rental category.

Previous recommendations, some already implemented by the county, included eliminating the solar water tax credit, reclassifying very small agriculture lots to residential and repealing an obsolete residential program.

Council members, sitting as the Finance Committee, emphasized the report is just that, a report. Bills would have to be brought forward to implement any of the recommendations, they said.

“Some of the public was convinced we are raising taxes today. I want to clarify that we’re not raising taxes today,” said Puna Councilman Matt Kanealii-Kleinfelder. “These are just some ideas.”


Property Tax Administrator Lisa Miura agreed with that comment, at least to a point.

“This was a pulse check here,” Miura said. “It’s a recommendation from this group. (But) the last thing this group wants to see is another report sitting on a shelf.”

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