The Hawaii County Council passed a bill that would earmark a portion of tax revenues on luxury homes for homeless programs and housing.
Wednesday’s council meeting featured the second and final reading of Bill 111, which takes at least 75% of the real property tax revenue collected from tier 2 residential properties — properties valued at $2 million or more — and allocates it to county-sponsored programs designed to address housing and homelessness.
The provision would expire on June 30, 2027.
Finance Director Deanna Sako said the policy could raise about $7 million next year based on current property value trends.
The tiered tax system — whereby residential properties are subject to additional tax for each thousand dollar of property value over $2 million, was only approved in 2020. Under this scheme, properties above that threshold are taxed at $13.60 per thousand dollars, compared to $11.10 per thousand for properties beneath the threshold.
Although the bill inspired impassioned debate among council members at previous meetings, Wednesday’s meeting was relatively sedate, with Hilo Councilman Aaron Chung, sponsor of the bill, noting that the thrice-amended bill was now in a state that was “acceptable to everyone.”
Hamakua Councilwoman Heather Kimball, who previously had doubts about how the funds were to be allocated, said she was “comfortable that the money will be managed well.”
However, Chung also moved to amend the bill one last time, altering slightly how the funds will be appropriated.
Under Chung’s amendment, the difference in revenue between the tier 2 properties and any below that value will be subject to the 75% appropriation, a change that he said will not significantly alter how much funds are raised under the policy.
The council voted unanimously to pass the bill with Chung’s amendment.
Email Michael Brestovansky at mbrestovansky@hawaiitribune-herald.com.