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Taxes go up for absentee homeowners

Property owners who do not live in their homes can expect an increase in their property tax rate, under proposals passed by the City Council today.

The Council approved the city’s $1.82 billion operating budget that is balanced, in part, on an increased tax rate for nonoccupant property owners.

The measures now go to Mayor Mufi Hannemann for consideration. Hannemann advocated for the separate tax rate, as a means to balance the budget and go after speculators and investors who own property in Hawaii but do not live in the state.

The budget bill passed 9-0.

Property tax rates are set by separate resolution, which was approved by a vote of 6-3, with members Ikaika Anderson, Romy Cachola and Ann Kobayashi voting in opposition.

Resolution 10-60 increases the rate for nonoccupant owners by 16 cents, to $3.58 per $1,000 of property value, while all other property tax rates remain unchanged.

Cachola noted that the nonoccupant homeowner class would be the only class of property owners to see rate increases two years in a row, while Kobayashi argued that the new rate would simply be passed on to renters who can least afford it.

“In the end, we end up hurting the people who need help the most,” Kobayashi said.

Bill Brennan, a spokesman for the Hannemann administration, said as a homeowner, he supports the new, separate class because it is “pro-homeowner.”

The Hannemann administration supports the new tax rates, and argues that because of decreased property valuations, most homeowners in the new class should see no increase or even a drop in their property tax bills.

Council members also planned to consider a proposal that would grant a one-time $100 tax credit to property owners who have two dwellings on their property. It is aimed at easing the tax burden on those who take care of families in units that are on their property.

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