Pepe Paguirigan was shocked when he saw the latest property tax bill on the Kunia lot he’s farming.

The retired construction supervisor has a 99-year lease for 12 acres in Kunia Loa Ridge Farmlands, a sprawling, off-the-grid agriculture development along the foothills of the Waianae Mountain Range.

Paguirigan, 64, has not built anything on his sloping lot, where he initially planted about 200 fruit trees but watched half of them die because he wasn’t able to get sufficient water from the development’s irrigation system. Most of his vegetable crops died as well.

The city recently valued Lot 38, the 12 acres Paguirigan is leasing, at $742,300. Based on that value, the tax bill for this year came to $4,445, according to the city’s online property tax records.

Not far from Lot 38 is another sloping parcel within Kunia Loa that covers more than 11 acres and has 8,100 square feet of building improvements, including a Buddhist temple.

The city assessed the land and buildings on that parcel at $814,300, 10 percent higher than the value of Paguirigan’s lot, according to the online records. Yet the tax bill totaled only $2,422 — 45 percent less than his.

"Something is wrong with the system," Paguirigan said.

When he tried to appeal the bill, Paguirigan said he was told by the city that he was unable to do so because city records do not list him as the owner or lessee of the lot.

Instead, the records show Kunia Loa Ridge Farmlands, the nonprofit that owns the entire 854-acre development, as the Lot 38 owner and C&C Farmlands, the developer, as the lessee.

Paguirigan, like all lessees, owns shares in the nonprofit.

The tax disparities are more pronounced when compared with lots just outside of Kunia Loa.

Syngenta, a major multinational ag company, owns a 725-acre parcel assessed at nearly $21 million by the city. But because of tax breaks, Syngenta’s tab this year was only $3,175 — not even three-fourths of the bill for Paguirigan’s 12-acre lot, the records show.

Asked about the substantial disparities between similar lots, Gary Kurokawa, the city’s deputy budget director, said in a written statement that he’s assuming some property users have filed for discounted rates because their land has been in active ag use for at least one to 10 years, making them eligible for varying tax breaks.

But neither of the Kunia Loa lots has such discounts, raising questions about the disparity. Kurokawa wasn’t available late Friday afternoon to clarify the matter or to address the appeal issue.

Following the advice of what an escrow officer told Paguirigan when he bought into the project in 2010, he said he is not paying the Lot 38 tax tab until the property records and bill are under his name and he can file an appeal.

In prior years, Paguirigan said the developer paid the property taxes.

The high taxes are just one of several problems that make running a successful farm at Kunia Loa difficult, according to Paguirigan and Romy Mindo, who also leases a lot there.

A water rate of $2.50 per 1,000 gallons, compared with about 50 cents elsewhere, makes the economics problematic, they said, and they’re hearing the price is about to increase dramatically.

Also, water availability and the pressure at many of the Kunia Loa lots are insufficient, particularly at higher elevations where Paguirigan has his farm, he added.

The meters the developer installed are too small, Paguirigan said, and he has stopped paying his bill until the various problems are fixed.