A City Council subcommittee tasked with providing relief to property owners affected by the approximately 10% or greater increase in real property tax assessments on Oahu has outlined its intention to update real property tax homeowner exemptions and the income eligibility threshold.

The Council’s Permitted Interaction Group, or PIG — comprised of Chair Tommy Waters, Vice Chair Esther Kia‘aina, Radiant Cordero and Matt Weyer — has offered options taken from a slew of potential real property tax bills addressing such things as long-term rental classifications or exemptions, modification to real property tax credits, and homeowner exemptions and amendments to real property tax rate classifications, among others.

“Basically, the idea here was we looked at numerous bills in order to try and figure out how we can help local people get a tax break, how we can keep local people in Hawaii, in their homes,” Waters said at a special PIG meeting on June 7.

Although the subcommittee presented its brief report, due to state legal requirements, the full Council was not allowed to officially discuss that report until the whole panel convenes at its next meeting in July.

“And we hope to take immediate action at the next duly scheduled full Council meeting, which we want to do as soon as possible,” Waters said.

Still, as part of its findings, the subcommittee narrowed its preferences for possible action.

That included immediately updating real property tax homeowner exemptions and the income eligibility threshold for the real property tax credit. To do this, the subcommittee wished to agendize two measures — Bill 37 and Bill 40, both introduced by Kia‘aina in 2022 — for third and final readings.

As drafted, Bill 37 would increase the income eligibility threshold from $60,000 to $80,000 toward a real property tax credit. The measure would allow those eligible to see their tax capped at 3% of their income, according to Waters, who noted Bill 37 would be granted to people who need it most — namely, low-income earners.

“And in Hawaii, $80,000 is considered low income,” he said.

Likewise, Bill 40 would increase the homeowners exemption from $100,000 to $120,000 and raise the senior exemption from $140,000 to $160,000.

And Bill 40 increases homeowners exemptions “both for everyone across the board, but especially for kupuna,” he said, adding “we want to keep our kupuna safe in their homes and that’s what Bill 40 does.”

Waters noted the current PIG would officially dissolve — albeit temporarily — until another similar panel is created to further review these proposed tax relief measures.

“We could not vote on Bill 37 or Bill 40 until we dissolve this particular Permitted Interaction Group,” he said. “And we thought it was important to dissolve it now so that we could take immediate action on Bill 37 and Bill 40 so that it will take effect next year.”

If the measures are approved, the city would send public notices informing residents of the new laws, he said.

“So people can file their exemptions, they can file for the low-income tax credit,” he said. “That’s why we’re dissolving it today and we’re going to have another full Council meeting to discuss this.”

Members of the public also spoke in support of tax relief for residents.

Among them, Choon James said the main thing to consider with tax relief measures was “whether we want to help our local residents stay here, and to continue to stay here, or be pushed out through gentrification.”

“It’s ironic to say that even those who are making $100,000 are struggling in Hawaii,” she added. “So it seems everybody is needy except the super-affluent.”

The full City Council is expected to next meet on July 12.