Proposed Changes to Property Tax on Maui Real Estate Purpose of Community Meeting

November 15, 2019, 11:27 a.m. HST

PC: Wendy Osher

Maui County Council Member Tasha Kama hosts a community meeting on proposed property tax changes discussed at last week’s council meeting.

The community meeting is scheduled for 6:00 p.m. on Wednesday, November 20, 2019 at the Kahului Community Center, located at 275 Uhu Street.

Marcy Martin, Senior Technical Property Officer at the Maui Department of Finance, will give a brief presentation on the nature of the proposed changes, followed by an opportunity for participants to ask questions.

The county council recently concluded a temporary inquiry panel process which recommended the first steps in a multi-step process to reform the property tax system.

One of these first steps is to rename the current property classifications to better distinguish the valuation basis. For example, the existing classification “owner” would be classified as “owner-occupied” to distinguish it from “non-owner-occupied” or secondary residences.

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The other part of these initial steps is to provide graduated or progressive tax rates. Under the county’s current property tax system, all properties of the same classification are taxed at the same rate ($X.XX per $1,000 of assessed value). The proposed change would allow the county council to set a different rate for up to three levels of assessed value.

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For example, the board could set a lower rate for properties with the lower assessed value and higher rates for properties in the other two tiers. The establishment of the tiers would be done during the budget process, as well as any decision to set differential tax rates.

Further reforms to the property tax system may be considered by council in a subsequent TIG process. These reforms include property tax reductions for non-owner occupied residential units that are dedicated to affordable long-term rentals.

Council member Kama, who occupies the seat of residence in Kahului, expects other council members to hold similar information sessions in their respective residence districts, but invites all interested residents to attend. .

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