Report addresses Hawaii's rising property values
Thu, Apr 20, 2023 1:00 PM
By Merrilee Gasser, The Center Square
Hawaii's skyrocketing property values could lead to higher tax payments unless local lawmakers take mitigating measures, according to a new report.
The Grassroot Institute of Hawaii, a nonpartisan, nonprofit research and educational institute, released a Thursday policy brief titled "How Hawaii's county lawmakers can provide tax relief to offset higher property assessments." It outlined several lines of action local leaders could take to prevent rising property taxes.
"Property values have shot up across Hawaii over the past two years," the report said. "As a result, all four of the state's counties saw their property tax revenues balloon in fiscal 2023. Hawaii County's revenues grew by 19.81%, Kauai's by 19.23%, Maui's by 12.4% and Honolulu's by 9.14%. This windfall could be seen as a positive outcome for county budgets, but many isle residents have bemoaned the potential higher tax burden."
Hawaii's property taxes are based on property assessments. Property tax payments can automatically increase without county officials increasing property tax rates, according to the report. With recent property assessment increases, higher property taxes are on the horizon.
"With our already notoriously high cost of living, a huge tax increase is likely to be more than many families can bear," said Keli'i Akina, the president and CEO of Grassroot Institute. "Landlords have warned that tax hikes might force them to increase rental rates, and homeowners have had a crash course in the world of valuation appeals. Ultimately, property tax increases could further fuel the ongoing exodus of Hawaii residents to the mainland."
Institute researcher Jonathan Helton listed mitigating measures like simple rate cuts, exemptions, indexing, assessment "circuit breakers," and more as steps local lawmakers could take to prevent higher property taxes.
"In particular, counties should consider slashing property tax rates, increasing homeowner exemptions, expanding low-income tax credits and extending relief to renters and businesses," Helton wrote.
Property tax relief measures are currently under consideration in all of Hawaii's counties, according to Akina.
"Lawmakers would do well to consider providing more permanent relief so local families won't have to face this same issue in future years," Akina said.