Homeowners’ Taxes May Drop, Hotel Rates May Rise | News, Sports, Jobs

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Visitor accommodation could see a tax increase under the current budget proposal of a Maui County Council committee. Committee members are raising taxes in hopes of generating more money for affordable housing. Maui News / MATTHEW THAYER photo

High-priced homes and visitor accommodation could see property tax increases, while owners of more affordable homes could get some relief under a proposal from the Maui County Council Budget Committee.

A tax increase for hotels and resorts, short-term rentals and timeshares, as well as properties valued over $ 1.5 million could provide more funding for affordable housing, said committee members, who set tax rates as they approach the end of their review of Mayor Michael Victorino’s proposed budget for fiscal year 2022. Higher categories can also afford to pay more. , they added.

Other members, however, said the tax increase was unnecessary – especially without a specific project to finance – and that bond funds could be used instead to start infrastructure work for housing. affordable.

The Budget, Finance and Economic Development Committee, which voted 5-3 in favor of the proposed tariffs on Thursday, will send its proposal to the entire Maui County Council, which is due to make a decision on May 14 at the after a public hearing.

Under the proposal, hotels and resorts could see their current rate of $ 10.70 per $ 1,000 of net assessed value increase to $ 11.75. Timeshare could see rates drop from $ 14.40 to $ 14.60.

The proposed property taxes for fiscal year 2022 would provide some relief to lower class homeowners while increasing visitor accommodation rates. The Maui County Council Budget Committee on Thursday voted 5-3 to recommend the proposed taxes for full council consideration. Maui News / MATTHEW THAYER photo

Short-term rentals with an estimated value of less than $ 800,000 could see rates drop from $ 11.08 to $ 11.11, while second-level rentals of $ 800,001 to $ 1.5 million would drop from $ 800,000 to $ 1.5 million. $ 11.08 to $ 11.15 and those of the third level valued at $ 1.5 million or more. would see an increase from $ 11.08 to $ 11.20.

Victorino had kept the tax rates the same for the hotel and resort and timeshare categories in his proposal to council, while lowering the tax rates in each level of the short-term rental category. The mayor had cited the impacts of COVID-19 in his decisions, with the visitor sector among the hardest hit when travel slowed and hotels closed.

However, both Victorino and the Budget Committee are aiming to reduce the tax rates for owner-occupied homes in the first tier of $ 800,000 and below from the current rate of $ 2.51 to $ 2.41. The two also offered a slightly lower rate for second tier owner-occupied housing worth $ 800,001 to $ 1.5 million, from the current tax rate of $ 2.56 to $ 2.51. $. As Victorino sought to keep rates at the same level for the third tier of owner-occupied housing over $ 1.5 million, the budget committee is asking for an increase from $ 2.61 to $ 2.71.

The prices of the more expensive houses not occupied by the owner would also increase according to the proposal of the budget committee. As Victorino and the committee seek to keep the current rates the same for the first two levels of the non-owner occupied category, Victorino has proposed an increase from $ 6.90 to $ 7.50 for homes valued at over $ 1.5 million and the committee increased it to $ 8. .

Property taxes are generally the county’s primary source of revenue. Victorino’s proposed rates would bring in $ 373.6 million, while the committee’s rates would bring in $ 383.2 million, or about $ 9.6 million more, according to committee documents.

At the moment, there are no concrete plans for the additional funds that would be generated by the increase in taxes.

Committee chair Keani Rawlins-Fernandez and board members Tamara Paltin, Kelly King, Shane Sinenci and Mike Molina voted in favor of the proposed rates.

Rawlins-Fernandez said she was “not really happy to raise property taxes” and that there is more than one way to address the affordable housing crisis. However, she said she would vote with the majority to move the matter forward and stressed that the committee had added safeguards to protect residents.

Council Chair Alice Lee and Council Members Yuki-Lei Sugimura and Gabe Johnson opposed the tax rates.

Lee said she disagreed with some rates, noting that the “The real intention to raise taxes here is to accumulate money for infrastructure. “

“And that’s not my priority at this stage, because we don’t have a project and we don’t have a plan”, she said. “I wouldn’t mind, if necessary, raising funds to help local families who are trapped by the high appreciation of the homes around them. This is something that I think we need to address, now or in the future, in the near future. “

“But this is an urgent need as opposed to fundraising for the bank and parking lot for the time a project arises,” she added.

Johnson voted against the proposed rates because he wanted higher taxes for hotels and resorts.

“I don’t agree with the body and that’s OK. We’re adults, I don’t think we’ve tried enough” he said. “You know (affordable housing is) a crisis, and it’s time to act. I say it all the time, ‘if your hair is on fire, you have to act like this.’ “

Witnesses at a public hearing on virtual property tax on Wednesday night called for most rates to stay the same, while others wanted to see higher rates for visitor accommodation.

Maui Chamber of Commerce President Pamela Tumpap said while businesses are still reeling from the pandemic, they understand the need to fund county priorities and have called for property tax rates to stay stable for apartments, agriculture, conservation, industry, hotel and resort, timeshare. , commercial and commercial residential categories.

She also asked the council to take into account the higher median house prices that residents face and expand the first level of the homeowner category to include homes with an appraised value of up to $ 1 million. , in order to include as many residents as possible.

The chamber also supported Victorino’s proposal for short-term rental rates.

Dr Genesis Young said property tax rates should be increased for hotels and other visitor accommodation, so if properties increase their rates in turn, it will pay off. “best quality” visitors and maybe less overall. Young, who was testifying on his own behalf and as chair of the Climate Action and Advisory Citizens Group sustainable tourism subcommittee, said he recommended a rate of $ 16.41 for hotels and resorts as well. as timeshares and short term rentals.

He reminded the committee that the entire board passed a resolution in February highlighting “quality rather than quantity” when it came to visitors to Maui County.

* Melissa Tanji can be contacted at [email protected]

Proposed property tax rates for fiscal year 2022

As Maui County Council continues its budget review, members are finalizing proposed property tax rates for the upcoming fiscal year. The following is a list of current property tax rates, the rates proposed by Mayor Michael Victorino and the proposals of the Council Budget Committee:

Occupied by their owner:

Level 1: up to $ 800,000; $ 2.51 (current); $ 2.41 (mayor); $ 2.41 (tip).

Level 2: $ 800,001 to $ 1.5 million; $ 2.56; $ 2.51; $ 2.51.

Level 3: Over $ 1.5 million; $ 2.61; $ 2.61; $ 2.71.

Not occupied by the owner:

Level 1: up to $ 800,000; $ 5.45 (current and proposed).

Level 2: $ 800,001 to $ 1.5 million; $ 6.05 (current and proposed).

Level 3: Over $ 1.5 million; $ 6.90; $ 7.50; $ 8.

• Apartment, $ 5.55 (current and proposed).

• Hotel / Resort, $ 10.70; $ 10.70; $ 11.75.

• Timeshare, $ 14.40; $ 14.40; $ 14.60.

Short term rental:

Level 1: up to $ 800,000; $ 11.08; $ 10.70; $ 11.11

Level 2: $ 800,0001 to $ 1.5 million; $ 11.08; $ 10.85; $ 11.15.

Level 3: Over $ 1.5 million; $ 11.08; $ 11; $ 11.20.

• Agricultural: $ 5.94 (current and proposed).

• Retention: $ 6.43 (current and proposed).

• Commercial: $ 6.29 (current and proposed).

• Industrial: $ 7.20 (current and proposed).

• Commercialized residential: $ 4.40 (current and proposed).

All rates are based on $ 1,000 net assessed value.

The whole council is expected to vote on the tariffs on May 14 after a public hearing. Fiscal year 2022 begins July 1 and ends June 30, 2022.

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