HILO — Puna Councilwoman Eileen O’Hara was unable to muster support Wednesday for a resolution seeking to provide tax relief for commercial properties in Pahoa and Volcano.
The County Council voted against the property tax amnesty measure a second time 7-1, with O’Hara voting yes and Puna Councilwoman Jen Ruggles absent. It would have requested the county administration impose the minimum tax rate on properties in Pahoa and Volcano that host businesses impacted by the Kilauea eruption.
Businesses in both villages were severely impacted by the eruption, which destroyed more than 700 homes in lower Puna and caused a lengthy closure of Hawaii Volcanoes National Park.
Pahoa merchants told council members that they are still struggling to recover.
“Tenants are now reporting revenue decreases up to 40 percent,” said Suzanne Kruppa, owner of Pahoa Marketplace. “Some are on the verge of collapse.”
O’Hara said Pahoa is at risk of becoming a ghost town.
“This is really needed now, and at the rate the county is moving, we’re not going to get any help in the short term,” she said.
While sympathetic to their plight, other council members said they had the same issues with the measure as when it was given a negative recommendation in committee two weeks before, mainly that it provides tax breaks to some commercial properties but not others. Several said businesses around the island have been impacted by the eruption.
Hilo Councilwoman Sue Lee Loy credited O’Hara for “scrapping for her district” but added she still doesn’t think this is the right way to legislate.
“Again, we would do the exact same thing and scrap,” she said. “I think we have to go about it a little smarter and in an appropriate policy way.”
Kohala Councilman Tim Richards said giving some property owners tax amnesty in this way would set a bad precedent.
“Although I want to support Puna, Pahoa, I cannot support it in this method,” he said.
Hilo Councilman Aaron Chung said he didn’t like that the resolution also seeks to reduce taxes for properties where a business is planning to open but doesn’t currently exist.
O’Hara said the resolution, which would request the county administration to reduce the taxes for six months, would cost the county $200,000 in lost revenue if enacted.
“This is not going to break the county,” she said, adding businesses could save $1,500 to $3,500 as a result. O’Hara said that’s the “difference between going broke and not.”
The resolution doesn’t mandate that the break is passed along to tenants. In the case of the Pahoa Marketplace, Kruppa said the tenant’s share of the tax burden is part of their rent.
As a result of properties being inundated or isolated because of lava, the county reduced the assessed value for 6,874 parcels, mostly residential, to $0, effectively giving them a property tax waiver.
The impact to the county is $3,354,529 in lost property tax revenue for the current fiscal year that began July 1.
Chung said he doesn’t think the resolution would do the same thing since the commercial properties in Pahoa and Volcano haven’t seen their assessed values reduced because of the eruption.
“What Ms. O’Hara is looking for is something that deals with an income-based assessment, and there really is no authorization for something like that,” he said.
O’Hara disagreed and said she thought the concerns were being overstated.
While facing resistance to the resolution, O’Hara suggested that Puna faces discrimination similar to what Ruggles once alleged through a controversial measure. She said Puna “continues to receive this kind of fiscal discrimination.”
Council Chairwoman Valerie Poindexter bristled at that remark.
“Saying discrimination is kind of taking it, to me, too far,” she said.
“If anything, I would say you are discriminating against the rest of us by not looking fairly at what happens around the island.
“I don’t want the public to hear what council member O’Hara is saying and hold that as truth,” Poindexter added.
The council adopted a separate resolution Wednesday asking the federal government to lift the cap for crop disaster assistance to help farmers impacted by the eruption.
Email Tom Callis at tcallis@hawaiitribune-herald.com.
Tax and spenders never want to give up their gravy train.
All other property owners on thr Big Island had large increasing property tax forced on them, so how this island shows a deficit of paid taxes, something very fishy not explained in this article
Harry Kim politics of tax and spend and give raises to his lazy staff, then find more ways to tax and spend, yet nothing gets done. Two years into his term and we have terrible roads, mass transit going on its third director, parks closing, infrastructure deteriorating and he keeps talking and planning and creating committees to do nothing. But expect another round of tax increases soon.
34% increase of council members salaries?!
If you look at the yearly budget, it increases exponentially and is currently 67% or more of the budget goes to County of Hawaii employees, past and present, and does not make it to the residents of the island.
Problems are also the unpaid pensions! Sooner or later we will face all taxes go to employees, police and pensions and nothing is left for roads, schools etc..
Many of the Hawaii County employees are “afraid” to come to Pahoa. Pahoa has a reputation that is enforced by the State and County’s lack of equal services for residents, that it is just a wild-west hippy drug place or whatever people say and think.
According to Land and Power in Hawaii, the Hawaii government planners never expected people to live out here and never provided any infrastructure – keeping Puna a bedroom community for workers in Hilo, forcing us to drive to Hilo for anything besides the most. basic necessities., therefore Hilo gets the tax dollars from sales tax and gas tax that is paid by the Puna residents having to shop there.
The State and County receive federal funds and they are not spent equally in Puna, for example, there are 10 buses a day which leave Hilo for Pahoa, but only 3 ever make it to Kalapana. 5 buses a day leave for Volcano, but only 2 stops make it to Ocean View or Pahala.
Some of my older friends who have been here forever tell me it’s been like a wildwest area down Pahoa way. People there wanted to be left alone, and i for one respected that, now that you and other folks in Puna district have run into harder times you now expect the rest of us to bail you out with out much bother for you. Which way do you want it, leave you alone or make Puna look like Kailua-Kona at a bargain basement price in lava zone 1 to make up for past indiscretions.
Voting is the only power the public has. Con-Con is the last best hope.
NO ON CON_CON
What is your fear of Con-CON. We the voters would control this one, not those idiot that keep getting voted in. Con-AM is the one to fear, that the one those idiot will tax the hell out of all of us. $55 Million cost is bogus, meant to scare the uninformed voters.
You have a woefully incorrect understanding of taxes. Hilo does not get the tax dollars from the sales tax; the State of Hawaii does. Hilo does not get the tax dollars from the gas tax: the State of Hawaii does.
You are right that taxes (as spent by the Feds, State, County) are not equally spent in Puna. You are just wrong that Puna under receives; in fact, it gets far more in tax spending than it contributes.
Over 70% of County revenue comes from West Hawaii (due to property values compared to East Hawaii), yet only about 30% of expenditures are in West Hawaii. One non-resident resort home in Kona, pays more real estate taxes than 30-50 residential homes in Puna. I also believe that West Hawaii (and North, too) pay a greater share of State income taxes. The poverty rate is much higher in East Hawaii, so I would argue that a disproportionate amount of Federal and State aid money goes to that area, too.
So, the truth is that Puna receives far more than it gives.
True statement, thank you for doing the research. But you have to remember, these are the same people who bought in Lava Zone One.
…almost Zero is spent in Kona which pays the largest amount.
Man, you live on an Island and to find a job which pays you have to move and drive a lot, a fate we all share – don’t you think? I don’t like it, because it takes my time for driving.
You want more buses try to organize it by yourself.
Biggest chunk of the budget, FRINGE BENEFITS 106,559,330 WTF ??????
what the .uck is going on?