The Committee for More Equitable Taxation recently requested the Maui County Council repeal the current circuit breaker legislation and legislatively reinstate the previous law by no later than mid-December. That date would allow residents the opportunity to quickly apply or reapply for the circuit breaker before the end of 2013.
The Nov. 5 request stated, in part: "Fortunately, repeal and reinstatement would mean that those intended to benefit from the legislation would still have the opportunity to qualify. Unfortunately, it also means that some residents who were not intended to benefit will probably continue to try to do so.
"COMET has concluded it is preferable to help deserving residents and suffer some unintended beneficiaries for one more year rather than eliminate potentially hundreds of the deserving retirees, residents with low incomes and longtime/multigenerational families who are financially and emotionally suffering because of the recently revised circuit breaker legislation, the current unfair market value assessment system and difficult economic times.
"COMET suggests enactment of completely new legislation by October 2014 with more rational and reasonable qualifying standards. Revised standards should be derived from scientifically compiled information, consideration of property tax impacts upon renters, consideration of an acquisition-based assessment system, consideration of fairness and legality of property taxes upon kanaka maoli and consideration of establishing a review board with authority to review appeals and deny undeserving applicants. The precautionary principle of 'do no harm' should be at the heart of every circuit breaker consideration and decision.
"Unfortunately, COMET has not received a written response to its important and timely letter, which was dated Oct. 25, to the Maui County Council Budget and Finance Committee. The letter includes relevant and appropriate requests for information."
At 9 a.m. Dec. 3, the Council Budget and Finance Committee will consider the request from COMET and a recently introduced bill from Council Member Mike Victorino to amend part of the current circuit breaker legislation. Committee Chairman Mike White and committee members may propose other options.
Mayor Alan Arakawa vetoed the current circuit breaker legislation and stated, "I support the council's work in proposing legislation to address abuse of this important tax credit, but the flaws contained in this bill have not been adequately addressed. We must continue to work toward eliminating abuse of this tax credit, but in doing so we must be careful to avoid causing harm to the very people the circuit breaker was designed to help. Although I am vetoing this bill, I hope to see an amended version of it in the near future, one that is more prudently crafted." COMET agreed. Unfortunately, all nine members of the council voted to override the veto.
In 1991, COMET worked with the Maui County Council to establish the circuit breaker property tax credit. That was intended to be a short-term fix for the unfair and immoral market value assessment system. The Maui News headline of April 12, 1991, stated: "Major property tax reform proposed." One of the proposals was that "a study of the current property tax system would be completed with recommendations developed for revamping the system at the end of the three-year period for the proposed reform package. Possibilities for changes include doing away with the comparative sales (market value) method of assessing property."
Today, 22 years later, the market value assessment system is still in effect and continues to hurt many longtime residents. The important study and recommendations have never been produced. The proposed scientific study by COMET of a fair acquisition-based assessment system continues to be intentionally overlooked.
We hope taxpayers and citizens will express their ideas at the Dec. 3 hearing. Thankfully, we live in a participatory democracy. Please participate.
* William D. Tavares and John Blumer-Buell are co-chairmen of COMET.