Monday, November 2, 2015

Musings: Rentals, Dogs and Taxes

As Kauai residents struggle to find affordable rentals, the Kauai County Council is looking at tax breaks for property owners who offer that sort of housing.

Councilman Ross Kagawa was first up with Bill 2600, which is set for a public hearing at Wednesday's Council meeting. It grants a one-time tax credit to property owners who have not raised the rent on their long-term affordable rental units. According to the bill:

The tax credit shall be equal to the difference of the maximum allowable monthly rental amount for tax years 2015 and 2016 and shall be based on the size of the unit (i.e., number of bedrooms).

The problem with Ross' bill is that it covers only with existing longterm affordable rentals, without offering property owners an incentive to convert their housing to that use. 

Councilman Gary Hooser, meanwhile, has upped the ante with draft Bill 2606, which will be introduced at Wednesday's meeting. 

It would prohibit the Council from raising property taxes on owner-occupied properties and affordable long-term rentals beyond the most recent actual cost of living increase, as reflected by the Consumer Price Index. 

Gary took to his blog to drum up support and offer his rationale for his bill:

While homeowners have an obligation to help pay for County services and while the cost of County services continue to increase, the obligation of existing homeowners should be to support only normal cost of living increases and not be forced to support additional increases in the cost and expansion of county government.

It's hard to follow the logic here, unless the Council is prepared to base property taxes on value of government services received.

Gary goes on to acknowledge that he recently voted to repeal a cap to eliminate the disparities that caps create and “'reset' the tax structure in a more equitable fashion.” But now, he says, “it is clear that a new CAP needs to be put into place again.” 

He continues:

Passage of this measure will require strong community support as the current majority will likely resist its passage and argue instead for a “comprehensive review” of the entire tax structure. Many on the Council have been saying this for the past two years, yet nothing has been done. I agree and support a comprehensive review, but in the meantime we need to CAP at a reasonable level increases to those that live in their homes and rent at affordable rates.

So why hasn't Gary proposed a comprehensive review? He's been sitting on the Council for the past two years. There was nothing to stop him from advancing a review of the tax structure. Instead, he chose to expend his time and political capital on a failed bid to eliminate the ag tax credit for land in seed production.

Meanwhile, neither tax bill deals with the underlying issues: a shortage of affordable rental units and steadily rising housing costs.

Hawaii News Now recently aired a report that pegged housing as “the biggest cost-of-living driver in the islands.” It quoted Lawrence Boyd, an economist and associate specialist with the University of Hawaii Center for Labor Education Research, as saying:

[O]utside demand is the biggest factor driving Hawaii's high housing costs. “Basically what Hawaii has become is a preferred place for the international 1 percent to buy property.”

Boyd said he thinks government should aim to stunt outside demand — and lower housing prices — by raising property taxes for non-residents and vacation rentals.

“If you engineered the exemption properly, more of these places would be rented long-term rather than as vacation rentals and because there would be an increase in that, that would lower the prices for local rentals.”

Kauai County lost a big chunk of housing to the TVR industry — both legal and illegal —especially on the North Shore. While it's happily raking in more dough from those higher property taxes, it's done nothing to address the loss of longterm affordable rentals that affects so many residents.

Hawaii News Now goes on to quote local economist Paul Brewbaker as saying:

"[T]he solution to Hawai's skyrocketing housing prices is reducing housing and development regulations to make it easier to build."

Hawaii already tried this, and we're still feeling the dismal results. Back in the early 1990s, it was standard practice to impose a 60 percent affordable housing component on any developer seeking to reclassify land into the urban designation. It wasn't long before the counties themselves started asking the state Land Use Commission to reduce that affordable housing requirement – perhaps because they were having a hard time extracting other conditions from developers.

If you continue to “reduce the cost of acquiring the entitlement,” as Brewbaker advises, who picks up the tab for all the associated infrastructure? Existing property owners? And if there's a cap for homeowners, is it borne solely by hotels and TVRs? Or just left undone?

These are the tough issues that the Kauai County Council needs to address, rather than adopt band-aid tax credits and caps that seem an awful lot like pre-election year pandering.

But they'd much prefer to spend their time on barking dogs, fireplace smoke and the other manini matters that have occupied this do-nothing Council for the past year. Because yes, the latest barking dog ordinance will be introduced on Wednesday, too.

Here's what renders that ordinance ridiculous (emphasis added):

A dog shall not be deemed a barking dog for purposes of this section if, at the time the dog is barking or making any other noise, a person is trespassing upon or traveling past private property in or upon which the dog is situated or for any other reasonable or apparent cause for the dog’s barking.

Mmmm, doesn't that pretty much include everything? Cats, pigs, loneliness, neglect, hunger, other barking dogs, boredom? Aren't those all reasonable reasons for a dog to bark? And who decides what's reasonable? A human, or a jury of the canine's peers?


Anonymous said...

The NS BnBs if they were turned into rentals would be at the 4000 and up monthly rent.
These are expensive houses and will never convert to local housing. Many landlords find themselves breaking even on their long term rental properties. The County tax break for longterm rentals is a joke. When Tim Bynum raised the taxes on non-home owner occupied properties, taxes went up 2 to 4000 per year for many rentals. The tenant absorbed these costs. And now we have common rents at 2000 to 3000 per month. But after taxes, insurance and other costs the landlord is usually still just hanging on.
We need more houses PERIOD. Simple, four walls and a roof. Until we get Da Hoos, Mason and JoAnn out of office there will be no effective housing. Their bikepaths and dreamy walking paths to Starbucks and Veggie Sandwich stores kill all development. These meandering and dreamy tree lined meandering walk paths add big dollars to the developer.
Go to big land, beg them to cut some borderline properties out, got to the LUC beg them to fast track the zone change. Have Planning and Water do their work while the LUC goes thru...and maybe you can break ground in 3 years and have houses in 4. As long as government is out of it.
Put some good engineer surveyors in charge (Kauai has 2 of the best) get some old time relators and builders in the mix and results will happen.
There is only one rule. KEEP JoANN, Da Hoos and Baby Hoos, Felicia and Mason out of the way. If these gum-in the-works antis are involved we will have mandated, sushi bars, marrywwana centers, yoga parks, and 73 studies on the effects of houses on old cane lands.
Just build 'em and they will come. And oh yeah, there are plenny old time realators, builders and surveyors who would get into this heart and soul, altruistic giving AS LONG AS THE f*cked up, know it all, tell it all, do nothing POLITICIANS stay the f*ck out of the mix.
It is easy to build. Shelter is essential. JoAnn and her ilk have killed housing for perhaps we can do some good. C'mon Mel, reach out to the many realators, builders and engineers you know. Our fine D Esaki and C Kodani could get this ball rollin' in 2 weeks. The landowners may even be ready to share (there will be a cost, but not at resort prices)...This is the best island and has the best people, time to do something.
And all you JoAnn protectors out there, get your facts straight before you protect her. For DECADES she has done the most damage to housing for locals...via Water, Planning, bad attitude, Apartment forced extortion's etc, She thinks she knows but she don't know. She talks good, but her talk is real bad for the locals.

Unknown said...

Just need to get rid of those malice prepense pooches and we will finally have paradise! But what about evil roosters?

Anonymous said...

People should be free to rent to whomever they want. The market will decide.
Taking extra tax $ from NS residents and giving it to Lihue residents, again. ......

Anonymous said...

When I see the airport full of young hippies flying back to where they came from because they couldnt find housing, Im soooo happy!!!!

Anonymous said...

8:49 same tired cut and paste analysis. Explain why all of the other islands have the same affordable housing problem. Yukimura controlled land use statewide? And Kukuiula and Princeville would have more affordable units but for her? You have no clue as to how these projects are developed and marketed. The last thing they want is an economically (and hence racially) integrated community. Hard to sell exclusivity with poor brown folk across the street hanging their laundry for all to see.

Anonymous said...

Don't forget Gary Hooser has a vested interest in tax breaks for long-term rentals. He rents a room in his home to Laurie Cicotello. Check out his record of advocacy on that particular point over the past two years.

Anonymous said...

You think you'd actually have to have paid your own taxes before being able to make tax policy. This is nothing more than pandering to the voters to get himself reelected. Gary is all about serving Gary. Keep his job and benefits and lower his own taxes.

Anonymous said...

Your average local wage earner can't afford housing costs on Kauai.

Now your average drug dealing local can afford housing costs and the cost of living on Kauai.

Maybe the whole plan all along is for the locals to sell drugs to the mainlanders and tourists to support the cost of living in Hawaii.

Hawaii is the closest thing to a third world country that I have ever seen.

Anonymous said...

1:37pm you hate Kauai? Why are you still here? Don't let the door hit you on the way out.

Anonymous said...

Born and raised.

Came back after many years away and now I'm fighting to save Kauai from the IDIOTS in charge.

You should try to identify problem areas and find solutions if you care and love Kauai.

Cowards that go through the motion and accept defeat aren't wanted and needed on Kauai.

Those who survived the Hurricanes and put in work to make Kauai a better place have to once again get down and dirty to clean the mess we are in.

If not then move to the 9th island with all those cowards.

Anonymous said...

6:51 your comments at 1:37 has no solutions at all. Your point about selling drugs to tourists are baseless. If you wanted to help the future of this island, you would call KPD with names of these drug sellers instead of blogging it here with no facts. Hawaii is not the closest thing to a third world country, I think you are the one doing drugs. Again for the betterment of Kauai, go back to where you came from for many years mr. or ms. born and raised, we are not proud of you.

Anonymous said...

10:50 The Yukimura Housing crisis regarding Pville and A&B is an example. High end projects and put the local housing away from the the "big houses". There is 400 acres at Hanamaulu, 50 acres by Molokoa, 1000 acres behind Wallmart to new Hanamaulu Bridge, 4,000 acres by the new Kapaia Dump etc. Tons of marginal lands. JoAnn and Hooser et all beat up big land so much by trying to kill Big Ag compounded with a million BS rules on bikepaths, affordable housing extortion, byzantine Planning process, Sisyphus-like water department process.. ad nauseaum....why would anyone in their right mind attempt to do a public good project, when the County leaders are venomous in their laws and actions regarding any development. Especially altruism.
JoAnn and Da Hoos, Mason and others must realize that the future of housing, roads, water and public access is the hands of Big Land. If you were Big Land would you bring these wolves to lunch, when Da Hoos and JoAnn (and of course L'il Mason) think that Big Land is the main course on the menu? JoAnn and Gary sworn to serve, but in reality sworn to serve big land their Obituary notice and serve the island's people high taxes, high rents and beautiful bike lanes and smelly buses. Holy HAPA Fistee, where is their some common sense?
But if you are a rich newcomer, in your nice house and do not care for the future of the kids on the island....continue to protect JoAnn and Da Hoos. They will keep Kauai for the rich. Locals need not apply.

Anonymous said...

*Le Sigh* When will Kauai County Council actually do something about the drug problem on island? These young adults need something to do to keep them off drugs and alcohol. But no, barking dogs and gmos are so much worse for us. Paradise is still good.

Anonymous said...

Yeah right, 10:11

If you leave it up to "rent to whomever you want, let the market decide" believing the best will happen, think north shore and south kauai where greedy people taking blatant advantage of their neighbors and surroundings have all but destroyed what were once close knit communities. If you think this is a good thing , you must have your head screwed on backwards.

Anonymous said...

8:38 cut and paste crap again. You make the same comment but can't refute the facts. Who supported Princeville and Kukuiula? And when Gary or Joann control the majority on the council when these projects were going through the system? Yes the seed company bill was bad law but to lay all of that on those two and Mason is b.s.

Anonymous said...

8:38, stop grumbling about Joann, Hooser and Mason---go get Rapozo, Kagawa, Kaneshiro and Kualii to do what you want done--they have the joker in their hands--4 to win! If you think the other three have been doing damage, then go to the other 4, get them to do what needs to be done! The other three have no power right now--so hurry up, no grumble get it done before you're too late!

Anonymous said...

I'm not leaving Until I destroy the Kauai Syndicate Mafia and all their slaves.

Redemption for the unsolved murders

Resurrection of their lives and

Salvation for them, their families and friends

Exodus for Kauai's people

Anonymous said...

Fix the traffic. Rail from Lihue to Kapaa. All those cars with only one person is wasteful and selfish.

Anonymous said...

8:38. Keep doing what you do the locals support you, Joanne, Mason, and Gary all going down next election. They got real lucky last time, this time Brun, Perry, and DeCosta will unseat them, just watch. 2:09 and 2:12 Wanna bet?

Anonymous said...

Then all the problems will be fixed.

Anonymous said...

It is a good question really. Joann, Hooser and Mason are powerless. So why aren't Mel and Ross getting stuff done? The other two will follow them anywhere so they have the 4 votes needed to do whatever they want yet choose to do nothing. What gives here?

Anonymous said...

The barking dog law being introduced is without bark or bite. What a f'ing joke. Let's try to appease both sides by actually having a law but ensure that it's not truly enforceable. Did I enter the twilight zone? Is there any form of intelligence on the council??

Anonymous said...

Taylor, Mickens and Rosa.

Anonymous said...

7:10 A.M. We the silent voters, actually like it this way. This is why we voted overwhelmingly for the top 4 people. It was time to mend the broken community. We got most of the community dividers out. that's just the election fact. it's nice to see small items on the agenda.

You and all the others pissing and moaning about why the 4 not doing anything are just pissed (in one of the silent majority's opinion) that your group is on the short end of the stick.

This is where you and all the newbies (assumption), are still crying on this blog because your just pissed that the control of the council is not on your side. AGAIN! This is the fact, the electorial fact.

It is great this way. Our small (lower population) quiet / community based island can just continue on with life with and without all this choosing sides.

Just like little kids, picking sides. stating your justifiable reasoning why you like and dislike a person. You're losing focus of what life is all about. With or without each and everyone of us on this island, life will go on.

Just remember, come next election, be part of the silent majority. cast your one vote. That's all you got!

So for now, let the Council do their job. The more we pull and tough on them, the less they can focus on what they have to do.

If you consider it nothing, that's all good. maybe it's better than dividing friends and neighbors through lies and deception.

Joan, keep up the vigilance.

Anonymous said...

The council could do so much more if the people were nicer. That's the only thing holding up progress.

Anonymous said...

What a hypocrite you are.

You speak of getting rid of the community dividers and you also say also say the council control is on your side. So you are not a divider? Yet your comments speaks loud and clear what kind of a cheerleader you are.

The newbies? Like you've worked all your life making Kauai and the world a better place for only you to enjoy.

Just like little kids picking sides is calling the kettle black on your part.

You sir or ma'am have a lot to learn and growing up to do.

Anonymous said...

10:35 p.m. yes I am (A Hypocrite). Everything you claim i am. 61 years old (maybe). doing community service for over 30 years, watching all our kids grow up on this island making a difference in my community, the kids i coached have their own kinds, and i've worked with theirs also.

i've contributed to this island (hands on) and not just words, and no, not the world, the world is way to big to have an impact. i've seen some parts of the world and discovered we are all (you and me) a single person(s) of a 100 billion population (or what ever count there is).

we all have 1 vote, I voted my way, with the silent majority.

You have a great week and weekend. our conversation is over, you spoke your mind, i spoke mine. you want the last word in, go have it. As reading this blog for a long time, there's no end, just a continuation to the next great article on this blog.

Anonymous said...

10:35 p.m. one last thing, 9:10 a.m. wrote the same comment as i did, except the person chose to shorten out his/her answer.

isn't that pretty cool. 8:35 and 9:10, back to back.