RESOLUTION

WHEREAS, real property values and real property taxes have skyrocketed in the City and County of Honolulu and in Kauai, Maui, and Hawaii counties as well; and

WHEREAS, these skyrocketing increases in property values and property taxes have been "too much and too fast" for most people; and

WHEREAS, the people of Hawaii are hurting and homeowners and renters, particularly those on fixed low incomes, the elderly, the disabled, and the poor, are the most vulnerable to losing their homes in an already tight housing and rental market; and

WHEREAS, Hawaii has one of, if not the lowest, homeowner occupancy rates in the nation, and approximately forty-eight per cent of residents are renters; and

WHEREAS, homeowners and renters have no control and defenses against rising property values, which are fueled by out-of-state and global economic forces; and

WHEREAS, real property taxes are the primary source of revenues for the counties; and

WHEREAS, the counties are faced with ever increasing administrative costs of public services for residents and large daily populations of visitors and military personnel; and

WHEREAS, the present administration of real property taxes imposes an unfair burden upon homeowners and renters and, in many cases, upon those who can least afford it; and

WHEREAS, it is impossible to achieve a fair and equitable tax revenue base for the counties to provide essential public services if the base is limited to the real property tax; and

WHEREAS, the counties have sought and continue to seek more sources of revenues from the State, including the recently passed general excise tax surcharge, the transient accommodations tax, and state grants and appropriations; and

WHEREAS, the counties' and the State's funding problems are exacerbated by recent federal budgetary cutbacks in domestic programs; and

WHEREAS, federal and state income tax policies can have both positive and negative impacts upon the State's and the counties' funding resources, the economy, housing options, social safety net programs, the environment, energy, education, and the people; and

WHEREAS, federal, state, and county tax policies in recent years have shifted a greater portion of the tax and revenue burden onto the lower and middle income classes and reduced the tax and revenue burden away from the higher income classes, corporations and big business, and special interest groups; and

WHEREAS, federal, state, and county tax policies have worked independently of each other without regard to the cumulative impact and burden upon taxpayers and the people, and at times have been inconsistent, counter-productive, and based on invalid economic assumptions and projections; and

WHEREAS, as recently demonstrated by the dispute between the State and City and County of Honolulu over the collection and distribution of the general excise surcharge, better cooperation and coordination could make the tax collection less costly and more efficient; and

WHEREAS, state law established and authorized the State Tax Review Commission to conduct a systematic review of the State's tax structure using such standards as equity and efficiency; and

WHEREAS, the Mayor of the City and County of Honolulu has recently formed a Tax Policy Committee as a response to residents' opposition to the skyrocketing real property values and taxes and the City Council of the City and County of Honolulu has passed tax relief measures, which many believe would provide insufficient tax relief; and

WHEREAS, many believe that a "holistic" review, study, and restructuring of the State's and the counties' tax and revenue generating systems must be done to achieve a fair and equitable system for the State, the counties, and the people; now, therefore,

BE IT RESOLVED by the House of Representatives of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2006, the Senate concurring, that the Governor, the county Mayors and county councils with the assistance of the State Tax Review Commission, the City and County of Honolulu's Tax Policy Committee and comparable committees of Kauai, Maui, and Hawaii counties, are requested to jointly review, study, and recommend, with public input and participation from all taxpayers, on how the State's and counties' tax and revenue systems may be restructured and realigned to achieve a fair and equitable tax and revenue system for the State and the counties; and

BE IT FURTHER RESOLVED that the State Tax Review Commission and the City and County of Honolulu's Tax Policy Committee and comparable committees of Kauai, Maui, and Hawaii counties are requested to report their findings and recommendations to the Legislature not later than twenty days prior to the convening of the Regular Session of 2007; and

BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to Governor, the Mayors and Chairpersons of the county councils of Honolulu, Kauai, Maui, and Hawaii counties, the Chairperson of the State Tax Review Commission, the Chairperson of the City and County of Honolulu's Tax Policy Committee, and the Chairpersons of comparable tax policy committees of Kauai, Maui, and Hawaii counties.

Report Title:

Review State and Counties' Tax and Revenue Systems