by Andrew Walden
With the Hannemann-Caldwell administration choosing to assess higher commercial property tax rates on mixed-use buildings previously assessed at residential rates, Kalihi landlords are being forced to dump commercial tenants.
The result will be shuttered storefronts in some of Honolulu's most densely populated neighborhoods and massive rent hikes for low income residents.
Among the tenants being forced out are the Hawaiian Hope computer literacy center and several other non-profit groups at 611 N. King St. Under the newly enforced tax assessment rules, the affordably-priced storefront space they had been using on the ground floor of a four story apartment building triggers a reclassification of the entire building at the much higher commercial property tax rates. The difference-$40,000 per year in new taxes—makes continuing with the commercial space unrealistic for the landlord. The groups are ordered to vacate by September 15.
That’s not all. According to Curtis Kropar, Executive Director of Hawaiian Hope, “Notices found hanging in the building announce to residents that rent will be going up for all of the 400 low income apartments unless something else is done about it.”
Nonprofit leaders say it will be difficult for them to find commercial space priced comparably to the $1 per square foot they had been paying.
The tax changes are part of a package which became controversial when low-income Kalihi homeowners suddenly found themselves owing $13,000 in annual property taxes because the city chose to reassess their homes based on the industrial zoning of the property they sit upon rather than its residential use.
Meanwhile acting Mayor Kirk Caldwell, Jon Van Dyke, and dozens of Honolulu's wealthy and politically connected enjoy a $100 per year tax rate on their “historic” mansions under a tax loophole allegedly designed to encourage owners to keep them visible to the street.
KITV VIDEO: Evictions Leave Hawaii Non Profits Scrambling
Aug 20: Property tax quadruples for needy families in Kalihi (Thanks for the $13,000 tax bill, Mufi)
Shapiro: Caldwell, Hannemann smarting from Kalihi tax flap
SA: Hidden homes get big tax breaks
LINK: Hawaiian Hope