Thursday, June 13, 2024
Hawai'i Free Press

Current Articles | Archives

Saturday, January 29, 2022
Blangiardi Exempts Affordable rentals from GE Tax
By News Release @ 4:31 PM :: 2838 Views :: Honolulu County, Development, Taxes

New incentives approved to spur development of affordable rentals

$40M available as affordable housing development incentive

News Release from City and County of Honolulu, Jan 27, 2022

HONOLULU – Honolulu Mayor Rick Blangiardi signed two sets of administrative rules that significantly further the goal of increasing the island’s supply of much-needed affordable housing. Additionally, the City is extending the deadline for submitting proposals for its $40 million affordable housing solicitation.

“This is about strategic and transformative change that will benefit our residents, and strengthen the City’s ability to deliver affordable housing on a sustainable basis for years and decades to come,” said Mayor Rick Blangiardi. “From day one our team has emphasized the need to address affordable housing for our residents and these are huge steps forward toward long term generational solutions.”

The first set of rules will allow the City to approve and exempt from general excise taxes any qualified person or firm involved in a newly constructed affordable housing project, or a moderately or substantially rehabilitated affordable housing project. The rules define the types of incomes eligible for exemption, the application process for certification of projects and rents received in affordable rental housing projects, criteria for determining eligible projects, and exemption for existing rental projects.  The adoption of these rules are a significant step forward in incentivizing the building of needed housing for the community.

The second set of rules govern the City’s Multi-Family Rental Housing program and restores the City and County of Honolulu as an active issuer of tax-exempt special revenue bonds or private activity bonds (PAB).  Under the Internal Revenue Code, a municipality such as the City can use its private activity bond volume allocation to issue tax-exempt special revenue bonds, the proceeds of which the borrower would use to construct or acquire and rehabilitate affordable rental units.  The tax-exempt special revenue bonds are not secured by the City’s credit, instead the bonds are secured by the borrower. 

The PAB program is available to developers of projects having a minimum 20 percent of the total number of units targeted to households earning 50 percent or less of the area median income (AMI), or a minimum of 40 percent of the total number of units set aside to households earning 60 percent or less of the AMI.  It has been more than 23 years since the City last had a private activity bond program and the adoption of this set of rules, represents the City once again taking an aggressive stance on the development of affordable housing units.

Taken together, the new rules significantly change the incentives surrounding the development of much needed housing and are just one part of the City’s strategy to bring about transformative change to the island. The Department of Planning and Permitting (DPP) will administer both the general excise tax exemption and the PAB programs. It is currently structuring and developing both programs and will be taking applications once they are established.

Available now, is the City’s Department of Community Services (DCS) active solicitation for project proposals using the available balance of the City Affordable Housing Fund (AHF).  Up to $40 million of the City’s AHF will be awarded to eligible projects that create rental units available to low-income individuals and families earning 60% of Area Median Income or less.  In Honolulu for 2021, this would include a family of three earning less than $65,280, a couple earning less than $58,020, or a single earning less than $52,920. This solicitation closes on Feb. 25, 2022 at 10 a.m. and must be received by the City and County of Honolulu’s Division of Purchasing by the deadline.  To apply or learn more about this opportunity please click here.

—PAU—

Links

TEXT "follow HawaiiFreePress" to 40404

Register to Vote

2aHawaii

Aloha Pregnancy Care Center

AntiPlanner

Antonio Gramsci Reading List

A Place for Women in Waipio

Ballotpedia Hawaii

Broken Trust

Build More Hawaiian Homes Working Group

Christian Homeschoolers of Hawaii

Cliff Slater's Second Opinion

DVids Hawaii

FIRE

Fix Oahu!

Frontline: The Fixers

Genetic Literacy Project

Grassroot Institute

Habele.org

Hawaii Aquarium Fish Report

Hawaii Aviation Preservation Society

Hawaii Catholic TV

Hawaii Christian Coalition

Hawaii Cigar Association

Hawaii ConCon Info

Hawaii Debt Clock

Hawaii Defense Foundation

Hawaii Family Forum

Hawaii Farmers and Ranchers United

Hawaii Farmer's Daughter

Hawaii Federation of Republican Women

Hawaii History Blog

Hawaii Jihadi Trial

Hawaii Legal News

Hawaii Legal Short-Term Rental Alliance

Hawaii Matters

Hawaii Military History

Hawaii's Partnership for Appropriate & Compassionate Care

Hawaii Public Charter School Network

Hawaii Rifle Association

Hawaii Shippers Council

Hawaii Together

HiFiCo

Hiram Fong Papers

Homeschool Legal Defense Hawaii

Honolulu Navy League

Honolulu Traffic

House Minority Blog

Imua TMT

Inouye-Kwock, NYT 1992

Inside the Nature Conservancy

Inverse Condemnation

July 4 in Hawaii

Land and Power in Hawaii

Lessons in Firearm Education

Lingle Years

Managed Care Matters -- Hawaii

MentalIllnessPolicy.org

Missile Defense Advocacy

MIS Veterans Hawaii

NAMI Hawaii

Natatorium.org

National Parents Org Hawaii

NFIB Hawaii News

NRA-ILA Hawaii

Obookiah

OHA Lies

Opt Out Today

Patients Rights Council Hawaii

Practical Policy Institute of Hawaii

Pritchett Cartoons

Pro-GMO Hawaii

RailRipoff.com

Rental by Owner Awareness Assn

Research Institute for Hawaii USA

Rick Hamada Show

RJ Rummel

School Choice in Hawaii

SenatorFong.com

Talking Tax

Tax Foundation of Hawaii

The Real Hanabusa

Time Out Honolulu

Trustee Akina KWO Columns

Waagey.org

West Maui Taxpayers Association

What Natalie Thinks

Whole Life Hawaii