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HomeMy WebLinkAbout2014_0110_Minutes Open_APPROVEDCOUNTY OF KAUAI Minutes of Meeting OPEN SESSION Approved as circulated 2/14/14 Board /Committee: BOARD OF REVIEW Meeting Date January 10, 2014 Location Mo`ikeha Building, Meeting Room 2 A/B Start of Meeting: 1:05 p.m. End of Meeting: 1:42 p.m. Present Chair Jose Diogo; Vice -Chair Dottie Bekeart. Members: Craig De Costa (1:09 p.m.); Cayetano Gerardo; and Russell Kyono Also: Deputy County Attorney Jennifer Winn; Deputy County Attorney Stephen Hall; Boards & Commissions Office Staff. Support Clerk Barbara Davis; Administrative Aide Teresa Tamura; Deputy Director of Finance Sally Motta; Tax Manager Kim Hester Excused Absent SUBJECT DISCUSSION ACTION Prior to the start of the meeting, Council Administrative Assistant Eddie Topenio gave the Oath of Office to new Board member Dorothy Bekeart and reappointed member Jose Diogo. Call To Order Vice -Chair Diogo called the meeting to order at 1:05 p.m. with 4 members present Election of Mr. Kyono made the motion to nominate Jose Chair and Vice Diogo as Chair. Mr. Gerardo seconded the Chair for 2014 motion. Motion carried 4:0 Mr. Gerardo made the motion to nominate Dottie Bekeart as Vice - Chair. Mr. Kyono seconded the motion. Motion carried 4:0 Approval of a. Open Session Minutes of August 2, 2013 Mr. Gerardo moved to approve the minutes as Minutes circulated. Mr. Kyono seconded the motion. Motion carried 4:0 Mr. De Costa entered the meeting at 1:09 p.m. Appeals None Scheduled Establish Attorney Winn advised the Board that Ms. Hester would be updating them Format for on the changes to the law, which might help the Board determine the format Hearing of for hearing appeals, and whether the Board would like to continue to Appeals formulate their decisions in closed session. Board of Review Open Session January 10, 2014 01M SUBJECT DISCUSSION ACTION Ms. Hester said there have been several legislative changes to the tax laws in the past three years culminating in 2013, and effective for the 2014 tax year. The minimum tax changes are self - explanatory. However the disabled veterans who currently have been benefitting from paying minimum tax on their properties will be paying the $100 minimum tax in 2014 unless they applied for a low income exemption, which would reduce their minimum tax to $50. Previous to 2014 disabled veterans were not required to file a low income exemption to get a lower minimum tax because there was only one minimum tax, which was $25. Acknowledging that the Board does not hear appeals on taxes, but the tax changes in the law will be part of what the Board hears as the appellants come in. Ms. Hester went on to explain that the tax is now based on the actual use in which the highest tax rate associated with those uses shall be applied; multiple zonings on a vacant property are taxed as zoned and will have two tax rates if it has two zonings. The apartment class has been morphed into the resort class; there are several tax classes within the VDA based on the actual use. Attorney Winn pointed out there was a change a couple of years ago (Section 6.4 of the County Code) that states vacant properties shall be classed as zoned until actual use is established except for vacant property previously classed as apartments shall be classified as hotel and resort until actual use is established. Ms. Hester stated there is a new reason that can be used to file an appeal. It is not a numbered item on the appeal, but it is just below item number 4, and allows someone to state what they believe their tax classification should be. Properties that have multiple uses will be assigned the tax rate with the highest and best use. 26,000 surveys were sent out earlier to allow the Board of Review Open Session January 10, 2014 01M SUBJECT DISCUSSION ACTION owners the right and option to attest to their actual use on the property, and to indicate multiple uses on the property. Ms. Hester also explained the criteria for changing the tax classification, noting that the requests received are mainly changes from vacation rental to residential or commercial to residential. One of the most important things the Real Property division has learned is when the Department of Taxation issued a TAT (Transient Accommodation Tax) license they formerly did not indicate where that license covered; going forward they will now list the site addresses that the tax license covers. Ms. Hester further explained how prior TVRs could appeal that classification by providing appropriate documentation of non- use for 2014. October I has become the new assessment date. This year around December 1 the assessment notices were sent out for 2014, for the period October 1, 2013 through October 1, 2014. The new assessment for 2015 will be mailed around the first week of December. The new appeal window is December I through December 31. The Home Use cap for FY 2015 has been removed and replaced with Home Use exemptions which have been greatly increased from $48,000 to $160,000 for the basic exemption, ages 60 -69 went from $96,000 to $180,000 and ages 70+ went from $120,000 to $200,000. Home Exemption now requires you reside in your home as a primary residence for a minimum of 181 days; foreign nationals are allowed to spend 180 days out of country. They must file Hawaii residential income taxes or sign an affidavit stating they do not file taxes. They should have a Hawaii driver's license, vote in Hawaii, utilities bills to prove they live in their homes as a primary residence and they should not have an exemption anywhere else. A Home Exemption may entitle someone to a Homestead Class. In 2010, the rules defined the term "exclusive" which qualified the owner for the Homestead Class, meaning the home is exclusively used for the owner. Now the Homestead Class is available to more people; if someone owns the property they live on and have a second unit, house or guest house, and rent Board of Review Open Session January 10, 2014 I'._- Al SUBJECT DISCUSSION ACTION it as an affordable long -term rental they now can get the Homestead Class for the entire property where previously it would have reverted to the zoning rate. Attorney Winn advised the Board that as a quasi-judicial board they can make their decisions in closed sessions, which is what they did last year. The new information provided by Ms. Hester is to help the Board decide whether or not they want to continue this process. The Board members concurred that it seemed to stifle discussion when done in front of the appellant, and so they favored closed session decisions. Attorney Winn went on to explain that in the previous year, appeals were treated in a "court" manner in which the appellant presented their case first, and the Board could then ask questions. The Tax Department then presented their case next since the appellant has the burden; the Board can then question the Tax Department. The appellant gets the last word. The Board then has its discussion and decision - making in closed session. Ms. Bekeart questioned if records were kept of the closed session discussions. Attorney Winn stated yes, but only the Board's decision is released to the public. Chair Diogo called for a motion to entertain closed session discussions and decision - making. Ms. Bekeart so moved. Mr. Kyono seconded the motion. Motion carried 5:0 Scheduled Effective February 7, meeting dates are the first and second Friday of each Meeting Dates month, at 1:00 p.m., until all appeals have been reviewed. Ms. Bekeart moved to approve the meeting dates for 2014 as scheduled. Mr. De Costa seconded the motion. Motion carried 5:0 Announcements Mr. De Costa stated he would not be available for the February 7 meeting. Adjournment Mr. Gerardo moved to adjourn the meeting at 1:42 p.m. Mr. Kyono seconded the motion. Motion carried 5:0 Board of Review Open Session January 10, 2014 Submitted by: I' _ Barbara Davis, Staff Support Clerk () Approved as circulated. () Approved with amendments. See minutes of Reviewed and Approved by: meeting. Jose R. Diogo, Chair