Panel not sold on tax break measure for Pahoa, Volcano businesses

Hawaii County Council members gave a measure intended to help struggling businesses in Pahoa and Volcano a negative recommendation this week.

The resolution, introduced by Puna Councilwoman Eileen O’Hara, would have provided commercial properties in the two villages a break on their property taxes through the end of the 2019-2020 fiscal year.

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A council committee, which includes each member of the council, voted against it 7-1 on Tuesday, citing concerns over equity since there are other businesses around the island impacted by the Kilauea eruption that wouldn’t benefit. O’Hara voted yes, while Puna Councilwoman Jen Ruggles was absent.

The resolution still moves forward to a regular council meeting but with a negative recommendation.

If adopted, owners of commercial properties in Pahoa and Volcano where a legal business operates or plans to operate would pay the minimum tax of $200 a year.

The county already made efforts to reduce or eliminate the property tax burden for properties in the inundation zone in lower Puna, which doesn’t extend to Pahoa village.

According to the Real Property Tax Division, 6,874 properties had their assessed values, which determines how much they pay in taxes, reduced or eliminated because of the volcano. Parcels qualified for the break if they were inundated, inaccessible or had limited accessibility, or were potentially threatened by lava.

All are located in lower Puna from about Kapoho through Kalapana. Each property is residential except for Puna Geothermal Venture, which is industrial, and one commercial property, according to the county.

The impact to the county is $3,354,529 in lost property tax revenue for the current fiscal year that began July 1. Property owners pay nothing if the assessed value is $0.

Reassessments will be made in January.

The lower East Rift Zone eruption began in May and has been paused since August. More than 700 homes have been destroyed.

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Businesses can still apply with the U.S. Small Business Administration for an economic injury loan. That deadline is March 14. For more information, call 800-659-2955 or visit www.sba.gov/disaster.

Email Tom Callis at tcallis@hawaiitribune-herald.com.

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