Sometimes it pays to fight City Hall.
Such was the case Tuesday for Kohanaiki Shores LLC, which sent representatives to the county Tax Board of Review to appeal the county appraiser’s values on 18 parcels in its upscale oceanfront subdivision just south of the Ellison Onizuka Kona International Airport at Keahole.
The developers ended up having several million dollars lopped off the value of three parcels — saving them tens of thousands of dollars in taxes — while settling a number of others with the county for as-yet unknown amounts. The Tax Board denied the developer’s request and sustained the county appraiser’s assessment on a fourth parcel.
“We of Kohanaiki feel we are partners in the community,” Derek Fukumoto, vice president of finance for the developer, told the board. “We want to pay our fair share.”
Kohanaiki Shores LLC is just one of hundreds of property owners taking advantage of the opportunity to appeal their assessments before the five-member citizen board that annually holds long, tedious meetings where it goes over parcel values one-by-one, double-checking the county Finance Department’s assessments of property for tax purposes.
The board holds two to four daylong meetings a month, usually from July through October. Last year, the board heard 212 cases. This year, 392 parcels are under appeal, a 45.9% increase.
Anyone can appeal their assessment, provided they file by April 9, less than a month after the March 15 mailing of assessment notices. Those not satisfied with the Tax Board’s ruling can further appeal to the Tax Appeal Court, provided they do that within 30 days.
The county is trying to bring assessed valuations closer to the market values of properties, which in the case of Kohanaiki, meant increases ranging from 23% to a whopping 79%.
“I base them on (comparable) sales,” Appraiser Matthew Radmilovic told the board. “I’m using very conservative sales.”
Some of the county’s assessments last year were based on sales stemming from a bankruptcy, which Radmilovic tried to adjust for this year. Those values were included in Kohanaiki’s comparable sales figures, however.
That conversation led to board member Reico Ford reminding the developer and the county to be more careful with their comparisons.
“You’re looking at the same records. … We are talking about picking and choosing based on your different goals,” Ford said.
“Are we having a pick-and-choose game here?”
Some property owners are appearing before the Tax Board to question a change to county policy that reclassified small agriculture lots of less than 1 acre that didn’t meet certain requirements from agriculture to residential.
Property owners in the agricultural class pay $9.35 in tax for every $1,000 in property value, while those in the residential class pay $11.10 under current property tax rates.
The change, which increased assessments for 6,835 parcels, resulted in 23 appeals to the Tax Board this year, said Real Property Tax Administrator Lisa Miura.
The county had estimated the reclassification would bring in an extra $1.3 million this year.
The Tax Board on Tuesday sustained the county on appeals of several of the newly reclassified lots, including one property owner who saw the tax bill on her $237,600 value Hawaiian Paradise Park property go up by $532.