A taxing connection for Caldwell

I’m getting buzz in my e-mail inbox about the Rob Perez story in yesterday’s Star-Advertiser about how nearly 250 O’ahu homeowners — including acting Mayor Kirk Caldwell — are paying as little as $300 a year in property taxes by having a special “historic” designation placed on their houses.

Some readers don’t like the way the dots connect between the mayor paying minimal taxes on the $1.8 million Manoa home he owns with his wife Donna Tanoue and the recent city tax reclassifications that smacked some 250 O’ahu residents, mostly in Kalihi, with property tax increases of more than 300 percent in some cases.

One Stanley Street homeowner saw his bill go up from $2,335 last year to $10,552 this year. The city’s initial response was to offer affected homeowners a payment plan, although Caldwell has since proposed more substantive relief.

According to the Star-Advertiser, Caldwell saw his property tax drop from nearly $5,500 in 2005 to $100 in 2006 when he took advantage of the decades-old historic home exemption; the minimum flat tax has since increased to $300. Caldwell was in the Legislature and not working for the city at the time.

The Perez story had drawn more than 200 online reader comments the last time I looked, most of which seemed to be directing ire at “the rich” in general rather than Caldwell specifically, but it’s not a good kind of attention less than a week before the election.

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25 Comments on “A taxing connection for Caldwell”

  1. Holly Huber Says:

    CORRECTION! Rob Perez DID make the connection with the recent property tax increases for Kalihi & Makiki homeowners:

    “Poor oversight of the exemption program adds a new wrinkle to a recent controversy over the city’s handling of property tax issues. The city came under fire last month because of changes made to classifications for about 240 property owners. The city changed the classifications from residential to commercial or industrial to address concerns about equity from nearby property owners. The changes resulted in tax bills increasing fourfold for affected residents.”

    “The city is ‘balancing the budget by taking from the poor and giving to the rich — quadrupling taxes on homeowners in industrial and commercial areas while providing generous tax exemptions to historic homes,’ said government watchdog activist and database developer Holly Huber.”

  2. Mitch Kahle Says:

    All of these property owners signed a declaration that the exemption was a “material factor” in their ability to maintain their historic home.

    This is fraud!

    As virtually all of these owners are wealthy and most own high-end second or third homes on Oahu.

    Compare this with how the city treated the poor folks in Kalihi and how low-income residents must jump through numerous bureaucratic hoops to obtain any reduction in property taxes.

    So much for Mufi’s claim that he “cares about the little folks.” That’s pure BS!

    The Real Property Assessment Division should be AUDITED!

  3. David Shapiro Says:

    I’m sorry, Holly. Stupid mistake from moving type around. My apologies.

  4. Michael Says:

    http://hawaii.gov/dhhl/applicants/appforms/applyhhl

    OHA will be on the war path.
    1 dollar a year to lease land only to Native Hawaiians. 300 or 30 pieces of silver for Non
    Native Hawaiians, the People of Hawaii are getting scammed. “City” pulls a “Wall street”

    The boehner agrees with President Obama for a continued tax cut for those who make less then 250,000 dollars a year BUT? You have to let the rich get the Whole Pie.. Those who make less than 250,000 get the crumbs.
    Is one sure hanneman and caldwell are not DINOs?
    Welcome to the world of Bizzaro. Hood Robin.
    All of this for Rail! Business as usual.

  5. Capitol -ist/WassupDoc Says:

    Want to read some very interesting posts? Go to Ian’s blog – not quite as illogical and illiterate as the SA Comments section, but clearly people are playing for keeps in this race.By 11:59 pm Saturday evening, there’s going to be “blood on the streets” in downtown Honolulu when the loser is announced.

  6. shaftalley Says:

    eliminate property taxes.

  7. WooWoo Says:

    I wanted to add my 2cents regarding a house that was pictured in the article, at 3300 Tantalus.

    From the article:

    “The Liljestrand House is open to the public and financially difficult to sustain, an owner said. A lawyer representing the owner said the property is in full compliance with all applicable statutes, rules and regulations pertaining to property taxes. No information, however, was provided on when the house is open to the public.”

    This house is a marvel to experience. It is an Ossipoff house, and when I was contemplating renovations to my home (a project ultimately abandoned when I woke up from my dream and realized I had no money) I went to visit it for inspiration. I sent an email through their website and got a reply the next day. They gave me the date of their next tour, which was about 2 weeks away at the time.

    I arrived and received a friendly and wonderful tour from the son of the original owner. Also on the tour was a young architect and a general contractor. The architect had been on the tour before, and mentioned to me that he returned periodically to experience the genius and beauty of the house.

    Based on my personal experience, I can attest that this house is definitely open to the public, and definitely a historic landmark, and a plain amazing work of art. I urge all of you to check out the website and pay a visit to the house.

    http://theliljestrandhouse.com/about.html

  8. Knee jerkin Says:

    Allowing property tax breaks as an incentive to preserve historic properties may or may not be a good thing, but publishing this story less than one week before an election and including a wildly inaccurate and inflammatory quote about “balancing the budget on the backs of the poor” showed incredibly poor judgment by all concerned, especially since the Star-Advertiser allowed itself to be so badly duped and manipulated on the property reclassifications story by those who publicized it for political purposes and fell far short of the truth in doing so.

  9. Michael Golojuch, Jr. Says:

    So “shaftalley” how will the city run without property taxes?

  10. shaftalley Says:

    good question michael Golojuch.and i think that the market will help the city.if given a chnce.the city is doing a lousy job now.with tax revenue.historically,government gets a lot of revenue if they do not intervene in the market.right now the market is not 100% FREE.one day i hope that we will be FREE!!!!!!!

  11. Michael Golojuch, Jr. Says:

    So you want to privatize the police – what we pay on a a case per case bases? We pay for the parks we only use? We pay for the streets we only drive on?

    That makes no sense – so thanks for clearing that up for everyone.

  12. shaftalley Says:

    Michael, we should privatize the police in honolulu if that is what the citizens want.and i doubt that it will cometo a vote.the problem is not the rank and file cops or any other city worker!!!michael, the rank and file are capitalists!! the rank and file workers believe in the free market. that includes private/ public workers!! we all pay taxes!!!

  13. townieone Says:

    Gotta hand it to Mufi. He got on the stage of the Hawaii Five-0 premier in Waikiki in front of Caldwell and Lingle amid boos and hisses and at least one “PLEASE DON’T SING!”.

    I just goes to show how many strings Caldwell will have hanging from Mufi’s office

  14. zzzzzing Says:

    “Gotta hand it to Mufi. He got on the stage of the Hawaii Five-0 premier in Waikiki in front of Caldwell and Lingle amid boos and hisses and at least one “PLEASE DON’T SING!”.”

    If it wasn’t so pitiful, it’d be funny. i guess he still thinks he’s the king of Honolulu… no shame, that guy.

  15. tommy Says:

    I don’t see any dots to connect. These are two unrelated events. Caldwell hasn’t broken any laws nor has he been accused of breaking any laws with the tax break for his pricey home. As the article points out, and blog owner Shapiro repeats, Caldwell got the tax break years before he started working for the city.

  16. WooWoo Says:

    Tommy-

    There are no dots to connect in a court of law. However, the court of public opinion has a much lower bar. It doesn’t mean anybody will think that there is wrongdoing. It just means that some voters will think, “wow, he lives in a million dollar home in Manoa and pays $300 a year in property tax, and the old Filipino lady on social security I saw on the news had her property tax raised to $10,000 per year. What kine mayor is that?”

    Of course, you can say that Caldwell is not to blame for either the historic exemption or the re-classification in Kalihi, which is true. But he is no doubt willing to take credit for lots of good things as acting mayor… He’s gonna have to take his lumps on the bad things too.

  17. Mike Middlesworth Says:

    I don’t think you’re required to take the tax break. A forward-looking politician would be wise not to….

  18. charles Says:

    @Mike, that’s like saying all politicians shouldn’t take any tax deductions or better yet, pay more than what you owe to really set the bar high.

    Then again maybe all corporate CEO’s or professional athletes or entertainers, etc., should avail themselves of every tax break; after all, they make enough, no?

  19. Michael Says:

    Don’t own property, Don’t pay taxes. Simple solution to a complicated question.

  20. waialuahaole Says:

    Or maybe Caldwell should have had the decency to know something was wrong with the situation and that while legally he was OK, it was improper for him to benefit like that. He should have brought attention to this situation and worked to rectify it. Had he done that, he would have turned this black eye into a boost in his credibility and public opinion of his integrity.

  21. Mike Middlesworth Says:

    Charles–
    I’m not talking about right/wrong or even whether a politician is entitled. The issue is one of appearances: How is this going to look to those I’m asking to vote for me?
    aloha,
    mike

  22. charles Says:

    Mike, the problem is one of expectations and perception. If a politician were to try to cater and appease everyone out there, nothing would get done.

    For argument’s sake, what if a candidate were to run and say that, if elected, would only take $1 year in salary. Does that automatically mean this person would do the best job or at least a better job than someone who accepts the salary?

    Did Caldwell break any law, rule, policy, etc.?

  23. David Shapiro Says:

    I don’t think the issue is illegality or impropriety. Caldwell’s problem is that his initial response to those who had their property reclassified was perceived as indifferent. If the reason he seemed unable to feel their pain was because he pays virtually no property taxes himself, that would tend to grate on homeowners who pay many times more than the mayor. It’s a question of sensitivity to the hardship of others who are shouldering a much bigger burden than he is.

  24. Holly Huber Says:

    Caldwell made a false statement on his “Petition to Dedicate Historic Residential Real Property for Preservation”. In signing the form, Caldwell certified that “the current level of taxation is a material factor which threatens the continued existence of the historical residential property.” In other words, he and his wife, Donna Tanoue, claimed they could not afford to maintain their historic home without property tax relief. In 2005, Caldwell & Tanoue paid $5,479 in real property tax. It is hard to believe this wealthy couple (both lawyers) could not afford this annual tax of less than $500 per month.

  25. zzzzzz Says:

    A couple things need more emphasis.

    One is whether the historic designation is something the homeowner seeks, vs. something thrust on the homeowner by a government entity. In his Wednesday article, Perez quotes Gary Kurokawa, who indicates the historic designation is something the homeowner must seek.

    The other missing item is what the historic designation does to the property value.

    Why would someone seek the historic designation? After all, a homeowner committed to preserving a historic residence can do so without the designation. My guess is for financial gain, hoping the designation will increase the property value, as well as for the tax break.

    It’s not as if the government is forcing the designation on homeowners, along with onerous restrictions on what can and can’t be done with the property (e.g., not allowing them to tear down and build a new house). I could see the rationale for a tax break in that situation.


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