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Kauai mayor outlines tax changes, housing gains and requests state match for wastewater facility plans
Summary
Kauai reported revenue adjustments that boosted housing spending, described recent affordable-housing projects, and requested legislative support for stadium renovations and matching funds for wastewater facility planning.
Kauai County told the Senate and House finance committees that it has shifted tax burdens toward non–owner-occupied properties and visitor accommodations to protect owner-occupied taxpayers and to raise revenue for infrastructure and housing.
"Real property taxes constitute about 80% of our general fund," Mayor Derek Kawakami said, calling the county dependent on property tax base stability. The mayor said Kauai implemented the state’s first tiered non‑owner-occupied residential tax rates in fiscal 2025, producing about $9.6 million in additional revenue, and raised the top rate for the vacation-rental class from $9.85 to $12.20 per $1,000 of assessed value for portions over $2,500,000, generating nearly $10,000,000 in added revenue.
Kauai officials said combined general excise tax (GET) and transient accommodations tax (TAT) revenue contributes roughly $70,000,000 to the county’s general fund. The county said it allocated a record $35,000,000 for road resurfacing in fiscal 2025 and that the general fund contributed about $14,900,000 in fiscal 2024 and $20,100,000 in fiscal 2025 to housing.
The county described specific housing achievements at the Lima Ola development: 32 units of supportive housing (Keala Ola Phase 2), 45 workforce rental units and 40 senior units, and the first eight single-family leasehold homes for working professionals. Kauai said it is planning predevelopment for about 700 acres in Kilauea and Waimea and said it repaid a $12,000,000 DERF loan early, saving roughly $7,000,000 in debt service.
Kauai requested state capital improvement funding for phase 2 renovations at Vidinha (Widina/Vadina) Stadium — to cover ADA, bleacher and lighting improvements — and for structural and safety upgrades at Hanapepe Stadium. The county also said it is pursuing a public rodeo facility and will host the state rodeo finals; the mayor said Kauai was the only island without a public rodeo facility.
On wastewater, the mayor said Kauai is preparing comprehensive facility plans for each of four regional treatment facilities at an approximate cost of $5,000,000 per plan and requested the Legislature consider a $2,500,000 match for each facility plan while the county would contribute the remaining funds.
Kauai officials said they will provide detailed CIP amounts and project-level figures to legislators on request and asked for continued state partnership on infrastructure and housing.
