Committee backs amendment to affordable‑rental tax class, adds Section 8 certification and raises qualifying threshold

The Hawaii County Committee on Finance on April 15 voted to forward Bill 39 to the full council with a favorable recommendation after adopting an amendment that would tie the affordable‑rental real‑property tax classification to area‑median‑income thresholds and explicitly include units certified under the Section 8 program.

Councilmember Holeyka Inaba, who moved the main motion and offered the amendment, said the change would decouple the county’s affordable‑rental tax class from the Housing Office’s internal payment standard and instead align it with a percentage of the area median income (AMI). “The intent is to broaden the scope of who we are trying to serve,” Councilmember Inaba said.

Under the version forwarded by the committee, the affordable‑rental class would be based on 80% of AMI (the bill text sets 80% as the chosen threshold) and also allow landlords whose properties are certified by the Office of Housing and Community Development (OHCD) as Section 8 rental units to qualify. Kejal Acosta, housing administrator, explained the rationale: Section 8 certification verifies tenant income eligibility and housing quality through the federal voucher program, which relieves some verification burden from Real Property Tax staff.

Real Property Tax Administrator Lisa Miura told the committee the change would reduce the Real Property office’s workload because OHCD already certifies income eligibility for Section 8 participants. “Including … certified by the Office of Housing and Community Development as Section 8 rental units” helps shift verification responsibilities to housing staff, she said.

Committee members debated the effect of switching from the Office of Housing’s payment standard to AMI, which in some areas would increase the dollar amounts landlords could charge while still qualifying for the tax class. Several members expressed concern about geographic differences across the island — particularly how an island‑wide AMI threshold could affect east‑side renters versus west‑side renters — and asked OHCD for more localized market comparisons. Councilmember Heather Kimball and others suggested consideration of ZIP‑level or small‑area differentials or phased increases to avoid sudden rent spikes.

The committee also removed a requirement in current rules that affordable rental units be “legally permitted by all codes,” a change the sponsor said was intended to expand the pool of eligible properties and increase landlord participation. OHCD staff clarified that Section 8 participation requires health and habitability inspections and rent reasonableness checks as part of the federal program.

After adopting the amendment (motion by Councilmember Holeyka Inaba; second by Councilmember Michelle Galimba), the committee approved the bill as amended and forwarded it to the full council with a favorable recommendation. The clerk recorded eight ayes and one no (Councilmember Jennifer Kogewata).

Officials asked for follow‑up material before council consideration: OHCD will provide a geographic distribution of affected properties and market‑rate comparisons by ZIP code so the council can judge how an 80% AMI threshold would align with local rents and affordability goals.

Action summary: the committee adopted the amendment to Bill 39 to add Section 8 certification and to set the affordable‑rental qualification at 80% AMI, then forwarded the amended bill to full council with a favorable recommendation (motion by Councilmember Holeyka Inaba; second by Councilmember Michelle Galimba). The clerk recorded 8 yes, 1 no.