Finance committee split over extending Hawaii County short‑term agricultural tax dedication window

The Hawaii County Council Committee on Finance debated Bill 23 on Feb. 18, 2025, a measure to change the county’s short‑term commercial agricultural land tax dedication so that the county would assess dedicated parcels at the agricultural value for five years instead of the current three.

Supporters said extending the dedication to five years would give farmers more time to produce before reapplying and reduce administrative burden for Real Property Tax (RPT). "This is really to give real property tax opportunity to investigate and expand this program a little bit more," Councilmember Hughes said during the committee discussion.

Real Property Tax Administrator Lisa Meir told the committee that most applicants had not expressed a clear preference between three and five years but emphasized a procedural point: "It's just that going forward if somebody applies they would not have the option of a 3 it would just be a 5," Meir said, explaining that existing applicants who applied under a three‑year expectation would not be forced into five years immediately but future applicants would only have the five‑year option if the bill passed.

Several council members expressed concern about reduced oversight if the dedication period were lengthened. "By extending this to 5 years, we actually decreased the oversight on the properties in the short term ag dedication," the committee chair said during deliberations. Councilmember Kimball said she preferred the three‑year option for oversight reasons: "I prefer to see it be 3 years."

Committee members also discussed lease practices at major landowners. Meir reported she had consulted Kamehameha Schools’ land division and that the three‑year lease floor has practical roots in how some landholders structure initial leases for new lessees.

An amendment proposed by Councilmember Jane Eustace and seconded by Councilmember Onishi (Communication 96.1) reverted language in Bill 23 to preserve a three‑year lease minimum for recorded agricultural leases while keeping other changes proposed in the bill. The amendment passed on a voice vote.

After additional discussion the committee voted on the main motion to forward Bill 23 as amended to full council with a favorable recommendation. The roll call recorded four votes in favor (Councilmembers Eustace, Reynava, Kerkowitz and Onishi) and five opposed (Councilmembers Galimba, Kaguata, Kimball, Villegas and the Chair), and the motion failed. The clerk recorded that the committee will forward Bill 23 to council with an unfavorable recommendation.

Clarifying details provided during the hearing: RPT reported 69 dedicated short‑term agricultural applications had been reviewed recently; of those, 10 involved a three‑year lease and one involved a six‑year lease. Administrators said short‑term dedications require inspection at each application and are not recorded at the Bureau of Conveyances, unlike long‑term dedications.

The committee’s discussion separated three items: (1) the policy question of whether extending the dedication to five years would encourage farming and reduce paperwork; (2) the oversight tradeoff—longer dedication means less frequent review; and (3) lease‑term interactions for properties with recorded leases. The amendment preserved a mechanism to align the dedication period with a parcel’s lease term when applicable.

The measure will now be transmitted to the full County Council with an unfavorable recommendation, per the committee vote.

Ending: The committee’s debate underscored competing priorities: easing administrative burdens and incentivizing production versus preserving frequent oversight to confirm active agricultural use. RPT staff and council members said they would continue outreach and that RPT is available to provide more detailed lease and program data as the council considers the measure at the next stage.