(a) 
Definitions. As used in this Section:
"Dwelling"
means a building or portion thereof designed or used exclusively for residential occupancy and having all necessary facilities for permanent residency such as living, sleeping, cooking, eating and sanitation.
"Long-term affordable rental"
means a dwelling subject to a written lease agreement signed by the owner or the owner's duly assigned representative with a term of one (1) year or more and at a monthly rent not to exceed the maximum housing cost based on the long-term affordable rental limit for the year in which the owner files his or her application.
"Long-term affordable rental limit"
means the midpoint of the maximum rental limits for each unit type using between eighty percent (80%) and one hundred percent (100%) of the Kaua'i median household income as defined by the Kaua'i County Housing Agency Rental Housing Guidelines.
"Residential leases of state-owned property"
means leases or revocable permits issued by the State of Hawai'i for a residential dwelling occupied as a principal home.
(b) 
Any owner of real property that is rented or leased as a long-term affordable rental shall receive the Long-Term Affordable Rental tax rate as provided in Section 5A-6.4; provided that all dwellings on the property are long-term affordable rentals or residential leases of state-owned property.
(c) 
Any owner of real property that is rented or leased as a long-term affordable rental of which their tenant is operating a day care center as a licensed day care provider shall be an allowed activity under this Section and shall receive the Long-Term Affordable Rental tax rate as provided in Section 5A-6.4, provided that the day care center is operated out of the long-term affordable rental dwelling. A day care center operating out of a separate dwelling on the property that is not a long-term affordable rental shall not qualify for the Long-Term Affordable Rental tax rate.
(d) 
The owner may apply for the beneficial tax rate on a single year or multi-year basis. An owner with a multi-year written lease agreement may apply to receive the beneficial tax rate for each year that the lease agreement is in effect up to a maximum of three (3) years, provided that as applicable to long-term affordable rentals, rent in each year of the lease does not exceed the long term affordable rental limits at the time of application. At the expiration of the multi-year beneficial tax period, the owner may file a new application to receive the beneficial tax rate as long as when applying to a long-term affordable rental property, it adheres to the long term affordable rental requirements at the time of the new application.
(e) 
The owner shall file his or her application annually in a form prescribed by the Director of Finance by September 30 prior to the tax year beginning July 1 for the beneficial tax rate. The owner shall notify the Director of Finance within thirty (30) calendar days if the property is no longer being rented or leased as a long-term affordable rental or as residential leases of state-owned property due to the sale of the property or conversion to another use. If there is a change in the use as a long-term affordable rental, the beneficial tax rate shall be automatically revoked and all differences in the amount of taxes that should be due for the tax year without the beneficial tax rate shall become due and payable. If the Director is of the view that, for any year the beneficial tax rate should not be allowed, in whole or in part, the Director may. for up to three (3) tax years (current plus two (2) prior), revoke the beneficial tax rate, in whole or in part, and reset the assessment cap, and may add to the assessment list the amount of value involved, in the manner provided by Section 5A-3.4 for the assessment of omitted property.
(f) 
The Director may adopt rules and prescribe forms.
(Ord. No. 821, November 8, 2004; Ord. No. 833, October 7, 2005; Ord. No. 889, December 16, 2009; Ord. No. 920, December 14, 2011; Ord. No. 953, August 28, 2013; Ord. No. 954, August 28, 2013; Ord. No. 995, November 24, 2015; Ord. No. 1004, July 6, 2016; Ord. No. 1016, August 14, 2017; Ord. No. 1038, August 29, 2018; Ord. No. 1053, July 8, 2019; Ord. No. 1152, November 20, 2023; Ord. No. 1162, September 26, 2024; Ord. No. 1170, April 9, 2025)
(a) 
Definitions. For purposes of this section:
"Family member"
means a spouse; child by blood, adoption or marriage; and the following blood relatives: parent; sibling; grandparent; grandchild; aunt, uncle, niece, nephew.
"Homeowner"
means a person who owns the property and has a home exemption under Sec. 5A-11.4.
"Homeowner property"
means the property with regard to which a homeowner filed and was granted a home exemption under Sec. 5A-11.4.
"Income"
means gross income as defined in Sec. 5A-11.4(d) for the calendar year preceding the year of application.
"Own" or "owner"
refers to the act of having, or those persons vested with, legal title of property.
"Owner-occupant"
has the meaning as provided in Sec. 5A-11.4(d).
(b) 
A homeowner who meets the criteria in Subsection (c) shall pay as real property taxes the higher of an amount equal to 3% of all the owners' income(s) or the amount of $500.
(c) 
In order to receive the home preservation tax limit, the homeowner shall meet the following criteria at the time of application:
(1) 
The homeowner property receives the Owner-Occupied tax rate or qualifies for the Owner-Occupied tax rate for the tax year the home preservation tax limit is to be applied.
(2) 
The homeowner does not own real property other than the property at issue in the application.
(3) 
The homeowner property has had a home exemption for a minimum of ten (10) years without change in ownership other than transfers between family members.
(4) 
If there are multiple dwellings on the property, each dwelling is occupied by an owner-occupant.
(5) 
The homeowner property has a net taxable assessed value exceeding one million dollars ($1,000,000.00).
(6) 
The income of all owners does not exceed two hundred thousand dollars ($200,000.00).
(7) 
There are no delinquent real property taxes on the homeowner property.
(d) 
The homeowner shall apply for the home preservation tax limit annually on or before September 30th preceding the tax year the home preservation tax limit is to be applied.
(e) 
The Director shall prescribe appropriate forms for applications and require proof of income which shall include, but is not limited to, the following:
(1) 
A copy of the State personal income tax returns or records for all owners which set forth their State gross income; and
(2) 
A copy of the Federal personal income tax returns for all owners which set forth their Federal gross income.
In the event that any of the owners were not required to file an income tax return pursuant to the Internal Revenue Code of the United States of 1954, as amended, or Hawai'i Revised Statutes, Chapter 235, as amended, the owner-occupant shall sign an affidavit stating the reason there was no requirement to file, and attesting to the amount of income received. The applicant may refuse to provide such proof or any additional information requested by the Director, but upon such refusal, the Director may deny the application and there shall be no appeal from such a denial.
The application form, which shall be signed by the owner(s), shall contain authorization to the State Department of Taxation and the Internal Revenue Service for release to the County Finance Director, a certified copy of the income tax records showing gross income. The Director may charge the owner(s) the fee necessary to obtain said certified copies.
(f) 
The Director shall approve the application if the homeowner meets all of the criteria for the home preservation tax limit. If the Director determines that the application cannot be approved or the information contained therein verified, the Director shall so notify the homeowner and provide the reason for the denial on or before December 1st preceding the tax year.
(Ord. No. 953, August 28, 2013; Ord. No. 966, March 10, 2014; Ord. No. 1150, July 31, 2023; Ord. No. 1152, November 20, 2023)
(a) 
Any owner who has a home exemption pursuant to Section 5A-11.4, Kaua'i County Code 1987, as amended, or receives the beneficial tax rate due to a long-term affordable rental, and residential leases of state-owned property pursuant to Section 5A-11A.1 shall receive a three percent (3%) assessment cap.
(b) 
The Director shall note on the notice of assessment or tax bill, or both, that the property receives the three percent (3%) assessment cap.
(c) 
Property receiving the assessment cap shall be taxed in the following manner:
(1) 
The property shall be assessed based on its market value, provided that, any increase in assessed value from the prior tax year's assessment shall not exceed three percent (3%).
(A) 
Any improvements to the property, including, but not limited to: new construction, renovations, and partial demolition, that increase the fair market value of the property, the assessment shall be increased based on the value of the improvements undertaken, notwithstanding the assessment cap limits.
(B) 
If property receiving the assessment cap subsequently increases in assessed value due solely to actions of the owner, such as but not limited to, the creation of a subdivision or condominium property regime, consolidation of lots or land area, or change in zoning, the assessment cap shall be reset to market value in the year of the change.
(C) 
If there is an error in the assessment for any year, the correction of which is not permitted under the terms of Section 5A-1.19, the assessment for the next year shall be based on what the assessment would have been for the previous year without the error.
(D) 
The gain or loss of an agricultural dedication, breach or expiration of a dedication, or change in status to another real property program that affects the value shall be excluded from the three percent (3%) assessment cap limit.
(2) 
In the case of properties that are multiuse parcels or structures, no assessment cap shall be granted.
(d) 
The Director shall calculate the assessment cap as prescribed in subsection (c).
(e) 
Upon transfer or sale of property, real property assessments shall be reset to reflect the market value of the property as of October 1 following the transfer or sale.
(f) 
The transfer of property for the purpose of conveying real property shall be excluded from subsection (e) if the same owner continues to maintain a home exemption pursuant to Section 5A-11.4(a) of Kaua'i County Code 1987, as amended.
(Ord. No. 997, January 28, 2016; Ord. No. 1015, August 14, 2017; Ord. No. 1152, November 20, 2023; Ord. No. 1162, September 26, 2024; Ord. No. 1168, January 31, 2025)