Bill > HB489

This bill establishes a comprehensive approach to addressing vacant homes in Hawaii by creating a new tax surcharge and special fund designed to incentivize property owners to either occupy their properties or make them available for long-term rental. The bill imposes an annual surcharge of 4% on residential real properties that are vacant for 180 days or more, calculated based on the average annual rental value and potential lost general excise tax revenue. Property owners will be required to obtain a general excise tax license and file an annual return detailing their property's occupancy status. The surcharge does not apply to properties that are used as primary residences, temporarily occupied by military members or students, rented at fair market value, or exempt due to specific circumstances like owner hospitalization or property renovation. The revenues collected from this surcharge will be deposited into a new Vacant Homes Special Fund, which will be administered by the Hawaii Housing Finance and Development Corporation and used to support rental assistance programs similar to the federal Section 8 housing assistance program. Counties will be required to disclose to the Department of Taxation a list of non-owner-occupied residential properties, and the Department of Business, Economic Development, and Tourism will calculate and publish average annual rental values to facilitate the surcharge calculation. The bill aims to recover lost economic activity, support local housing needs, and create a more equitable tax structure for properties that remain largely unoccupied throughout the year.

Housing and Urban Affairs

https://www.capitol.hawaii.gov/session/measure_indiv.aspx?billtype=HB&billnumber=489&year=2025