Maui taxes [IMPORTANT - Proposal to RAISE Property Tax - AGAIN!]

LisaRex said:

This rate will be in effect from July 1, 2011 until June 30, 2012, at which time the rental motor vehicle surcharge tax will revert back to $3/day barring any further legislations.

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Yeah, right!

DeniseM said:

Yeah, right!

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Our fall 2012 reservation does have the $3/day surcharge and a $4.50/day facility charge. Not to forget the 11.11% concession fee, sales tax, and vehicle registration fee. Ouch

luv_maui said:

Our fall 2012 reservation does have the $3/day surcharge and a $4.50/day facility charge. Not to forget the 11.11% concession fee, sales tax, and vehicle registration fee. Ouch

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I would bring this point up to Maui council in my complaint letter. They need to realize how much these taxes add up to. Our real estate taxes are already significantly higher than homeowners. They need to quit pecking us to death.

I had tentatively planned go to Kauai/Maui in March of next year. This constant attacks on timeshare owners, and complete unfairness of their tax structure, leaves a very bad taste in my mouth. As an owner, I have no choice but to pay the property tax bill to Maui County. But I don't have to use my week. Instead, I can exchange it and drop my vacation dollars somewhere else.

Ouch. I havent looked at rental cars for my trip in Sept yet.

hypnotiq said:

Ouch. I havent looked at rental cars for my trip in Sept yet.

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It doesn't matter if it is booked or not - even if it was already booked, they would add the new tax.

Oh I know that much, I was just at the taxes being close to 50% of the cost.

Oh well, I think Ill treat my Maui trip like my Europe trip in 2007. I'm just going to swipe my card, not think about it, and enjoy the trip.

For anyone interested in renting a car on Maui im May, I just booked an intermediate SUV for 7 days for $172 (including taxes) from Costco (Alamo). Base rate $97 and taxes $75.

Taxes

We just stopped renting a car while we're there. Maui Executive Transportation picks us up at the airport and drops us at the resort for $50 plus tip each way for 2 people. We take the resort shuttle everywhere else.

Two days ago (February 7) the news of a settlement with Maui County was circulated among the Starwood sales staff. In that package was an FAQ that owners can have. I couldn't get an electronic copy but did receive a printout.

I don't know how to format the tables so they are spaced properly. Perhaps someone can help me with that. I also put the text into a Word document.

Net: KOR has $ 2,382,057 tax savings, KORN has $1,510,096 tax savings, over the 2009/2010 and 2010/2011 tax years.

Here's what the FAQ says:

MAUI COUNTY REAL PROPERTY TAXT SETTLEMENT OVERVIEW
Information
February 7, 2011
The Ka'anapali Ocean Resort Villas (KOR) Vacation Owners Association and Ka'anapali Ocean Resort Villas North (KORN) Vacation Owner's Assiciation ("Associations") filed a tax appeal in April 2009 when both associations received notice of a substantial increase in property valuation by Maui County. The increased valuation led to a corresponding increase of $4,124,162 in real property taxes from $2,261,819 in tax year 2008/2009 to $6,385,981 for tax year 2009/2010 for KORN and an increase of $5,199,076 in real property taxes from $1,218,266 in tax year 2009/2009 to $6,417,342 for tax year 2009/2010.
The Associations paid the full amount of the taxes under protest. The disputed portion of the taxes was placed in a litigation escrow account and frozen from use by the County of Maui pending the outcome of the appeal.
During the course of the litigation, the Associations discovered the true market value of their respective properties for assessment purposes. The Associations hired a well respected real property appraisal firm. The firm's staff completed exhaustive research and analysis of the market data for vacation ownership units. This data and conclusions were presented in detail to Maui County staff. As a result, The County of Maui has agreed to wholly accept our expert witness'calculated property values for the 2009/2010 and 2010/2011 assessments and is making the appropriate adjustments. The following table reflects the net reduction in assessments and corresponding tax saving versus the original tax liability imposed for the years provided herein.

Ocean Resort Villas (KOR)

INITIAL AGREED NET
ASSESSED ASSESSED REDUCTION % TAX
YEAR VALUE VALUE IN VALUE RED. SAVINGS

2009/2010 $ 456,139,860 $ 355,139,065 $ 101,000,795 22.1% $ 1,414,011
2010/2011 368,902,800 299,756,660 69,146,140 18.7% 968,046

Total $ 825,042,660 $ 654,895,725 $ 170,146,935 20.6% $ 2,382,057

Ocean Resort Villas North (KORN)

INITIAL AGREED NET
ASSESSED ASSESSED REDUCTION % TAX
YEAR VALUE VALUE IN VALUE RED. SAVINGS

2009/2010 $ 456,291,590 $ 379,259,315 $ 77,032,275 16.9% $ 1,078,452
2010/2011 376,861,200 346,029,493 30,831,707 8.2% 431,644

Total $ 833,152,790 $ 725,288,808 $ 107,863,982 12.9% $ 1,510,096
In addition to a refund of taxes, as reflected in the Tax Savings column above, the Associations will receive interest on these amounts as well. The refund will be placed into the general operating fund of the Associations. The Board of Directors for each Association has discussed how to apply the funds in compliance with the Association's governing documents. Each Association board has decided that the fun ds will be applied toward the operation and reserve expenses in the 2012 budget for the respective Association when the budget is considered for approval this fall.

Sorry about long quote do we know how the refund and interest were dispersed.

LisaRex said:

It's 40-50% of the total cost, from my calculations.

Hawaii

"Effective July 1, 2011 the Hawaii State rental motor vehicle surcharge tax will increase from $3/day to $7.50/day. This rate will be in effect from July 1, 2011 until June 30, 2012, at which time the rental motor vehicle surcharge tax will revert back to $3/day barring any further legislations.

Unfortunately this will come as an unwelcomed surprise for most customers as the car rental companies have not yet included this significant tax increase in their cost estimates and rental confirmation notifications as the bill was only signed by Governor Neil Abercrombie on June 9, 2011.

Ref: DEPARTMENT OF TAXATION ANNOUNCEMENT NO. 2011-08 http://www.state.hi.us/tax/announce/ann11-08.pdf"

http://discounthawaiicarrental.com/news/134.htm

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Thanks for the info. Unwelcome, but understood. Too bad Maui isn't governed in a balanced manner.

luv_maui said:

Our fall 2012 reservation does have the $3/day surcharge and a $4.50/day facility charge. Not to forget the 11.11% concession fee, sales tax, and vehicle registration fee. Ouch

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Last year I rented off airport and avoided some of these charges. Almost as convenient, less crowded, and otherwise perfectly fine... Why spend more? Of course, sometimes the total cost via Costco and other sources for at airport locations are still "reasonable".

hypnotiq said:

Oh I know that much, I was just at the taxes being close to 50% of the cost.

Oh well, I think Ill treat my Maui trip like my Europe trip in 2007. I'm just going to swipe my card, not think about it, and enjoy the trip.

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Now you've got the Maui [government] spirit!

Fwiw, this is exactly what Maui expects will happen. I'm not sure what the tipping point will be when tourists and non-resident homeowners say enough, but they're on the road toward discovering it. We don't get a vote on Maui, so our opinion isn't considered well. It does seem, by their actions, that timeshare owners in particular aren't welcome (but do spend your money while visiting...).

Dear Fellow Owner,

This is important information about the taxes and annual assessments for your vacation ownership interest at The Westin Ka'anapali Ocean Resort Villas. Please read this entire message carefully. The first item relates to the recent Maui County (County) tax appeal settlement and the second item asks for your help in defeating proposed state tax increases on timeshare owners.

Item #1: County of Maui - Property Tax Refund

As you may know, our Association has been in a two-year-long dispute with the County of Maui over property taxes. We're happy to share that we have settled the dispute to our satisfaction. The Association appealed the County's tax assessment for the 2009/2010 and 2010/2011 tax years because of the significant increase in assessed values and taxes owed to the County. Specifically, we, as Owners at The Westin Ka'anapali Ocean Resort Villas, faced a 182% increase with total taxes rising from $2.3 million to $6.4 million. This increase was due to a change in Maui County’s appraisal methodology and inaccurate market data.

Our Reaction to the Tax Increase
On behalf of the Association, we retained legal counsel and property appraisal experts, filed a formal appeal and paid the County in full but under protest.

The Appeal
The County's Board of Review heard our appeal and offered only minimal reductions. We then appealed to the Tax Appeal Court for the State of Hawaii and began the pretrial process. A few months later, Maui County began negotiations and settlement discussions with our legal counsel and property appraisal experts. Based on the extensive market research completed by our counsel and experts, updated assessed values were offered by the Association. Because the Association's suggested assessed values were fair and well-documented, Maui County accepted them. While we had hoped for assessed values and the resulting taxes to return to the pre-2009 levels, that expectation was not realistic based on the Association's own research and data.

Outcome
The following table reflects the settlement reached with the County, showing the net reduction in our property's assessed value and the corresponding tax savings for the last two tax years. Additionally, the Association will receive interest on these refunds.



The Refund
Maui County will issue a refund check, with interest, directly to our Association. These amounts will be placed into the Association's operating account and we will determine how best to apply these funds during our 2012 budget review process.

Future
Our settlement is for the last two tax years and does not guarantee any future assessed value the County may determine. We do believe we've established with the County the true market value of our property. We believe the County now has a better understanding and will likely base its future valuations upon the research and data presented by the Association.

alohakevin,

That is old news from last year. It is not clear what the HOA did with the refunds. The MF for 2012 were kept fairly level. The sales people said they used the money to build the playground and add some other amenities on the south side.

This issue now is that they want to shift the tax burden to put more costs on the TimeShare and Resort businesses, and reduce the already low taxes on residents. They attempt to make it sound OK by calling it "Revenue Neutral", that is, they are not taking in more $$$ for the county, but they are making sure that some of us pay more, so the residents can pay less.

Greg

gregb said:

alohakevin,

That is old news from last year. It is not clear what the HOA did with the refunds. The MF for 2012 were kept fairly level. The sales people said they used the money to build the playground and add some other amenities on the south side.

This issue now is that they want to shift the tax burden to put more costs on the TimeShare and Resort businesses, and reduce the already low taxes on residents. They attempt to make it sound OK by calling it "Revenue Neutral", that is, they are not taking in more $$$ for the county, but they are making sure that some of us pay more, so the residents can pay less.

Greg

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Thanks Greg I realize this is last year. I didnt know if- since the taxes were paid by us and then wood was refunded and earned interest if this might reflect on our current tax obligation or if this was swept under the rug. If we paid the taxes and there was a refund and interest earned shouldnt we get a prorated deduction against current liability. What am i missing or is this way off base. Just curious

I understand the neutral point. The burden is shifted to timeshare and to me represents a discriminatory tax policy, if it goes through it wont be neutral to us. Also if wood once again pays taxes under protest (which we pay) and after arbitration gets another refund and interest who stands to gain. This whole system seems very convoluted.

The refund for 2010 and 2011 was paid to the HOA. They used the refund to reduce the MF and to make improvements to the resort.

Greg

Ken555 said:

Last year I rented off airport and avoided some of these charges. Almost as convenient, less crowded, and otherwise perfectly fine... Why spend more? Of course, sometimes the total cost via Costco and other sources for at airport locations are still "reasonable".

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You can save the 11% airport tax by doing that.

http://discounthawaiicarrental.com/news/138.htm

LisaRex said:

You can save the 11% airport tax by doing that.

http://discounthawaiicarrental.com/news/138.htm

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I'm not certain without checking the receipt, but I don't think there was a facility charge for off airport, either.

Is Oprah a non-resident owner? She's on our side, probably!

On April 11, 2012 I spoke before the County Council at the Civic Center in Lahaina regarding the proposed property tax increase for timeshare owners on Maui.

I was not alone in my efforts to persuade the Council not to increase the property tax. There were about 30 people in the room who were against the proposed tax increase on Maui timeshares. This included many employees from Westin Ka anapali Ocean Resort Villas, Gregg Lundberg( former General Manager for Westin Ka anapali Ocean Resort Villas and Westin Ka anapali Ocean Resort Villas North), Angela Nolan( current General Manager for Westin Ka anapali and Westin Ka anapali North). There were also a couple of owners from the Westin properties. There were a few business owners who provide services to the Westin timeshare one was an owner of a company that has the landscaping contract with Westin Ka anapali and an owner of a tourist activities company which employs over 250 people. There were three employees from Ka anapali Beach Club (Diamond Resorts), and one from Marriott Maui Ocean Club, one from Kahana Falls and of course myself representing my clients, who don’t have a voice, and also as a concerned local businessman. The Westin group was very impressive. Their presentation was good; they spoke with passion on how the impact of higher taxes could affect their employment. The Westin managers spoke of the amount of dollars Westin timeshare owners pay in taxes, how many people Westin employs. There were several employees who spoke of how they continued to be employed by timeshare companies even during the economic downturn on Maui and they have family members who lost their jobs and houses, while they were still employed in the timeshare industry. Westin/Starwood also spoke of their involvement in the betterment of this community by donating to The Boys and Girls Club, Big Brothers and Maui Food Bank to name a few.

Nearly half the people who spoke at this hearing were timeshare tax related. I was glad to see such a big turnout opposed to the timeshare tax increase. The last County Council meeting I went to Gregg Lundberg and I were the only people in the timeshare industry who spoke to the Council regarding the repercussions of another property tax hike.

I testified as a real estate broker and a business man concerned about the impact the tax increase will have on Maui. I said one of two things will happen if taxes were raised. The default on timeshares will increase and consequently there will be more foreclosures, which could cause layoffs of employees. Those who would pay the higher fees would spend less in restaurants, shops and activities which would affect the livelihood of the local businesses. I also said the notion of timeshare owner’s not spending money while they are here is not true. Timeshare owners spend money as soon as they arrive in Maui. They rent a car, they buy food, and they don't sit in their rooms. Timeshare owners are the most loyal customers we have on our island and are a vital component to our economy. I urged them to consider the impact of higher taxes will have on our community.

Following is my video from the County Council meeting. http://advantagevacation.com/timesh...ing-proposed-timeshare-property-tax-increase/

I was asked if I would consider paying more in personal property taxes as opposed to an increase in timeshare property taxes. I said I know what I pay in taxes doesn't cover the basic services I get as a resident and, yes, I would pay more in taxes, since I can afford it, and for the betterment of our community.

It is imperative if you own a timeshare on Maui you write your County Council and voice your opinion.

Alan M. Arakawa, Mayor Mayors.Office@co.maui.hi.us

Danny A. Mateo, Council Chair danny.mateo@mauicounty.us

Joseph Pontanilla, Council-Vice Chair joseph.pontanilla@mauicounty.us

Gladys C. Baisa, Council Member gladys.baisa@mauicounty.us

Robert Carroll, Council Member robert.carroll@mauicounty.us

Elle Cochran, Council Member elle.cochran@mauicounty.us

Donald G. Couch, Jr., Council Member don.couch@mauicounty.us

G. Riki Hokama, Council Member riki.hokama@mauicounty.us

Michael P. Victorino, Council Member michael.victorino@mauicounty.us

Mike White, Council Member mike.white@mauicounty.us

Thank you for going to bat for us, Syed. I am very glad to hear that so many people attended the meeting, including the employees who would be negatively affected by another tax increase.

I appreciate your time and efforts. And I will write an email to the council members and reiterate what I told them last year. I love Maui, but I will not stand to be treated like an unwanted intruder when there are so many other great places to choose from.

To echo what Lisa said, Thank you Syed for both your efforts in front of the council and your very helpful reporting back about the meeting. I will also be sending out a letter today.

Thanks.

Thanks Syed

Strong work there Syed, I applaud your efforts at combating this seemingly every year!

TUGBrian said:

Strong work there Syed, I applaud your efforts at combating this seemingly every year!

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I vote to give Life-Time TUG membership to Syed...
(we brought our 1st TS - WKORV OFD - from Syed - highly recommend - truly a stand-up guy)