The following testimony was submitted by the Grassroot Institute of Hawaii for consideration by the Maui County Council Special Committee on Real Property Tax Reform on Oct. 14, 2025.
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Oct. 14, 2025, 1:30 p.m.
Maui Council Chamber, Kalana O Maui Building
To: Maui County Council, Special Committee on Real Property Tax Reform
Alice Lee, Chair
Keani Rawlins-Fernandez, Vice Chair
From: Grassroot Institute of Hawaii
Jonathan Helton, Policy Analyst
Re: Bill 144 (2025) — A BILL EXTENDING MAUl WILDFIRES REAL PROPERTY TAX RELIEF
Aloha Chair Lee, Vice Chair Rawlins-Fernandez and other members of the Committee,
The Grassroot Institute of Hawaii supports Bill 144 (2025), which would extend property tax waivers for properties destroyed in the Aug. 8, 2023, wildfires and those in the designated yellow and red reentry zones until July 1, 2028, and make other technical changes.
Previous legislation extended exemptions that were in place at the time of the wildfires for any property damaged or made inaccessible as a result of the wildfires; however, those waivers are slated to expire on July 1, 2026.
Further extending each of these waivers would help Lahaina homeowners and businesses afford to rebuild in Lahaina town. If the waivers expire next year, many property owners will face the prospect of paying taxes on land they cannot easily — and in some cases, legally — rebuild on.
Land values are another reason these exemptions are so critical. For many Lahaina parcels, close to 70% of their pre-fire taxable value was in the land. Were that land to be taxed before they can rebuild, many owners would be paying almost their entire pre-fire tax bills on properties they could not functionally use.
For example, Fleetwood’s on Front Street paid $54,122.03 in taxes in fiscal 2023. Of the property’s $8,780,500 assessed value, $6,018,300 — 68.5% of its value — was in the land.[1] The owner has been unable to rebuild the property to date and will face a $37,000 bill if the waiver expires in 2026 and assessments remain at pre-fire levels.
Extending these waivers would come at a relatively small cost to the county. The Maui Department of Finance has estimated the current exemptions for destroyed properties and those in the yellow and red reentry zones cost the County about $21.2 million — equivalent to 3.2% of the roughly $660 million the county will collect in fiscal 2026.[2]
Bill 144 (2025) also states that new owners of any properties sold before July 1, 2028, that had received one of these exemptions must begin paying taxes on the property.
However, this language could present a challenge for homeowners and businesses that do not want to rebuild in Lahaina, because imposing the property tax on new owners of a property could reduce its potential sale value.
Thank you for the opportunity to testify.
Jonathan Helton
Policy Analyst
Grassroot Institute of Hawaii
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[1] Parcel no. 460090070000, County of Maui Tax Assessor’s Office, accessed Sept. 17, 2025.
[2] “Selected Real Property Statistics for Budget Consideration Fiscal Year 2025-2026,” Maui Department of Finance, Real Property Assessment Division, p. 33; and “County of Maui Real Property Tax Valuation for Fiscal Year 2025 – 2026,” Real Property Assessment Division, Honolulu Department of Budget and Fiscal Services, July 2025.
