In a letter to the Maui Mayor, Maui County Council, and letters to the editors of Maui News, Lahaina News, Maui Now, Maui Time, Maui Watch, Hawaii Tribune Herald, Hawaii Herald, Honolulu Star Advertiser, Honolulu Civil Beat, Hawaii Reporter, Pacific Business News, and Midweek:
As a time-share owner on Maui, I thought you might be interested in the ramifications of Maui's war on time-shares, how this impacts me and what effect it will have on your future.
I purchased my ownership on Ka'anapali Beach, north of Black Rock, in Jan. 2003. At this time, time-share properties were (property) taxed as a Resort/Hotel. For fiscal year 2004, this meant a tax of $8.30 per $1000 assessed value. For the homeowner resident, their tax was $3.55/$1000. Summarily, time-share visitors were being billed 133% more than the homeowner while being instrumental in providing for the Maui economy.
In November, 2004, the Maui Mayor and County Council chose to create a specific property tax classification just for time-share properties. Online news reports attributed this action to Maui's dislike for uncontrolled time-share development. This was their effort to discourage sales and therefore future projects. However, their nearsightedness failed to allow them to see that they weren't punishing the fat cat companies and corporations but rather the tourists, people not unlike your residents we share space with. Most of us are retired or middle-aged and work 40-60 hours a week, like your residents. I purchased under the good faith of Maui government in existence at the time, only to watch it disappear in less than 2 years.
To my recollection, the owner's association had described Maui's increased taxation as Maui's decision that time-share owners should be held more accountable to infrastructure repairs and replacements/upgrades. According to more online news reports, it was Maui's government belief that this segment of the visiting population placed an unusual burden on the infrastructure, specifically the roads and the water/sewer system.
Shortly after Maui's implementation of the time-share tax classification (Jan. 1, 2005) and associated increase in property taxes, Maui commissioned a $75,000 time-share study to Hospitality Advisors LLC, which, along with the University of Hawaii School of Travel Industry, determined that time-share use had no greater/worsening effect upon Maui than the resorts and hotels. This finding was clear in June, 2006, though without-
1) any significant mitigation in time-share property assessments;
2) any significant aggravation in resort and hotel assessments; or
3) the removal of the tax classification and the "relumping" of time-share taxation back into the category of resorts and hotels, as the study clearly purported.
In fiscal year 2006, time-shares paid a tax assessment of $14.00/$1000, resorts and hotels paid $8.20/$1000 while the homeowner paid $2.50/$1000!
(Incidentally, I've recently read that Council member Mike White is the general manager of the Ka'anapali Hotel. This might explain why the Council didn't put resorts and hotels in the same (higher) tax bracket as their equally destructive time-share properties.
Maui is the only county within the State of Hawai'i to have a separate time-share tax classification. This does NOT exist on the islands of Hawai'i or Kauai, or in the city of Honolulu, for example. There is no mention of its existence anywhere else.
As of fiscal year 2016, time-shares are taxed at $14.31/$1000, resorts and hotels are taxed at $8.71/$1000 and the island homeowner resident is taxed at a paultry $2.70/$1000. Summarily, time-share owners are taxed at greater than 400% more than the homeowner and 65% more than the resorts and hotels that do equal amounts of damage to Maui's infrastructure.
Maui Mayor and County Council, what message does this convey?
*The average time-share owner (myself) sees a government who makes decisions for change without clear evidence to suggest the need for it, i.e., it was not evidence-based. That decision was geared to highly favor their citizens (and perhaps a hotel-managing county council member as well), relieving them of all to most of the financial burden to maintain the society they live in full-time.
*I see a government who randomly chooses to disparage time-share owners with a higher taxation class than resorts and hotels despite Maui's paid study (evidence) suggesting both should be treated the same.
*I see a government who chooses to obtain(?)/retain the good will of their citizens through lower property tax rates, increasing the chances for Mayor and County Council member re-elections.
*I see a government who places their expenses in the hands of those who lack input and the ability to vote otherwise.
*I see a government who has lost the good will of the visitor, they just haven't seen it yet (but it's coming, like a storm, and you should be worried).
*I see a government who doesn't understand the disintegrating future they have willed their people.
Citizens:
You are likely aware of the ongoing time-share dispute with the Maui government and the lawsuit(s) that have followed. Just prior to a recent court proceeding, the Maui government decided that it hadn't properly assessed the time-share owners, represented in the lawsuit, for years 2006, 2007 and 2008. Online news reports state that the two affected complexes had been assessed as time-shares (rightfully) but not as condominiums (additionally). The original $2.1-$2.5 MILLION for each of these three years JUST from one complex, was effectively doubled to $5 MILLION and change, each of these three years.
As mentioned above, taxing the complexes as time-shares and condominiums would seem to suggest double taxation, similar to your glass bottle beverage purchases. The consumer is billed a deposit to penalize the purchaser if they don't recycle the bottle, but assessed an "environmental fee" at checkout as well. Either way, Maui government has guaranteed routes into everyone's wallet and pocketbook. Since it IS all about the revenues, one can not help but to believe that some form of corruption exists to influence this actions.
Citizens, I would r-e-a-l-l-y feel sorry for you, having to deal with your mayor and county council were it not for the exceptionally low property taxes you benefit from. While you might feel like patting your government on the back for their generosity, consider this-
If your bucket of tourists springs a leak due to time-share owners boycotting your county, who will be maintaining your economy? Who will be paying your bills?
*Less time-share owners mean partially-filled flights, which leads to less flights that will fly full. Less flights = less airfare taxes. Who's going to pay for airport renovations, maintenance and operations?
*Less time-share owners mean less car rentals and less gasoline purchased, both ow which provide taxes for road repairs. Where is this money going to come from?
*If you or someone you know works at the airport, as a ticket agent, a gate agent or a baggage handler for example, expect permanent lay-offs because the volume of travelers won't be able to support the current labor costs.
*Same goes with a car rental agency.
*Expect the lower volume of travelers to jack up your airfares. It's all about supply and demand, where pricing always follows demand unless supply creates an overhead cost that can't be managed efficiently.
*Less time-share owners means partially filled time-share complexes having fewer guests. Do you really think these complexes will pay people to stand around? More jobs will be lost.
*Less time-share owners means less dollars going to private businesses as well. Shopping, restaurant and groceries, tourism activities...if you have a job here, some will have to say, "good-bye work, hello unemployment." If you are a small business owner, business is going to get a lot less busy. Some if not most of you won't be able to keep your doors open with residents and resort/hotel visitors (who are likely to abstain travel to Maui based on your government's tyrannical actions).
Do the math.
Are you better off with less traffic? Sure you are, but at what cost elsewhere?
You can deny-deny-deny this future outcome but your local government is hard at work to create it and maintain it. They are determined to put Maui in line behind Puerto Rico for bankruptcy. You, citizen, are either part of the solution or part of the problem. You can't hide in the middle and say it doesn't involve you.
Sure, Maui government can always increase the tax rate on the resorts and hotels...until it drives them away in the same way as the time-share owners. Who's left now to tax?
Oh, and as for the average owner, don't worry about them, or me. I don't have to come to Maui to use my ownership. Maui government may be able to shake me down annually but they'll never see another thin dime in discretionary spending. Nothing personal - I just don't go where I don't feel welcomed.
In fact, I'm not even trapped (like you are) to have to put up with your inept government by paying even one more outrageous property tax if I so choose. I'm guessing a lot more time-share owners will feel the same way and exercise their options by the time I'm done. Look for me in local, Oahu and west coast newspapers; airline inflight magazines; online travel sites, time-share sites, and generic complaint sites; my blog; Maui time-share owner's associations; Political Action Committees...you get the idea. With all the property taxes I'll be saving I can even afford to splurge on paid advertising to get my very simple point across to others. The facts speak for themselves.
You see, we all get to choose.
What will you choose?
Hope like hell I'm wrong (because once the "tide turns" and tourism begins its downward spiral, it will be too late to change. You will have already lost) or save some semblance of life by paying your way and demanding that your representatives find other alternatives?
Time-shares, like it or not, are your lifeline. Cut it and you will most definitely bleed yourselves dry. The numbers don't lie.
***ALL Time-share owners***
If you can use your ownership elsewhere, I highly encourage you to do so. Maui needs to miss your contribution to their economy for several years.
If you can't use your ownership elsewhere, the least you can do is to band together simultaneously and boycott the island for 2-4 weeks a year, every year at different times of the year. This is all about you now, not the company/corporation/developer who has done too little too late. Find a way to send your message to Maui in the only way they will hear you - a loss of $$$.
Lastly, you have to look at this real estate property as an investment and detach yourself from it. Objectively, you don't hold onto investments that keep tanking year after year after year.
As a time-share owner on Maui, I thought you might be interested in the ramifications of Maui's war on time-shares, how this impacts me and what effect it will have on your future.
I purchased my ownership on Ka'anapali Beach, north of Black Rock, in Jan. 2003. At this time, time-share properties were (property) taxed as a Resort/Hotel. For fiscal year 2004, this meant a tax of $8.30 per $1000 assessed value. For the homeowner resident, their tax was $3.55/$1000. Summarily, time-share visitors were being billed 133% more than the homeowner while being instrumental in providing for the Maui economy.
In November, 2004, the Maui Mayor and County Council chose to create a specific property tax classification just for time-share properties. Online news reports attributed this action to Maui's dislike for uncontrolled time-share development. This was their effort to discourage sales and therefore future projects. However, their nearsightedness failed to allow them to see that they weren't punishing the fat cat companies and corporations but rather the tourists, people not unlike your residents we share space with. Most of us are retired or middle-aged and work 40-60 hours a week, like your residents. I purchased under the good faith of Maui government in existence at the time, only to watch it disappear in less than 2 years.
To my recollection, the owner's association had described Maui's increased taxation as Maui's decision that time-share owners should be held more accountable to infrastructure repairs and replacements/upgrades. According to more online news reports, it was Maui's government belief that this segment of the visiting population placed an unusual burden on the infrastructure, specifically the roads and the water/sewer system.
Shortly after Maui's implementation of the time-share tax classification (Jan. 1, 2005) and associated increase in property taxes, Maui commissioned a $75,000 time-share study to Hospitality Advisors LLC, which, along with the University of Hawaii School of Travel Industry, determined that time-share use had no greater/worsening effect upon Maui than the resorts and hotels. This finding was clear in June, 2006, though without-
1) any significant mitigation in time-share property assessments;
2) any significant aggravation in resort and hotel assessments; or
3) the removal of the tax classification and the "relumping" of time-share taxation back into the category of resorts and hotels, as the study clearly purported.
In fiscal year 2006, time-shares paid a tax assessment of $14.00/$1000, resorts and hotels paid $8.20/$1000 while the homeowner paid $2.50/$1000!
(Incidentally, I've recently read that Council member Mike White is the general manager of the Ka'anapali Hotel. This might explain why the Council didn't put resorts and hotels in the same (higher) tax bracket as their equally destructive time-share properties.
Maui is the only county within the State of Hawai'i to have a separate time-share tax classification. This does NOT exist on the islands of Hawai'i or Kauai, or in the city of Honolulu, for example. There is no mention of its existence anywhere else.
As of fiscal year 2016, time-shares are taxed at $14.31/$1000, resorts and hotels are taxed at $8.71/$1000 and the island homeowner resident is taxed at a paultry $2.70/$1000. Summarily, time-share owners are taxed at greater than 400% more than the homeowner and 65% more than the resorts and hotels that do equal amounts of damage to Maui's infrastructure.
Maui Mayor and County Council, what message does this convey?
*The average time-share owner (myself) sees a government who makes decisions for change without clear evidence to suggest the need for it, i.e., it was not evidence-based. That decision was geared to highly favor their citizens (and perhaps a hotel-managing county council member as well), relieving them of all to most of the financial burden to maintain the society they live in full-time.
*I see a government who randomly chooses to disparage time-share owners with a higher taxation class than resorts and hotels despite Maui's paid study (evidence) suggesting both should be treated the same.
*I see a government who chooses to obtain(?)/retain the good will of their citizens through lower property tax rates, increasing the chances for Mayor and County Council member re-elections.
*I see a government who places their expenses in the hands of those who lack input and the ability to vote otherwise.
*I see a government who has lost the good will of the visitor, they just haven't seen it yet (but it's coming, like a storm, and you should be worried).
*I see a government who doesn't understand the disintegrating future they have willed their people.
Citizens:
You are likely aware of the ongoing time-share dispute with the Maui government and the lawsuit(s) that have followed. Just prior to a recent court proceeding, the Maui government decided that it hadn't properly assessed the time-share owners, represented in the lawsuit, for years 2006, 2007 and 2008. Online news reports state that the two affected complexes had been assessed as time-shares (rightfully) but not as condominiums (additionally). The original $2.1-$2.5 MILLION for each of these three years JUST from one complex, was effectively doubled to $5 MILLION and change, each of these three years.
As mentioned above, taxing the complexes as time-shares and condominiums would seem to suggest double taxation, similar to your glass bottle beverage purchases. The consumer is billed a deposit to penalize the purchaser if they don't recycle the bottle, but assessed an "environmental fee" at checkout as well. Either way, Maui government has guaranteed routes into everyone's wallet and pocketbook. Since it IS all about the revenues, one can not help but to believe that some form of corruption exists to influence this actions.
Citizens, I would r-e-a-l-l-y feel sorry for you, having to deal with your mayor and county council were it not for the exceptionally low property taxes you benefit from. While you might feel like patting your government on the back for their generosity, consider this-
What is Maui's chief industry for revenues?
Tourism.
Tourism.
Where does Maui's chief means of revenues come from?
Tourists,most of whom are time-share owners.
Tourists,most of whom are time-share owners.
If your bucket of tourists springs a leak due to time-share owners boycotting your county, who will be maintaining your economy? Who will be paying your bills?
*Less time-share owners mean partially-filled flights, which leads to less flights that will fly full. Less flights = less airfare taxes. Who's going to pay for airport renovations, maintenance and operations?
*Less time-share owners mean less car rentals and less gasoline purchased, both ow which provide taxes for road repairs. Where is this money going to come from?
*If you or someone you know works at the airport, as a ticket agent, a gate agent or a baggage handler for example, expect permanent lay-offs because the volume of travelers won't be able to support the current labor costs.
*Same goes with a car rental agency.
*Expect the lower volume of travelers to jack up your airfares. It's all about supply and demand, where pricing always follows demand unless supply creates an overhead cost that can't be managed efficiently.
*Less time-share owners means partially filled time-share complexes having fewer guests. Do you really think these complexes will pay people to stand around? More jobs will be lost.
*Less time-share owners means less dollars going to private businesses as well. Shopping, restaurant and groceries, tourism activities...if you have a job here, some will have to say, "good-bye work, hello unemployment." If you are a small business owner, business is going to get a lot less busy. Some if not most of you won't be able to keep your doors open with residents and resort/hotel visitors (who are likely to abstain travel to Maui based on your government's tyrannical actions).
Do the math.
Are you better off with less traffic? Sure you are, but at what cost elsewhere?
You can deny-deny-deny this future outcome but your local government is hard at work to create it and maintain it. They are determined to put Maui in line behind Puerto Rico for bankruptcy. You, citizen, are either part of the solution or part of the problem. You can't hide in the middle and say it doesn't involve you.
Sure, Maui government can always increase the tax rate on the resorts and hotels...until it drives them away in the same way as the time-share owners. Who's left now to tax?
Oh, and as for the average owner, don't worry about them, or me. I don't have to come to Maui to use my ownership. Maui government may be able to shake me down annually but they'll never see another thin dime in discretionary spending. Nothing personal - I just don't go where I don't feel welcomed.
In fact, I'm not even trapped (like you are) to have to put up with your inept government by paying even one more outrageous property tax if I so choose. I'm guessing a lot more time-share owners will feel the same way and exercise their options by the time I'm done. Look for me in local, Oahu and west coast newspapers; airline inflight magazines; online travel sites, time-share sites, and generic complaint sites; my blog; Maui time-share owner's associations; Political Action Committees...you get the idea. With all the property taxes I'll be saving I can even afford to splurge on paid advertising to get my very simple point across to others. The facts speak for themselves.
You see, we all get to choose.
What will you choose?
Hope like hell I'm wrong (because once the "tide turns" and tourism begins its downward spiral, it will be too late to change. You will have already lost) or save some semblance of life by paying your way and demanding that your representatives find other alternatives?
Time-shares, like it or not, are your lifeline. Cut it and you will most definitely bleed yourselves dry. The numbers don't lie.
***ALL Time-share owners***
If you can use your ownership elsewhere, I highly encourage you to do so. Maui needs to miss your contribution to their economy for several years.
If you can't use your ownership elsewhere, the least you can do is to band together simultaneously and boycott the island for 2-4 weeks a year, every year at different times of the year. This is all about you now, not the company/corporation/developer who has done too little too late. Find a way to send your message to Maui in the only way they will hear you - a loss of $$$.
Lastly, you have to look at this real estate property as an investment and detach yourself from it. Objectively, you don't hold onto investments that keep tanking year after year after year.
