Property tax break for historic homes dedicated to preservation

Portions of residential real property which are dedicated and approved by the Director of Finance as provided for by this Section, shall be exempt from real property taxation to the following extent:Those residential properties qualifying for a home exemption under Section 5A-11.4 and those residential properties owned by a nonprofit organization as defined in Section 5A-11.10(c) shall be exempt to the extent of 100% of the assessed value of real property as determined by the Director of Finance pursuant to Subsection (c) of this Section, except that the minimum tax provision of Sec. 5A-6.3(g) shall apply; andAll other properties shall be exempt to the extent of 75% of the assessed value of the real property as determined by the Director of Finance pursuant to Subsection (c)."Residential" as used in this Subsection shall mean improved with a building designed for or adapted to residential use and currently used solely as a dwelling.An owner of taxable real property that is the site of an historic residential property that has been individually placed on the Hawai'i Register of Historic Places after January 1, 1977, desiring to dedicate the property or a portion thereof for historic preservation, may petition the Director of Finance by July 1st of any year, provided that in cases of leasehold property the petition shall be signed by both the lessor and the lessee. The form of the petition shall be determined by the Director of Finance and shall include:A copy of the registration form for the Hawai'i Register of Historic Places, certified by the Historic Preservations Office, Department of Land and Natural Resources, State of Hawai'i, including all attachments;A map showing the area to be dedicated and the location of the historic buildings, structures and sites as set forth on the registration form, provided the Director may require a map drawn to scale by a licensed surveyor if it is necessary in order to make a determination of the land area to be exempted;A certification by the owner that the property is visually accessible to the public or that the public shall be allowed visual access at least 12 days per year, the specific dates of which shall be set forth in the petition; andThe owner's authorization for members of the assessment staff to visit and inspect the property as necessary to conduct a finding of fact as set forth in Subsection (c) of this Section.Upon receipt of a completed petition as set forth in Subsection (b) of this Section, the Director of Finance shall prepare findings of fact as to whether the property has been placed on the Hawai'i Register of Historic Places after January 1, 1977 and whether the building is residential as defined in this Section.If the findings of fact are favorable, the Director shall approve the petition and determine what portion or portions of the real property shall be exempted. The exempt area shall be limited to the area surrounding the historic residence traditionally and currently maintained as its grounds, including the lawn, landscaped areas and other areas directly associated with the residential use of the historic dwelling, and such historic sites as designated on the registration form for the Hawai'i Register of Historic Places; provided the exempt area shall not include any area not on the Hawai'i Register of Historic Places nor any lots of record which are not improved with a historic residence meeting the requirements of this Section. The Director shall notify the owner of the approval or disapproval of the petition by September 15th of the year of application. If the petition is approved, the Director shall prepare a notice of dedication and deliver it to the owner along with the notice of approval. The owner shall execute and record the notice of dedication with the Bureau of Conveyances of the Department of Land and Natural Resources so that prospective buyers will be put on notice as to the restrictions on the property. The exemption shall take effect on October 1st; provided that if the Director does not receive a recorded copy of the notice of dedication within 45 days of the date of approval, the exemption shall be canceled and the dedication approval shall be rescinded.Upon approval of the petition, the owner shall enter into an agreement with the Director of Finance to maintain the historic residence in structurally sound and weathertight condition free from decay, or to perform such repairs as necessary for the dwelling to be in structurally sound and weathertight condition free from decay by the fifth (5th) year following the effective date of the exemption. Such condition shall be certified in writing by a licensed architect or general contractor and submitted to the Director of Finance by July 1st of the fifth (5th) and tenth (10th) years of the first 10 year exempt period and every tenth (10th) year after that as long as the property remains dedicated to historic preservation under this Section.The approval of the petition by the Director shall constitute a forfeiture on the part of the owner of any right:To subdivide or to register under the Condominium Property Regime any portion of the exempt area.To change the use of the exempt property to other than residential use, provided that if the new use meets the requirements for exemption under Sec. 5A-11.10, the provisions of Subsection (f) of this Section shall not apply.To construct or cause to be constructed any additions or new buildings in the exempt area without approval by the State Historic Preservation Office, provided that no new dwelling units or guest houses may be built in the exempt area. The additions and buildings as approved and constructed and the land they occupy shall be fully taxable.The approval of the petition shall also constitute a commitment on the part of the owner to maintain the visual accessibility of the building to the public, to maintain the exempt land area and to continue to be listed on the Hawai'i Register of Historic Places.These restrictions and the exemption shall be in effect for a period of 10 years.The owner may renew the exemption for additional 10 year periods by applying for such renewal according to the same timetable as a new petition subject to the Director's certification that the property continues to meet the requirements set forth in Subsection (c) of this Section.Failure of the owner to provide the certification of structural soundness and weathertightness as provided in Subsection (d) of this Section or to observe the other restrictions of Subsection (d) shall cancel the tax exemption and subject the owner to a retroactive tax and interest which shall be due and payable within 30 days following the mailing of the notice of retroactive assessment to the owner. The retroactive tax and interest shall be computed from the beginning of the tax year for which the application was originally approved to the end of the tax year that the cancellation occurred. The retroactive tax for each tax year shall be based on the difference in the amount of taxes that were paid and those that would have been due but for the exemption allowed by this Section. The retroactive tax shall be payable together with interest at 12% per annum from the respective dates that these payments would have been due provided the provision in this Subsection shall not preclude the County from pursuing any other remedy to enforce the covenant on the use of the land.The retroactive taxes and interest due and owing as a result of a cancellation of the dedication shall be a paramount lien upon the property pursuant to Sec. 5A-5.1.Any person who becomes an owner of real property that is permitted an exemption under this Section shall be subject to the restrictions and duties imposed under this Section.An owner applicant may appeal any determination as in the case of an appeal from an assessment.Subject to Chapter 91, Hawai'i Revised Statutes, the Director shall adopt rules and regulations deemed necessary to accomplish the foregoing.