Property Tax Assessment Cap for Homes and Affordable Rentals

Any owner who has a home exemption pursuant to Section , Kaua'i County Code 1987, as amended, or receives the beneficial tax rate due to a long-term affordable rental, and residential leases of state-owned property pursuant to Section shall receive a three percent (3%) assessment cap.The Director shall note on the notice of assessment or tax bill, or both, that the property receives the three percent (3%) assessment cap.Property receiving the assessment cap shall be taxed in the following manner:The property shall be assessed based on its market value, provided that, any increase in assessed value from the prior tax year's assessment shall not exceed three percent (3%).Any improvements to the property, including, but not limited to: new construction, renovations, and partial demolition, that increase the fair market value of the property, the assessment shall be increased based on the value of the improvements undertaken, notwithstanding the assessment cap limits.If property receiving the assessment cap subsequently increases in assessed value due solely to actions of the owner, such as but not limited to, the creation of a subdivision or condominium property regime, consolidation of lots or land area, or change in zoning, the assessment cap shall be reset to market value in the year of the change.If there is an error in the assessment for any year, the correction of which is not permitted under the terms of Section , the assessment for the next year shall be based on what the assessment would have been for the previous year without the error.The gain or loss of an agricultural dedication, breach or expiration of a dedication, or change in status to another real property program that affects the value shall be excluded from the three percent (3%) assessment cap limit.In the case of properties that are multiuse parcels or structures, no assessment cap shall be granted.The Director shall calculate the assessment cap as prescribed in subsection .Upon transfer or sale of property, real property assessments shall be reset to reflect the market value of the property as of October 1 following the transfer or sale.The transfer of property for the purpose of conveying real property shall be excluded from subsection if the same owner continues to maintain a home exemption pursuant to Section of Kaua'i County Code 1987, as amended.