An empty homes tax could net the City and County of Honolulu nearly $300 million in revenue over the first decade.
Months ago, the council asked consulting firm Ernst and Young if an empty homes tax on O'ahu could generate revenue for the city and bring more units into the local housing supply.
Mohammed Bhamani led the study and presented its findings to the council Tuesday.
"An EHT implemented under the current draft of Bill 46 could be financially feasible and is estimated to result in a positive financial impact to the city of approximately $290 million over the first 10 years," Bhamani said.
That's how much net revenue the bill would generate, even though it carves out more than a dozen exemptions to the tax, including those for secondary homes and units listed for sale.
The study says that potential revenue could jump up to about $550 million if the bill scaled back on those exemptions, as is the case in other cities that also tax empty homes.
But, the impact it would have on the local housing supply has left some wanting more. The study says the tax would convert just 1,000 or so units into rentals or for-sale properties.
Some officials say such low returns might not be worth the effort it would take to create a new property tax.
"We're talking about a thousand units after all of the heavy lifting that we have to do. We're concerned — right now is this the right way to go? If we evaluate what's important to us as (an) administration in terms of addressing empty homes, we just don't see it," said Andy Kawano, the director of the Honolulu Department of Budget and Fiscal Services.
There are also still concerns about the constitutionality of an empty homes tax. Opponents worry it would force homeowners to either sell or rent out their properties.
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