Changes coming to city grant program for rail-affected businesses

Yahoo

5 days ago

The City and County of Honolulu's financial relief effort for small businesses negatively affected by ongoing construction of the over-$10 billion Skyline project is on track for proposed changes.
That's because the city's so-called transit construction mitigation fund, or TCMF, grant program—which Mayor Rick Blangiardi signed into law under Bill 40 in February 2024—was supposed to individually award any struggling, eligible business located along the rail corridor into Kakaako with a $10, 000 grant.
But the city says only a few grants—out of the dozens of applications its received thus far—were actually awarded.
'Five awards of $10, 000 have been paid, ' Ryan Wilson, a city spokesperson, told the Honolulu Star-­Advertiser this week.
Wilson noted the city has received 34 applications submitted by local businesses. Of those, 15 applications were deemed ineligible. And 19 applications were returned for revision.
To date, six applications were awarded—one on first submission, five on second submission, he said.
'The sixth business owner has not returned multiple calls and emails from the city, ' Wilson asserted. 'A letter will also be sent to the business owner providing a deadline to comply with the Hawaii Compliance Express (HCE ) certificate requirement, or the award will be terminated.'
Legislation to expand eligibility to floundering businesses along the rail line who could receive TCMF funds recently materialized.
The Honolulu City Council's Budget Committee on Tuesday voted to pass Bill 31, which seeks to increase the maximum allowed annual revenue for small businesses to $1 million, up from $750, 000.
The measure's other proposed amendments would remove the number of employees limit, previously locked at 15 or fewer workers ; and require the applicant business to have opened at least 12 months prior to the start of any rail project construction within the transit construction mitigation zone in which the business is physically located, as determined by the city Department of Budget and Fiscal Services director.
Previously, a grant applicant's business had to be open for business at their current physical location before Jan. 1, 2022.
The full Council may review Bill 31 for possible approval at its meeting on Wednesday.
Before the vote at Tuesday's committee meeting, Council member Radiant Cordero—who co-sponsored the measure in March with Tyler Dos Santos-Tam—asked BFS Director Andy Kawano 'if there's a need for rule-making again since there's going to be new criteria with this program ?'
Kawano replied, 'Yes, we're going to have to amend the rules we currently have in place.'
'One requirement, for instance, is the limitation on employees ; I think it's 15 or fewer right now, ' he added. 'So that's going to have to be amended.'
Kawano confirmed that a 'public notice ' will have to be issued over the program's potential changes.
After the meeting, Dos Santos-Tam noted Bill 31 updates will expand the grant program's requirements.
'The expansion of eligibility for the (TCMF ) shows our commitment to making assistance more accessible and inclusive, allowing more small and medium-­sized businesses to receive the support they need, ' he said in a statement. 'Rail project construction can create significant disruptions that impact day-to-day operations, and this bill helps ease those burdens so businesses can continue to serve their customers and maintain their employees.'
Cordero agreed.
'These businesses provide more than just jobs and services ; they bring life and identity to our neighborhoods, ' she said in a statement. 'Supporting Bill 31 ensures our small businesses, which play a vital role in our communities, can keep thriving as our city grows and changes.'
Cordero and Dos Santos-­Tam—who respectively represent portions of the Kalihi and Iwilei communities—co-sponsored Bill 40 as well.
Meanwhile, Anthony Han, owner of Soul Chicken and Bliss Lounge on the 1000 block of Dillingham Boulevard, said he's hanging on to his business in the face of Skyline's construction that's slated through year 2030.
'I've made a little more money than last year or a few years ago, but I'm still struggling, ' Han told the Star-Advertiser. 'That's why I'm thinking about whether to close this place or not.'
Han said he currently owes $60, 000 in unpaid rent. 'I have another debt around $45, 000, ' he asserted. 'That is a true story.'
Still, he confirmed the city approved his $10, 000 grant application earlier this year : he received a check in the mail in April.
'It's not enough though, ' Han claimed, 'the cost of everything went up.'
In January, the city started offering $10, 000 grants to applicant businesses located near the rail line.
At the time, TCMF grants were to be awarded on a first-come, first-served basis, based on authorized and available funding for the program.
But by early February, the city had to extend the time to submit applications.
That month, the Mayor's Office said the extension—to Feb. 21—was due to TCMF grant applicants not properly filing business documentation with the city.
'Many of the applications that were submitted to the portal needed to be returned to applicants for revisions, especially because they lacked the required documentation, ' Ian Scheuring, the mayor's deputy communications director, told the Star-Advertiser previously.
He noted errors led to applicants being denied grant funding.
'The city has received numerous applications for the (TCMF ) program that did not qualify, or were not in compliance with the rules of the program and were rejected, ' Scheuring said previously.
According to the city, the total dollar amount spent on this program so far includes $50, 000 for the five $10, 000 awards ; $13, 585 for the program's one-year payment toward its information management system ; and $967.94 to publish legal notices regarding administrative rules hearings on this city-run program.