A proposal to develop an improvement district to revitalize downtown Hilo is on death’s door after a majority of affected property owners disapproved of the concept.
The Downtown Hilo Business Improvement District — which was officially proposed by a Hawaii County Council bill in late 2022, but has been a topic of discussion for years — would allow property owners to fund infrastructure maintenance and other upgrades between Ponahawai Street, Wailuku Drive, Kapiolani Street and the Hilo Bayfront using assessments levied against member businesses.
Those potential members, however, largely rejected the idea, testifying en masse against the proposal during a public hearing in February.
That opposition mostly agreed the primary problem in the downtown area is rampant homelessness, which a business improvement district is not necessarily equipped to solve, and that the assessments they would have to pay — a rate of $1.50 per $1,000 of “total net taxable value,” according to the bill — would be too much for many businesses already struggling under rising taxes.
At Wednesday’s meeting of the County Council, opponents of the proposal were counted and weighed against the total number of potential district members. County Clerk Jon Henricks said that while there are 313 properties that would be included in the district, the county received more than 200 declarations against the plan, accounting for 64.2% of the affected owners.
Some downtown Hilo property and business owners reiterated their opposition Wednesday during a County Council meeting in Hilo. Nancy Cabral, president of Day-Lum Rentals and Management, said the assessments levied on district members would be intolerable.
Cabral said that Chapter 35 of the County Code, which governs the establishment of business improvement districts, states that district assessments would be liens placed against the land and its improvements, which would have priority over all other liens, and would be subject to an interest rate determined by the district.
“I agree that downtown needs a whole lot of help,” Cabral said, but added that the potentially large assessment fees could be too much for many property owners.
Retired UFC fighter B. J. Penn also appeared at Wednesday’s meeting, alongside mother, businesswoman Lorraine Shin, to oppose the proposal. Penn and Shin own several properties within the district’s proposed boundaries.
“I’m here to support Hilo,” Penn said. “I want us to be able to come together. I agree we need changes to the district.”
Penn said he and several other prominent business owners, including Cabral and Shin, would instead prefer to revive the Hilo Downtown Improvement Association, a largely defunct organization that in the past has shared similar goals for the area.
“The DIA has been silent for a while, but we’re trying to maybe bring that back,” Cabral told the Tribune-Herald. “Or, if that doesn’t work, maybe we can see about doing the BID but without this tax.”
Corporation Counsel Elizabeth Strance said Wednesday the majority consensus among property owners does not oblige the council to reject the bill. But Kailua-Kona Councilman Holeka Inaba said that, if he were to vote on the bill Wednesday, he would have voted against it.
However, no vote on the bill will happen for months. Strance said that, for procedural reasons, the council’s acceptance of Henricks’ report requires that no further action on the measure be taken for 90 days, which will push back the council’s next discussion about the proposal until July 6.
Inaba suggested that perhaps those 90 days will allow property owners to discuss alterations to the bill that would make it more palatable.
Email Michael Brestovansky at mbrestovansky@hawaiitribune-herald.com.