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Council committee advances Downtown Honolulu Business Improvement District bill with church exemption added
Summary
Committee amended Bill 51 to expand the Fort Street Mall Special Improvement District into a Downtown Honolulu BID, added a church-property tax exemption back into the plan, and reported the bill out for third reading after testimony from business and faith groups and the administration.
The Honolulu City Council Committee on Zoning and Planning on Sept. 23 amended and reported out Bill 51 (2025) CD2 to expand Fort Street Mall Special Improvement District No. 2 into a broader Downtown Honolulu Special Improvement District and to add an exemption for parcels used for church purposes.
The hand-carried CD2 (OCS 2025-0776) incorporates committee and staff changes clarifying district boundaries, supplemental services and improvements, assessment financing and apportionment, the size of the District Association board, and the proposed first-year budget. The committee's hand-carried version also reinserted a provision (new section 10(b)(4)(3) in the district plan) exempting parcels that are exempt from real property tax under RoH 8-10.9(b)(3) (property used for church purposes) from the special assessment.
Why it matters: proponents said the BID would finance safety, maintenance and marketing services to revitalize downtown and attract and retain businesses and visitors. Chris Fong of Tradewind Capital said downtown's retail landscape has weakened since COVID and that a BID could provide safety and maintenance personnel, power washing, and other services to improve the look and feel of the district.
Kiko McClellan, representing the Roman Catholic Diocese of Honolulu, thanked the committee for restoring the church-property exemption and supported the bill, noting that parish resources are charitable and mission-driven. Angela Melody Young, testifying on behalf of CARES, said she supported the church exemption and urged inclusion of Chinatown as a community of interest that the BID could help.
Managing Director Mike Forme told the committee the administration supports the proposal as a public-private partnership and stressed that the city does not intend to cede responsibilities to the BID. "The city's commitment would probably be more than it is now," Forme said, describing the partnership model used in Waikiki as an example of increased city responsiveness when a BID is in place.
Action taken: The committee amended Bill 51 to the hand-carried CD2 and the chair directed the bill be reported out for passage on third reading.
Details: the Downtown Honolulu BID plan attached as Exhibit B in the bill will set the rate or method of apportionment of the special assessment, the supplemental services to be provided, and the initial budget. The restored exemption covers parcels already exempt from real property taxes for church purposes under RoH 8-10.9(b)(3); the committee added that back into the district plan at the request of faith-based testifiers.
Next steps: With the committee's recommendation, Bill 51 CD2 will proceed to the full council for third-reading consideration.
