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Friday, January 5, 2018
"Why Isn’t Honolulu Helping Businesses Hurt By Rail Construction?" (Because It Doesn't Want To, And No One Is Making It)
By Robert Thomas @ 3:07 PM :: 5836 Views :: Land Use, Rail
"Why Isn’t Honolulu Helping Businesses Hurt By Rail Construction?" (Because It Doesn't Want To, And No One Is Making It)
A recent report in Honolulu Civil Beat asks the question: "Why Isn’t Honolulu Helping Businesses Hurt By Rail Construction?" (The Civil Beat editorial board asks the same question.)  According to the report:
Two years ago, the Honolulu City Council created a fund to help businesses hurt by construction of the 20-mile long rail project. But there was a hitch: the council never appropriated any money for it.

Then last April, the council put a line item in the budget for fiscal year 2018, which began July 1 and ends June 30, offering $2 million in property tax breaks to businesses suffering losses from work on the rail line.

With five months left to go in the fiscal year and no effort to distribute those tax breaks, that offer is looking like an empty promise.

The Civil Beat story continues with reports of failing businesses, the Honolulu Authority for Rapid Transit's efforts to hand out discount cards for businesses impacted by rail construction, and the agency's hiring of even more employees and contractors all while many businesses have gone or are going under ("The agency will soon hire a business relations specialist to work as a liaison between the agency, contractors and businesses."). The main theme of the story is the City needs to do something.

So why hasn't the City done more than putting a line in its budget that it will take less from these business owners? (Note that in the first quote above, the City isn't actually handing out money to help these businesses, it is merely anticipating receiving less property tax from them.) The short answer to Civil Beat's question is that in the end, the City doesn't really care all that much about these particular businesses or their owners.

Perhaps a harsh assessment. But realistic if you look at it: the City's sole focus is on the actual rail construction, and getting it finished and operating, not on those whose lives and businesses get in the way. Construction delays thus far have cost the City dearly, both in money and in political and public capital, and it is committed to moving forward, and not getting distracted by accommodating any more than it absolutely needs to. And the City anticipates that once the project is up and running, businesses which survive (or new businesses that may take their place), will be there, and all will be forgotten.  

So what is a business owner to do, since waiting for the City to do the right thing isn't going to get anywhere?

Here's a lesson from a Texas restaurant owner. Or should we say "former restaurant owner" because the business folded due to loss of access and traffic after the county transit authority's adjacent rail project interfered with ingress and egress. The owner brought an inverse condemnation claim against the agency, alleging the construction and the resulting rail line which caused the his business to go under and that "once construction was completed, access to the restaurant was possible but difficult." The owners sought to "recover lost profits allegedly caused by the temporary, total denial of access to the restaurant during the construction of the North Line." They also "sought to recover for the permanent diminution in the value of the property caused by the alleged material and substantial impairment of access once the North Line construction was completed."

What distinguished this case from the usual situation where a condemnee seeks damages caused by loss of access was that here, the agency did not condemn any of the restaurant's property. The trial court dismissed the complaint, but the court of appeals reinstated the claim and allowed it to go to trial. The loss of access was not, as the rail agency argued, a "community damage" shared by all. The court concluded that if the owner were able to prove access to its property was blocked, then this was not a mere "inconvenience" resulting from the rail project, but a taking or damaging of property.

In other words, to answer Civil Beat's question, it's unlikely the City will do much, if anything, for property owners who are hurt by rail construction. It is up to the owners to help themselves.  


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