RELATING TO SMALL BUSINESS LOANS.

Budget Labor Small Business Technology

Active

The official status still shows this bill as active or still awaiting another formal step.

Sponsor: ILAGAN, EVSLIN, GARCIA, ICHIYAMA, IWAMOTO, KAHALOA, KAPELA, KITAGAWA, KONG, LA CHICA, MARTEN, MATAYOSHI, MORIKAWA, PERRUSO, QUINLAN, SAYAMA, SOUZA, TAKAYAMA, TAM, WARD
Last action: 2026-04-02
Official status: Received notice of the discharge of all House Conferees (Hse. Com. No. 457).
Effective date: Not listed

Plain English Breakdown

The bill does not provide specific details on the number of businesses that will be eligible for loans.

Support for New Businesses in Hawaii

This bill appropriates funds to the Department of Business, Economic Development, and Tourism (DBEDT) to contract services that support start-up business financing.

What This Bill Does

Appropriates $500,000 each year from fiscal years 2025-2026 and 2026-2027 for the Hawaii Start-Up Business Loan Program special fund.
Establishes a Hawaii Start-Up Business Loan Program to provide loans to start-up businesses registered in Hawaii that have been operating for three years or less.
Sets up rules for eligibility, loan amounts, terms, and conditions for these loans.
Requires regular reports on the program's activities.

Who It Names or Affects

New businesses in Hawaii that are less than three years old.
The Department of Business, Economic Development, and Tourism which will manage the program.

Terms To Know

Start-up business: A business registered in Hawaii that has been operating for three years or less.
Financial institution: An organization authorized to do business under state or federal laws relating to financial institutions, including banks and credit unions.

Limits and Unknowns

The bill does not specify how many businesses will be able to receive loans.
It is unclear if the loan program will continue after the initial funding period ends in 2027.

Amendments

These notes stay tied to the official amendment files and metadata from the legislature.

HD1

Hawaii published version HD1

Plain English: This amendment establishes a Hawaii start-up business loan program to provide loans to new businesses, aiming to support entrepreneurship and job creation.

Adds definitions for key terms such as 'Department', 'Division', 'Financial institution', 'Program', and 'Start-up business'.
Establishes the Hawaii start-up business loan program under Chapter 210D of the Hawaii Revised Statutes, to be administered by the division in coordination with the Hawaii technology development corporation.
Sets rules for eligibility criteria, preferences, conditions, and reporting requirements for loans issued through this program.
Specifies that loans will not exceed $50,000, have a term not exceeding ten years, and no interest is charged for the first five years.

The text was truncated at the end, so some details about fund management might be incomplete or missing.
Specific rules and conditions for loan eligibility and administration are left to future rule-making by the division.

SD1

Hawaii published version SD1

Plain English: This amendment establishes a new Hawaii Start-Up Business Loan Program to provide financial assistance to start-up businesses in the state, aiming to boost entrepreneurship and job creation.

Adds a new part to Chapter 210D of the Hawaii Revised Statutes to establish the Hawaii Start-Up Business Loan Program.
Defines key terms such as 'Department', 'Division', 'Financial Institution', 'Program', and 'Start-up business'.
Specifies that loans under this program can be used for working capital, facility construction or improvement, and equipment financing.
Sets loan limits of $50,000 with no interest charged for the first five years.

The amendment text is incomplete and does not provide full details on all aspects of the program's implementation.

SD2

Hawaii published version SD2

Plain English: This amendment allocates funds to the Department of Business, Economic Development, and Tourism to provide services that support start-up businesses in Hawaii.

Allocates money from general state revenues for fiscal years 2025-2026 and 2026-2027 to help start-up businesses with financing and support.

The exact amount of funding is not specified in the amendment text.
Businesses already eligible for another loan program are excluded from this new program, but details on how this exclusion will work are unclear.

Bill History

2026-04-02 S
Received notice of the discharge of all House Conferees (Hse. Com. No. 457).
2026-04-01 H
House Conferee(s) discharged.
2025-12-08 D
Carried over to 2026 Regular Session.
2025-04-21 S
Received notice of appointment of House conferees (Hse. Com. No. 755).
2025-04-17 H
House Conferees Appointed: Ilagan, Hussey Co-Chairs; Matsumoto.
2025-04-11 S
Received notice of disagreement (Hse. Com. No. 704).
2025-04-10 H
House disagrees with Senate amendment (s).
2025-04-08 H
Returned from Senate (Sen. Com. No. 641) in amended form (SD 2).
2025-04-08 S
Report adopted; Passed Third Reading, as amended (SD 2). Ayes, 25; Aye(s) with reservations: none . Noes, 0 (none). Excused, 0 (none). Transmitted to House.
2025-04-04 S
48 Hrs. Notice 04-08-25.
2025-04-04 S
Reported from WAM (Stand. Com. Rep. No. 1806) with recommendation of passage on Third Reading, as amended (SD 2).
2025-04-03 S
The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in WAM were as follows: 13 Aye(s): Senator(s) Dela Cruz, Moriwaki, Aquino, DeCoite, Elefante, Hashimoto, Inouye, Kanuha, Kidani, Kim, Lee, C., Wakai, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none.
2025-04-01 S
The committee(s) on WAM will hold a public decision making on 04-03-25 10:01AM; Conference Room 211 & Videoconference.
2025-03-17 S
Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM.
2025-03-17 S
Reported from EDT (Stand. Com. Rep. No. 1092) with recommendation of passage on Second Reading, as amended (SD 1) and referral to WAM.
2025-03-11 S
The committee(s) on EDT recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in EDT were as follows: 5 Aye(s): Senator(s) DeCoite, Wakai, Fukunaga, Kim, Awa; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none.
2025-03-06 S
The committee(s) on EDT has scheduled a public hearing on 03-11-25 1:00PM; Conference Room 229 & Videoconference.
2025-03-04 S
Referred to EDT, WAM.
2025-03-04 S
Passed First Reading.
2025-03-04 S
Received from House (Hse. Com. No. 106).
2025-02-28 H
Passed Third Reading with none voting aye with reservations; none voting no (0) and Representative(s) Cochran, Pierick, Templo, Ward excused (4). Transmitted to Senate.
2025-02-28 H
Reported from FIN (Stand. Com. Rep. No. 985), recommending passage on Third Reading.
2025-02-24 H
The committee on FIN recommend that the measure be PASSED, UNAMENDED. The votes were as follows: 15 Ayes: Representative(s) Yamashita, Takenouchi, Grandinetti, Holt, Hussey, Keohokapu-Lee Loy, Kitagawa, Kusch, Lamosao, Lee, M., Miyake, Morikawa, Templo, Alcos, Reyes Oda; Ayes with reservations: none; 0 Noes: none; and 1 Excused: Representative(s) Ward.
2025-02-21 H
Bill scheduled to be heard by FIN on Monday, 02-24-25 10:00AM in House conference room 308 VIA VIDEOCONFERENCE.
2025-02-10 H
Passed Second Reading as amended in HD 1 and referred to the committee(s) on FIN with none voting aye with reservations; none voting no (0) and Representative(s) Belatti, Cochran, Kila, Ward excused (4).
2025-02-10 H
Reported from ECD (Stand. Com. Rep. No. 300) as amended in HD 1, recommending passage on Second Reading and referral to FIN.
2025-02-05 H
The committee on ECD recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 7 Ayes: Representative(s) Ilagan, Hussey, Holt, Tam, Templo, Todd, Matsumoto; Ayes with reservations: none; 0 Noes: none; and 0 Excused: none.
2025-01-29 H
Bill scheduled to be heard by ECD on Wednesday, 02-05-25 10:00AM in House conference room 423 VIA VIDEOCONFERENCE.
2025-01-21 H
Referred to ECD, FIN, referral sheet 2
2025-01-21 H
Introduced and Pass First Reading.
2025-01-17 H
Pending introduction.

Official Summary Text

RELATING TO SMALL BUSINESS LOANS.
DBEDT; Start-Up Business; Financing; Support; Contracted Services; Appropriations ($)
Appropriates moneys to the Department of Business, Economic Development, and Tourism for the contracting of services for start-up business financing and support. Effective 7/1/3000. (SD2)

Current Bill Text

Read the full stored bill text

HB455

HOUSE OF REPRESENTATIVES

H.B. NO.

455

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

relating
to small business loans
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

����
SECTION
1.
�
The legislature finds that the
COVID-19 pandemic, supply chain issues, and inflation have hurt the State's
economy and local businesses on every level, including the start-up industry.
�
Despite this, many small businesses and
entrepreneurs are ready to take the leap into starting up a business but lack
the resources to do so, as access to capital is one of the biggest barriers for
start-ups.

����
The
legislature further finds that new businesses and young companies under five
years of age create the most new jobs, on net, in the United States.
�
While the State offers a variety of financial
assistance to start-up businesses in Hawaii, most assistance is to help
existing businesses expand and scale up, rather than to help successfully
launch new businesses.

����
The
legislature believes that providing support to local small businesses and
entrepreneurs looking to begin a start-up could lead to the creation of more
jobs in the State.

����
The
purpose of this Act is to benefit the local economy and create new jobs by
establishing and appropriating funds for a Hawaii start-up business loan
program to encourage entrepreneurship and economic diversification and
resilience.

����
SECTION
2.
�
The Hawaii Revised Statutes is
amended by adding a new chapter to title 13 to be appropriately designated and
to read as follows:

"
Chapter

hawaii start-up business loan program

����
�
-1
�
Definitions.
�

As used in this chapter:

����
"Department"
means the department of business, economic development, and tourism.

����
"Division"
means the business development and support division of the department.

����
"Financial
institution" means any organization authorized to do business under state
or federal laws relating to financial institutions, including, without
limitation, banks, savings banks, savings and loan companies or associations,
financial services loan companies, community development financial
institutions, and credit unions.

����
"Program"
means the Hawaii start-up business loan program.

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"Start-up
business" means a business that:

����
(1)
�
Is registered in the State;

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(2)
�
Has been in business for three years or less;
and

����
(3)
�
Fulfills the qualifications established by the
division to receive a start-up business loan under the program.

����
� -2

�
Hawaii start-up business loan program.
�
There is established a Hawaii start-up
business loan program that shall be administered by the division in
coordination with the Hawaii technology development corporation.

����
� -3

�
Functions, powers, and duties of the
division; rules.
�
(a)
�
In the performance of and with respect to the
functions, powers, and duties vested in the division by this chapter, the
division may:

����
(1)
�
Adopt rules to carry out this chapter; and

����
(2)
�
Perform all functions necessary to effectuate
the purposes of this chapter.

����
(b)
�
The rules shall:

����
(1)
�
Prescribe the qualifications for eligibility
of applicants for loans;

����
(2)
�
Establish preferences and priorities in
determining eligibility for loans;

����
(3)
�
Establish the conditions, consistent with the
purposes of this chapter, for the issuance or continuance of loans; and

����
(4)
�
Provide for inspection at reasonable hours of
the plant, books, and records of an enterprise that has applied for or has been
issued a loan, and require the submission of progress and final reports.

����
� -4
�
Direct loans; terms and restrictions.
�
(a) The division may make loans to address
start-up business concerns, including the financing of working capital,
construction or improvement of facilities, and equipment.
�
The loans pursuant to this section shall not
be made in conjunction with any other loans made or grants awarded by the
division.
�
Where the loans made by the
division are secured, the security may be subordinated to the loans made by
other financial institutions; provided that the subordination is required to
obtain loans from those institutions.
�

The necessity for and extent of security required in any loan shall be
determined by the division.

����
(b)
�
Loans issued pursuant
to this section shall be subject to the following restrictions and limitations:

����
(1)
�
No
loan shall be granted unless financial assistance is not available to the
applicant; provided that the condition may be waived by the division for
participation loans or loan guarantees with a private financial institution;

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(2)
�
The
amount of the loan shall not exceed a total of $50,000;

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(3)
�
No
loan shall be made for a term exceeding ten years, to begin on the date the
loan is awarded and funding is disbursed to the applicant;

����
(4)
�
No
interest shall be charged for the first five years of the ten-year loan period,
or the period prior to the middle of a loan period of less than ten years, from
the date of the issuance of the loan; provided that the remainder of the loan
period shall be at market interest rates;

����
(5)
�
Upon
reaching five years of the ten-year loan period, or the middle of a loan period
of less than ten years, negotiations shall commence regarding a payment plan
for the remaining loan by the end of the agreed-upon loan period; provided that
the agreement shall be finalized within ninety days of the commencement of the
negotiations; provided further that a report shall be submitted to the
department on the status of the business, use of the loan, and how the loan has
contributed to the business' growth;

����
(6)
�
Any
remaining loan balance made to a small business that filed and was approved for
bankruptcy protection within ten years of receipt of the loan shall be
forgiven; and

����
(7)
�
No
recipient of a loan shall be required to make a personal guarantee as a
condition of receiving a loan.

����
(c)
�
The division may contract with any financial institution
for services, including servicing or administering loans pursuant to this
section.

����
� -5

�
Hawaii start-up business loan program
special fund.
�
(a) There is
established in the state treasury the Hawaii start‑up business loan
program special fund, into which shall be deposited:

����
(1)
�
Appropriations made by the legislature to the
fund;

����
(2)
�
Moneys received as repayments of loans; and

����
(3)
�
Payments of loan interest or fees.

����
(b)
�
Moneys in the Hawaii start-up business loan
program special fund shall be administered by the department and shall be used
for providing loans to start-up businesses.

����
(c)
�
All unexpected and unencumbered moneys
remaining in the Hawaii start-up business loan program special fund at the
close of each fiscal year shall not lapse to the credit of the general fund.

����
(d) The
department may contract with any financial institution for services, including
the day-to-day management of the fund pursuant to this section.

����
� -6

�
Reports.
�
The department shall submit a report to
the legislature on the division's activities in administering the program no
later than twenty days prior to the convening of each regular session beginning
with the regular session of 2026.
�
The
report shall include:

����
(1)
�
A description and uses of loans from the loan
program;

����
(2)
�
A summary of information and analytical data concerning
the implementation of the loan program; and

����
(3)
�
Loan repayments made."

����
SECTION
3
.
�
There
is appropriated out of the general revenues of the State of Hawaii the sum of
$500,000 or so much thereof as may be necessary for fiscal year 2025-2026 and
the same sum or so much thereof as may be necessary for fiscal year 2026-2027
to be deposited into the Hawaii start‑up business loan program special
fund established pursuant to section 2 of this Act.

����
SECTION
4
.
�
There
is appropriated out of the Hawaii start‑up business loan program special
fund the sum of $500,000 or so much thereof as may be necessary for fiscal year
2025-2026 and the same sum or so much thereof as may be necessary for fiscal
year 2026-2027 for the purposes of implementing the Hawaii start‑up
business loan program and providing loans under the program.

����
The sums appropriated shall be expended by
the department of business, economic development, and tourism for the purposes
of this Act.

����
SECTION 5.
�
If any provision of this Act, or the
application thereof to any person or circumstance, is held invalid, the
invalidity does not affect other provisions or applications of the Act that can
be given effect without the invalid provision or application, and to this end
the provisions of this Act are severable.

����
SECTION 6.
�
This Act shall take effect on July 1, 2025.

INTRODUCED BY:

_____________________________

Report Title:

Hawaii
Start-Up Business Loan Program; Hawaii Start-up Business Loan Program Special
Fund; DBEDT; Business Development and Support Division; HTDC; Report;
Appropriation

Description:

Establishes
the Hawaii start-up business loan program.
�
Establishes the Hawaii start-up business loan
program special fund.
�
Requires DBEDT to
submit an annual report to the Legislature regarding the program.
�
Appropriates funds.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.