By Haley Lehman

The City and County of Honolulu Office of Revitalization announced Aug. 7 that it will close on Friday, Aug. 14, after the Honolulu City Council cut the office’s budget by $2 million.

In a statement to Aloha State Daily on Monday, Honolulu Mayor Rick Blangiardi stated, “The next time a small business owner asks why the City no longer offers the support they once depended on, the answer is simple: the City Council eliminated the office that provided it. The next time farmers recovering from the Kona Low storms ask why economic recovery assistance is no longer available, the answer is the same. Council votes have consequences. Beginning Friday, our community will experience the consequences of this one.”

The Honolulu City Council established the Office of Economic Revitalization in October 2020 to coordinate the city’s Covid-19 economic response and recovery efforts, accelerate economic expansion and disburse state and federal funding through grants and loans. The office managed approximately $408 million in federal pandemic relief funds and other grants for programs supporting local businesses, agriculture and Covid-19 relief funds over the last five years, according to a news release from OER.

An audit released in January 2026 noted issues with accountability and transparency related to OER’s staffing and funding and found that OER did not meet five of its eight responsibilities outlined in the resolution.

“Specifically, OER has demonstrated activity in economic response and recovery, identifying and management of funds for economic revitalization, and small business support. However, the office has not fully established or implemented the remaining five required functions including economic development and investment, economic improvement projects, a business resource hub, sector-specific economic support, and economic revitalization commission,” Acting City Auditor Troy Shimasaki wrote in the report.

The audit encouraged the office to establish a long-term sustainability plan, provide annual performance reports, evaluate program and services that are shared with other city departments and the state and ensure it meets all eight responsibilities.

The Honolulu City Council cut $1.62 million in salaries and $412,000 in expenses for OER in the budget for the 2026 fiscal year, leaving approximately $56,000 in operating funds. Blangiardi vetoed the cuts in June, calling the cuts “misguided and indefensible,” and the council voted 6-2 to override the mayor’s veto in July.

. . .

Chamber of Commerce Hawaiʻi President and CEO Sherry Menor urged the Council in June to sustain funding for OER.

“As Oʻahu continues to navigate economic uncertainty, strong alignment between government and the business community is essential to recovery,” she wrote. “Scaling back key economic functions risks slowing progress and weakening the foundation needed for long-term stability, diversification, and growth. Maintaining dedicated capacity in economic resilience remains vital to both near-term recovery and long-term growth for the City.”

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