STATE OF HAWAIʻIHAWAIʻI COMMUNITY-BASED ECONOMIC DEVELOPMENTTECHNICAL AND FINANCIAL ASSISTANCE PROGRAM

CY 2023
ANNUAL & FINANCIAL REPORTS
TO THE 32nd LEGISLATURE
As required by Section 201-10, Hawaiʻi Revised
Statutes and Section 210D-14, Hawaiʻi Revised Statutes

CBED Program Annual Report 2023

Table of Contents
Executive Summary ............................................................................................................ 2
CBED Mission .................................................................................................................... 3
CBED Advisory Council ...................................................................................................... 4
CBED Loan Program .......................................................................................................... 6
Current Loans ....................................................................................................................... 8
CBED Grants...................................................................................................................... 12
CBED Technical Assistance ............................................................................................... 13
Conclusion .......................................................................................................................... 14

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EXECUTIVE SUMMARY
The Legislature created a Community-Based Economic Development (CBED) Program in1991 in the Department of Business, Economic Development and Tourism (DBEDT) with
Act 111, SLH 1991, codified as Chapter 210D, Hawaiʻi Revised Statutes. As part of thestatute, the CBED Advisory Council and the CBED Revolving Fund were also created.
The Council reviews CBED financing requests and makes recommendations on theawarding of loans and grants, subject to the final approval of the DBEDT director. The
Council also advises the director on program implementation, and members represent theircounty in liaison with stakeholders in community-based economic development.
The Hawaiʻi Community-Based Economic Development Revolving Fund (now called the
CBED Special Fund) was established to provide training and capacity-building
opportunities and to invest in community economic development projects that result inmeasurable economic impact. Sources of revenue include repayments of loan principal,
loan interest, and interest from the department’s participation in the State’s investment
pool. Sources of expenditures include loans (state funds only), loans (20% state match for
EDA loans, see below) grants and technical assistance. As of December 1, 2023, the
CBED Special Fund account had a balance of $157,938.41.
CBED offers small business loans usually from $50,000 to $125,000 to eligible small
businesses that support economic development in their communities. The CBED program
helps small businesses to develop viable, sustainable ventures that serve local needs andare compatible with the vision, character and cultural values of their communities. The
CBED loan program supports a broad range of businesses, including agricultural
producers, manufacturers and wholesalers.
In FY 2021, the CBED program applied for and was awarded a grant of one million dollars($1,000,000) from the U.S. Economic Development Administration (EDA)/U.S.
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Department of Commerce for the CBED Revolving Loan Fund (RLF). The one-milliondollar EDA grant was matched by a required CBED commitment of $250,000. As of
December 1, 2023, CBED had 16 active loans supporting small businesses and 162 jobs ineconomically challenged areas of the state. Also, as of December 1, 2023, the CBED-EDA
Revolving Loan Fund (RLF) had $72,000 in funds left in the draw-down from EDA(requiring a $18,000 or 20% CBED match). As of December 1, 2023, the CBED-EDA
RLF account had a balance of $123,693.08. Sources of revenue include repayments of loan
principal, loan interest, and interest from the department’s participation in the State’s
investment pool. Sources of expenditures include loans (EDA with 20% state match) andloan servicing fees.
CBED currently has underwriting, co-lending and loan servicing arrangements with the
Hawai‘i Dept. of Agriculture (HDOA), Feed the Hunger Fund (FTHF), HawaiʻiCommunity Reinvestment Corporation (HCRC) and the Waianae Economic Development
Council (WEDC), an “emerging Community Development Financial Institution (CDFI).”
CBED partners with various organizations to target “hard to reach” sectors of Hawai‘i’sbusiness community to present information on business resources and educate communitybased organizations, such as non-profits, on how to strengthen their economic development
capabilities.
CBED MISSION
Through loans, grants and technical assistance the Community-Based Economic
Development (CBED) program provides training and capacity building opportunities topromote, support, and invest in community-based development projects that result inmeasurable economic impact.

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CBED ADVISORY COUNCILThe CBED Program is guided by an Advisory Council comprised of community leadersfrom around the State.
The CBED Advisory Council reviews all requests for financial assistance (loans andgrants) to assess whether the proposed community-based economic development activity
or enterprise is likely to achieve the purposes of the CBED program. The Council makes
recommendations to DBEDT regarding the appropriateness of the proposed activity orenterprise, and the DBEDT Director then has final authority to approve or disapprove thefinancial assistance.
CBED Advisory Council Members

COLLEEN MCALUNEY

Oʻahu
Exp: 06/30/2025

TEENA RASMUSSEN

Maui
Exp: 06/30/2027

JANE HORIKE

Hawaiʻi
Exp: 06/30/2025

KAREN BARR

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Oʻahu
Exp: 06/30/2027

KALEOKALANI KURODA

Oʻahu
Exp: 06/30/2023(Holdover)

NANCY ELVIRA LO

Oʻahu
Exp: 06/30/2023(Holdover)

ROBBIE MELTON

KauaʻiExp: 06/30/2026

DENNIS T. LING
Ex-Officio Representative for Director James
Kunane Tokioka
Department of Business, Economic
Development & Tourism

DBEDT
Representative

CASEY BROWN
Ex-Officio Representative for Chair Carmen
Hulu Lindsey
Office of Hawaiian Affairs

OHA Representative

MATTHEW K. LOKE
Ex-Officio Representative for Chairperson
Sharon Hurd, Department of Agriculture

DOA Representative

Council members bring a myriad of skill sets to the Department and the CBED Program.
Skill sets of current CBED Advisory Council Members include, but are not limited to:Strategic Communications, Program Management, Community Outreach, ProjectManagement, Government, Strategic Planning, Public Speaking, Nonprofits, Leadership,

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Business Strategy/Business Analytics, Financial Modeling, Process Improvement,
Finance, Risk Management, Public Policy, Grants, Public Administration, Customer
Service, Legislative Relations, and Policy Analysis.
During strategic planning sessions, the Council has voiced its agreement and understandingof the importance of partnerships and emphasized the need to leverage and obtain
additional CBED funding and seek loan servicing assistance to address the fact that
DBEDT does not have a loan officer to underwrite and service loans made through the
CBED program.
CBED LOAN PROGRAM
The Hawai‘i CBED Revolving Fund (now called a “Special” Fund) was established toprovide training and capacity-building opportunities and invest in community economic
development projects that result in measurable economic impact. Sources of revenue
include repayments of loan principal, loan interest, “Transfers” of revenue collections fromother closed DBEDT loan programs (i.e., Capital Loan Program, Small & Large Fishing
Vessel Loan Programs), fees from community conferences and other events sponsoredthrough the CBED Program and interest from the department’s participation in the State’s
investment pool. Sources of expenditures include loans (state funds only), loans (20% state
match for EDA loans, see CBED-EDA RLF) grants and technical assistance.
CBED Special Fund Account FY 2023
Beginning balance as of July 1, 2022
Revenues for fiscal year
Expenditures for fiscal year
Balance as of June 30, 2023

$275,302.52$91,371.13($98,457.24)$268,216.41

CBED Special Fund Account FY 2024 (5 mo.)
Beginning balance as of July 1, 2023
Revenues for fiscal year
Expenditures for fiscal year
Balance as of December 1, 2023

$268,216.41$4,120.00($114,398.00)$157,938.41

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In FY 2021, the CBED Program applied for and was awarded a grant of one million dollars($1,000,000) from the U.S. Economic Development Administration (EDA) in the U.S.
Department of Commerce. The one-million-dollar grant was matched by a CBED requiredcommitment of $250,000. Funds from CBED and EDA are committed to making loans tosmall firms that are ready to expand their businesses, create additional jobs and can exhibit
community benefits through their expansion.

The fund focuses primarily on

manufacturers, wholesalers, agricultural and value-added agricultural companies.
The CBED-EDA Revolving Loan Fund (RLF) is separate from the CBED Special Fund
outlined above since the CBED-EDA RLF uses federal funds with a state fundcommitment. The fund can only be used for loans, and it is tracked separately for EDA
reporting purposes.
CBED-EDA RLF Account FY 2023
Beginning balance as of July 1, 2022
Revenues for fiscal year:
Expenditures for fiscal year
Balance as of June 30, 2023

$ 6,202.24
445,735.51(338,876.25)$113,061.50

CBED-EDA RLF Account FY 2024 (5 mo.)
Beginning balance as of July 1, 2023
Revenues for fiscal year:
Expenditures for fiscal year
Balance as of December 1, 2023

$113,061.50$198,898.36(188,266.78)$123,693.08

The additional EDA funding into the State of Hawai‘i’s Community-Based Economic
Development Revolving Loan Fund (CBED-EDA RLF) enables the State to move towards
a more sustainable economy by supporting certain types of business activities as outlinedin the Comprehensive Economic Development Strategy (CEDS); in particular,
manufacturing; the diversification of agriculture and value-added agricultural production.
The EDA funding also allows for increasing jobs in economically challenged areas of theState. CBED-EDA RLF loans can be used for: start-up costs and working capital;

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construction or improvement of facilities; purchase of equipment; payment of production
and marketing expenses, including materials, labor and services.
CURRENT CBED LOANS
CBED Funded Loans
Kohala Meats & Deli – (February 2017) This is a joint loan
with the Department of Business, Economic
Development
andTourism's
Community-Based
Economic Development Program (CBED) and the State
Agriculture’s Loan Division (SALD). The $50,000 joint
CBED-SALD loan to Mr. David Fuertes and wife,
Carolyn Fuertes, was made towards completing
renovations of a 1,592 square foot leased building on Hawaiʻi Island that houses themeat market and deli and to refurbish the chill box. Mr. and Mrs. Fuertes havecontributed $100,000 of their own funds towards the project.
Hawaiian Agricultural Products, LLC (April 2020) received a 10-year CBED $60,000
loan matched with a $60,000 loan (total $120,000) from the State
Department of Agriculture’s Loan Division (SALD). CBED Revolving
funds were used primarily for the purchase and installation of additional
brewing and holding equipment needed to expand production anddistribution of shochu made at their distillery in Hale‘iwa. This is thesecond CBED loan approved for Hawaiian Agricultural Products. The
first was made in November 2011 for a $25,000 CBED loan, matched by
a SALD loan of $25,000. Funds were used primarily for the purchase and installation of aboiler, the last crucial piece of equipment needed to complete the distillery.
CBED-EDA Funded Loans
Re-Use Hawaiʻi (October 2021) CBED approved a CBEDEDA Revolving Fund loan of $50,000 to non-profit Re-Use
Hawaiʻi to be matched with a $50,000 loan from HawaiʻiCommunity Reinvestment Corporation (HCRC). CBED
Revolving funds will be used primarily for the purchase of
equipment and transportation needed to expand
deconstruction, acquisition and storage, and transportation equipment.
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Haleiwa Distilling Company (December 2021) CBED approved a CBED-EDA
Revolving Fund loan of $175,000 to Nathan Sisler, to bematched with a $175,000 loan from the Feed the Hunger
Fund (FTHF). CBED Revolving funds will be usedprimarily for the purchase and installation of additional
brewing and holding equipment needed to expand
production and distribution of whiskey, rum, liquors andgin made at his Waialua Sugar Mill distillery.
Maika`i Health Corporation (February 2022) was approved for a CBED-EDA Revolving
Fund loan of $50,000, matched with an additional $100,000 loan through a participationloan agreement between Hawaiʻi Community Reinvestment Corporation (HCRC-$50,000)
and Hawaiʻi Island CDFI-Lei Ho‘olaha (LH-$50,000). The
loan will be used to finance the cost associated with the startup of the Maikaʻi Health Community Clinic in Hilo which
opened on November 15, 2021. CBED-EDA Revolving
funds will be used primarily for leasehold improvements andoperating capital needed towards expanding services andoperations. Funding will allow Maika`i Health Corporation
to retain seven (7) full-time jobs and two (2) part-time positions. Expansion of services
will add additional positions which will be tracked.
HB Baking, Inc. (April 2022) was approved for a CBED-EDA
Revolving Fund loan of $25,000. CBED-EDA funds will be usedprimarily for the purchase of an ice cream truck to sell at pop-up
markets on the Island of Oahu and any operating capital needed towards
expanding services and operations. The company makes desserts andice cream. Funding supports the retention of two (2) full-time
employees and two (2) part-time employees. Expansion of services will
add additional positions which will be tracked.
Lubrco, LLC (May 2022) was approved for a CBED-EDA Revolving Fundloan of $125,000. CBED-EDA funds will be used primarily for working
capital and operating capital needs towards new product development,
scaling production and purchase order fulfillment. Lubrco develops,
processes, manufactures and packages disinfectant and cleaning solutions in
Hawaiʻi for product distribution to all islands, the Pacific Rim and North
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America. Funding supports the retention of five (5) full-time employees at the company’s
manufacturing site.
Amro-Asian Trade, Inc. (May 2022) was approved for a CBED-EDA Revolving Fundloan of $100,000. The company operates in the General Merchandise, Non-durable
business/industry within the Wholesale Trade-Non-durable Goods sector. CBED-EDA
funds will be used only for the purchase of inventory. AmroAsian Trade, Inc., offers innovative, high-speed denominating
counters. Currency Discriminators and Sorters are manufactured
in Japan and South Korea. Funding supports the retention of four (4) full-time employees.
Farm Link Hawaiʻi, Inc. (June 2022) was approved for a CBED-EDA
Revolving Fund loan of $100,000, matched with an additional $100,000
loan through a participation loan agreement with Feed the Hunger Fund
(FTHF). CBED-EDA funds will primarily be used for working capital.
Farm Link Hawaiʻi connects local growers and buyers via its innovative
online marketplace and supply-chain infrastructure. Farm Link Hawaiʻi connects
household and commercial buyers to local farmers for delivery or pickup. The company’s
mission is to build a thriving, equitable food system in Hawaiʻi by empowering local
farmers and improving access to local foods. The company currently employs twenty-two(22) people. In 2021, Farm Link Hawaiʻi purchased over $1 million of local produce andproducts from over two hundred (200) local farmers and ranchers and sold to over two
thousand (2,000) unique buyers.
Pomai Kulolo (June 2022) was approved for a CBED-EDA Revolving
Fund loan of $105,000, matched with an additional $395,000 throughparticipation loans among Feed the Hunger Fund (FTHF $150,000); Lei
Ho`olaha ($100,000); and the Hawaiʻi State Department of Agriculture(SALD $145,000). The company is native Hawaiian-owned and makes
Hawaiian food and desserts. CBED-EDA funds will primarily be used for upgrading
current facilities, expanding operations, and securing a supply chain for future growth.
Pomai Kulolo currently has twenty-five (25) employees and will create four (4) additional
positions.
Holoholo Tree Service, LLC (October 2022) wasapproved for a CBED-EDA Revolving Fund loan of$45,000. Holoholo Tree Service is a commercial
and residential tree specialty company that provides services in tree removal and thinning,
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hazardous removal, mulching, powerline trimming, and land cleaning. The company isbased in Mā‘ili, on the Wai‘anae Coast, which is designated as one of O‘ahu’s Enterprise
Zones, currently employs two (2) full-time employees, is a locally owned Native Hawaiian“woman owned” business less than two years old and is being fast tracked to enter into theFederal 8(a) Program. CBED’s loan will be used to purchase a new 2022 Bandit 250 XP
12” Disc Chipper. Acquiring this equipment will help to secure the hiring of an additional
two (2) full-time employees and two (2) additional part-time employees.
Kauai Kim Chee, LLC (November 2022) was approved for a CBED-EDA
revolving fund loan for $100,000, with a co-funding match of $30,000 fromthe Wai‘anae Economic Development Council’s (WEDC) Micro-Loan Fundfor a total of $130,000. Kauai Kim Chee manufactures value-added
agricultural food products for wholesale, retail, and the provision of “foodto-go.” The company was established in 2015 with primary products of Korean stylekimchee, namasu and pickled daikon. Their products are found at local farmers markets,
restaurants on Kaua‘i Island such as Duke’s and Keoki’s Paradise, ABC Stores,
Foodland/Sack n Save, and Times Supermarket on Kaua‘i. The company currently has two(2) full-time and two (2) part-time employees. 65% of the $130,000 loan will be used forthe purchase of a fully equipped food truck to increase company presence at pop-up
markets and community events on Kaua‘i. The balance of the loan funds will be used toincrease refrigeration units to accommodate anticipated business expansion.
Koko Kai Foods LLC dba Koko Kai Yogurt (May 2023) was founded by Aline Steinerand Jonathan Roach in mid-2020. The CBED Advisory Council voted to recommend
approval of Koko Kai Foods LLC for a CBED-EDA loan of $60,000 with a $60,000 match
from Feed the Hunger Fund (FTHF). Borrowers will also contribute Owners Capital of$50,000 for a total amount of $170,000. The funds will be used to purchase new yogurt
production and bottling equipment, build a “cold room,” complete
improvements in a new warehouse space, and provide someworking capital to help with bulk purchases of packaging
materials. Koko Kai Foods is a producer of non-dairy (coconut)
yogurts that sources ingredients from local farmers when possible,and fair-trade farmers when they have to import. Koko Kai yogurt is dairy free, gluten freeand plant based. It is unique in the market of coconut yogurts because it contains no addedsugars, starches, fillers, or gums nor preservatives and relies on 13 live and active highquality probiotics strains to achieve a shelf stable pH. Koko Kai sources most fruit andspices for their yogurts locally, from local farmers. They are currently selling products in

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Hawaiʻi in 84 locations throughout the State – Foodland, Wholefoods and Safeway, and in
California in nine (9) locations in the Los Angeles area.
Samurai, Inc. (September 2023) was approved for a $100,000 loan from CBEDwith a match of $100,000 from Feed the Hunger Fund (FTHF). Founded in 1995,
Samurai manufactures ice cream, frozen desserts, sugar and confectionery
products. They are based in the Kalihi area of Honolulu in an Enterprise Zone
and employ 20 people. The loan will allow the company toupdate their facilities and purchase automated production equipment that will increase
labor efficiency and reduce costs.
OCR Inc. dba Small Kine Farm (October 2023) received a $50,000 loan from CBED tomatch a $225,000 loan from the State Department of Agriculture’s Loan Division (SALD).
The CBED loan will allow the company to begin their organic mushroom growing
operation in Waimānalo, an Enterprise Zone. The
funds will be used for working capital andequipment. This loan supports Hawaiʻi’s food selfsufficiency initiatives.
Kauai Fine Woodworking (October 2023) was approved for a $75,000
loan with a match of $75,000 from Feed the Hunger Fund (FTHF).
Founded in 2021 by Adam Lang, Kauai Fine Woodworking (KFW)
operates from the North Shore of Kaua‘i in an Enterprise Zone. Adam has
23 years of experience as a carpenter, and the business is known for its
dedication to producing exceptional custom woodwork including crafting cabinetry,
designing custom doors, and creating elegant shelving units. The company employs eight(8) skilled workers. The loan will be used for facilities, equipment and working capital.
CBED GRANTS
Although the CBED program has limited funds for grants, the CBED Advisory Council in
response to the Maui fires of summer 2023 explored how the CBED program could assist
suffering Maui businesses. The Council approved granting financial support to allow small
businesses to participate in the Hawaiian Airlines Made in Maui County Festival on
November 3 and 4, 2023, at the Maui Arts & Cultural Center.

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The CBED program provided $65,000 in grants to cover booth fees for vendors. The
Hawaiian Airlines Made in Maui County Festival is an annual event
presented by the Maui Chamber of Commerce to showcase products fromthe islands of Maui, Moloka‘i, and Lāna‘i. “Many of our participants
experienced hardships following the devastating wildfires, losing
inventory, storefronts, retail outlets, and so much more, and we deeply
appreciate DBEDT’s financial support so our vendors can focus on preparing for theFestival,” said Pamela Tumpap, president of the Maui Chamber of Commerce. “This year
marks the 10th anniversary of the festival and it’s much needed, especially this year.” Thesponsorship allowed 132 companies to exhibit at the event and for the community toexperience what vendors have to offer while helping their recovery efforts. Each of theparticipating vendors received $450 for their booth space and other associated costs for the
Hawaiian Airlines Made in Maui County Festival.

CBED TECHNICAL ASSISTANCE
DBEDT's popular Hawaiʻi Small Business Fair was held September
16, 2023, at Leeward Community College (LCC) and was attended
by almost 250 small businesses. The purpose of the Fair was to help
local entrepreneurs launch and grow their companies in a postpandemic economy and the state’s new business landscape. The Fair
organized by DBEDT's CBED program and many DBEDT partner organizations offered
more than 20 classes led by professional
experts addressing a wide range of topics
including finding access to working
capital, protecting brand and intellectual
property,

e-commerce,socialmedia

marketing, staff management strategies,
and

more.

Additionally,

attendees

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connected with more than 30 exhibitors from various federal, state and county agencies,
financial institutions, and nonprofit business support agencies.

CONCLUSION
Community-based economic development is specifically a strategy for addressing theneeds of low–income communities. CBED has been implemented in the United States formore than 40 years, and in Hawaiʻi for more than 30 years. CBED strategies and practices
can play a valuable part in an overall economic development strategy for Hawai‘i.
Specifically, CBED is a bottom-up economic development initiative that can supplement
more centralized or top-down approaches. This bottom-up approach begins by sourcing
economic development opportunities from local communities themselves, which can begeographic or demographic communities or communities of interest. These opportunities,
which usually become projects, not only have community-backing, but usually have someform of community control. The CBED approach can help existing or build newcommunity-based businesses for a more sustainable Hawai‘i economy, based on
decentralization, partnerships, human resource development, and innovation. CBED is a
key strategy for providing economic opportunities for Hawai‘i’s residents.

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