A bill before the state Legislature would appropriate funding for the Hawai‘i Technology Development Corp. that would support the economic development agency in its efforts to diversify the state’s economy.
In the most recent version of the legislation, House Bill 454 will establish state goals for economic growth by driving innovation and technology and would give money to HTDC to support programs that address those goals; and require HTDC to provide annual reports to the state Legislature for the next three years.
The bill was heard by the House Economic Development & Technology Committee earlier this month, and subsequently passed a second reading as amended in HD1 with Rep. Elijah Pierick casting the lone 'no' vote, according to status updates on the measure. It was considered by the House Finance Committee Monday.
The bill initially called for a $6 million appropriation from the state's general revenues in both the 2025-26 and 2026-27 fiscal years — $2 million for the Hawai‘i Small Business Innovation Research Program, or HSBIR, $2 million for the Manufacturing Assistance program, or MAP, and $2 million for accelerator programs facilitated by HTDC.
However, it was passed from the Finance Committee with amendments, including one to "blank out the appropriation numbers."
According to a previous announcement from the agency, the MAP grant, which is capped at $100,000, offers a reimbursement of up to 20% to businesses on eligible expenditures that include equipment, workforce training, energy efficiency projects and feasibility studies for manufacturing.
Meanwhile, HSBIR is a matching grant program that aids businesses that have received federal Small Business Innovation Research Grants.
An agency spokesperson told Aloha State Daily that HTDC’s base appropriation for fiscal year 2025 was a little more than $1.64 million. An additional $6 million in funding would about triple its budget.
Testimony submitted before Monday’s Finance Committee meeting supported the legislation and funding.
HTDC Interim Executive Director Sandi Kanemori said in written testimony submitted before the committee hearing that the organization is “dedicated to initiatives that promote economic diversification and sustainable development, while fostering technology advancement and business growth. These efforts ultimately contribute to economic stability for Hawai‘i’s small to medium-sized businesses.”
Kanemori told committee members Monday that the bill supports its three core programs, which align with HTDC’s mission “to promote economic diversification, create a more resilient Hawai‘i that supports small businesses, entrepreneurs and start-up companies, whom, among other things, are helping us to solve local problems in our community using local innovation and technology.”
“… We, of course, need to invest in our own local companies and local business assistance programs, especially if we want to stay competitive in this ever-changing global digital economy. So we ask for your support on this bill.”
“Funding for MAP, HSBIR and Accelerator grant programs are critical for the growth of our local economy,” Kanemori told Aloha State Daily in a follow-up. “These grants provide the catalyst that spark innovation, growth and sustainability for small businesses here in Hawai‘i."
Blue Startups — a business accelerator focused on helping "scalable-technology companies compete globally," according to its website — benefits from the accelerator funding provided by HTDC, Managing Partner Chenoa Farnsworth wrote in testimony in support of the bill submitted before Monday's hearing.
"Without HTDC funding, we would not be able to provide the support for our technology based companies in Hawai‘i," Farnsworth wrote. "We strongly believe we need to grow the technology sector in Hawai‘i in order to provide high-paying jobs in the future. To date, Blue Startups has supported 131 companies through its 12-week mentorship program. Those companies have gone on to attract over $1 billion in funding and created over 1,000 jobs."
The measure, which can be read in full here, was introduced by state Rep. Greggor Ilagan, who represents parts of Hawai‘i Island’s Puna District and is chair Economic Development & Technology Committee. Ilagan did not immediately return a phone call or respond to emails from ASD.
Kanemori, a senior economic program manager, is serving as interim executive director of the HTDC. Former Executive Director and CEO Damon Matteo was appointed to the role last November but resigned from the position on Jan. 23, the agency spokesperson told ASD. Matteo had been working with the organization since his appointment and "getting acclimated remotely," but a firm date for his physical start in Hawai‘i could not be agreed upon, they said. An "expedited search process" is underway to find and appoint a new executive director.
Stephanie Salmons can be reached at stephanie@alohastatedaily.com.
