Photo of the former Uncle Billy’s Hotel on Banyan Drive in Hilo after the vegetation was cleared (courtesy Hawaiʻi DLNR)

(BIVN) – A few weeks after Governor Josh Green issued an Emergency Proclamation concerning the former Uncle Billy’s Hotel on Banyan Drive in Hilo, the State of Hawaiʻi has an update.

From the Hawaiʻi Department of Land and Natural Resources:

The dilapidated and condemned Uncle Billy’s hotel will have a perimeter fence constructed around the entire property beginning this month.

Today, overgrown vegetation surrounding the front of the building was cleared. The entire perimeter will be cleared in advance of fence installation.

Following the state procurement process, the DLNR Land Division has contracted Andrew’s Fencing LLC to build fencing around the former 148-room hotel. The company informed DLNR that it will start work in August and take about one month for completion. The purpose of the fence is to physically secure the site from continued illegal occupation and to alleviate health and safety concerns. Demolition of the building could begin by the end of the year.

Photo of the former Uncle Billy’s Hotel on Banyan Drive in Hilo after the vegetation was cleared (courtesy Hawaiʻi DLNR)

While the Emergency Proclamation issued by Governor Josh Green, M.D., on July 18, removes and/or expedites some of the regulatory processes associated with a project of this magnitude it does not exempt a demolition contractor from securing material disposal certificates and other regulatory permits. A demolisher has not been chosen yet through the established procurement process.

The proclamation terms the situation as an “emergency situation” and expires on Sept. 15 and can be extended for 60 days if necessary. Additionally, for any contracts that are entered into during the term of the proclamation, it provides work can continue until completion even if after the effective period: “Notwithstanding the termination of a disaster emergency relief period, any contracts, agreements, procurements, programs, or employment of personnel entered into, started, amended, or continued by reason of the provisions of the proclamation relating to this emergency shall continue in full force and effect.”

In the 2022 session, the legislature appropriated $13.5 million out of the DLNR Special Land and Development Fund (SLDF) for the demolition of the hotel. However, the SLDF does not have $13.5 million to pay for the demolition. In the 2023 session, the Legislature appropriated $8 million in reimbursable general obligation bond funds that DLNR will have to pay back over time with interest. DLNR is using the 2023 appropriation of $8 million to pay for the demolition under the emergency proclamation.

DLNR Chair Dawn Chang said, “We appreciate the Governor’s emergency proclamation as we have long sought a solution to Uncle Billy’s. DLNR has been planning for the demolition of the hotel for many years and has been seeking legislative appropriations for the demolition since 2019. The Legislature did not make funds available until the 2023 session. The proclamation is intended to remove some of the regulatory processes that can delay timely demolition and removal. It speeds up the permitting and contracting process by suspending certain State and County permitting and procurement requirements.”

Chang added that with the perimeter fencing and ultimate demolition of the building, the State is removing a serious health and safety hazard to provide greater opportunities for economic development or recreational opportunities of the site.

Once Uncle Billy’s is demolished, the property is cleaned up and restored to bare ground, DLNR will make recommendations to the Land Board, in consultation with the community and stakeholders. This planning process will help decide the future use for the property. “We are part of a collaborative working group coming up with a vision for the future of Banyan Drive and this will not be DLNR’s vision alone. We believe that continued coordination with the Hawai‘i Island community, and in particular the Hilo community, can make Banyan Drive an economic engine and cultural resource for everyone.” Chang said.

This includes conducting an updated strategic assessment of the Banyan Drive area, including but not limited to feasibility, infrastructure, and market studies to facilitate redevelopment. During its July 14 meeting, the Board of Land and Natural Resources (BLNR) authorized Chang to negotiate a Memorandum of Agreement with the Hawaii Community Development Authority to procure and manage a consultant for this project.

In addition to the demolition of Uncle Billy’s, another Banyan Drive priority is the renovation of the former Country Club Condominium Hotel. At its meeting on April 28, the BLNR authorized the DLNR to negotiate a development agreement for this project with Banyan Drive Management LLC. Those negotiations are ongoing.