 Aloha, everyone, and welcome to Hawaii Together on Think Tech Hawaii. I'm Kaylee Akina, your host and president of the Grassroot Institute of Hawaii. Before the COVID-19 lockdowns, Bill Comerford owned four of Honolulu's most well-known restaurant bars. You've heard of them. Kelly O'Neill's, Irish Rose Saloon, Anna O'Brien's, and O'Tools. But the forced closures during the lockdown years and later heavy taxation led him to sell all but three, and now he's left with only the Irish Rose Saloon. Comerford says he's racked up lawsuits and debt when he was forced to close his businesses. But the latest nail in the coffin is a surprise state tax. It's a bill related to the Federal Restaurant Revitalization Fund and Shuttered Venue Operator's Grant Program. Bill is now being served with the notice of having to pay taxes on that assistance. During this episode of Hawaii Together, Comerford will discuss the taxes and fees that ultimately toppled his businesses and wiped out his retirement savings that he built up over many years. These are not happy thoughts, but I'm so grateful for the courage and the stamina of this gentleman and friend, Bill Comerford. Bill, thanks for coming on the program today. Welcome. Very great to see you, Kelly. Wonderful day. Very nice to be able to come out and express my opinion on occasions. It's always good to hear from you, and what you have to say is relevant to all of us here in Hawaii. But first, tell us a little bit about your background. In particular, how would you get into the restaurant and bar business and let our viewers know the scope of your success? Well, I was raised in New England, Connecticut, and Rhode Island. My dad had me at the beach every summer, and we were 100 yards away from the bar, and my dad raised me in that bar. My very first job, he took me home and said, son, you're working. I said, when? He said, tomorrow. Where? At the bar. Till when? Till Labor Day. How much are we making? $20 a week. That's how I got into business at a very young age of 12 years old. Pursued it throughout high school and college as a means of it. How I say it means of income. I decided as a history major, I was not going to teach. In my senior year, I walked into restaurant management. I've been there pretty much ever since. Came to Hawaii in 1979. Came a bartender and bar manager. Came bar manager for multiple operations. Eventually became bar manager for the Irish Rose Saloon. And when my owner, Jeremy Owain Fessenden, chose to retire, stepped in and said, I'd be willing to buy it. I wanted to buy it, and my partner wanted to buy it. And he decided we're going to make it partners. And we've been partners for 23 years. And sadly, we went all the way through everything, built every bar. We developed our bars as, how do I say, not as we didn't own the, we owned the business. We didn't own the building. So we were less seized in all operations. But we, every operation we had financed the next operation. So we had four operating bars, a management company, that ran them all, which was the key to our success. And then what happened was that we encountered COVID, which kind of shut us down because why? We gathered people, and that was our guilt. No, it wasn't guilt. We did it for years. And gathering people was the sin that you had during COVID. And sadly, they didn't speak to us. They didn't, our government did not aid us for 15 months. It took 15 months for us to get any money. And in that timeframe, we fell out of all of our operations. We lost everything we had. It was all gone. You know, Bill, during those COVID-19 lockdown years, what was it like to try to operate and keep your establishments running? It was impossible. Yes, our government, as it was, I would say local government, City and County being the mayor as our head administrator. And with the state, with the governor as the head administrator, they were absolute rulers. And they made the call. And they made up the information as they went along. They didn't follow state rules. They didn't follow City and County rules. They made it up based on other, like I said, other situations in other areas, like what was happening in California, what was happening elsewhere. They would take something from that and just make up a rule. There's no such rule that we have to have a restaurant have 30% sales food. Any bar can sell food. I had the permits and everything else. I had the passing permits. So all of a sudden I started selling hot dogs and you decided, hey, you have to sell 30% food. Or otherwise you're not a restaurant. Which is totally conflicting to every license in Hawaii, because it's never been developed. So the regulations during that period of time, the lockdowns, just really didn't make sense. Completely. They were really harmful. Sure, very much so. We lost, they closed us in March of 2020. Right around St. Patrick's Day. I think St. Patrick's Day was the shutting day. He stayed open at midnight that day and then closed the next day. In that timeframe, we had no income at all. There was no source of income. You have to be open as a bar to make an income. So we were closed from that period. And we were very brilliant in what we did because we had a very good controller. In other words, we had a corporate office that did all our operations. And our controller got us immediately into the PPP programs. We got a immediate $10,000 EIDL, which is not going to cover a six and a half million dollar year corporation. But that's what we started with. And from there we applied for a $150,000 EIDL, which was a 30 year loan at 1%. And then we got into the PPP. We received it very early because we had our application ready and doing so, we received approximately almost $600,000 for the four operations. Now, every bar has 100, the whole four bars takes $100,000 just in expense for rent, insurance and just the basics. Probably utilities as well. So we received the closest $600,000. And that was a federal grant in the PPP. And that was coming through U.S. Congress. And one of the stipulations that the Speaker of the House made was that 75% had to go to labor to pay their expenses. On Hawaii, our expenses extremely high. So what that meant was I had to pay three months of labor to open for one month and a half, for 40 days. That's how much rent I could pay. So it made no sense. So before they even let us open, we were closed. And all the money had been spent because it had paid to the employees to keep them in a job that wasn't there. Well, Bill, at that point, how many employees did you have in these four restaurants? And what happened? What's happened to those employees? Well, we had 80-plus employees employed at any one given time. Part-timers, full-timers in the corporation, inside each of the bars. Each bar was its own corporation. And what we did was we filed our taxes through E&J Lounge Operating Company. And so we had approximately 150 musicians because that's what we did. We employed musicians every single night, bands, single entertainers, visiting bands, concerts from everywhere, things that we did. And that's what we did as a means of making entertainment. That was our business model. So when that came about, we no longer had 150 employees plus employees as employees, as contract musicians. And plus we had 85 employees that were put out of work, including myself and everybody in the corporation as well. E&J. So the shutdowns not only affected your business, it affected the lives of all of these employees and contractors who depended. And in their families as well. Well, Bill, if you don't mind telling our viewers, how did this impact you personally in terms of your own finances? You mentioned to me back then that all you had left was your retirement. What happened, Bill Cumberford, as a result of the lockdown? It's been severe. I had a laugh because I was in the ICU two years in a row prior to it. I ended up getting COVID and went to ICU for that as well. So I had health issues. I had no employees to use because once you paid them, they were paid. They couldn't qualify for unemployment themselves. So it was a big challenge talking to all of them, trying to make a decision how it worked. Because I told them, I said, we're not going to open in time. For us to be open. So going back to me, I still have my house. I'll be getting divorced and I'll be separating and moving away. And I'm choosing to leave Hawaii. Been here since 1979. It's been very good to me. Had a good corporation. I made money. I enjoyed the island. I love the people. I love everything here. I gather people. I bring people to my bars all the time. I developed things for the friends of St. Patrick, the whole Irish community. I did the St. Patrick's Day parade. I still lead that every year. And I've lost all that. And so the bars themselves, the beast of burden, as each bar lost its lease or passed away, I was moving all the product from one bar to the next bar to the next bar. So by the time we got around to by December, all our bars were gone. So we were forced to sell Kelly own eels and we were forced to sell our tools. The other two bars, the lease expired. So we did nothing with that. And when we eventually came around to the restaurant relief fund, 15 months later, we had two licenses still valid, but we had no leases. So our landlords asked us to come back so we could use the money. I took the money just to go back to get out of debt, because that was a million dollars in debt at that time, which I was able to do. I got out of debt. But should I have done it in Hawaii? I could have took that money to the mainland and just took it up and opened the whole bar system somewhere else which is probably what I should have done because of the nature of how Hawaii's government treated me. They ignored me. They quite honestly just ignored it. Not just me. Everybody in the bar business and guess what? They ignored all small business. And that's what they did. Truly, they ignored small business and took care of their own needs. They went home for 18 months, got paid and came back 18 months later and that's pretty much what they've been doing. To what do you attribute the treatment that you received or the lack of attention at the very least to the concerns that you and other bar owners had during that pandemic period? Well, there's two very sadly very obvious things that they have in Hawaii. And one thing is they say, don't rock the boat. You rock that canoe, you'll see bad effects from it. So, they'll be on your doorstep every day. That's what they've always said about the liquor commission. You can complain about the liquor commission, they will be on your doorstep immediately. Well, Bill, you were not silent. You were willing to talk to the media. You were interviewed on television. You were in the newspaper and do you feel that there were negative ramifications of your being willing to speak out publicly about the government? Absolutely. The mayor realized that every liquor license he let us open the bars on June 19th. Everybody says, why June 19th? Because every liquor license on the island expired on June 30th. He had us come back, apply for our liquor license again, pay for a million dollar liquor liability, pay for our taxes for the past year, but it's open for 19 days in June. I'm sorry, not 19 days. It was 11 days in June. And then you let us open 30 days in July before he closed this again. So, he let us renew our liquor license and pay for it and pay for our insurance. Then he closed this. So, that's a huge problem. But beyond that, because we were in that open period because I spoke out for two weeks straight and I said, liquor inspectors, health inspectors in police inside the Irish Roe Saloon every single day, all hours coming in and they remarked to me, they said you're doing a really good job here. You're following all the rules. I don't understand why we keep getting sent back. I said, well, who's the source of the complaint? The mayor's office. Of course, they always call that anonymous. Which is nonsense. It was absolutely a mayor call bullet who was calling that. He had them going in there every single day. I asked the police. I asked the liquor inspectors. I tried to reach the health inspectors. Health department never refused to return to any call ever, ever. So, the basis is all that complaints came out of the mayor's office. Now, Bill, the story you've told is bad enough in and of itself. When you've tried to get yourself back on your feet, you are doing your best. Recently, you got hit with the knowledge that there's another story. After you thought everything was starting to settle down, there was what we call a surprise tax from the State Department of Taxation. It had to do with taxing some of the federal funds you received in the COVID program. Tell us a little bit about that. Explain that. As I said, I received different monies and different times, but when you're applying for different things during this program, there was limitations on every application you could make. Let's just say I got to the end of my fiscal year of June 30, of 2020. I'm going into the next year and I've renewed my liquor license. I'm trying to apply for more PPP money. I could receive none. Why? Because you have the shuttered venues grant. Because you have live music. They're ignoring me that I can get any further funding. I can't get any more funding. I'm sitting there waiting and going through the shuttered venues grant. You're trying to do the applications there. It kind of started in that July, August, September time period. People were just gathering together trying to find out what the program was going to be. If you're applying for a shuttered venues grant, you could not receive any PPP money. You could still receive money from the CARES Act. I got a little bit from the city and county, but I only got that at the very end of the year when my bars were already closed. So it did very little good. It just paid off some bills. It paid off past electric bills and whatever along those lines. Utility bills. But as you continue to go forward, they're saying, well, guess what? But we're going to offer something else that's coming up. Restaurant Relief Fund. So the restaurant relief fund they're talking about at the end of the year in December. And that's something that's just going to be a program coming forward. So you're waiting for money and you're waiting for money and you can't get any money. There's no money to get. I go to the government. The government says, the city and county's economic advisement board tells me $1 million. I say, excuse me, do you know any banks loaning $1 million that somebody has no income? They said, oh, well, then you should sell your bar. I said, do you know anybody who wants to buy a bar that you can't open? So here I am. I can't sell the bar for any money. I can't operate the bar for any money. I'm just stuck in limbo. Just accumulating more bills. Continuous. So eventually they actually got the restaurant relief fund money going. Now we applied for that. Once again, I had a very good controller. He had everything ready for us. We submitted the application and we didn't think we would get it. But because we lost 95% of our income, we went from $6.5 million a year in sales to half a month sales, which was $300,000. For a whole year. And you could not keep four or five companies going that way. We managed this with $150,000 to keep the E&J going just to have to do the paperwork and all the taxes and everything else. Currently, I still have all five operations. Why? Because I'm still doing taxes for every one of them. It's not like they're there. They're gone. Kelly O'Neill has been sold to somebody else. O'Toole has been sold to somebody else to operate as a black shamrock tavern. Recently, I sold Dan O'Brien's under a management contract. It's a sale over time. Because quite honestly, it's a rough road out there. It's not like the business has come back. The business has come back to maybe two thirds of what it used to be. But you can't pay the utilities and expenses that you had from the past and pay the current rates and everything's going up because of inflation. There's no return on this. I've gone from making a very decent salary to making below the poverty line. Bill, going back to the federal funds for which you're being taxed by the State Department of Tax, let's be clear about this. You're not talking about Paycheck Protection Plan or PPP money. No, they forget that. This is money from the restaurant revitalization fund or the shuttered venue operators grant program, right? Here's my question. Why are you being taxed for monies you took from those federal programs when people who received aid under the PPP Paycheck Protection Plan are not being taxed? It's a state tax decision and quite honestly, that's where it's at. So if PPP money has been forgiven, but my restaurant relief fund money is not being forgiven and they're taxing in two manners. They're taxing as income which was $3.1 million. That's $3.1 million and how is that going to come across on tax wise? I just don't know. But when I came back with that money to operate, we were still under restrictions. Bars had to close by 10 o'clock. My bars had to have live bands at 9 to 1 o'clock. You can't open up and say you're a nightclub at 3 o'clock in the afternoon and make money. It's not going to happen. So we lost money to the tune of about $750,000 in the first year. $450,000 in the second year and we had to use all the money. So we used all the money and if you didn't use it, you had to return it. So after the fact, now they're saying, it's a year and a half later, they're saying we're going to tax everybody that's on that list that got that restaurant relief fund. Restaurant relief fund money. And so in doing so they could tax me in two ways. They're taxing me as GET as a single transaction to receive in $3.1 million. So they want the 4.75% of that which would be about $160,000. That's not Trump change at all. So that's the one decision and then if they tax it as income I don't know how I have to assume it has to go through the same income tax process. So hopefully I'll have a loss and it won't have to be that one. But it could be anywhere from $160,000 maybe to half a million dollars of money that's not there. If you don't mind you've shared this with some of our audience before but how big of a tax bill are we looking at for you? And are you going to be able to pay it? I question it because what I was trying to do was personally coming back I came back just to try to get out of debt and see if I could put my bars in a position to sell. So I'm trying to be in that position hopefully so I can return something from all my effort of 25 plus years to try to have a return on my business investment. So quite honestly what I am is I'm a small business advocate. I'm just talking for the sake of all small business and white. And quite honestly the sad thing about all this is that I cite some that people say it's a mystery and it is a mystery. There is something out there called the white small business bill of rights and you can find it on the Department of Economics Business and Economics and Tourism on their website. It's on the SRBVV Small Business Regulatory Review Board. And you go there and you'll find 16 rights that you have that they profess come to Hawaii and these are the rights you have when you operate a business. It's all of falsehood. It's complete falsehood. They never pass them. If they want to do something for the state of Hawaii pass that bill right now because for 16 months trying to reach out to government to ask questions they wouldn't even answer the phone. They wouldn't even answer the phone. They wouldn't take a request for a meeting. What was represented at the time was representing the Hawaii Bar Owners Association and representing multiple owners and they wouldn't even take a call. Bill, what are business owners doing to fight this? Is it Hawaii Restaurant Association or other groups going to bat over the situation? I believe there's some members of the Hawaii Restaurant Association. Some paid it and some said I won't contend. Others said I'll wait and see. And that's pretty much it. It's a wait and see operation right now. But what they've done is they've gone to the Small Business Administration has a list of all those people that received those funds and they're going right down the line auditing all of them. Now they audited me for the tax purpose in December as a Christmas gift. As my gift for Valentine's Day the Labor Department saw it. I've been audited by the Liquor Commission. I'm one person trying to run everything and I cannot do it. That's why I'm saying that my blood pressure has been so high they're killing me. So my action right now is give it all up and leave the state. That's the smartest thing I can do. It's a sad thing to do. But that's what I have to do to stay alive. If I die, think don't. Have any state lawmakers step forward and try to help you or the governor who is the boss of the director of DOT? No. Same condition during COVID. You could not reach a government. I was told by members of the DEVD that don't even come at us. But honestly. This is certainly a somber situation and just to hear you say that your only recourse is to leave Hawaii a place that has been your home which you love and which you have contributed so much in terms of our restaurant culture and our community makes me very sad. We've only got a minute left, Bill. Any closing thoughts or ideas that you'd like to share with our audience? I firmly believe if I had one mission in life here in Hawaii it would be to introduce those laws. Small Business Regulatory Review Civil Rights. They should be law. They should be law. They can't ignore this. They can't do it all the time. They ignore you. So you're gone. And that's not what the government is supposed to do. The government is supposed to be represented as the people. Not supposed to be represented as the government itself. I feel that the state government here represents not the business people, not the people, but themselves. Those in government. Pyrocrats, everybody else. That's who they view the money sport. And that's how they keep it and that's that. I don't mind making money and paying taxes. Let me bank money. Just don't keep taxing me and putting me out of business. He put me out of business and he taxed me for it. Why? You found words. Bill, thank you for being on the program today. My pleasure. Well, you've heard from Bill Comerford, entrepreneur here in Hawaii possibly on his way out of the state. Words to think about. This is Kaili Ikeena on Think Tech Hawaii's Hawaii Together. Until next time. Aloha. If you liked this show, why don't you give us a like or subscribe to our channel? Thanks so much.