The Hawai‘i Department of Commerce and Consumer Affairs’ new, $2.1 million “Business Express” registration system is causing what users describe as interminable delays in processing documents needed to start and operate businesses. Processes that previously might take a few days are taking weeks or months. 

For them, the Business Express system is far from speedy.

In a statement provided by spokesman William Nhieu, DCCA acknowledges it’s facing problems merging three 20-year-old systems into one new one — a task that involves migrating millions of documents and business records and training staff to use the new system. Staff are finding problems and continually working with the vendor, Aalta LLC, to work out bugs, the statement said.

“As with any transition of this scale, staff who had years of familiarity with the legacy systems are now completing training and building day-to-day proficiency with the new platform,” the statement said.

Whatever the reason, Danielle McKim says the delays are frustrating. McKim has been running businesses in Hawaiʻi for 30 years, dealing with the often frustratingly slow culture of the state’s bureaucracy, but nothing, she says, prepared her for this. She’s trying to start a real estate services business but learned that the system is bogged down with delays when she tried to register.

“This just feels like another kick in the face,” said McKim, who noted CNBC in July ranked Hawaiʻi as the worst U.S. state to do business in. “I can understand it’s Hawaiʻi and things take time, but this is horrific.”

McKim’s views are echoed on a Reddit channel where users are sharing horror stories about delays with the business registration system. One Reddit user says the process, which in the past took three to five days, is now taking eight weeks. Another user wrote of having to miss a scheduled business conference, which required a business registration to attend, because of the delays.

DCCA couldn’t say how many applications were backlogged or how long wait times are now, but confirmed the problem is significant enough that the agency has brought on more staff to process applications.

With small businesses serving as a major part of the Hawaiʻi economy, anything that slows the ability to start new ones has broad impact, said Sherry Menor McNamara, president and chief executive of the Chamber of Commerce Hawaiʻi.

“Any time there’s a delay,” she said, “we’re slowing the growth of our economy.”

Agency Suggests People Call For Updates

DCCA over the summer announced that the change to the new system and online portal would take effect July 6. Expedited processing of documents for people willing to pay extra would no longer be available.

“During this transition,” an announcement posted on DCCA’s website said, “we apologize for any delays you may encounter.”

In its statement to Civil Beat, DCCA encouraged people facing excessive delays to call 1-844-808-3222 (ext. 2) for updates on their filings. 

According to DCCA, part of the issue involves the volume of work. The agency handles 160,000 transactions annually and maintains files on more than 200,000 registered entities. As workers deal with the new system, issues that didn’t show up during testing are now starting to surface, and workers must determine whether the problems amount to nuances in the system or actual bugs. 

 “While many transactions are straightforward and may be processed quickly, others involve complex or complicated filings that require significant review,” the statement said.  

Simple transactions might include simply changing the address of an existing registered business, while a new business registration is more complicated. 

The statement provided by Nhieu said the agency “understands the importance of timely business filings to Hawaii’s business community and is working to process all applications as expeditiously as possible.”   

‘This Is Ridiculous’

McKim learned about the issues when she tried to register a new business in late August. A licensed real estate broker, McKim has also run a farm and solar company and was familiar with the old business registration system.

When she went to DCCA’s website, she saw that applications were being delayed, but not for how long. So she looked elsewhere online, including Reddit, and was alarmed to find people talking about two-month processing times — far longer than in the past, with no option for expedited service.

By contrast, she says, getting a taxpayer identification number from the IRS took “about five minutes.”

“That’s the most bloated bureaucracy ever,” she said of the IRS, “and they’re faster than Hawaiʻi.”

The slow processing times have significant implications for business owners like McKim. Without a valid registration, she can’t do things like register her business or open a business bank account. 

“This is ridiculous,” she said.