The Honolulu City Council has passed a measure to make grants and loans available to businesses hit hard by rail construction, but it’s still unclear where the city would get the funds for such a program or at what amount.

The measure now goes to Mayor Kirk Caldwell following the Council’s 9-0 vote Wednesday. Caldwell intends to sign Bill 42 into law pending legal review, one of his spokesmen said.

The bill advances as many businesses continue to absorb the brunt of rail construction along Farrington and Kamehameha highways, with the popular Flamingo Restaurant Bakery closing its Pearl City location last month, Tanioka’s Seafood & Catering scaling back its hours and Zippy’s temporarily closing its Waimalu location through August for renovations, with the work timed to coincide with rail construction, among other examples.

“If these places that are the best establishments out there (are suffering) then we know something’s wrong,” Councilman Trevor Ozawa said before Wednesday’s unanimous vote.

Also prior to the vote, Council Chairman Ernie Martin repeated the proposal he made last month that the city consider using some of the hundreds of millions of dollars from a potential five-year rail extension to fund the program. However, federal transit officials say that any local or state funding used as a match to federally funded projects cannot be used to help local businesses stay afloat, per federal policy.

In other words, rail officials cannot “carve out” state tax dollars devoted to the project for the construction mitigation fund, they say.

After Wednesday’s meeting, Martin said that he had not discussed the issue directly with the federal partners funding $1.55 billion of the approximately $6 billion elevated rail transit project. He further said that his proposal to use general excise tax surcharge dollars does not mean that the City Council is guaranteed to pass the five-year extension, which Gov. David Ige authorized last month.

“Nothing is a done deal,” Martin said Wednesday. “All of the members are exercising their own due diligence” on how they’ll vote regarding the extension.

The city could also use its general fund dollars or federal Community Development Block Grant funds provided to the city to fund the construction mitigation program, Martin added.

“There are other avenues,” he said.

Last week, during the Honolulu Authority for Rapid Transportation board meeting, new Chairman Don Horner suggested reaching out to local banks to help the businesses, and he proposed the agency reach out to the Hawaii Bankers Association to see if it might assist.