HONOLULU — The Hawai‘i Tourism Authority’s top leaders argued for the continuation of the state agency — and their jobs — in a press conference Wednesday, April 19, which they scheduled to address the “unintended consequences” of two measures looking to dissolve the HTA and replace it with a new state office.
The two measures, House Bill 1375, introduced by state Rep. Sean Quinlan, and Senate Bill 1522, introduced by state Sen. Donovan Dela Cruz, both state that it’s “necessary and appropriate” to dissolve the HTA “due to mismanagement” and replace it with an office of tourism and destination management within the state Department of Business, Economic Development &Tourism.
Both bills, introduced as a response to public complaints of over-tourism, are now headed to Senate-House conference committee meetings.
“To say we’re at serious odds with the Legislature is an understatement,” said HTA President and CEO John DeFries during his opening remarks at the Hawai‘i Convention Centre in Honolulu on Wednesday afternoon. “We’re hoping that today we can respond to questions and make our case known.”
DeFries began by highlighting the HTA’s strong revenues in “a marketplace globally that is still relatively unstable,” noting the authority ended up with a direct tax revenue of $2.21 billion in 2022.
“We are on track for another productive year. Those results are directly related to the network that we have globally,” he said, adding that the “mere name change” of the HTA would have “immense ripple effects” on tourism in Hawai‘i.
Those effects include the state losing more than $14 million in federal funding for visitor education and natural resources, said Daniel Naho‘opi‘i, the HTA’s chief administrative officer.
“Just that little move of dissolving our agency and changing the name means we would actually have to reapply for those federal funds because they’re no longer tied to our agency,” he said.
Naho‘opi‘i also said the bills would halt progress with “destination management action plans,” the HTA’s initiatives for “regenerative tourism” across the Hawaiian islands.
Naho‘opi‘i also lamented that the bills would restructure positions and change the top leadership. Both SB 1522 and HB 1375 seek to disband the current 12-member board and replace it with nine members from a variety of diverse backgrounds under state control.
“Now we’ve already had problems with losing quality senior leadership because they were afraid of not knowing what’s going to happen to their positions,” said Naho‘opi‘i, adding the HTA is already “making moves” in senior leadership changes.
“But by dictating this process of what should be and how we should be structured, it actually just creates more confusion,” he said.
Naho‘opi‘i suggested that state conduct “a governance study that’s been recommended” to do an “external deep dive into how (the HTA) should function” instead of dissolving the authority.
Even if neither bill is approved, the HTA faces severe budget cuts for the upcoming 2023-24 fiscal year. The authority requested $75 million, but the current state House bill of the operating budget, formally known as House Bill 300, appropriates just $35 million.
The Senate version appropriates zero dollars.
“How are we going to communicate to our community partners that we have the funding … if we can’t even guarantee that we have the capacity to support them,” said Naho‘opi‘i of the budget. HB 1375 appropriates $60 million for the establishment of a new office of tourism and destination management.
HTA Board Chairman George Kam also spoke during the conference, and was hopeful about positive collaboration between the HTA and state lawmakers.
“I think we can really come up with great policies that’s really going to improve the life of all the people in Hawai‘i,” he said. “A strong foundation of Hawai‘i tourism will be balanced with the desires of the community … I think you’ve constantly seen that since we embraced our new strategic plan,” he said.
Kam also noted the board is made up of a diverse group, and emphasized that DeFries is the “right leader and navigator” at this time.
DeFries was hired by the HTA in September 2020, and is the first Native Hawaiian to lead the agency. According to a 2020 report from the Honolulu Star-Advertiser, he has a base salary of $270,000, with an automatic 5 percent increase each year. His contract is set to expire on Sept. 23, 2023, according to the report.
Toward the end of the meeting, DeFries said the end of the pandemic, climate change and political instability means the state of tourism in Hawai‘i is vulnerable to global competition.
He stated the HTA is committed to working with the state Senate and House “not as separate units, but as a harmonious whole.”
If passed and signed into law by Gov. Josh Green, SB 1522 and HB 1375 in their current forms would take effect July 1.
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Emma Grunwald, reporter, can be reached at 808-652-0638 or egrunwald@thegardenisland.com.
