HTA seeks additional funds for destination management

Feb. 12—The Hawaii Tourism Authority is still fighting for its life in the state Legislature but has come out swinging with a request to increase its budget by $9 million, add 14 more staff positions and raise salaries for its top executives.

The Hawaii Tourism Authority is still fighting for its life in the state Legislature but has come out swinging with a request to increase its budget by $9 million, add 14 more staff positions and raise salaries for its top executives.

Newly elected HTA board Chair Mufi Hannemann said, "We really believe now than ever that a robust tourism industry is needed. We need a state agency to lead that charge on behalf of government but also to be a strong interface with the industry."

That's why HTA seeks $69 million for fiscal year 2025, which is up from the $60 million that it received for fiscal year 2024 and was approved in Gov. Josh Green's administrative budget for fiscal year 2025.

"We want to make a case given what has happened in Maui and other things that have come about, such as discovering that the Legislature would like us to do things (like destination stewardship ) that require additional resources, " Hannemann said.

Hannemann and interim HTA President and CEO Daniel Naho 'opi 'i said HTA's major goals for the legislative session include :—Attaining lump sum budget funding for HTA, preferably at the $69 million level.—Opposing any effort to have HTA eliminated, diminished or put into another state department.—Codifying destination stewardship responsibilities.—Focusing on workforce development.—Expanding sports-related activities.—Supporting the Hawai 'i Convention Center's repairs and capital improvements, and seeking additional revenue for the center by urging passage of a bill that would allow the center to pursue revenue through a naming rights agreement with a partner.

Naho 'opi 'i said the increase in staff is to fill in personnel, support audit fiscal recommendations, bring Destination Management Action Plan team members in-house, and support HTA's July reorganization, which created a new destination stewardship department now led by Kalanai Ka 'ana ­'ana, who is serving as both chief brand officer and chief stewardship officer.

Naho 'opi 'i, who is HTA's chief administrative officer, also works two jobs. He also has been serving as interim HTA president and CEO since John De Fries, who formerly held the job, retired in September.

"We currently have 25 authorized positions, and we only have 19 employed right now, " Naho 'opi 'i said. "We know that we are short-staffed now. We had 32 before the pandemic when we were fully staffed."

Ka 'ana 'ana said as HTA approached the end of 2019 and people were feeling the pressure of the 10 million visitors, it caused HTA to shift its view of the work.

"What we embarked on and were interrupted by the pandemic a bit was, What does destination management or stewardship look like ?" he said. "At that very moment the number of positions was decreasing, but the work and the scope was also increasing."

Naho 'opi 'i said HTA is now requesting five destination managers and three administration assistants to build its stewardship team. He said on the fiscal side, HTA wants to add a quality assurance manager, a contracts manager and three additional administrative and accounting support team members. Naho 'opi 'i said HTA also seeks to add a government affairs person to assist with public affairs.

The HTA board during its January meeting authorized a search to fill the chief brand officer position and directed staff to update criteria so that it would be ready to begin a search for the president and CEO when appropriate.

Competitive salaries Hannemann said in the interest of staying competitive and attracting the best employees, the recommendation is to increase the annual salary for the HTA's president and CEO position to $300, 000 from $250, 000 and the chief brand officer's annual salary to $225, 000 from $175, 000.

HTA's goals, especially for budget and salaries, will likely meet with debate given the financial constraints that the deadly Aug. 8 Maui wildfires have put on the state. But it's not just its budget that HTA must monitor vigorously. HTA Public Affairs Officer Ilihia Gionson told the HTA board at its January meeting that the agency is tracking at least 86 bills this legislative session, some that deal with HTA directly and others that "cover the gamut from travel and visitor experience to transparency and accountability, environmental protections, Hawaii-made products and the like."

Gionson said some early flagged priorities for HTA include reviewing bills having to do with "the green fee, the Hawai 'i Convention Center such as naming rights, bond funding opportunities, coupling the (convention ) center's management and marketing, and transferring management of the (convention ) center from HTA to the Department of Accounting and General Services."

"There are a few measures about HTA itself clarifying the appointment for board members, reducing the number of board members and so on. There's one bill (House Bill 2563 ) about a smart destination platform—a concept that we have discussed internally in the past and haven't had the budget to go and pursue—and so we look forward to vigorous discussions throughout the session, " he said.

Still looming are powerful carryover bills from last session that sought to repeal or reorganize HTA. While action has not been taken on them so far this year, they are a reminder that HTA still has a lot of ground to make up with legislators if it hopes to make it through this session intact—and possibly, if Hannemann has his way, even stronger.

Budget cuts The agency was under fire long before 2023. Lawmakers trimmed HTA's budget in 2018. Then, in 2021, HTA experienced major changes after legislators overrode Gov. David Ige's veto of House Bill 862, which took away the tourism agency's dedicated funding source and cut its annual budget to $60 million from $79 million.

HTA was left without funding in 2023 when lawmakers couldn't agree on House Bill 1375, which contained the only funding for the agency. The bill had sought to replace the agency with a new tourism governance model.

HB 1375 made it all the way to the end-of-session conference committee and stalled as House Draft 3, which would create the Office of Tourism and Destination Management within the Department of Business, Economic Development and Tourism and take over HTA functions.

At the end of that conference committee, state Sen. Lynn DeCoite (D, Hana-East and Upcountry Maui-Molokai-Lanai-Kahoolawe ), chair of the Senate Committee on Energy, Economic Development and Tourism, or EET, said in a statement, "During negotiations the Senate proposed that the HTA continue to exist with a reduced governing board consisting of only nine members and a primary focus on marketing and promoting tourism."

"As part of our proposal, we also recommended establishing the Office of Destination Management under the Department of Business, Economic Development, and Tourism (DBEDT ), " she added. "The primary objective of this new agency would be to engage and involve local communities in destination management planning, which would provide valuable insight and feedback to help guide the state's overall tourism strategy."

HB 1375 carried over to this year's session along with Senate Bill 1522, which would have repealed the HTA and established an Office of Destination Management within DBEDT. It would have required the Office of Destination Management to implement certain county destination management action plans. It also would have established and funded a tourism liaison officer within the office of the governor.

DeCoite was not immediately able to respond to a request for comment on her current views regarding whether HTA should stay autonomous, as well as its funding and staffing requests.

State Sen. Glenn Wakai (D, Kalihi-Salt Lake-Pearl Harbor ), majority floor leader and EET vice chair, opined that more legislators were dissatisfied with HTA in 2023 and 2022. Wakai said he does not expect discussions to upend HTA will get much traction this year ; however, he said that there is still an appetite to guide HTA toward more efficiency.

"Last year, HTA's procurement difficulties had a lot to do with the legislative angst toward HTA, " Wakai said, adding that leadership changes at HTA, the HTA board and DBEDT also have given lawmakers more confidence.

Procurement problem HTA last spring finally moved past nearly two years of procurement controversy after splitting its top U.S. tourism award into two separate contracts when it selected the Hawaii Visitors and Convention Bureau to handle U.S. brand marketing and the Council for Native Hawaiian Advancement to handle destination stewardship. Prior to that, HTA faced protests from both entities. which had both been awarded the U.S. tourism contract and both had it rescinded by former DBEDT Director Mike McCartney.

Though he cannot speak for other legislators, the views of state Rep. Sean Quinlan (D, Waialua-Haleiwa-­Punaluu ), House Tourism Committee chair, are critical to tourism bills and to HTA. He told the Honolulu Star-Advertiser on Friday, "It is not my intention to bring back the carryover bills, " and that he supports an independent HTA.

"I don't think it would be prudent for us to move HTA to DBEDT, " he said. "DBEDT has enough on their plate already. We've already given them too much. How much more can we give to one agency ?

"At a certain point we've gone past the capacity to manage all of this under the current structure without just completely burning people out. I'd really prefer for HTA to stay as an independent agency."

Quinlan said he agrees with building capacity in destination management, which he views as managing the physical flows of people.

"What I would like HTA to do is help those communities that have been most inundated to get the most relief, " he said. "I think the smart app (bill ) is the future of destination management, to convert county and state parks and destinations into a system that requires visitors to make a reservation and pay for it. For locals, we can use this endeavor to carve out more parking spots than normally would have been available to just locals, and, of course, it would be free for us."

Moreover, he said, "The smart app bill is my absolute favorite in my career. If we do this, other places will follow."

Quinlan said he understands that HTA will need to add more bodies, especially if the smart app progresses, and he's a fan of more sports marketing.

"I won't quibble with them saying that they would like to do more things, but $69 million is a lot of money and I'm not sure that we can afford that right now, " he said. "I'm not sure it would be prudent to appropriate that amount given the other challenges that we are facing at this time."

Quinlan added that he also has concerns about HTA's plan to raise salaries "at a time when the state has a cash flow problem."

He said salaries fall under the purview of the HTA board, but noted that DBEDT Director James Kunane Tokioka has come out forcibly against large raises.