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Tension Over Tourism

Should Hawaii's tourism czars focus on attracting more visitors or take a holistic view of tourism's impact?

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Mike McCartney, head of the Hawaii Tourism Authority
Photo: Olivier Koning

During good times, there is virtually nothing easier to sell than Hawaii.

If people have money and an itch to travel, all you need to do is remind them that Hawaii, with its sunny beaches, happy people and varied cultures, is more than ready for their visit.

But what about tough times? How do you sell Hawaii when it’s not enough for Hawaii to simply sell itself?

That’s the challenge currently facing the hotels, airlines and attractions that make up the state’s visitor industry. It also involves a potent mix of politics, money and the basic question of who is in charge of marketing Hawaii to the world.

In a recent special report commissioned by First Hawaiian Bank, Hawaii Pacific University professor Leroy Laney argued that while tourism is by far the dominant economic player in Hawaii’s economy (perhaps responsible for as much as 40 percent of the state’s GDP when multipliers are used), it receives far less focused attention than it deserves. In short, policymakers – like Hawaii’s general public – tend to take tourism for granted.

“It would help if there were more of a shared vision and coordination among state, county and individual agencies with regard to tourism policy and planning,” Laney argues.

That, says Mike McCartney, the recently installed head of the Hawaii Tourism Authority, is precisely what he and his agency are attempting to do. HTA was created in 1998 in response to the economic shocks created by the first Gulf War and the Japanese economic bubble and the continuing political unhappiness with the Hawaii Visitors Bureau (now the Hawaii Visitors and Convention Bureau).

What was needed, policymakers decided, was a Cabinet-level organization focused on the overall health and impact of the tourism industry, rather than a narrowly focused marketing organization like HVB, which was primarily responsive to the needs of hotels and airlines. Others in the visitor industry had withheld their support and dollars from HVB because they felt they were not being heard. That put greater pressure on the state and taxpayers to pay for HVB’s activities.

Ben Cayetano, who was governor at the time HTA was created, says it was an effort to manage tourism from a broader perspective – that is, taking into account tourism’s impact on such things as culture and the environment rather than simply how it affects hotels and airline traffic.

“Many politicians, including me, were unhappy,” Cayetano remembers. “It seemed because of tourism’s critical importance to the state’s economy, the Legislature found it difficult to deny HVB requests for more tourism marketing funds. Thus, there was little incentive for HVB to solicit more contributions from its dwindling membership. To compound matters, most legislators felt that, in fact, the state’s so-called oversight over how HVB used its funding was ineffective.”

A deal was struck, and a critical part of it was that the Hawaii Tourism Authority would get a dedicated slice of the transient accommodations tax (commonly called the hotel tax) to fund its efforts. (From a high of around $90 million, HTA today receives around $70 million a year for its operations and marketing.) The industry concluded that if it was going to swallow the bitter pill of a hotel tax, much of the money should go to an agency dedicated to its interests.

Some argue that this new arrangement has done little other than shift control of tourism promotion from the hotels and airlines to politicians. It is true that those chosen to run HTA have been well-connected to the Democratic establishment in Hawaii.

That would include McCartney, formerly a state senator and head of Hawaii Public Television. But the personable McCartney says he is willing to be judged on his and HTA’s performances. A key shift, he says, is that HTA is now focused on what is best for Hawaii, not what works best for specific interests within the tourism industry.

Hawaii Business magazine invites you to comment on our articles and the issues they raise. Comments are moderated for offensive language, commercial messages and off-topic posts and may be deleted. Some comments may be chosen for inclusion in the magazine on the Feedback page.

Old to new | New to old
Sep 2, 2009 07:06 pm
 Posted by  JohnsonWKChoi

Back to college marketing 101, we need to find out what the new and/or returning visitors want from Hawaii. So often we hear the same thing when I went to college 35 years ago that is sun, sea, weather and hula girls. A lot of things have changed in 35 years, more competition from around the world offer much better value for the dollar than Hawaii can offer.

When we visited many former Hawaii residents in the mainland USA from the major cities like New York, Chicago, San Francisco and Los Angels, unless they returned to Hawaii for family reasons or for retirement, many found Hawaii boring and little to do unless they are the sun, sea and surf types.

It should be a wake up call for policy makers long ago as the visitor spending in Hawaii has been declining since 1989, for 20 years, according to Bank of Hawaii economic reports.

Sep 2, 2009 07:09 pm
 Posted by  JohnsonWKChoi

Back to college marketing 101, we need to find out what the new and/or returning visitors want from Hawaii. So often we hear the same thing when I went to college 35 years ago that is sun, sea, weather and hula girls. A lot of things have changed in 35 years, more competition from around the world offer much better value for the dollar than Hawaii can offer.

When we visited many former Hawaii residents in the mainland USA from the major cities like New York, Chicago, San Francisco and Los Angels, unless they returned to Hawaii for family reasons or for retirement, many found Hawaii boring and little to do unless they are the sun, sea and surf types.

It should be a wake up call for policy makers long ago as the visitor spending in Hawaii has been declining since 1989, for 20 years, according to Bank of Hawaii economic reports.

This has been flagged
Sep 18, 2009 08:03 am
 Posted by  Curt Sharp

an integrated model is required which does not make Hawai'i reliant on the tourist industry for survival. tourism is not always about beaches, and hotels and entertainment.

for that matter, the current model should be turned on its head, scrapped and rebuilt!!

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