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Interview: Sen. Dela Cruz says HTA contract is causing frustration among legislators

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Hawaiʻi State Senate
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Sen. Donovan Dela Cruz speaking at the Ways and Means Committee meeting on Dec. 12, 2022.

The state's number one economic driver is under scrutiny following the cancellation of an award for a lucrative marketing and management contract by Mike McCartney.

The former head of the Department of Business, Economic Development and Tourism made the move minutes before his term ended last week.

While lawmakers had him on the hot seat last week, the Hawaiʻi Tourism Authority was grilled about its part in the debacle on Tuesday.

The second day of questioning by state senators on the powerful money committee uncovered serious missteps — including asking a bidder embroiled in the controversial tourism marketing and management contract to sponsor a reception for the Hawaiʻi Tourism Authority’s conference last week.

HTA admitted that was a poor move and lawmakers on the Ways and Means Committee questioned if the authority was following its own rules, which senators discovered aren't posted online.

The Conversation talked to state Sen. Donovan Dela Cruz, who along with other senators, was also taken aback when HTA president John De Fries suggested that the agency once again be “exempted” from state procurement law.

"There's a lot of angst in the committee because it doesn't seem like there's consistency," Dela Cruz said. He said that nobody is making sure the processes are being followed, such as by publishing the rules online.

Dela Cruz said they will be looking at procurement laws, since he believes that the former DBEDT director and HTA 'pushed the envelope with the law' when delegating the procurement powers.

"No one has any idea of what happened, how it happened internally," he said. "That's very frustrating for a lot of us. We feel like there could be a lot more transparency."

Dela Cruz said that he thinks they should have brought in the state procurement officer and attorney general to make sure the process was 'cleaner.'

"When you ask the state procurement officer, her response was, 'Well, they included me on only certain components, not the entire process,'" he said.

Lawmakers in the House are said to be talking about holding their own hearings to learn more about what led to the mishandling of the contract award.

Meanwhile, the HTA is back to square one in awarding the branding and marketing contract for the U.S. worth $34 million.

This will be the third time in about a year that this process has been restarted. At the heart of the dispute were the Council for Native Hawaiian Advancement and the Hawaiʻi Visitors and Convention Bureau. The HVCB has held the contract since the 1990s.

This interview aired on The Conversation on Dec. 13, 2022. The Conversation airs weekdays at 11 a.m. on HPR-1.

Catherine Cruz is the host of The Conversation. Originally from Guam, she spent more than 30 years at KITV, covering beats from government to education. Contact her at ccruz@hawaiipublicradio.org.
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