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Hawaiʻi Tourism Authority defers action on canceled $34M marketing contract

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Marco Garcia/AP
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FR132415 AP
In this file photo, surfers ride waves off Ala Moana Beach Park in Honolulu, with Diamond Head mountain in the background. (AP Photo/Marco Garcia, File)

The Hawaiʻi Tourism Authority held its annual conference this week in Honolulu, but it’s a controversial time for the group. Its board met late Wednesday to reassess how it should market the islands after the cancellation of a major contract by a former state director.

Mike McCartney, the now-former head of the state Department of Business, Economic Development and Tourism, testified during the special HTA board of directors meeting.

In his final act as the director of DBEDT earlier this week, McCartney canceled a lucrative marketing contract with the Council for Native Hawaiian Advancement, sending the HTA back to square one in awarding a 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 CNHA and the Hawaiʻi Visitors and Convention Bureau. The HVCB has held HTA's marketing contract for the domestic market since the 1990s.

mike mccartney dbedt
Hawaiʻi State Senate
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Youtube
Former DBEDT director Mike McCartney in the Ways and Means Informational Briefing on Nov. 28, 2022.

McCartney said the RFP cancellations were a result of a lack of staff training and time constraints due to procurement laws. He said canceling the contract was the right decision for the future of Hawaiʻi.

"In that process, I just thought in my heart, nothing was right. It was going to continue to be another debate and battle for who's right, who's wrong over a shrinking pie," McCartney said. "And you know, we're really good at getting our piece of the pie but we got to learn how to grow the pie."

"And it's not just ask the Legislature for more money, we have to create that opportunity so that they can appropriate it," he said.

McCartney cited significant events that led up to the situation and called for the industry and the state to take a new direction.

Gov. Josh Green attended the meeting with new DBEDT Director Chris Sadayasu. Green promised to work with all stakeholders to ensure a new path for state tourism.

"I've already tasked our new director to work with our attorney general to make sure we honor the right path. It has to be done correctly. It has to be done fairly. I have a very good relationship with both parties. And I feel they will complement each other very well, one way or another. But it's important that we do things right," Green said. "I will say that our team is now going to take it from here."

CNHA CEO Kūhiō Lewis called for the reversal of the cancellation, saying it was unlawful. But he said he’s committed to helping transform tourism in Hawaiʻi.

The HTA board deferred discussion on its next steps for the U.S. contract until its next board meeting later this month.

Casey Harlow is an HPR reporter and occasionally fills in as local host of Morning Edition and All Things Considered. Contact him at charlow@hawaiipublicradio.org or on Twitter (@CaseyHarlow).
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