Saturday, July 12, 2003

State legislators are questioning a deal in which a local news team took a state-paid trip to Japan with Gov. Linda Lingle, who is there for a tourism promotional tour. Here, Lingle observes Sony's pet robot dog, the Aibo, during a visit to Sony Media World in Tokyo.

HVCB controls urged

The state needs more powers to deal
with problems with the bureau,
the state auditor says

The state needs stronger negotiating power to iron out long-standing problems with the Hawaii Visitors & Convention Bureau, a private agency funded by the state to market tourism, state Auditor Marion Higa said yesterday.

Higa said many of the problems a recent state audit revealed at the visitors bureau are the same issues revealed by previous state audits in 1993 and 1987.

"I think the state is at a disadvantage here ... where state staff are not prepared to take on private entities that they're up against," she said.

The state may have to invest more resources into the state Hawaii Tourism Authority, which was set up in 1998 to manage the bureau, she said.

Higa's sentiment contrasts with that of some in the tourism industry who have been coming to the bureau's aid in recent months, notably during Gov. Linda Lingle's Tourism Summit. Tom Ocasek, former chairman of the bureau, recently wrote that the bureau is "becoming an organization that is suppressed and intimidated, stifled by layers of approvals, checks and cross-checks."

Higa spoke yesterday at a joint House-Senate committee briefing on her critical audit of the Hawaii visitors bureau, released last week. The audit pointed to several potential abuses of state funds by the bureau, and bureau officials have publicly admitted making some mistakes.

The state tourism authority has recently entered more stringent language into the bureau's tourism marketing contract, which is worth $33.2 million and runs from January through the end of this year. Yet the bureau and the state did not actually agree to the contract and sign it until June, five months after the contract began.

Higa said the bureau appears to be a capable agency, but questions linger over whether the state has gotten its money's worth from the bureau's tourism marketing activities. Between 2000 and 2002, the bureau's state contracts were worth $151.7 million, more than two-thirds of its funding. The bureau's private funding during the same time was $71.5 million.

Higa said that because the bureau is a private, nonprofit organization, only a state audit could uncover problems. But even the audit did not delve exhaustively into whether the bureau used state or private funds for certain expenses. Higa said she has struggled with the issue. Only recently has the state attorney general's office issued an opinion that says private entities fall under the scope of the auditor's authority, she said.

Yesterday's legislative briefing also dealt with the arrangement in which a TV news crew from KITV-4 took a state-paid promotional trip with Lingle to Japan this week. The station, hit with criticism, has said it will reimburse the Hawaii visitors bureau for the $4,100 cost of the trip.

Lingle plans to brief the media on her trip Monday afternoon at 2:30.

The House and Senate tourism committees plan to hold a further joint briefing the same day at 1 p.m.

House Speaker Calvin Say and Senate President Robert Bunda have called for a preliminary investigation into the KITV controversy. Say and Bunda were not invited to Lingle's Japan trip until June 30, five days before the trip started.

Tony Vericella, president and chief executive of the Hawaii visitors bureau, said the purpose of having the news station there was to inform the public about efforts to revive tourism.

Sen. Donna Mercado Kim pointed out that KITV took the trip to cover Lingle, not other state tourism leaders.

Rex Johnson, president and chief executive of the tourism authority, said he did not learn that the visitors bureau was paying for KITV's trip until after the trip started.

Vericella also said that after Sept. 11, 2001, television news station KGMB-9 took a trip to New York paid for by the Maui Visitors Bureau.

Bob Loy, KGMB's news director at the time, said he had no knowledge of the arrangement, station executive Rick Blangiardi said yesterday.

During yesterday's briefing, Kim (D, Halawa-Kalihi) asked pointed questions about the audit and KITV's trip but did not get many hard answers.

The Democratic-controlled Legislature has the option of forming an investigatory committee, which would give lawmakers subpoena powers to get answers about the audit and about the trip.


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