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Liu blasted over layoffs


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POSTED: Tuesday, September 22, 2009

Legislative heads of the House and Senate business committees publicly censured Ted Liu, the embattled director of the state Department of Business, Economic Development and Tourism, yesterday for his decision to lay off nearly all of the workers in the state's film office and key staff from other economic development engines.

Liu, who testified during a joint briefing at the state Capitol yesterday, said he must cut 40 out of 95 positions within DBEDT to meet the state-mandated balanced budget. The deepest cut would hit the Hawaii Film Office, which would lose four out of five employees. However, several one-person offices such as the Community-Based Economic Development program, the Enterprise Zone Program and the Small Business Regulatory Review Board also would lose key people.

“;We have been extremely disappointed to hear the basis of your decisions,”; said Sen. Carol Fukunaga (D, Lower Makiki-Punchbowl), chairwoman of the Senate Committee on Economic Development and Technology.

Her counterpart, Rep. Angus McKelvey (D, Olowalu-Kapalua), chairman of the Economic Revitalization, Business & Military Affairs Committee, compared Liu to a football coach who decides to replace his best scorers with special-team members.

“;I think you're going to be 0-16,”; McKelvey said. “;The positions you are targeting seem to be the biggest generators of money. We are running up on Black Friday, but I would hope that you would revisit this.”;

Liu, who does not need legislative input to execute his decision, staunchly defended his position. The layoffs, which would take effect in November if a furlough plan is not adopted, would achieve a cost savings of about $2.2 million per year and would necessitate finding alternate delivery services, he said.

Liu told legislators that he arrived at his layoff list by making necessary tradeoffs such as replacing specialists with generalists.

Despite cuts, Liu said all departmental functions and statutory requirements would remain unchanged and met. However, several state legislators questioned Liu's management decisions. Sen. Donna Mercado Kim (D, Halawa-Kalihi Valley), who wanted to move the film office to the Hawaii Tourism Authority last session, chastised Liu for the proposed changes.

“;During the session you said that this was not the time (to move), and yet you have dismantled your department far greater,”; Kim said.

His decisions also were criticized by multiple crowd members, who spoke in favor of keeping the state's film office, economic development programs and small-business support intact.

“;Common sense dictates that in order for something to flourish, it needs nurturing and expert handling,”; said Jeremy Spear, a local filmmaker who directed, wrote and produced the ESPN and PBS show “;Polynesian Power: Islanders in Pro Football.”;

Chris Lee, founder of the University of Hawaii's Academy for Creative Media, also testified in support of Hawaii's film office. Hawaii-born film actress Tia Carrere submitted testimony, along with many other prominent film industry members.

Hawaii Film Commissioner Donne Dawson, whose job is on the line, said after the hearing that others within DBEDT are ill prepared to take on the duties of her office.

“;If it's important to maintain the level of service, it begs the question why they decided to eliminate the entire brain trust,”; Dawson said, adding that there has been no cross-training.

The film office, which has brought in $1 billion since 2001, still has several deals on the table and $206 million in tax credits to process, she said.

Thomas Smyth, who spent 23 years in DBEDT management before leaving the agency, said that the film and other cuts eliminate DBEDT's support for the business community.

“;If smaller cuts had been made in each branch or office of DBEDT, business support could be maintained by those who remain,”; Smyth said.

Cutting entire programs leaves little support, especially when those chosen to remain do not know much about them, Smyth said.