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Saturday, July 15, 2000

Opening convention
center to local events

Bullet The issue: The Hawaii Tourism Authority has decided to open the Hawaii Convention Center to local events.

Bullet Our view: Some residents will like the idea but the hotels may complain if the center takes business away from them.

SINCE its opening two years ago, the Hawaii Convention Center has hosted few local events; one of the biggest was this year's auto show.

The Convention Center Authority, which supervised construction and operated the facility until the Legislature abolished it, argued that the highest priority of the convention center was attracting mainland and foreign conventions. The authority didn't want local events interfering with that goal.

Moreover, the convention center was built to accommodate meetings that were too large for Waikiki hotels to handle with their own meeting facilities. The authority didn't want to compete with the hotels for business from smaller events, many of which are local.

But the Hawaii Tourism Authority has taken control of the center with the demise of the Convention Center Authority and has modified the policy. Local organizations will now have more opportunities to use this premier facility. This should mollify critics of the old policy.

There are two conditions: Each meeting must bring at least 300 people to the center and organizations must pay 30 cents per square foot for exhibition space and 20 cents per square foot for meeting rooms.

Also, the center will not be allowed to host any event at a loss or provide "unfair competition" to hotels and such public facilities as the Neal Blaisdell Center.

Bob Fishman, the tourism authority's chief executive officer, said the move to allow local bookings "will strengthen our relations with our local taxpayers, and it will provide experience and training opportunities for the center's staff. When we try to market the building to potential customers, it's good for them to see it in action."

That's fine as long as business is good for the tourism industry and there is enough to go around. But it could get tricky if business falls off and the hotels complain about competition from the state.

It may take some skillful maneuvering to avoid that pitfall. The center, after all, was built to help the visitor industry, not compete with it.

AFTER an understandably slow start in booking conventions, the convention center has hosted several huge meetings, most recently the Lions. It has demonstrated its capacity to handle big conventions, which has helped to attract more of them. Bookings have picked up considerably, helped by the compliments given by people who have already attended events there. It's an outstanding facility.

The convention center's future seems bright and so does its potential to help the economy. Getting local groups in there could be another plus. But it has to be done carefully.

Florida tobacco award
is big blow to industry

Bullet The issue: A Florida jury has imposed a punitive award of $145 billion against the tobacco industry.

Bullet Our view: Cigarette companies should accept a national settlement to satisfy legal claims and bring them under federal regulation.

FLORIDA jurors' record-setting rebuke of the tobacco industry may not result in the prescribed punishment, but the industry is left scrambling for survival. A lengthy appeal process is likely to greatly reduce the $145 billion award in punitive damages, and the verdict may be overturned in its entirety.

But tobacco companies eventually may be forced to accept huge concessions in federal legislation in order to survive.

Tobacco companies have agreed to pay $246 billion to states over 25 years in exchange for withdrawal of lawsuits by state attorneys general. That settlement did not cover the kind of class-action suit filed by three Florida smokers on behalf of the estimated 300,000 sick smokers in that state. Nor did it preclude the federal government from filing suit against the industry last September to recover $20 billion spent on health programs to treat smoking-related illnesses.

A cigarette company attorney complained that the Florida verdict amounted to a "death warrant" for the industry. However, under Florida law, a punitive award cannot bankrupt a company. That law by itself may shelve the jury's award. If not, numerous legal issues in the case are expected to be challenged in appellate courts, including the makeup of the class.

Top executives appeared before the jury to claim that they have changed their ways. They now accept that their product is addictive and harmful and spend millions to discourage teen-agers from smoking. However, Stanley Rosenblatt, an attorney representing the plaintiffs, asked why cigarette makers still run full-page advertisements in publications such as Rolling Stone and Entertainment Weekly aimed at young people.

Industry lawyers indicated their clients could be put out of business if the punitive award exceeded $375 million. That would amount to only 3 percent of the industry's $15.3 billion audited net worth, or about four days in wholesale cigarette sales.

DESPITE the tobacco executives' claim of enlightenment, their lack of credibility remains intact.

The Florida verdict is a crippling blow to Big Tobacco but not a death warrant. It should provide an incentive for the industry to accept a settlement that includes regulation by the Food and Drug Administration, which it has resisted.

Published by Liberty Newspapers Limited Partnership

Rupert E. Phillips, CEO

John M. Flanagan, Editor & Publisher

David Shapiro, Managing Editor

Diane Yukihiro Chang, Senior Editor & Editorial Page Editor

Frank Bridgewater & Michael Rovner, Assistant Managing Editors

A.A. Smyser, Contributing Editor

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