Reins added to
center’s special fund

The convention center’s manager
must get OK for wining and dining
expenses over $200,000

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By Tim Ruel
truel@starbulletin.com

As a measure of accountability, the Hawaii Tourism Authority is requiring that the new marketer of the Hawaii Convention Center must get special approval for any expense over $200,000 spent on wining and dining its customers.

No such approval was required previously when the $350 million convention center was marketed by the Hawaii Visitors & Convention Bureau. The bureau's contract ended last month, and a new contract is being finalized with a successor, SMG of Philadelphia.

The approval must come directly from Rex Johnson, newly named chief executive of the state authority. The policy shift specifically covers a $2 million "marketing flexibility" fund that is available each year for SMG to spend on customers whose conventions would create exposure for the center.

Essentially, the flexibility fund is going to be less flexible from now on, said Johnson.

Johnson said he started thinking about instituting such a policy last year after reading critical reports about spending by the Los Angeles Convention and Visitors Bureau.

Sen. Donna Mercado Kim, who questioned officials from SMG and the authority at a Capitol briefing yesterday, asked Johnson why the policy wasn't in place before.

"We probably didn't do a lot of things that we should have done, from an accountability standpoint," said Johnson, who began working for the authority in September. He said the authority will provide more information about the use of the fund to Kim, who is chairwoman of the Senate tourism committee.

Johnson said he was surprised that the authority did not have such a policy when the Hawaii Visitors & Convention Bureau was marketing the Hawaii Convention Center. He added that his sense was that the fund was used properly.

Sometimes you need to spend a lot to get an important customer, and sometimes you don't, said Frank Haas, tourism marketing director for the state authority. "It's how bad you want the group" to book a convention, Haas said.

Tony Vericella, president and chief executive of the Hawaii visitors bureau, could not be reached for comment.

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Hawaii Visitors & Convention Bureau
Hawaii Tourism Authority