State legislators have ordered Ted Liu, the embattled director of the Department of Business, Economic Development and Tourism, to provide a written accounting of his decision to lay off nearly all workers in the Hawaii Film Office, which has brought about $1 billion to the state since 2001.

When recent layoff notices circulated to nearly 1,100 state workers, four employees of the five-person Hawaii Film Office — including Director Donne Dawson — were included. The layoffs begin Nov. 13 unless labor negotiations between the Hawaii Government Employees Association and the state result in a stay.

Since the Film Office is mandated by state law to remain open, the Legislature wants to ensure layoffs do not effectively shut it down, said Sen. Carol Fukunaga (D, Lower Makiki-Punchbowl), chairwoman of the Senate Committee on Economic Development and Technology.

“;We believe that the spotlight of public scrutiny has a great impact,”; Fukunaga said yesterday following a nearly five-hour public hearing at the Capitol.

It seems that even the faltering economy cannot take the heat off Liu, who recently lost part of his department after legislators dismantled it following a scathing state audit and allegations of criminal misconduct in regard to procurement.

It was standing room only at the hearing, which was co-sponsored by the House Committee on Economic Revitalization, Business and Military Affairs. The event was well attended by members of the local film industry in Hawaii and even drew testimony from local entertainer Willie K, the producers of “;Lost”; and the organizers of the well-respected International Film Festival.

“;If you take this out, both nationally and internationally we are screwed,”; said Willie K.

When the HGEA rejected the administration's proposal to reduce a $900 million budget shortfall through furloughs, Liu said he had to eliminate 40 jobs, resulting in an indeterminate amount of savings.

“;I support the decision that has been made, but I'm greatly concerned about how to move forward,”; said Georja Skinner, director of DBEDT's Creative Industries Division. “;The HGEA could agree to furloughs and save these jobs. They could be the hero of this movie.”;

While legislators do not have jurisdiction over Liu's hiring and firing decisions, Fukunaga said some lawmakers worry they will affect the economy.

Dawson told lawmakers that the film office has supported about 7,000 film, television and commercial projects since 2001. More than a dozen projects, which could bring $200 million to the state, are pending, she said.

“;There is no doubt that without the Hawaii Film Office, all of this potential business will take their millions and go someplace else,”; Dawson said. “;I am hopeful that our government will recognize the tremendous value in what this industry has to offer the state, what it takes to make it happen successfully, and brush off the welcome mat and leave it at the door.”;

Liu told lawmakers that the film office would function without Dawson and other specialists and that their duties could be transferred to remaining DBEDT workers and county film commissioners.

“;There was a face before Donne, and there will be a face after Donne,”; Liu said, disputing the notion that film layoffs were politically motivated. “;Someone will be the face of the film office.”;

But others, members of the film industry and some lawmakers, questioned the wisdom of dismantling an income-generating engine during a crucial time in Hawaii's economy.

“;You are cutting off programs that bring revenue into this state, and it just doesn't square,”; said Sen. Rosalyn Baker (D, West and South Maui).

Sen. David Ige (D, Kalihi) said he was disconcerted that Liu made layoff decisions without computing savings.

“;At home when we need to reduce our budget, we look at the total cost savings of an action,”; Ige said. “;We don't get rid of a child.”;

After Liu returns his report to the legislative committees in two weeks, lawmakers will scrutinize it and issue a committee report, Fukunaga said.

“;Once he provides us with more information, we'll be in a better position to look for solutions,”; she said.