Hawaii Tourism Authority weighs marketing contract options

Board members of the Hawaii Tourism Authority want authoritative advice on options they may have to deal with the head of another state agency rescinding a multimillion-dollar tourism marketing contract HTA awarded in June.

At a Wednesday meeting, the board deferred taking any action two days after Mike McCartney, whose job as the director of the Department of Business, Economic Development and Tourism ended at noon Monday, rescinded the contract award to the Council for Native Hawaiian Advancement shortly before his term expired.

HTA’s board maneuver followed more than 90 minutes of hearing impassioned testimony from CNHA supporters who urged board members to reverse McCartney’s move, which McCartney has described as “final and binding.”

The board also heard McCartney give a 35-minute, somewhat rambling, explanation on why he did what he did.

McCartney’s oratory included stories about laws he helped create as a state senator from 1988 to 1998, how he helped create the Hawai‘i Convention Center and how tourism was hit by the Great Recession between 2007 and 2009.

McCartney, who once led HTA, said his Monday action was largely taken to avert an expected administrative hearing and subsequent expected court case that he said would have still left a problem with what is a lucrative mainland tourism marketing and destination management contract that CNHA won over the Hawaii Visitors and Convention Bureau and led HVCB to a file a procurement protest.

“That’s why I did what I did,” he told the board.

In letters to CNHA and HVCB on Monday, McCartney stated that his rescission decision “should not be considered a ruling on the protest filed by HVCB.”

McCartney also told HTA’s board Wednesday that part of why he rescinded the contract award was inspired by an “Aloha Spirit” bill that a friend of his authored and became state law in 1986.

“That’s in the end how I made this decision on the razor’s edge, good or bad — that I thought was in the best interest to move Hawaii forward,” he said.

Another part of McCartney’s motivation for his decision, he said, was the late Native Hawaiian activist George Helm and about 15 books that McCartney held up for the board one by one.

The books included a 1960 visitors guide to Hawaii, “Nation Within” about American occupation of Hawaii, “From a Native Daughter” about colonialism and sovereignty in Hawaii, “Land and Power in Hawaii” and a book of local political cartoons.

McCartney left the books and two file boxes with emails and documents pertaining to the contract dispute for new DBEDT Director Chris Sadayasu, who attended the meeting.

Some CNHA supporters took offense to McCartney’s presentation.

Trisha Kehaulani Watson, a legal expert and consultant on Hawaiian culture, noted that McCartney did not say that anything was unlawful about the award to CNHA.

“This decision was arbitrary and capricious,” she said.

Watson also criticized McCartney’s references to books by Hawaiian authors as influencing his decision.

“I don’t care about his feelings,” she said. “It was quite frankly one of the most insulting things I’ve ever had to listen to. Don’t talk to us and invoke our kupuna (elders or ancestors) and stab us in the face at the same time.”

Kapua Medeiros of Waimanalo scoffed at McCartney’s decision being rooted in aloha spirit.

“Aloha is not giving something and then taking it away,” she said.

Homelani Schaedel of Kapolei called McCartney’s move a shameful debacle and stain.

“How is this pono (right)?” she asked the board. “I sit here with so much eha (pain). I can tell you this: It isn’t pono, but it needs to be made pono.”

A few others urged the board to reverse McCartney’s move, including at least a couple of people representing companies that have partnered with CNHA to carry out the contract that is worth more than $34 million in the first two years of a potential four-year arrangement.

Nicholas Carroll, chief of staff to CNHA CEO Kuhio Lewis, told the board that the nonprofit is not going to sit idle.

“We’re not giving up,” he said.

CNHA filed a formal protest to the rescission with DBEDT and HTA on Tuesday.

Lewis also addressed the board. He called McCartney’s decision unlawful and asked for it to be undone.

“We are anxious, we are eager and we are ready to embark on this important kuleana (responsibility),” he said. “What was done at the eleventh hour was not pono, and was unlawful.”

Gov. Josh Green addressed the board and acknowledged that there are two aggrieved participants in the contract mess. He said his administration, including attorneys, will work with all parties to move forward with some action before March 31 when the second of two six-month contract extensions for HVCB expire.

“Our team is going to take it from here,” he said.

McCartney, in his letters to CNHA and HVCB, said he is confident that HTA will solicit new bids that split the contract work in two pieces — one to market Hawaii and one to manage Hawaii’s resources as a visitor destination.

The board unanimously passed a motion to defer any decision to its next meeting Dec. 22, and requested advice from state attorneys and the State Procurement Office about whether any procurement process was violated, whether it could proceed with the award to CNHA and whether there might be other options available to HTA and DBEDT’s new director.