With a new leadership team at the Hawaii Tourism Authority, residents clamoring for more regulation and the 10 million visitor mark eclipsed, the Hawaii tourism industry is at a crossroads.
Video courtesy of the Hawaii Tourism Authority
Video courtesy of the Hawaii Tourism Authority
Mend relations, broaden the mission
At the end of December, the HTA’s new leadership team was announced with just weeks to prepare for the start of the 2019 legislative session, which will be crucial for the agency moving forward.
The 2018 state audit was not the first time the HTA’s accounting and transparency had been questioned.
“Another failed audit could spell disaster for the HTA,” said Elizabeth Churchill, owner of the Churchill Group hospitality consultancy and a former executive at Aqua-Aston Hospitality. “It’s easy to talk about accountability, but you have to live it.
They’ve already had two failed audits, and I’d hate to think what would happen if they have a third. There are areas where change is needed, and we’ll see if the new leadership can take us in the appropriate direction.”
‘The new leadership at HTA should be going into communities and discussing the issues.’
At the forefront of forging a relationship with lawmakers will be new president and CEO Chris Tatum, who spent more than two decades with Marriott, most recently as the area general manager for Hawaii.
Karen Hughes, who spent 11 years as an executive with Starwood, and recently worked for the Hawaii Visitors and Convention Bureau, is the new vice president of marketing.
Keith Regan, a former managing director for Maui County, is the newly installed chief administrative officer.
Many observers argue that the HTA must broaden its scope and shake an at-times myopic focus on growing visitation and revenue. But when the HTA has attempted to address something other than marketing, state officials and competing agencies have often balked.
The HTA mission is “to strategically manage Hawaii tourism in a sustainable manner consistent with economic goals, cultural values, preservation of natural resources, community desires and visitor industry needs.”
Tatum agreed that the HTA needs to shake the impression that it is predominantly focused on marketing and said it is part of his mission to show the value of tourism not just to the state economy but also in the ways it can enhance communities and protect and manage resources.
“In my first month I’ve been meeting with legislators, industry leaders and different communities to get feedback on what we can do better and how they are all impacted,” Tatum said. “We have a responsibility to support the experience of our visitors and share the value of tourism with residents.”
‘We have a responsibility to share the value of tourism with residents.’
Armed with the audit, state Sen. Glenn Wakai, who argued that the agency is mostly a marketing unit, pressed to gut the HTA budget by 44%. After significant pushback, the budget was trimmed by 3%, but the message was delivered: The legislature wanted more accountability, transparency and communication from the HTA.
Frank Haas, principal at Marketing Management Inc. and the HTA vice president of marketing from 2002 to 2007, said of Wakai, “What he wanted to do is take his foot off the gas. I think he felt if you cut money to the HTA, you cut marketing, and you’ll have fewer tourists.”
But that, Haas insisted, is not the case.
“The tourists will keep coming because the hotels, airlines and attractions will continue to market themselves,” he said. “Cutting the HTA funding doesn’t take the foot off the gas, it takes the hands off the steering wheel, handing the future over to the industry itself.”
Haas is part of a camp that believes the HTA should look to its original mission statement to expand its vision and provide more comprehensive tourism leadership.
“The big thing I’m concerned about, as talented as the new team is, is [whether] the structure that they are working with is going to restrict their ability to succeed,” he said.
This is not the first time there’s been talk of the HTA broadening its influence.
Churchill recalled, “There were mandates years ago regarding bridging the gap between tourism and local communities, but little was accomplished. The new leadership at HTA should be going into community meetings and neighborhood boards and discussing the issues. They need to help set the agenda around homelessness, infrastructure, the airport, all these issues that are related to tourism.”
Sights set on sustainability, balance
While visitation to Hawaii is at record levels, tourism revenue, when adjusted for inflation, is flat to down over the past decade. As the state has attracted greater numbers, there has been far more discussion in recent years of how to manage resources and limit overuse.
Rather than pushing to attract any and all visitors, there has been a call for a more refined approach that would help balance tourism among different markets and segments to guard against peaks and troughs. Additionally, more and more popular sites in Hawaii, from scenic hikes to prime turtle-watching beaches, are plagued by traffic jams, safety hazards and other headaches for residents and officials.
On Kauai, the Queen’s Bath near Princeville is a picturesque seaside pool on a lava shelf fed by ocean waves. It is an Instagram dream but also immensely perilous. Five people have died there in the past decade, the most recent in December, when a 23-year-old woman from Los Angeles was swept off the rocks. The site is on the Kauai Visitors Bureau’s do-not-promote list, but that did not stop Travel + Leisure from calling the Queen’s Bath a “thrill-seeker’s paradise” in a 2017 article.
With more tourists than ever armed with more information than ever, the old methods of restricting access and managing traffic are not holding up. In the most extreme cases, restrictions and regulations have already been imposed, and more locations will likely follow suit in the future.
In 2017, the federal government instituted a reservation system for the popular sunrise tours to the top of Maui’s Haleakala. At the turn of the millennium, the Hanauma Bay Nature Preserve near Waikiki was suffocating under the crush of snorkelers who filled its waters daily. Now, the park is closed one day a week, and first-time visitors must watch a nine-minute video on safety and conservation.
Kelly Hoen, Hawaii area general manager of Outrigger Resorts, grew up in Hawaii and said that while the state has come a long way, there could be more focus on the preservation of vital natural resources.
'I think everyone sees the value, and I think that type of strategic approach for the most heavily used areas is needed.'
“I’ve got to be honest,” Hoen said, “as a kid, we never talked about that stuff, and I feel really sad about that. At the very beginning, when they announced that Hanauma Bay would close one day a week, people were upset. Now, it’s fantastic, and I think everyone sees the value, and I think that type of strategic approach for the most heavily used areas is needed.”
Most see a need for a comprehensive, interagency plan. The Hawaii Department of Land and Natural Resources (DLNR ) has struggled to keep up with trail, beach and park maintenance under increased demand, in part due to “uncertain and inadequate financial support,” according to a 2015 DLNR report.
Haas said one issue is resources.
“Hawaii just doesn’t have the budget that other destinations have, like a Las Vegas,” Haas said. “And, if it’s part of your mission to manage tourism in a sustainable manner, it’s simply not sufficient.”
Some, including Wakai, have argued for diverting some of the HTA’s $88 million annual budget to the DLNR and other state agencies that steward public resources more directly. Meanwhile, the tourism industry has been advocating for more of the $546 million collected annually from transient accommodation taxes to go not just to the HTA, but also to various state agencies with a direct impact on the visitor and community experience.
Natural resource conservation is just one example of an area where the HTA can hope to drive policy but must work with various officials and agencies to accomplish its goals.
Three Hawaii counties, Kauai, Maui and Hawaii, have vacation-rental policies, but there is no statewide regulation for a segment that has undoubtedly helped drive Hawaii’s successive years of record visitation.
The hotel industry, especially in Waikiki on unregulated Oahu, is clamoring for a “level playing field” that sets up a tax and regulatory system for the rentals.
Tatum also has his sights set on these key issues, mentioning both conservation of natural resources and regulation of vacation rentals as areas where he would like to see action. And he has already floated the idea of placing more “ambassadors” at popular parks and other sites to help educate the public.
“If we don’t have a sustainable process or plan in place to continue to reinvest in the product and experiences, it will be a short-lived success,” Tatum said. “We need to make sure the natural beauty, attractions and culture are preserved and supported.”
The goal, Haas suggested, is to start managing these places and issues before they reach crisis level.
“It’s not necessarily the fault of the HTA,” Haas said. “They have a broad and important mission, a great mission. It does not have the authority to do the things needed to execute the mission.”
Doubling down on aloha
At the open of 2019, the many people in Hawaii who depend on tourism are watching closely. The federal government shutdown has only hurt, and early booking pace shows some softening in demand for the Aloha State, several analysts told Travel Weekly.
“It’s unclear if its a signal of decline or of more demand for [Hawaii’s] competitors,” Churchill said. “Some of the competition, like Mexico and the Caribbean, have had to reinvent themselves and have some new and growing product. That’s something Hawaii has not kept up with. There’s not a lot of new product or new hotels. … It’s a mature destination.”
A common refrain in Hawaii tourism is that its most cherished assets are its distinct culture and aloha spirit. Much has been done over the past few decades to shed old, inaccurate stereotypes of Hawaiian culture and history. Still, many say much remains to be done to fortify the state’s singular element, which is increasingly vital as Hawaii competes globally.
North Shore EcoTours owner Keola Ryan was born and raised on Oahu and is now a teacher of Hawaiian Studies.
“For me, it’s very important that the local tourism industry and leaders reflect the culture of the place accurately and represent Hawaii in a culturally responsible way,” Ryan said. “Traditionally, the tourism industry only saw the entertainment value of the Hawaiian culture. When you see it only as entertainment, it can be manipulated and modified in order to satisfy the demands of the audience. And when that happens, the integrity of the culture can be lost.”
She concluded: “There has been a lot of progress made, but there’s a lot more work to be done.”
Brian Hegarty, vice president of marketing for the Travel Leaders Network, follows Hawaii closely and said that, while there has always been debate among the public about the value and mission of tourism authorities, their ability to bring together the public and private sectors behind a single goal is crucial.
“The new people coming in have experience in the private and public sector, and I think they’ll bring stability and confidence to the agency,” Hegarty said.
The HTA and its board have not been deaf to prevailing sentiment. Ben Rafter, an HTA board member and CEO of OLS Hotels and Resorts, said he fully expects the body to focus on sustainable tourism practices and initiatives.
“We are one of the most remote land masses in the world and one of the most ecologically diverse places,” Rafter said. “We have to embrace sustainable tourism and explore better pathways for the industry.”
‘We want to have tourism give back more than it takes.’
In a recent interview, Hughes cited balance as a key and made a point of saying that the HTA is more than a marketing wing, insisting it has a broader mission to “manage tourism.”
“We want to have tourism give back more than it takes,” Hughes said. “We want to make sure the HTA and its contractors are balancing the needs of community with those of this vital engine of our economy.”