The Aloha Stadium Authority is eager to start fresh rather than tackle a daunting list of needed upgrades at the 41-year-old, underused facility. It wants to construct a scaled-down replacement surrounded by new development, which could include restaurants, shops, offices, housing and easy access to a proposed city rail-transit station.
State lawmakers have embraced that vision and this year sensibly pitched in $10 million for master planning and environmental assessment at the 100-acre Halawa site. But the Legislature fumbled its handling of another stadium-related matter — House Bill 627, which would establish an Office of Public-Private Partnerships within the Department of Business, Economic Development and Tourism (DBEDT) to handle the state’s so-called “PPP or P3” opportunities.
That bill is now in a lineup with 14 others that Gov. David Ige intends to veto. The governor correctly reasons: “Having one office manage all public-private partnership contracts, proposals and negotiations for the state may create a bottleneck that will slow the progress for agencies already involved in these partnerships.”
A backer of HB 627, state Sen. Glenn Wakai (D, Kalihi, Salt Lake) has offered a weak response that such reasoning was prompted by a misunderstanding that all state public-private endeavors would go through the new office. But there’s no clear phrasing in the bill that suggests otherwise, and testimony submitted in support endorsed the idea of consolidating the state’s P3 efforts by way of the proposed office.
The bill’s supporters maintain that if a P3 office is put in place now, it will be ready to roll with stadium-focused proposals within a few years, when planning and environmental reviews wrap up. But it’s far from clear why a new office is needed for that purpose, and why existing DBEDT staff could not move just as quickly. And if, as Wakai has said, P3s are the wave of the future and the “days of every state project being 100 percent taxpayer-financed are pau,” then why can’t the agency in place shift focus?
The bill calls for $150,000 to launch a “state public-private partnership coordinator” position and office. DBEDT recommended bumping that up to $500,000 and establishing a total of four positions for the new office. The call for such spending raises red flags for bureaucratic bloat.
The strategy of forging public-private partnerships to help underwrite stadium costs holds great potential — especially as the city plans to build its midpoint rail station one-quarter mile from the site — and the ongoing TOD (transit-oriented development) effort encourages an array of commercial and residential construction, including affordable housing.
Across the country, local and state governments use P3s to allow for private investment in various public infrastructure projects. Typically, investment is recouped from revenue streams created by fees or tax revenue. Possibilities for Aloha Stadium might include: a ticket surcharge, user fees added to concession sales and parking, and tapping into taxes such as the tourist-geared transient accommodations tax (TAT) as well as levies on car rentals, tobacco and alcoholic beverages.
The 50,000-seat stadium opened in the mid-1970s at a cost of $37 million. The stadium authority — a nine-member, governor-appointed panel — is eyeing a 30,000- to 35,000-seat replacement that costs an estimated $324.5 million in current dollars. It asserts that big-ticket spending is prudent compared to taking on a growing backlog of deferred maintenance, including $120 million in improvements needed to comply with the Americans with Disabilities Act.
There’s plenty to cheer for in the stadium authority’s vision of a new sports and entertainment venue surrounded by a lively neighborhood. But it won’t be fully realized without careful planning and scrutiny tied to spending of taxpayer dollars. That oversight should include thorough vetting of any related proposal to open yet another state office.
