Airport concessionaires are asking state lawmakers to write into state law the types of relief available to them during the coronavirus pandemic and other emergencies that cause significant economic hardship. Senate Bill 1308 would ensure that the Hawaii Department of Transportation could extend leases, raise the maximum terms of contracts from 15 years to 20 years and allow businesses to cancel contracts to avoid defaulting and being barred from doing business with the state.

But the measure, which will be voted on by the Senate Transportation Committee today, is receiving pushback from the Hawaii Department of Transportation, which oversees the state’s airports, and the airlines.

The bill would apply to a large swath of airport-related businesses that contract with the state transportation department, including restaurants, shops, duty-free vendors, rental car companies, taxis and parking operators.

“What this bill does is say, we are going to put into law what your rights are,” said Jim Stone, legislative liaison for the Airport Concessionaires Committee, a trade group representing concession businesses.

The proposed legislation also specifies what would trigger such relief, such as a 15% dip in the volume of business for two or more months or a 10% or more reduction in business over the course of six months.

Stone stressed that the state transportation department would retain authority over whether individual lessees are afforded specific relief, but the measure guarantees that it’s at least a possibility.

“We are just putting it into law,” he said. “It’s not in a contract that can change from time to time, from year to year. We are saying that if there is significant hardship or an emergency then the law says what is available. Whether (the state) gives it or not is another question.”

State transportation officials are opposing the bill, saying they already have discretion to provide lessees with relief during sudden events such as the pandemic. The transportation department already has provided airport businesses with about $100 million in rent relief. The aid has reduced the total amount of rent they’ve paid the state by about 70%, compared to what they paid in the year before the pandemic hit.

“I opposed the bill because I want to follow what is already provided in the lease agreements,” Ross Higashi, deputy director for the Department of Transportation’s Airports Division, told the Star-Advertiser. “I don’t need any more discretion.”

Higashi said he was also concerned about the relief triggers that would be embedded into state law even after the pandemic has abated, saying they could transfer undue risk and obligation to the state.

Reductions in gross receipts, he noted, could be the result of customer spending habits, market trends, customer service and hours of operation — factors unrelated to a sudden event or disaster.

The airlines are also concerned that the bill could transfer the balance of revenue obligations toward them.

The airline and concessionaires cover the majority of the airports’ annual operating expenses, providing a revenue stream of about $420 million.

Pre-pandemic, the concessionaires covered about 45% of those expenses, with airlines picking up the rest. The pandemic has lowered the amount covered by concessionaires to 15%, according to the state transportation department. The state has been able to make up for the revenue losses with federal aid and restructuring bonds. But without that aid, the airlines are on the hook for covering any shortfall in revenues.

The Airlines Committee of Hawaii, which represents 19 air carriers that underwrite the state’s airport system, said in testimony that this isn’t the time to be transferring risk to the airlines.

“This added financial burden to the airlines could not come at a worse time, with the airline industry reporting multibillion dollar losses each quarter,” the industry group wrote in testimony.

Stone noted that the businesses he’s representing are also hurting.

“These are very, very difficult times and it is a struggle for the businesses just to survive and stay open,” he said.

A similar bill was shelved by the House of Representatives earlier this month after lawmakers decided it needed more work.