Hawaii visitor industry members are growing increasingly concerned that the Hawaii Tourism Authority will not have a well-
defined plan to provide branding and marketing
services for the domestic market after Wednesday when a U.S. tourism contract extension expires.
HTA on June 2 selected the Council for Native Hawaiian Advancement for a multiyear U.S. tourism award worth more than $34 million during the first two years. However, HTA and CNHA cannot move forward on
a contract until a June 21
protest from the Hawai‘i Visitors and Convention Bureau is settled.
HTA extended HVCB’s
U.S. tourism contract and
its global support services contract for three months in June as a stopgap measure to give Mike McCartney, director of the state Department of Business, Economic Development and Tourism, in his role as head of the purchasing agency, time to sort out a procurement protest.
HVCB was originally selected for the U.S. tourism contract by HTA to retain those duties in December in what was expected to be a multiyear, $100 million deal. CNHA protested and McCartney then rescinded HVCB’s contract, which was worth $22.5 million the first year.
HTA paid HVCB $4.25 million for the U.S. tourism contract extension and $375,000 for the global support contract extension.
HVCB declined to comment as did McCartney, who has a range of ways to solve the protest including brokering a compromise between HVCB and CNHA. Industry insiders say a compromise is possible. However, both entities have hired legal counsel.
CNHA CEO Kuhio Lewis issued a statement to the Honolulu Star-Advertiser Friday saying that “the state has had more than enough time to resolve the protest. We urge the affirmation of CNHA’s award so we can
begin the important work
of helping to transform
Hawaii’s visitor industry.
“As we await the state of Hawaii’s ‘expeditious’ resolution of the protest as the law requires, our pending contract allocation is arguably being impacted by
contract extensions to the protesting bidder, HVCB,” Lewis said. “Any further extensions beyond the current September 28 deadline will only exacerbate this harm to CNHA — and deprive the public of the services from the vendor that the state has determined is superior.”
HTA Public Affairs Officer Ilihia Gionson told the Star-Advertiser that an award determination or a contract extension is not
off the table. However, he added that, “If there is no resolution by September 28, our active brand marketing will be temporarily suspended in the U.S. while HTA brings that responsibility in-house with an emphasis on visitor education and industry support.”
Keith Vieira, principal of KV &Associates Hospitality, said HTA also must plan to maintain the HVCB-run visitor call center, especially now.
“People have questions whether it be COVID or hurricane season,” Vieira said.
Gionson said the “call center is among the services we are looking to continue beyond September 28, and we are exploring
options to do so.”
Meanwhile, HTA also is gearing up to put out a request for proposals for Japan, Canada and China this month. It also must reissue an earlier request for proposals for sports events that it unsuccessfully issued this spring.
Gionson said the island chapters are under contract until December.
“We plan to issue (a request for proposals) for those services in October
in time for award and contracting by the end of the current contract in December,” he said.
Industry insiders expect HVCB will try to retain the island chapters. CNHA has said that it is planning to bid.
Hawaii Hotel Alliance President Jerry Gibson said given the challenges of the U.S. and world economy, now is not the time to make sweeping changes.
“There is no entity that exists right now that could possibly be as expert on the market to make the impact that HVCB could make. There is no one out there that could pick any of the slack,” Gibson said.
Gibson said the industry is showing that future bookings are coming in at a decelerated pace.
“I’m really concerned that we aren’t getting the Asian business back as quickly as we thought we would,” he said. “On top of that, it’s almost an impossibility to improve our group situation quickly after the virus. If we aren’t out there welcoming visitors consistently and continuously with the right messages, it will have a definite impact on our industry. It will therefore have an impact on Hawaii economics.”
Lynette Eastman, general manager of the Surfjack
Hotel &Swim Club in Waikiki, said if HTA thinks it
can handle the U.S. market in-house, it needs to produce a viable plan.
“Hawaii is surviving on the U.S. market right now,” Eastman said. “We need to make sure that we don’t negatively impact the first quarter, which historically can make or break the year for Hawaii.”