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Governor of the State of Hawaiʻi

DAVID Y. IGE

Home » Latest Department News, Newsroom » DBEDT News Release: PROPOSALS TO BE RE-SOLICITED FOR
HAWAIʻI TOURISM MARKETING & MANAGEMENT IN THE UNITED STATES

DBEDT NEWS RELEASE: PROPOSALS TO

BE RE-SOLICITED FOR HAWAIʻI TOURISM
MARKETING & MANAGEMENT IN THE
UNITED STATES
Posted on Dec 30, 2021 in Latest Department News, Newsroom

HONOLULU – The Hawaiʻi Tourism Authority (HTA) issued a request for proposals in October
for a contractor to provide tourism destination brand marketing and management services for
the United States, Hawaiʻi’s largest market of visitors, commencing January 1, 2022. At the end
of a months long process, an initial award was rescinded in December by DBEDT Director Mike
McCartney, who as the head of the purchasing agency oversees all procurement.

“The Continental U S is the largest source of visitors to Hawaiʻi, which makes the effective man
agement of this market one of our most important efforts to bolster our state’s economy,” said
Director McCartney. “We determined that the solicitation did not provide for consideration of all
factors of significance to the agency, therefore it is in the best interest of the State of Hawai‘i to
rescind the offer and re-solicit the RFP. We are re-starting the process to find a definitive win-
ning proposal to move forward in the best interest of the State of Hawaiʻi ”

Hawaiʻi is represented in key markets around the world by contractors overseen by the Hawaiʻi
Tourism Authority To ensure continuity of marketing and management services in the U S mar
ket, the agency’s current contract with the Hawaiʻi Visitors & Convention Bureau will be ex-
tended for up to six months as proposals are received, reviewed, and a contract awarded and
negotiated. A new request for proposals will be issued in the coming weeks.

###
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 Media Contacts:

Charlene Chan

Department of Business, Economic Development & Tourism

808-824-0134

charlene.l.chan@hawaii.gov

dbedt hawaii gov (http //dbedt hawaii gov)

Ilihia Gionson

Hawaiʻi Tourism Authority

ilihia.gionson@gohta.net

hawaiitourismauthority.org

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TRANSCRIPTION of Sylvia Luke, John De Fries, and Kalani Ka‘anā‘anā
FIN Info Briefing – Wednesday – January 5, 2022 @ 9:00 A.M.

Youtube - Time on recording: 5:43:17 / 6:14:41 through 5:49:50 / 6:14:41

Sylvia Luke:

“Now I have a question for HTA.”

John De Fries:

“Yes Chair”

Sylvia Luke:

“Hi, Thank you, thank you for your presentation um”

“We have been um so I appreciate um your efforts in trying to um trying to be responsive to the
needs of the community and what is needed and the need for um tourism management um but
I do understand that you folks have retained the same marketing team? Um so and that is ah
somewhat troubling only because um you know in as much HTA um ah provides assurance that
the-the the marketing and the vision and the um the I guess some of the things that you see
which will be responsive to community concern will be addressed um, but it is somewhat
troubling that ah HTA still ended up retaining the same consultants um. So, are you confident
that the consultants, um are aware of ah basically what you folks are trying to um institute? Or
um or at least were trying to get some assurances that you know people understand what we
are all trying to do as far as tourism management and um and figure out a pathway ah before
we hit 10 million tourists again? To figure out um how we can um you know to get the type of
tourists you want and have them understand the cultural significance and the respect for our
natural areas and resources.”

John De Fries:

“Well great question, appreciate that ah Chair, and-and specifically just so that I’m clear, are
you referring specifically to the U.S. marketing arm of it?”

Sylvia Luke:

“Yes”
John De Fries:

“Okay, yeah, I will tell you that-that we are still in process by statute, we are required to um go
back out to RFP ah on these contracts, ah after 5 years and the fifth year was 2021. Ordinarily,
that RFP, if-if everything had moved according to schedule, ah the legge, the legislative
would’ve adjourned in early mid-May, ah our budget would then be finalized before our Board
in June, and then we would be out fiscal um the new fiscal year with that RFP being issued in
um in no later than in early August. As it turned out because of the activity that really didn’t
conclude legislatively until the 2 nd week of July. We ended up coming out with our final budget
and that RFP later than anticipated like mid-October. So, we are still in the middle of that what-
what we have done, is in working with the state procurement office ah come up with an
extension of the existing contract for up to 6-months that would enable us to complete the re-
scope the RFP in-in ways that you kind of describe with the sensitivities involved, culturally in
the community and with natural resources and the impacts. Ah this will create an opportunity
for us to still complete this process, but we needed to backstop our efforts, ah by creating this
extension of 6-months, but the final determination on who that marketing contractor will be
going forward has not been concluded as yet, and Kalani I’ll ask you to add to that please.”

Kalani Ka‘anā‘anā:

“Thanks John, and ah and Rep. so I think John kind of hit it pretty close and ah we cancelled the
RFP-22-01 and are preparing a new RFP and so in order to get that done, we have the 6-month
extension with the previous incumbant, ah but we’ll move through the process RFP moving
forward and select a vendor.”

Sylvia Luke:

“Okay, thank you for that clarification. So that RFP was issued but then subsequently you
cancelled the contract, um to give an extension so that you can re-issue the RFP, I think that’s
kind of an important point, only because um you know there the legislature and the community
wants HTA to um help us have a better tourism management, and the fact um, that since the
legislature ended um, HTA selected the same consultant ah contractor to do the marketing. We
weren’t sure if either HTA has changed the RFP to take care of our concerns or whether HTA
was actually listening to our concerns, and the fact that you chose the same consultant was a
concern. So now that I understand that you cancelled that contract and hopefully in light of
some of the concerns raised or in agreement with our concerns we hope to get further um
vision and further um I guess outline from you folks on how you feel ah we can move forward
on some type of management and um management of this industry.”
John De Fries:

“Appreciate that in the, just to be ah clear, the contract, the existing contract expired
December 31, and what was granted was an extension of up to six months which would enable
us to complete the reissuance of the RFP. So, the initial RFP was cancelled, the current contract
expired, and what we’re operating under now is the ability to go six months if we have to, if we
can conclude this selection process prior to that, we will.”
Monday, June 20, 2022 |
 Today's Paper |
77°

HAWAII NEWS

Hawaii Tourism Authority secures state funding

By Allison Schaefers •
May 6, 2022

Following an eleventh-­hour scramble, Hawaii Tourism Authority emerged from the 2022 legislative session with a fully intact
$60 million annual budget.

Lawmakers unanimously consented to House Bill 1147 during a floor vote held Thursday shortly before adjournment of the
session. It will now be sent to Gov. David Ige for consideration.

The bill, which switches the source of HTA’s budget to general funds, sets an additional $28.5 million expenditure ceiling for the
Hawai‘i Convention Center’s enterprise special fund and $100,000 for University of Hawaii tropical agriculture pursuits.

HTA President and CEO John De Fries thanked state lawmakers for “appropriating an operating budget for the Hawaii Tourism
Authority and for entrusting us with the important work of destination management and visitor education.” He added that the
state agency will work “diligently on behalf of our communities and visitor industry to help restore jobs, strengthen our economy
and to malama our island home.”

Sen. Kurt Fevella (R, Ewa Beach-Iroquois Point) rose in support of HB 1147 during the floor vote. “We have previously said the
visitor industry is an important sector of Hawaii’s economy, and in fact it has provided a significant share of the state tax
revenue to provide employment and opportunity in kamaaina families,” Fevella said.

“There are also challenges associated with this industry. There’s community concerns about the need to protect our cultural and
our native resources. Hawaii Tourism Authority is responsible for changing the course of making a focus to destination
management and visitor education. Appropriation will help HTA with the ability to show progress” toward implementing its
“Destination Management Action Plans” for each county.

The coming fiscal year’s state funding for HTA remained in limbo for much of the legislative session. House and Senate
conferees left HTA funding out of the final version of the state’s $17 billion supplemental budget, and legislative conflict over
alternative bills put the agency’s financial outlook in jeopardy.

Before signing off on the final draft of HB 1147, the Senate had favored House Bill 1785, which would have reorganized HTA.
The House had favored Senate Bill 775, which funded HTA w thout strings but sought to create an additional agency, a “Natural
Resource Management Commission,” with an appropriation of $30 million.

After last week’s deadline for fiscal bills, lawmakers amended HB 1147 to include HTA funding. The last-minute changes to
what was originally a “capital improvements bill” could still trigger a challenge about whether it tests the limits of a recent “gut
and replace” court ruling. The ruling requires that when a bill is stripped of its original content and replaced with something
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 entirely different, the move must be followed by a set of readings for the amended measure.

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EMBARGOED UNTIL 5:00 PM ON JUNE 2, 2022
HTA Release (22-13)

HTA Awards Contract for US Brand Management and Global Support Services
New Multi-year Contract Begins June 30, 2022

HONOLULU – The Hawai‘i Tourism Authority (HTA), the state agency responsible for
holistically managing tourism, has awarded a new contract for a comprehensive range of brand
management and visitor education services for the Hawaiian Islands in the United States
market, as well as support services shared by Hawai‘i’s brand management teams worldwide.

HTA issued a Request for Proposal (RFP) for the United States market on April 15. A list of
finalists was determined, and presentations were made to an evaluation committee comprised
of HTA, community and industry leaders.

In addition to the in-market activities contracted in previous periods, this Request For Proposals
(RFP 22-01) included coordination, communication, and promotion in Hawaiʻi for initiatives
produced by the community through the Destination Management Action Plans. It also included
support services for Hawaiʻi’s official travel website, app, social media channels, and creative
content used worldwide for branding and visitor education.

The contract was awarded to the Council for Native Hawaiian Advancement.

HTA will negotiate a multi-year contract with the Council for Native Hawaiian Advancement
which will commence on June 30, 2022, and will end on December 31, 2024, with HTA having
the option to extend the agreement for an additional two years.

###

About the Hawai‘i Tourism Authority

The Hawai‘i Tourism Authority is the state agency responsible for holistically managing tourism
in a sustainable manner consistent with community desires, economic goals, cultural values,
preservation of natural resources, and visitor industry needs. HTA works with the community
and industry to Mālama Kuʻu Home – care for our beloved home. For more information about
HTA, visit www.hawaiitourismauthority.org or follow @HawaiiHTA on Facebook, Instagram,
and Twitter.

For more information, contact:

T. Ilihia Gionson
Public Affairs Officer
Hawai‘i Tourism Authority
ilihia.gionson@gohta.net
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 Saturday, June 18, 2022 |
 Today's Paper |
79°

HAWAII NEWS

Questions cast pall over lucrative Hawaii tourism

contract
By Allison Schaefers •
June 15, 2022

The lucrative contract to market Hawaii’s visitor industry in the United States remains shrouded in uncertainty as the Hawaii
Tourism Authority sorts out whether its controversial procurement process will end in a historic change.

HTA awarded its largest piece of business, the U.S. brand management and global support services contract, on June 2 to the
Council for Native Hawaiian Advancement. The new contract, worth more than $34 million in the first two years, was expected
to start June 30 and is slated to end Dec. 31, 2024. The contract comes with an option to extend for an additional two years.

If the award stands, it will be the first time that a Native Hawaiian group has been in charge of marketing for the state’s largest
source of visitors. It also would be a rare example of an Indigenous nonprofit at the top spot of a state tourism agency.

But the deal is far from done.

Executives from the Hawaii Visitors and Convention Bureau, the losing bidder and current contract holder, met with HTA
officials Tuesday for a formal debriefing, and they have until next Tuesday to challenge CNHA’s award.

It’s unclear whether HVCB, the only entity ever to hold HTA’s U.S. marketing contract, will appeal.

HVCB President and CEO John Monahan declined to comment because he is still under a nondisclosure agreement, a
condition of HTA’s procurement process.

HTA officials, meanwhile, say they plan to scale up the organization so it can temporarily run the U.S. marketing operation if
HVCB’s current contract extension, which expires June 29, runs out before a new U.S. contract is finalized.

HTA President and CEO John De Fries said in a statement that the agency would “fill the gap in brand management and visitor
education for the U.S. market in-house, using existing funding.”

“Contingency planning is occurring at this time, which may include temporary reassignment of staff, emergency temporary
hires, emergency procurement, and convening members of the HTA Board in an advisory capacity,” he said.

Even if HVCB decides not to appeal and CNHA takes over on June 30, the plan calls for a 90-day transition, according to public
documents from the request for proposal process obtained by the Honolulu Star-Advertiser.

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If HVCB challenges CNHA, it will open the door to even more questions about an already complicated procurement process.

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 Based in Kapolei, CNHA describes itself as a nonprofit with a mission to enhance the cultural, economic, political and
community development of Native Hawaiians. The group says its services include financial counseling and providing grants and
loans targeting underserved communities in Hawaii.

CNHA originally lost the first version of the RFP by five points to HVCB, according to public records released by HTA on
Monday to the Star-Advertiser.

HVCB’s score was 581.3 points, while CNHA’s was 576 points. Wondros/IQ360, headed by Patrick McGovern and Lori
Teranishi, was the third finalist with a score of 543.3.

Protest letter

On Dec. 10, HTA awarded HVCB a four-year contract to market the U.S. that was worth $22.5 million the first year and came
with an option to extend a year. Seven days later CNHA sent state Department of Business, Economic Development and
Tourism Director Mike McCartney a 14-page protest, after which he rescinded HVCB’s offer.

CNHA said in its protest letter, “Given the importance of this industry to the culture, natural resources, and economic
development of this place we have called home for nearly 2,000 years, we feel compelled to protest this decision and strongly
urge HTA leadership to find that the best value to the state of Hawaii, and her people have not been met through this decision.”

McCartney declined to comment due to procurement rules.

CNHA’s protest letter alleged that committee member Karen Hughes gave it a low outlier score, which it said skewed the results
by nullifying the scores of five committee members. It stated that HTA’s procurement officer during a Dec. 13 briefing had
acknowledged that outlier scores affected the decision.

CNHA also argued that Hughes had a conflict of interest as a former HVCB executive.

CNHA said when it brought up the question of bias for Hughes during a debriefing, the HTA procurement officer indicated that
Hughes, who had worked for HVCB six years ago, was outside a five-year prior-­employment window that was used as the
threshold to determine conflict.

Hughes, a past HTA vice president of marketing and product development, declined to comment. She was the only committee
member with an extensive history in Hawaii’s hotel industry.

Other committee members for the first RFP included Laci Goshi, who was serving at the time as HTA brand manager for the
U.S. market; HTA Chief Brand Officer Kalani Ka‘ana‘ana; HTA board Chair George Kam; HTA board member David Arakawa;
HTA brand manager Maka Casson-Fisher; and Mahina Paishon-Duarte, a social entrepreneur with two Hawaii-based
businesses and co-founder of Waiwai Collective.

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 Second round

Changes to the scope of work in the second version of the request for proposals, which HTA re-solicited in April, added a
requirement for a global support services management plan. The second RFP’s scoring model was changed to minimize
marketing. Language was added to allow the new contractor to start without a permanent team in place.

The selection committee’s makeup changed during the second version of the RFP, as did the scores and applicants.

Arakawa, Kam, Ka‘ana‘ana and Paishon-Duarte returned to serve on the second RFP evaluation committee. However, Hughes,
Goshi and Casson-­Fisher were replaced by state harbors Administrator Davis Yogi, Kualoa Ranch President and owner John
Morgan, and Nalani Brun, director of Kauai County’s Office of Economic Development.

The second RFP committee, which did not include any hoteliers, picked CNHA over HVCB by a 103.9-point margin. The score
for CNHA in the second round was 724 and for HVCB was 620.08.

For the second RFP, only HVCB and CNHA applied.

CNHA asked Wondros, the third finalist from the first RFP, to become a major marketing subcontractor. Leslie Dance, a former
HTA vice president of marketing and product development, is on Wondros’ team.

CNHA dropped other well-known Hawaii visitor industry names as part of its first and second RFP applications. However, Star-
Advertiser research has confirmed that at least two of CNHA’s proposed team members — Jerry Gibson, of the Hawaii Hotel
Alliance and BRE Hotels and Resorts, and Tom Kiely, former XTERRA CEO/co-founder — had not committed to the
organization.

CNHA CEO Kuhio Lewis declined to address the discrepancies due to a nondisclosure agreement tied to the HTA procurement.

CNHA named Gibson as part of the transition team for its second RFP, which also included Lewis; interim Executive Director
Amy Kalili; Doug Chang, general manager of the The Ritz Carlton Residences, Waikiki Beach; Ann Botticelli, former Hawaiian
Airlines executive; Micah Kane, president and CEO of Hawaii Community Foundation; Rebecca Soon, owner of Solutions
Pacific and Ward Research; Frank Haas, industry and marketing consultant; Roy Tokujo, Ulalena and Ko ‘Olina Marketing,
former HVCB president; Kuha‘o Zane, president of the Edith Kanaka‘ole Foundation; Aaron Sala, president of Gravitas Pasifika
and a cultural practitioner; and an unspecified HTA representative. Ku‘uipo Kumukahi, director of culture at the Hyatt Regency
Waikiki, was named a potential transition team member.

Gibson’s name was important to the selection committee, as indicated by a clarifying question, where evaluators sought to
ascertain his participation.

The committee asked CNHA, “Mr. Jerry Gibson was listed as a potential executive on your transition team. Have you received a
commitment that he will be part of the transitional team if awarded this contract?”

CNHA told evaluators that all members listed on the transition team were confirmed.

CHNA told the committee, “We indicated (proposed) next to Mr. Gibson because we understand that he currently serves on the
board of the incumbent and surely he will be supporting that application. However, he did confirm that if CNHA were to be
awarded, he would be willing to serve on the Transition Team, and he indicated that he would do all he could to support a
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 smooth transition,”

Gibson, who serves as president of the Hawaii Hotel Alliance, told the Star-­Advertiser on Tuesday that he met with CNHA’s
Lewis on May 14 but did not make a commitment to the nonprofit.

“I was never asked to be involved with the bid from CNHA, and I have no idea how I ended up in the bid documents for CNHA,”
Gibson said. “I was never asked to be on the transition team by Kuhio Lewis. We had a conversation, and he asked, ‘If CNHA
wins the bid, would you be able to support us?’”

Kiely said he was misidentified as part of CNHA’s first RFP proposal’s transition team.

“I got a call from somebody last fall that said, ‘Hey, if somebody wants to talk about tourism, are you open to do that?’” he said.
“It was never mentioned that it was a proposal (involving) HTA, none of that. When I saw my name was part of a proposal, I
was upset about it.”

Kiely said the discrepancies in CNHA’s proposals must be evaluated.

“Someone needs to go back to HTA and say, ‘What are you doing?’” he said. “‘You gave it to HVCB the first time, and you
pulled it back and gave it to these other guys the second time, and some of their people aren’t even involved. It casts a pall on
the whole thing.”

Kiely said such an important state contract should check every box perfectly.

“If one box isn’t checked perfectly, then you stop and start again,” he said. “This is not a little $10,000 sponsorship of a kite-
flying tournament somewhere. This is the big deal.”

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