Hawaii lawmakers override Ige’s veto of tourism funding bill

HONOLULU — Hawaii lawmakers Tuesday overrode Gov. David Ige’s veto of a bill that overhauls how the state funds the Hawaii Tourism Authority and allocates tourism tax revenue to the counties.

The bill would stop funding the tourism agency with money raised by the transient accommodations tax on hotel stays and other short-term rentals. Instead, lawmakers intend to pay for the agency with money from the general fund, though for the current fiscal year they appropriated federal coronavirus relief funds.

Further, instead of providing the state’s four major counties with a share of transient accommodations tax revenue, the legislation gives the counties the authority to levy their own surcharge to the tax. Currently, the state charges one uniform hotel tax rate across the islands.

The House voted 38 in favor of overriding, with eight against and four members excused. The Senate voted 17 in favor of overriding and eight against.

Sen. Bennette Misalucha, vice chair of the Senate’s Energy, Economic Development, and Tourism Committee, said special funds shouldn’t be protected for the benefit of one industry. She said the Legislature brought special funds like hotel tax revenue into the general fund to stop this practice.

The Hawaii Tourism Authority will now be required to get support from lawmakers for its budget just like other state agencies, she said. This will require the agency to be more forthcoming with its strategic plans and force more communication between the agency and lawmakers, she said.

“It is part of the checks and balances in state government,” said Misalucha, a Democrat, before senators cast their votes.

Ige, also a Democrat, said he was concerned that the measure would damage the agency’s ability to shift beyond marketing Hawaii to travelers to instead better manage tourists who come to the islands.

“There really is no other state agency that is positioned to be able to identify the hotspots in every community, work with county and state, as well as private sector individuals, to really identify solutions and hopefully be able to fund them — at least on a pilot basis — so we can determine and mitigate the impact of the visitors coming here,” Ige said.

He said funding the tourism authority with federal coronavirus relief funds would hinder the agency because such money comes with extensive reporting requirements and mandates to adhere to strict procurement procedures. The governor said this would interfere with the agency’s advertising and its programs to fund the Merrie Monarch hula festival and other events.

Still, Ige also told reporters before lawmakers voted that he was prepared to execute what the Legislature adopted.

Rep. Sylvia Luke, the chair of the House Finance Committee, said the bill was a vehicle for the state to start managing tourism better. She said the measure did so in part by authorizing the Department of Land and Natural Resources to charge tourists fees to access popular parks.

The Democrat said lawmakers couldn’t just rely on the Hawaii Tourism Authority to manage tourism at some point in the future, but needed to step in and get involved themselves.

“This is a bill to do so now,” she said during debate on the House floor.

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This story has been corrected to show that the Hawaii Tourism Authority will be funded with federal coronavirus relief funds during the current fiscal year, instead of money from the state’s general fund.