Security costs of bank meeting at issue

In a Feb. 1 letter to the authority, Gov. Ben Cayetano asked the board to provide the money to the Honolulu Police Department to purchase riot gear.

Security costs associated with the bank’s annual meeting have touched a nerve with board members and others in the community who question which agency should pay for them.

Hawai‘i will be host to the meeting, the governor said in his letter, to position the state as an international meeting place, "the Geneva of the Pacific." Board members said yesterday they support that idea, but are unclear whether the purchase of equipment such as protective masks and riot gear is part of their mission to promote and support Hawai‘i’s tourism industry.

"I’m very sensitive about how we spend our dollars," said board vice chairman David Carey, chief executive of Outrigger Enterprises. "Our accountability is to deliver visitor expenditure, and it’s not clear how that works here."

State officials have said a total security budget for the bank’s annual meeting has not been established. The governor said in his letter that the state would ask Congress to reimburse security expenses incurred to hold the international meeting.

Seiji Naya, head of the Department of Business, Economic Development and Tourism, who has been key in landing the meeting, said he was told by a state official that the cost for security could run between $2 million and $7 million, and that in other cases where the federal government has reimbursed such expenses it has covered only half the total cost.

"It’s begun to worry me what’s happening," Naya said. "When I read this request from the governor which is very precise — to the dollar — I begin to think there must be a very precise number somewhere."

The tourism authority has asked for more information when the governor returns from an off-island state trip.

The tourism authority has a $61 million budget, paid for by revenue from the hotel rooms tax. The bulk of it, about $39 million, goes to marketing the state as a vacation and business destination.

"The question is, should we get rid of a half a million dollars of marketing money to fund this?" said authority member Keith Vieira, Hawai‘i operations director for Starwood Hotels and Resorts Worldwide. "No matter what you do, something has to get cut."

In a related issue, the authority’s chief executive officer, Robert Fishman, said an exemption is being sought from the hotel room tax for the bank. He said only transactions paid for directly by the bank would be exempt — covering fewer than 100 rooms for its staff and others out of a total of 3,000 people expected at the meeting, and amounting to roughly $15,000. As an international institution, Fishman said, the bank has certain "diplomatic immunity" and is exempt from taxation.

Michele Kayal can be reached by phone at 525-8024, or by e-mail at mkayal@honoluluadvertiser.com.

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