Tourism eyeing hotel tax
By Dan Nakaso
Advertiser Staff Writer
Hawai'i tourism officials don't plan to ask the Legislature for any extra money to market Hawai'i as a tourist destination following Sept. 11, but they do want greater access to the special hotel room tax fund.
The Hawai'i Visitor Industry Coalition plans to ask legislators this session to allow the tourism industry to receive more than the $61 million currently allowed each year from hotel room tax collections, said Tony Vericella, president and chief executive of the Hawai'i Visitors & Convention Bureau.
Lifting that cap would be a major boost "for everyone in the visitor industry," said Murray Towill, president of the Hawai'i Hotel Association and co-convenor of the Visitor Industry Coalition.
The funding formula, created in the mid-1990s, designates 37.9 percent of the hotel room tax for the tourism authority, not to exceed $61 million. The rest is divided among the Hawai'i Convention Center debt service, the general funds of the major counties, and to help pay for the Hawai'i Tourism Authority.
The issue of removing the cap has been moot until recent years because there was no excess money. But as the fund increased, groups such as the Sierra Club proposed using some of it to pay for things such as improving state parks.
"Everyone wants a piece of it, because people know there has been extra cash there," said Rep. Jerry Chang, D-2nd (S. Hilo), chairman of the House tourism and culture committee.
Removing the cap might not have much effect, given the downturn in tourism after Sept. 11. With fewer tourists filling hotel rooms, and less in room taxes being collected, Towill wonders if there might not be any money beyond the $61 million cap.
"It's conceivable that what's happened this year, postiSept. 11, means we won't generate as much money as in the past," he said.
Legislators gave tourism officials an extra $10 million out of the hotel room tax fund during a special session following the Sept. 11 terrorist attacks.
But Gov. Ben Cayetano and the heads of the Senate and House tourism committees said yesterday it was unlikely they would agree to remove the $61 million cap.
Before Sen. Donna Mercado Kim considers whether to lift the cap, she plans to repeat her request for an accounting of how tourism officials spend the state money they receive.
"I'm very frustrated," said Kim, D-15th (Kalihi Valley, 'Aiea). "I'm concerned where the emphasis is, and I have not gotten numbers on the areas I've been asking about. We're obviously marketing a product that has grown stale, to be frank."
Reach Dan Nakaso at dnakaso@honoluluadvertiser.com or 525-8085.
