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The Honolulu Advertiser
Posted on: Tuesday, November 12, 2002

Cayetano justifies $5M cut from HTA

By Susan Hooper
Advertiser Staff Writer

Gov. Ben Cayetano says he cut $5 million of key tourism marketing money this year in response to House Speaker Calvin Say's nomination of an Outrigger executive to a second term on the Hawai'i Tourism Authority, saying the nomination was "a classic case of how big business buys influence."

The cut amounted to more than 8 percent of the authority's $61 million fiscal-year 2003 appropriation for marketing the state's biggest industry and came at a crucial time as the industry struggles to recover from the decline in visitors that followed the Sept. 11 attacks.

At the time of the cut in June, Cayetano noted that money allocated for tourism marketing was still higher than it has been in the past. He did not state publicly any other reason for the cut.

In a recent statement, Cayetano said Outrigger chief executive David Carey — one of the authority's 13 original board members — "set up" his reappointment to the authority by "persuading" Say, D-18th (Palolo, St. Louis, Kaimuki), to submit only Carey's name for appointment to that seat.

"When we reminded the speaker that the law required him to send me three names, he sent me Carey's name and the names of two of Carey's employees," Cayetano said in his statement. "As far as I was concerned, this ploy was just another way of eliminating choices and assuring that Outrigger would have a voice on the HTA."

Cayetano said Say told the governor he appointed Carey "because Carey 'helped him.' "

Carey's actions as an authority member "reveal that Carey believes that whatever is good for Hawai'i's hotels must be good for tourism," Cayetano said. "I disagree with that."

"The speaker's actions set a bad precedent," the governor said. "It's a classic case of how big business buys influence. If Carey had been appointed to another board, I may have reacted differently. The HTA, however, is given $60 million to market tourism. There had to be some accountability. In this case, it cost the HTA $5 million."

In response to the governor's statement, Say said he did not know why Cayetano cut the $5 million from the tourism authority budget.

"We appropriated the funds, and he just made the restrictions," Say said. "I don't have any correspondence from him. I was just shocked that he would do that."

Say said his nomination of Carey was not in response to any help Carey gave him.

"When (Cayetano) talks about Calvin Say being taken care of, my answer is no, flat-out no," Say said.

Outrigger Enterprises has supported the House by sending employees as legislative interns to learn about public finance and the legislative process, he said, and the company has helped find lodgings for Neighbor Island legislators during the session. In addition, Say said, Outrigger's sponsorship of several Hawai'i sporting events, including the Rainbow Classic, "helped everyone in the state."

"But please state for the record: I was never taken care of," Say said.

Say said he sees nothing wrong in having a representative from Outrigger on the tourism authority.

"Outrigger is a locally based company, a kama'aina company, and we should have some presence of a local company, compared to the Starwoods or the Hiltons," Say said.

Say said he supported Carey's request to be reappointed to the authority because of Carey's knowledge of the industry.

"I truly feel that the credentials that Mr. Carey has are all well-qualified," he said.

Carey is still on the authority, but as a carry-over appointment, meaning he will serve indefinitely until either he is reappointed or someone else is appointed to his position, Carey said.

Carey, who is president and chief executive officer of Outrigger Enterprises, said he asked Say early this year to offer his name to the governor for another term on the tourism authority.

Carey said Outrigger has contributed to Say's campaign, and to the campaigns of 25 to 30 other House members "on both sides of the aisle."

"We support those who support our industry, and Calvin has always been a supporter of our industry," Carey said.

Outrigger is the largest hotel chain in the Islands, based on number of rooms. But Carey took issue with the characterization that he represents only the interests of Hawai'i hotels.

On the authority, he said, "I've always tried to represent the broader industry." In addition, he said, with more than 300,000 square feet of retail space in its hotels and two showrooms, Outrigger has significant tourism interests beyond hotels.

"To say that I only look at the hotels is simply incorrect, particularly in my role as a tourism authority board member, and I'm sorry the governor has that view because it's simply not accurate," Carey said.