Fresh approach for state tourism

By Kelly Yamanouchi
Advertiser Staff Writer

The new leader of the Hawai'i Tourism Authority isn't trying to hide the fact that he doesn't have any direct experience in the tourism industry.

Many in the industry say the choice is judicious as the agency seeks to recover from a scathing state audit and rebuild what had become an increasingly rocky relationship with the state Legislature. The hope is that if the tourism authority is able to gain credibility with the Legislature and the governor, it will also be able to reclaim some trust in the form of more funding and fewer restrictions.

But some question whether Johnson, someone who has never worked in tourism before, has the expertise needed to guide the tourism authority and its distribution of millions of dollars for the industry.

Whether Johnson is up to the task will become clear in coming months as the Legislature reconvenes, the authority makes changes in response to the state audit, and the agency copes with a $5 million budget cut as it tries to boost a still-slumping visitor industry.

"I think until we get our house clean, there are going to be more and more restrictions," Johnson said. Last week, the authority submitted its plan to the Senate pledging under Johnson to meet with the public, evaluate its own performance, follow policies and negotiate contracts more responsibly.

Keith Vieira, an authority board member and area director for Starwood Hotels & Resorts Worldwide, called Johnson "a very good listener who can ... understand what the legislators want to see, and then be able to present our plans and actions in language that meets their needs."

Johnson, 56, came to Hawai'i from Seattle in 1971 for a job with a construction company on Maui. He later directed the Hawai'i Community Development Authority, the state Department of Transportation then the Nature Conservancy of Hawai'i. His last job was an 11-month stint as director of physical facilities at Kaka-

'ako for the University of Hawai'i's John A. Burns School of Medicine.

In the early stages of his new job, Johnson said, "One thing that comes clear to me with everybody I've talked to is how important this business is to our community. The guys that really understand the business, they know what the issues are."

Some in the tourism industry, however, still find it difficult to understand why the authority selected someone with no industry experience for such an influential position in the state's tourism industry.

"We don't need a politician," said Dieter Thate, who runs German tour operator Dieter's Tours. "You need an expert there who understands tourism and marketing."

David Carey, president and chief executive of Outrigger and an authority board member who was on the search committee that found Johnson, said the appointment by unanimous vote of the board may seem like an "improbable selection," but Johnson's background in community consensus building, including his good reputation with the state Legislature "are some features that the tourism authority needs right now."

Board members see Johnson's experience in working with government as particularly valuable because a high priority for the authority is responding to the state auditor's report issued in February that said the authority was "fraught with serious management problems" and failed to evaluate its results.

"I think we can do a bit better job and answer their concerns," Johnson said.

Tony Vericella, president and chief executive of the Hawaii Visitors & Convention Bureau, the authority's primary marketing agent, said he has worked with Johnson in the past when Vericella was vice president and general manager of Budget Rent a Car in Hawai'i and Johnson was state transportation director.

"I think it will be a very open, straightforward, honest relationship with each other. Hopefully as a result of all that we can understand where everybody's role needs to be," Johnson said. "In the long run I think it will certainly be a much more positive situation for everybody."

Those who have worked with Johnson in the past call him a "people person."

Ed Cadman, dean of the John A. Burns School of Medicine, called Johnson "the prototypical CEO — the visionary, organized and good people skills."

"He can carry on a conversation with anybody — a manual laborer or the president of the university or the governor," Cadman said. "I've never seen him angry, not even behind closed doors."

Marilyn Kali, spokeswoman for the state Department of Transportation, worked there while Johnson was director and said he had no experience in transportation when he first started that job.

"But he's a quick study, and management is management wherever you are. And he's a good manager," Kali said. "People like working for him."

Johnson was transportation director during the controversial construction of H-3, and his task was to "try to repair relationships that had been undermined" in working with the Office of Hawaiian Affairs, Kali said. Johnson also was director during recovery efforts for Hurricane Iniki.

One of Johnson's biggest projects with the Department of Transportation was developing a plan for the state airports to negotiate lower landing fees with airlines to avoid losing any of the carriers. State revenues in the past had been based on high concession fees from duty-free sales, but because Japanese travel and duty-free revenues dropped after the 1991 Gulf War, Johnson had the task of restructuring support for the air system of the future, Kali said.

With his experience at the Department of Transportation, Johnson said he sees the tourism authority of the future as more involved in discussions with government agencies about infrastructure development dealing with airports, highways and harbors.

The tourism authority will also be helping the state with a study on sustainable tourism. Some board members are concerned that a trend toward lower-spending visitors means more people would need to travel to Hawai'i to bring the same contributions to the economy. That raises concerns about the long-term potential of a strain on the state's airports, harbors, agricultural and historical resources.

Johnson plans changes in marketing programs funded by the authority in the future. "It's going to be a painful process, because people are invested a lot in these programs," he said.

Johnson also said other agencies associated with the authority, including the state Department of Business, Economic Development and Tourism, convention center manager SMG and the Hawaii Visitors and Convention Bureau, would be drawn into the restructuring.

"All of those agencies will be cast with more accountability than they've had to deal with in the past," Johnson said.

His plans also include directing more money toward counties for tourism-related development.

"It gives the local community much more input and puts it out of Honolulu," Johnson said.

Authority board chairman Mike McCartney, who is also president of Hawaii Public Television, said Johnson's lack of experience in tourism is "probably healthy, because he comes to it with an open mind. You have HVCB that has the visionaries and the vision for marketing and those kinds of ideas."

"I think we need to take a look at it from a perspective of where we go rather than how it is and sometimes we may be so close to it that we can't see what needs change," McCartney said.

Also boosting Johnson is the authority's new marketing director, Frank Haas, second in command behind Johnson. Haas started with the authority as a marketing consultant, and has held positions in the past as vice president of marketing for the Ohana Foundation, managing director and chief executive of Ogilvy & Mather, Hawai'i, chairman of the American Marketing Association and adjunct professor of marketing at Hawai'i Pacific University.

Johnson will be highly paid for his work with the authority.

His $240,000 annual salary has raised some eyebrows and Johnson himself says there's no question his pay is high.

But that just means, he says, that the board has made clear to him that they have high expectations.

"The question's gotta be asked, 'Why pay the man so much?'" said former Honolulu Mayor Frank Fasi. "I don't know why these guys spend so much of my tax dollars."

The salary makes Johnson more highly paid than the former executive director, Robert Fishman, whose contract allowed $182,000 annually. After Fishman was called to active duty at the Pentagon, retired banking executive Rick Hum-

phreys served as interim executive director until early September and declined a salary. Gov. Ben Caye-

tano is paid a $94,779 annual salary.

Sen. Donna Mercado Kim, chairwoman of the state Senate Tourism and Intergovernmental Affairs Committee, said she hopes Johnson will improve the authority's standing.

"All kinds of things have continued after the audit came out, which still raises an eyebrow. Hopefully now that the new executive director is in there things will change," Kim said. "I certainly don't want to blame the new executive director, but they've inherited a lot of stuff."