Monahan, the 52-year-old former Liberty House Hawai'i chief executive, takes the job at a time when HVCB's traditional role marketing Hawai'i as a destination worldwide is diminishing. Facing new competition from other agencies interested in winning the lucrative marketing contracts, the HVCB was further hobbled this year when its top executive, Tony Vericella, resigned after an audit uncovered questionable management practices.

Earlier this year, Monahan was appointed trustee of Hawaiian Airlines, which had filed for bankruptcy in March. He resigned after three weeks, citing personal reasons. Yesterday, Monahan said he had health issues that have since been addressed, but he did not give details.

"I am actually in good health," Monahan said. "I do have a condition, but it's not life-threatening."

In his new post, Monahan will be paid $235,000 a year with the possibility of a $117,500 annual bonus, if certain undisclosed visitor count and related goals are reached.

Monahan is credited with guiding Liberty House through a three-year bankruptcy reorganization during which the company changed its focus from international visitors to Hawai'i residents. He left Liberty House in mid-2001 after the chain was sold to Federated Department Stores.

Because of his abrupt resignation as Hawaiian Airlines trustee, Monahan's health was a paramount concern of the HVCB board, said Tony Guerrero, board chairman.

Beyond that, Guerrero said Monahan's Liberty House background, including oversight of a $10 million-a-year marketing budget, was a key factor in selecting Monahan.

"So he does know marketing," Guerrero said. "He does know retailing and is a man of exquisite integrity and leadership."

Among his tasks is reviewing HVCB's operations to make sure they're in line with the agency's reduced responsibility, Monahan said.

The HVCB had long held the exclusive contract to promote Hawai'i to the world, but the Hawai'i Tourism Authority voted last month to spread out the $25 million state contract for tourism marketing.

HVCB received the largest portion as the marketer for North America, but Dentsu Inc. was selected to market Hawai'i to Japan; Marketing Garden to the rest of Asia; The Mangum Group to Europe; and The Walshe Group to Oceania.

Also this year the bureau lost the Hawai'i Convention Center marketing contract, a decision made by the HTA to comply with a legislative mandate.

"Obviously it's a different entity now with the change in the contracts, and our focus will be on North America and also our focus will be on making sure the organization is sized right to meet that assignment," Monahan said.

"I believe any business needs to be lean and mean, particularly when we're looking at marketing the state. We want as many of the dollars as possible to be out there promoting the state."

In addition to any possible reorganization, Monahan faces the challenge of restoring the image of an agency marred by controversy. The state auditor earlier this year sharply criticized HVCB's operations and questioned its use of state money. Vericella's spending of public money for his personal use contributed to his resignation.

Monahan said he will review the state audit's findings and HVCB's policies to make sure the organization operates in a fiscally sound manner.

"Those (audit) issues need to be addressed and the problems need to be corrected," he said. "We understand that the HTA and through the HTA that the state is our client and we have to make sure that the entire organization understands that."

Reaction to Monahan's selection was mixed.

State Rep. Jerry Chang, D-2nd (Hilo), chairman of the House Tourism Committee, said he was concerned about Monahan's limited tourism industry background.

"Knowing how to market Hawai'i is different from knowing how to market a department store," he said.

Chang also said that HVCB needs, above all, to better communicate with the Legislature and display more integrity and accountability in spending of taxpayer money.

Phil Fong, a former Liberty House vice president who worked with Monahan for three years, views Monahan's retailing background as a strength.

Fong said the job demanded a focus on customer needs, and coupled with Monahan's bankruptcy experience, makes him a logical choice to take over at HVCB.

"What I think John will bring to the job is instant credibility and accountability," Fong said.

Perry Sorenson, chief operating officer for Outrigger Hotels & Resorts, agreed that Monahan has the business background for what will be a challenging task.

The relationship between HTA and HVCB "needs to be looked at," Sorenson said. "The fact that HVCB is no longer the exclusive provider of marketing services worldwide, I think, argues for some changes."