The Chamber of Commerce Hawaii has donated $600,000 to a new political action committee created to oppose a ballot measure that seeks to tax investment properties to raise money for public education, according to the group’s president.

“It is an investment we had to make,” chamber president and CEO Sherry Menor-McNamara said Monday. “We need to protect our small business community because they’re the ones who are going to be impacted.”

The money given to the Affordable Hawaii Coalition PAC is a counterpunch to the half-million dollars the teachers’ union has already amassed for its own PAC to support the proposed constitutional amendment.

Mobilizing over the past month, several groups have raised money, signed advertising contracts and hired political strategists to help them sway voters on two major ballot questions to be decided Nov. 6.

Chamber of Commerce Hawaii President CEO Sherry Menor-McNamara2. 7 june 2016.
Chamber of Commerce Hawaii President Sherry Menor-McNamara said the money to oppose the constitutional amendment was “an investment we had to make.” Cory Lum/Civil Beat/2016

The proposed constitutional amendment to boost funding for local schools has generated the most financial activity so far, with more than $1 million raised between the opposing sides. But neither side has spent much — yet.

Meanwhile, a new committee formed Monday to influence whether Hawaii holds its first constitutional convention since 1978. There’s no money reported at this point, but last time the question was on the ballot groups spent almost $1.4 million on the issue.

The Hawaii State Teachers Association, which represents 13,700 teachers, formed a ballot issue committee called HSTA for Schools Our Keiki Deserve to back the ConAm measure.

As of Monday, the filing deadline for campaign finance reports covering Aug. 12 to Sept. 26, the group was sitting on $519,000 after spending almost $27,000, mostly on consulting services and mailers.

HSTA put the bulk of the money in the pot, but had received $100,000 before the primary from its parent affiliate, the National Education Association.

In the most recent reporting period, HSTA’s biggest expenditures were $15,000 to Washington-based Hamburger Strategies and $7,000 to Virginia-based Blue Origami Strategies for “professional services,” its filings show.

HSTA President Corey Rosenlee declined to comment on exactly how the union plans to spend the rest of its cash in the weeks leading up to the general election.

So far, the union — which argues the amendment is necessary to enhance funding for public education to pay teachers better and improve the quality of Hawaii’s schools — has been vocal and aggressive in its efforts to drum up public support.

A report last week by the personal finance site WalletHub, which ranked Hawaii the worst state to be a teacher as far as salary, income growth potential and pupil-teacher ratio, has provided the union with new ammunition in its campaign.

HSTA announced it was organizing a “walk-in protest” early Tuesday at certain public schools so teachers can express frustration with the findings of the WalletHub study and the general state of funding of schools here.

HSTA President Corey Rosenlee. 21 may 2015. photograph Cory Lum/Civil Beat
HSTA President Corey Rosenlee said the union’s PAC supports the ConAm to boost teacher salaries, as well as meeting other educational needs. Cory Lum/Civil Beat

The union also has a separate PAC called the HSTA Government Relations Committee, which has $230,000 cash on hand. Rosenlee said that PAC is dedicated more to political races than ballot issues.

On the flip side of the issue is the Affordable Hawaii Coalition PAC, a political action committee created this past summer to oppose the amendment. It is chaired by small business owner Stanley Lau, founder and CEO of Hawaii Tech Support.

The $600,000 from the chamber was “getting transferred” Monday, Menor-McNamara said. It was not listed on the Campaign Spending Commission reports.

She said the chamber has not invested this much money for a ballot question since she joined the business advocacy group in 2006.

“We believe it will increase the cost of living for everyone,” she said of the ConAm.

She said the ballot question does not specifically state the amount of a state surcharge on real investment property. Many small businesses rent and lease their spaces, and any increase will be handed down, and some businesses can’t afford any additional cost, she said.

Although the ballot question does not define “investment real property,” HSTA has said the legislative intent is to tax only nonresidential investment homes worth at least $1 million or more — not commercial properties or primary homes. The Legislature would ultimately decide the mechanics of it.

In all, the Affordable Hawaii Coalition reported raising $155,000 from several dozen entities and spending $77,000 from Aug. 12 to Sept. 26.

Donations ranged from $500 to $20,000. The largest was from a McLean, Virginia-based real estate investment trust, or REIT, known as Park Hotels and Resorts, which manages an extensive portfolio of luxury hotels and resorts, including the Hilton Hawaiian Village Waikiki Beach Resort in Honolulu and Hilton Waikoloa Village on Big Island.

Big spenders that contributed $10,000 included Hawaii Petroleum Inc. Consolidated, WC Maui Coast Hotel LLC, Shidler Pacific Advisors LLC, Dowling Company Inc. and Lanai Resorts LLC.

The coalition also received a $10,000 in-kind donation from the Honolulu-based real estate investment company Watumull Properties Corp. Jaidev Watumull, an executive at the firm whose name is listed in campaign spending reports, did not return an email or phone call seeking comment.

The Hawaii Insurers Council has also given the coalition $10,000.

Other contributors represent a range of business, insurance and automotive interests, including Workforce Housing For Hawaii, Island Insurance PAC, American Savings Bank, Tradewind Capital Group, Aloha Auto Group, New City Nissan and King Auto Group.

The coalition’s biggest reported expense so far, $45,000, went to the Honolulu communications firm CommPac LLC for professional services.

The PAC has also enlisted the services of several consultants, including Sanhi Government Strategies and Glenna Wong Public Relations, its filings show.

The coalition reported a $40,000 ad buy with Snyder Pickerill Media Group to run from Monday through Nov. 6, according to a statement of information for electioneering communications. The disclosures are required for candidates and noncandidate committees that spend more than $2,000 on political ads in a year.

Lau said Monday that representatives of the PAC have spoken to the Hawaii Auto Dealers Association, senior citizen groups, local Chamber of Commerce groups and other civic and volunteer organizations while also attending neighborhood board meetings to oppose the constitutional amendment.

“Right now, our focus is educating the public in general about the pluses and minuses of the ConAm, and from our perspective there’s a lot of holes with what’s being proposed,” he said.

New Group Formed Around ConCon

The other big issue on the ballot is whether Hawaii should hold a constitutional convention, or ConCon, in which elected delegates would take a look at revising the state’s founding legal document. It’s a question voters are asked every 10 years.

In 2008, the last time voters considered a ConCon, six outside groups got involved. With strong union backing, four groups lined up against it. They spent nearly $1.3 million, including a half-million dollars from teachers, on a successful campaign to quash it, according to the Campaign Spending Commission.

United Public Workers union building Kalihi UPW1. 13 nov 2016
The United Public Workers union is the only registered group spending money on the ConCon question so far. Cory Lum/Civil Beat/2016

Two groups in favor of the ConCon spent a combined $68,000. The measure failed by a nearly 2-to-1 margin.

This time around, only one group has formed so far that’s solely focused on the ConCon question. Preserve Our Hawaii, presumably an opponent, registered Monday with the commission.

The group is chaired by Karlie Asato, a consultant who worked for years with the Hawaii Government Employees Association, the state’s largest public-sector labor union. She could not be reached for comment Monday.

Preserve Our Hawaii’s first disclosure report with the commission shows no money being spent or raised as of Sept. 26.

The only registered group spending money on the ConCon question so far is the United Public Workers union, which represents 43,000 blue-collar supervisors, white-collar workers, education officers, nurses, law enforcement, lifeguards, scientists and administrative professionals.

UPW has spent nearly $9,000 opposing a ConCon so far. The union had $183,000 on hand as of Sept. 26.

The union has spent $105,000 since the Aug. 11 primary, including giving $9,000 directly to candidates. Most of the money went to ads supporting candidates, including Tommy Waters’ and Brandon Elefante’s bids for the Honolulu City Council, Derek Kawakami for Kauai mayor and Gov. David Ige’s re-election effort.

The next filing deadline for noncandidate committees is Oct. 29, the same day that candidates have to file their first campaign finance reports since the primary. The reporting schedule for individual candidate committees, set by the Legislature, leaves voters in the dark about the money behind campaigns until a week before the election.

Thoughts on this or any other story? Write a Letter to the Editor. Send to and put Letter in the subject line. 200 words max. You need to use your name and city and include a contact phone for verification purposes.

You can also comment directly on this story by scrolling down a little further. Comments are subject to approval and we may not publish every one.

Help power our public service journalism

As a local newsroom, Civil Beat has a unique public service role in times of crisis.

That’s why we’re committed to a paywall-free website and subscription-free content, so we can get vital information out to everyone, from all communities.

We are deploying a significant amount of our resources to covering the Maui fires, and your support ensures that we can pivot when these types of emergencies arise.

Make a gift to Civil Beat today and help power our nonprofit newsroom.

About the Authors