Accusing senators of creating a hostile environment for him and his staff, Gov. David Ige’s top economic development official on Thursday refused to answer questions before a joint Senate panel seeking information about the administration’s plan to rebound economically from the COVID-19 crisis.

“It’s my duty as a director to protect my employees,” said Mike McCartney, director of the state’s Department of Business, Economic Development and Tourism, when it was his turn to speak at an informational briefing held by the Senate Ways and Means Committee and the Energy, Economic Development and Tourism Committee.

McCartney’s refusal to talk with the Senate committees was the latest example of a growing rift between the Legislature and the Ige administration.

The conflict has gotten to the point that on Thursday the Senate appointed a special investigative committee with subpoena power to scrutinize how the Ige administration is handling the pandemic response and compel state officials to testify.

Opening Day of the Legislature wide view of the Senate floor.
Tension between the Senate and Gov. David Ige’s administration was on full display Thursday as lawmakers passed budget cuts and went back into recess until mid-June. Cory Lum/Civil Beat/2020

The Senate committee briefing had started with a sweeping overview of plummeting tax revenues by the director of the Department of Taxation and a presentation by the state economist.

As described by the Ways and Means Committee chairman, Donovan Dela Cruz, the purpose of the briefing was to find out how the Ige administration planned to replace the tourism jobs – and related tax revenues — that have been wiped out by the governor’s successful policies to stop the spread of the virus.

The problem is that stopping the spread of the virus also has meant shutting the tourism industry and losing tens of thousands of jobs. Although Ige and county mayors have begun to ease some restrictions, the hospitality industry, which employs about one in six workers in Hawaii, remains virtually dead, with hotels mostly empty and restaurants allowed to do take-out only.

In what appeared to be the first major unveiling of Ige’s overarching economic recovery plan, the meeting agenda showed McCartney would be joined by his key lieutenants, who are in charge of helping to create jobs for Hawaii. But when time came for the department’s presentation, McCartney said the department would not participate.

McCartney repeatedly alluded to bullying and harassment by senators and cited the Senate’s anti-harassment policy and Senate rules. He held up a paper copy of the Senate’s anti-harassment policy and insisted the committee abide by it.

“We have to change the way we have a conversation with each other,” he said.

At anther point he said, “Yes means nothing if you can’t say no” when he was asked why he couldn’t talk to the committee.

The meeting did nothing to shed light on a recovery plan that has been anything but clear. Ige has created a new position to guide the recovery: the Hawaii Economic and Community Recovery and Resiliency Navigator. And Ige filled the position with Alan Oshima, who previously was the chief executive of Hawaiian Electric Co., Oahu’s electricity provider.

Chair Senator Glenn Wakai listens as Senator Thielen questions testifier.
Sen. Glenn Wakai, who chairs the Senate Energy, Economic Development and Tourism Committee, tried to get DBEDT director Mike McCartney to talk about the state’s economic recovery plan. But McCartney refused. Cory Lum/Civil Beat/2020

Oshima has had a far more public profile than McCartney during the COVID-19 crisis. For example, it has been Oshima who has attended meetings of a House select committee composed of government officials and business leaders, which has helped craft milestones for slowly reopening.

Still, lawmakers have been reluctant to have two economy czars for the state, and recently denied Oshima’s request for $10 million, which included $9 million for consultants over the course of the year and $500,000 for staff salaries.

The source of McCartney’s complaints about the Senate was not immediately clear. During the briefing, Sen. Glenn Wakai, who chairs the Senate Energy, Economic Development and Tourism Committee, asked McCartney what the problem was but McCartney wouldn’t say, insisting that Senate President Ron Kouchi be brought in to referee.

Wakai couldn’t be reached for comment after the briefing.

In a follow-up call, Dela Cruz said he did not know.

McCartney did not return a call for comment, and neither did Kouchi.

Mike McCartney, director of the state Department of Business, Economic Development and Tourism, accused senators of creating a hostile environment for administration officials who were asked to testify. Anthony Quintano/Civil Beat

What was clear, however, is that Hawaii is suffering economically and there’s no end in sight to the woes. During a news conference on Wednesday, Ige said there was no timetable for opening to tourism.

Although it applies to all passenger arrivals, and not just tourists, Ige’s order imposing a 14-day quarantine on passenger arrivals has effectively helped stem the spread of COVID-19. However, the order also has devastated the state’s largest private industry. Daily arrivals dropped from more than 30,000 earlier this year to several hundred after the quarantine.

The result has been not only the loss of more than 200,000 jobs overall, but also a dramatic drop in tax collections needed to keep state and local governments afloat.

General excise tax collections, which are the state’s largest single source of tax revenue, have dropped to about $151 million so far in May from about $314 million last year, said Rona Suzuki, the director of Hawaii’s Department of Taxation, citing preliminary figures.

And what about hotel taxes, another major source of revenue for Hawaii? Those, she said, dropped from $52 million in May of 2019 to $4 million this May.

The Senate also formed an investigative committee Thursday with powers to subpoena information from the administration. This new committee is in addition to the Senate special COVID-19 committee, which held hearings on the state’s plans to respond to the coronavirus.

Those meetings often devolved into shouting matches between the senators and administration officials.

The Senate voted 24 to 1 to give this new committee powers to investigate the administration and its plans related to COVID-19. The special investigative committee could subpoena any documents and require testimony from state agencies on those plans.

Sen. Laura Thielen was the lone no vote.

House Speaker Scott Saiki also raised concerns about the new committee. He has told Senate President Ron Kouchi the new committee is unnecessary and that it may backfire.

“You could have officials not wanting to be specific for fear of being under penalty of perjury,” Saiki told reporters Thursday afternoon. “It’s not constructive at all.”
Civil Beat reporter Blaze Lovell contributed to this report.

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