The state agency in charge of tourism will try for a third time to execute a contract for marketing Hawaii to the mainland and managing visitors once they get here.

Hawaii Tourism Authority President John De Fries announced the restart in a press release Tuesday morning. This comes after controversy shrouded the procurement process as the agency stumbled by awarding the contract first to the Hawaii Convention and Visitors Bureau, which has marketed Hawaii for more than 100 years, then to the Council for Native Hawaiian Advancement.

The contract awarded to HCVB was worth about $21.5 million a year while the more recent CNHA contract was worth about $34 million in its first two years.

A view of Waikiki Beach in Jluly 2022.
The state is restarting solicitation for a major tourism marketing contract. Cory Lum/Civil Beat/2022

Former Gov. David Ige’s outgoing economic chief, Mike McCartney, notified the HCVB and CNHA in letters Monday that he would be rescinding the most recent contract awarded to CNHA and canceling the current contracting process.

McCartney called for two contracts instead — one dealing with marketing communications and travel and another focusing on brand management, education and “community-based economic development.”

“A single contract would not only put us at a competitive disadvantage in the market but also in dealing with the community,” McCartney wrote in the letter.

That could set up a scenario in which the HCVB would still oversee marketing Hawaii overseas, while the CNHA would handle the tourism management part that involves educating visitors who arrive in the state amid concerns about overcrowding and exploitation.

McCartney encouraged De Fries and the HTA Board of Directors to work with the State Procurement Office, the Office of Information Practices, the Attorney General’s Office, the state budget department and Gov. Josh Green to find a new way forward.

The HTA Board of Directors is set to discuss the issue at a special meeting Wednesday afternoon. McCartney is also expected to address the board.

There’s still no timeline set for when the HTA will officially issue a new request for proposals.

Both bidding parties signaled support for such an idea in October. However, the state’s procurement officer and the Attorney General’s Office raised serious concerns about splitting the contract as proposed during a Senate hearing in November.

The restarting of the process clears the way for either HVCB or CNHA to be awarded a contract. It’s also possible that neither could win a new award and that a different entity would step in to manage marketing Hawaii tourism.

Chris Sadayasu, the new director for the Department of Business, Economic Development and Tourism, did not respond to requests for comment left with his office.

CNHA President Kūhiō Lewis said in a written statement that the organization plans to protest McCartney’s recent decision to rescind its contract.

“To cancel a solicitation after an award, a State agency must determine that the award or RFP ‘is in violation of law.’ Mr. McCartney violated Hawaii procurement law by purporting to cancel the RFP and rescind the award without making that determination,” Lewis said. “CNHA won the award based on a fair and thorough procurement process. But the State, led by Mr. McCartney, has refused to allow CNHA to provide its services to the people of Hawaii.”

The Honolulu Star-Advertiser first reported on Sunday that the HTA’s handling of the solicitation process that resulted in CNHA being awarded the marketing contract may have violated state procurement laws.

In a written statement, HVCB President and CEO John Monahan said he was disappointed that McCartney was not able come to a resolution where CNHA and the bureau would share the contract. Canceling the RFP also leaves HVCB’s protest of the contract award to CNHA from earlier this year unresolved.

“However, we at HVCB remain steadfast in our commitment to honor Hawaii, its people and culture throughout all our efforts,” Monahan said, adding that the company believes in HTA’s “regenerative tourism model.”

“We look forward to hearing the direction that HTA will take under the new administration of Governor Josh Green and we remain committed to doing our part to ensure its success,” he wrote.

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