HOUSE OF REPRESENTATIVES |
H.C.R. NO. |
56 |
TWENTY-SECOND LEGISLATURE, 2004 |
H.D. 1 |
|
STATE OF HAWAII |
||
RESOLUTION
Requesting a study of interisland air carrier fare price mechanisms.
WHEREAS, although the waters surrounding Hawaii are one of the State's greatest assets, they also cause isolation of communities, an uneven distribution of social services, and the separation of families; and
WHEREAS, since 2001, commercial airlines that offer interisland passenger service have provided a number of explanations for increasing fares while decreasing the quantity of seats; and
WHEREAS, some have observed that the business strategies of these commercial airlines do not seem to be meeting the needs of leisure and business visitors, as well as Hawaii's residents; and
WHEREAS, over the years, the Legislature has sought to address these concerns by considering a range of legislation related to the air fares of interisland carriers; and
WHEREAS, in 1988, the Senate adopted S.R. No. 151, which requested commercial airlines providing interisland passenger service to offer half-price air fares to children under 12 years of age; and
WHEREAS, in making this request, the Senate reminded commercial airlines of the absence of alternative means of interisland travel and of the importance of encouraging our children to experience the different, unique features of all of the islands, which depends on children's ability to travel between the islands at affordable rates; and
WHEREAS, in 1990, S.C.R. No. 175 proposed to study the feasibility of establishing a state airline to provide interisland air service to bona fide Hawaii residents at reasonable prices; and
WHEREAS, in 1992, the Legislature adopted S.C.R. No. 7, H.D. 1, which requested commercial airlines as well as other businesses to work with representatives of the Hawaii tourist industry to provide greater discount rates to state residents; and
WHEREAS, in 1995, H.R. No. 205, H.D. 2, requested that air carriers not institute a commission cap plan on Hawaii travel agents since Hawaii residents already pay enough for air fares without having to pay additional processing fees; and
WHEREAS, despite these past actions, it remains unclear what processes and mechanisms are used by commercial airlines to set their passenger air fare prices; and
WHEREAS, without further information, concerns exist that the duopoly enjoyed by commercial airlines on certain interisland routes may promote excessive profit seeking that would be detrimental to Hawaii residents; and
WHEREAS, to alleviate these concerns that have existed for almost two decades, it is appropriate that a study be undertaken to clarify the decisions and actions that affect interisland passenger fare prices; now, therefore,
BE IT RESOLVED by the House of Representatives of the Twenty-second Legislature of the State of Hawaii, Regular Session of 2004, the Senate concurring, that the Department of Business, Economic Development, and Tourism (DBEDT), in cooperation with the Department of Economics of the College of Social Sciences of the University of Hawaii (UH), is requested to study the price-setting mechanisms and strategies of interisland air carriers; and
BE IT FURTHER RESOLVED that this study also include:
(1) The effects on our state economy of declining interisland air passenger capacity; and
(2) Any recommendations for legislation or policy action necessary to develop a fair and equitable pricing mechanism for island residents, as well as visitors;
and
BE IT FURTHER RESOLVED that the findings and recommendations of the study be submitted to the Legislature at least 20 days prior to the convening of the Regular Session of 2005; and
BE IT FURTHER RESOLVED that certified copies of this Concurrent Resolution be transmitted to the Director of DBEDT and the Director of the Department of Economics of the College of Social Sciences of the UH at Manoa.
Report Title:
Studying inter-island air carrier fare price-setting mechanisms.