HOUSE OF REPRESENTATIVES
THIRTY-SECOND LEGISLATURE, 2023
STATE OF HAWAII
A BILL FOR AN ACT
relating to tourism governance.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:
SECTION 1. The legislature finds that tourism is uniquely critical to the economy of the State and a significant generator of government revenue. However, tourism is also a potential source of intrusion onto the daily lives of residents and creates strains on state and county infrastructure and services.
Accordingly, the legislature believes that the tourism industry requires the best possible system of governance and oversight. The system must involve state and county agencies, private industry, and community stakeholders to ensure a balance among visitor and resident interests while guaranteeing that there is an ultimate emphasis on resident prosperity and well-being. The legislature further finds that coordination among these groups will ensure effective and coordinated approaches to long-term planning, appropriate marketing, impact mitigation, and other aspects of destination management, and regular analysis of tourism's costs and benefits.
Act 156, Session Laws of Hawaii 1998 (Act 156), which established the Hawaii tourism authority, specified that the authority should "[h]ave a permanent, strong focus on marketing and promotion". This mandate led to a perception among residents that the authority was responsible for the very high visitor counts in the late 2010s, a phenomenon that critics often called "overtourism". Act 156 also authorized the authority to coordinate with other agencies and required it to create a "long range plan for tourism in Hawaii". However, when the authority crafted such a plan for the 2005 through 2015 period that included agreements with other agencies and entities to take on responsibility for certain activities, the Hawaii tourism authority found that it did not have any means to enforce these agreements. Accordingly, subsequent plans have focused on goals and actions strictly within the authority's own purview.
After resident concerns about tourism impacts continued to grow through the late 2010s, the Hawaii tourism authority approved a plan in 2020 aimed at "destination management". In developing this idea, the authority worked with all four county governments to create and implement island-specific destination management action plans. While the legislature finds the destination management action plan process to be encouraging, the legislature notes that it is concerned that, without a formal system of coordination and enforcement capabilities, the authority will likely face the same problems it experienced in its Hawaii Tourism Strategic Plan: 2005-2015, likely resulting in the destination management action plans achieving few lasting results.
The legislature notes that Hawaii is not the only place where existing tourism governance systems have been challenged by resident demands for better destination management. In the past year, university scholars have authored blogs and articles pointing out that new coordinated tourism governance structures have been adopted or proposed in a number of diverse destinations, including the United States Columbia River Gorge, Los Angeles, Barcelona, Edinburgh, Iceland, and Amsterdam. Some of these structures appear to be primarily intra-governmental while others incorporated regular input from community, labor, business, environmental, and cultural organizations. However, these systems have not yet been systematically studied and it is unclear how applicable these systems would be to Hawaii.
Accordingly, the purpose of this Act is to require the legislative reference bureau to conduct a study that identifies and analyzes alternative tourism governance systems.
SECTION 2. (a) The legislative reference bureau shall conduct a study that identifies and analyzes actual and proposed alternative tourism governance systems used or proposed to be used in locations that are reasonably similar to Hawaii, as provided in this section.
For the purposes of this subsection, "reasonably similar to Hawaii" means a location where:
(1) Multiple levels of government entities and, if applicable, non-governmental entities must coordinate to address issues involving tourism, particularly at state or provincial and local levels;
(2) Tourism has an important role in the location's economy; and
(3) Tourism has a large impact on the location's communities;
provided that certain small island nations may also be appropriate for the study to the extent that the study's focus is on agency coordination and not on national powers that are unavailable to a state-level government entity within the United States.
(b) For each alternative tourism governance system, the study shall examine:
(1) The role of destination management organizations, whether destination management organizations are always present, and whether destinations at which destination management organizations are not present succeed economically and in terms of resident satisfaction with tourism. For tourism governance systems with strong destination management organizations present, the study shall assess whether balance has been achieved between agency effectiveness and any resident sense that tourism is being given an outsized role in government;
(2) Different approaches to optimizing coordination among agencies and entities for destination management, marketing, planning, and impact mitigation. The analysis shall include an assessment of methods to standardize throughout the State, if desired, approaches to:
(A) Pricing and other tools to control congestion;
(B) Assure balanced access to publicly maintained attractions, such as scenic and recreational areas, between residents and visitors; and
(C) Manage vacation rentals and other dispersed tourism-related commercial activities;
(3) Different approaches to communicate and engage with business, labor, environmental, cultural, and community interest groups, including the use of standing advisory committees, if any; and
(4) Various aspects of revenue generation, including:
(A) Sources of revenue, including various forms of tourism taxes and fees, and whether taxes or fees paid by local residents or businesses are used;
(B) Stability of the revenue stream, including the extent to which the system can rely on an ongoing, adequate stream of funding and how much the revenue stream fluctuates over time; and
(C) Allocation of revenue, including the methods and principles used to distribute revenue across multiple levels of government and across government agencies within each level of government.
(c) In conducting the study, the legislative reference bureau shall solicit input from community, governmental, and other stakeholder groups to identify relevant characteristics of Hawaii's tourism sector and its governance history, which must be understood and accommodated by any new governance system. Stakeholder groups shall be asked to identify:
(1) The apparent strengths and weaknesses of the current tourism governance system where governance is conducted primarily by the Hawaii tourism authority. The survey shall query the current level of trust in this system among the stakeholders; and
(2) Other structural considerations, including levels of government organization and structure critical to assessing whether various alternative tourism governance systems would be appropriate to Hawaii.
(d) Based on the research conducted and input received pursuant to subsections (b) and (c), the legislative reference bureau shall synthesize three potential alternative tourism governance systems that may be applied in Hawaii and summarize the systems in a general outline form. To the extent feasible, the outline shall identify each system's relative advantages and disadvantages regarding:
(1) Effective and competitive marketing based on appropriate messaging in regard to current issues of importance, such as responsible and respectful visitation, regenerative tourism goals, and authentic cultural experiences;
(2) Effective rapid response to ongoing or periodic issues requiring mitigation, especially those requiring the cooperation of multiple agencies;
(3) Capacity to manage visitor volume through tools, such as limits on lodging units, and ability to determine limits of acceptable growth given the available tools;
(4) Capacity to respond to:
(A) Current challenges, such as implementing a destination management program; and
(B) Ongoing or foreseeable future issues, such as public health or natural disaster response, climate change, and technological advances in transportation and hospitality;
(5) Capacity to develop long-range statewide multi-agency strategic plans for critical aspects of tourism, such as infrastructure and workforce development;
(6) Capacity to continue longstanding Hawaii tourism authority programs and responsibility, including convention center oversight and grants to community, cultural, and natural resource stakeholders;
(7) Ability to conduct periodic assessments of tourism's fiscal and societal costs and benefits, including both traditional economic measures and hidden costs and less monetizable benefits and costs at both the county and state levels;
(8) Ability to utilize tourism to further other economic diversification and development goals for the State;
(9) Ease or difficulty of converting to each system from the State's existing governance system while retaining desired assets and experience now vested in the Hawaii tourism authority, including the Hawaii tourism authority's evolving destination management action plan process; and
(10) A rough assessment of revenue implications for state and county governments from the conversion to the governance systems.
The study shall not recommend a single preferred approach among the alternatives.
SECTION 3. (a) The legislative reference bureau shall publish a draft report, including a proposed summary for public review purposes, no later than September 1, 2024. The bureau shall use the summary as a basis for an extensive statewide publicity and stakeholder input program lasting at least two months, including both electronic and in-person public meetings if feasible, as well as surveys of the general community, the business community, and interviews with key legislators, chief executives, and administrative department heads at both state and county levels of government.
(b) The legislative reference bureau shall submit a final report of potential options for legislative consideration to the legislature no later than twenty days prior to the convening of the regular session of 2025. The final report shall note any changes to potential new tourism governance systems based on the public input process pursuant to subsection (a), as well as a general summary of the input received.
SECTION 4. There is appropriated out of the general revenues of the State of Hawaii the sum of $750,000 or so much thereof as may be necessary for fiscal year 2023-2024 and the same sum or so much thereof as may be necessary for fiscal year 2024-2025 for the legislative reference bureau to conduct the study as provided in this Act.
The sums appropriated shall be expended by the legislative reference bureau for the purposes of this Act.
SECTION 5. The legislative reference bureau may contract the services of a consultant or consultants to perform all or some of the duties required in this Act with the funds appropriated in section 4 of this Act. Any procurement of services pursuant to this Act shall be exempt from chapter 103D, Hawaii Revised Statutes.
SECTION 6. This Act shall take effect upon its approval; provided that section 4 shall take effect on July 1, 2023.
Tourism; Governance Systems; LRB; Study; Appropriation
Requires the legislative reference bureau to conduct a study that identifies and analyzes alternative tourism governance systems. Requires the study to include a solicitation of input from certain stakeholder groups. Requires a final report to be submitted to the legislature prior to the convening of the Regular Session of 2025. Appropriates moneys.
The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.