Tovin Lapan
The Hawaii Tourism Authority board of directors voted unanimously at the end of June to end the term of current CEO and president George D. Szigeti.
Szigeti is being removed "without cause," according to the board. Per his contract, which was originally set up to run through 2020, he will receive a severance package amounting to six months of his salary after his final day, Oct. 31, 2018.
The vote by the board comes after a tumultuous year for the agency. A state audit released in February was highly critical of the HTA, citing "lax oversight, deficient internal controls and, ultimately, less accountability," including failure to follow a directive to reduce administrative costs and improper expense reimbursements.
HTA board chairman Rick Fried said the group decided to act as it appeared Szigeti's relationship with the state Senate had grown increasingly untenable.
"There were a couple of areas that, on balance, we felt it was appropriate to go in a new direction," Fried said.
The audit was used in arguments in the state legislature, specifically from the state senate committee on ways and means, to drastically reduce the HTA budget. After threatening more than $20 million in cuts, the legislature approved a budget that trimmed the HTA's general fund by roughly $3 million. Additionally, HTA COO Randy Baldemor and chief marketing officer Leslie Dance both resigned during the first six months of the year.
"Although HTA has semi-autonomy, the Senate is very involved with the budget. They attempted to reduce it by about a third, and that would have been disastrous," Fried said. "If anything, we need an increase."
Szigeti, who stepped into the role of CEO and president in 2015, previously served as president and CEO of the Hawaii Lodging and Tourism Association and in the same role at Better Brands, a subsidiary of Young's Market Co.
"In addition, everyone liked George, but a few people in the industry felt he maybe didn't have as much institutional knowledge as others who've been in the tourism business their whole life," Fried said. "We hired George in large part to bring a more business-like attitude to the way HTA operated, and in that respect, he did a lot of good things."
Szigeti drafted a more precise budget, improved the agency's transparency and made positive moves in the management of the major market contracts, Fried said, registering record arrivals and visitor spending every year of his term. One reason Szigeti is staying on through the end of October is so he can oversee the final plans and execution of the HTA Global Tourism Summit, set for Oct. 1 to 3 in Honolulu.
As Hawaii approaches the 10 million mark for annual visitors, residents have increasingly raised concerns about traffic, environmental sustainability, housing and other tourism-related issues. Rather than narrowly focusing on marketing the Aloha State and boosting visitation, many in the industry now argue the HTA, originally formed in 1998, should also take on more of a management role to ensure tourism remains in balance with the community.
"I'd agree that there has been a change in the needs of the state in regards to tourism, but you can't turn a ship 360 degrees in a week," Fried said. "We'd like a lot more emphasis on cultural events. We want to separate ourselves from other places with beaches and warm weather, and that includes a focus on more things that will improve resident sentiment. If too many tourists come and the trails are overrun, the beaches are packed and the roads are impossible to get around, that could keep people away from what brought them here in the first place."
The search for a new COO and chief marketing officer is underway, but permanent appointments could be delayed somewhat as the agency would like to have a new CEO and president in place before filling out too much of the executive staff, Fried said.
The HTA board is also getting an infusion of new voices. David Arakawa, executive director of the Land Use Research Foundation of Hawaii, joined the board in May. At the start of July, Kiyoko Kimura, director of owner relations for Aqua-Aston Hospitality, Micah Alameda, marketing manager for Na Leo TV, and Ben Rafter, managing member of Jororo, an investor in six hotels in Hawaii, started their terms, replacing Denise Yamaguchi, Donna Domingo and Gerald de Mello.