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House Finance Committee checks in on state investments in West Hawaii

November 7, 2017 - 10:39am

KAILUA-KONA — Members of the state House of Representatives Finance Committee were in town Monday to take a closer look at some of the projects they’ve recently funded throughout West Hawaii, including the major overhaul at the Ellison Onizuka Kona International Airport.

The upgrades to the airport include a $50 million federal inspection station set for completion within the next four years, as well as an $83 million terminal modernization project that began in February and is scheduled to wrap up in March 2019.

Representatives said there have been some raised eyebrows on Oahu accompanying such a large appropriation of funding for a neighbor island airport, as well as the economic benefits it provides, referencing the FIS.

Rep. Cindy Evans — North Kona, South Kohala, North Kohala — articulated why there is a measure of statewide benefit no matter which island airport received the station and accompanying international designation.

“When (visitors) spend their money, be it (general excise) tax or hotel tax, it goes into a pot and then it gets redistributed, so in a way it benefits the entire state,” Evans explained. “The Legislature makes the determination of how the money gets spread around, but the money that’s generated here will go into that bigger pot, so it is to the benefit of the whole state.”

According to a presentation Airport District Manager Chauncey Wong Yuen gave to visiting legislators Monday, the state’s second international terminal — which has led to a flood of announcements of new flights planned for KOA — will add $150 million in visitor spending on Hawaii Island and $20 million in tax revenue annually.

Rep. Sylvia Luke — Makiki, Punchbowl, Nuuanu, Dowsett Highlands, Pacific Heights and Pauoa on Oahu and chairwoman of the Finance Committee — said that beyond creating a redundancy allowing for mitigation of any natural disaster or military action that might impact the Daniel K. Inouye International Airport in Honolulu, the placement of the FIS in Kona cuts through the bureaucracy of travel and provides a gateway to the rest of the state for a new breed of visitor.

“Now you have sophisticated travelers who don’t want to be stuck in Waikiki, and they don’t want the tourist experience,” she said. “They want to go and explore, and this is giving them more options.”

Rep. Nicole Lowen — Kailua-Kona, Holualoa, Kalaoa, Honokohau and a member of the Finance Committee — said beyond the various dividends the investment will generate, the modernization project won’t cost the state an excessive amount of money. The project will be completed with federal funds, airports special funds and some revenue bonds.

As for the FIS, the state Department of Transportation has until next year to have secure funding in order to retain an international designation at KOA. Initially, the plan was to rely entirely on revenue bonds, but Lowen said the DOT may alter its approach.

“They’re figuring out the funding,” Lowen said. “There’s been some back and forth about the best way to finance it. The Legislature gave them funding in revenue bonds, but DOT wasn’t sure they could swing the whole amount in bonds. They’ve been considering some alternatives for financing some part with revenue bonds and some from their own funds.”

DOT did not return an inquiry by press time Monday.

Some improvements at the airport are currently underway, while others have already been completed.

Air-conditioned enclosures for Transportation Security Administration checkpoints have already been constructed and parking lots have been resurfaced with the addition of 100 stalls, among other projects.

“TSA right now, those employees have to stand out in kind of horrible conditions,” Lowen continued. “So they have a lot of turnover, in part because of that.”

Projects currently underway include the relocation of the Aircraft Rescue and Fire Fighting Station, which will be situated in front of the new traffic control tower. Nearly 400 parking stalls are also being added to a former employee parking lot.

Representatives trumpeted the economic value the inclusion of direct international flights has already provided Hawaii Island.

All told, construction at the airport will create hundreds of temporary positions. It’s also already bolstered the hotel, restaurant and taxi industries, representatives said, and will create more permanent jobs at the airport once all projects are complete.

“When you travel around the U.S. and the world, everybody is improving their airports because it’s infrastructure that’s 50, 60, 70 or 80 years old,” said Rep. Richard Onishi — Hilo, Keaau, Kurtistown, Volcano. “So everybody is trying to modernize it, to make that passenger experience a good one so they’re willing to come back, and Hawaii is no different.”

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