Senate Bill 2996 crashes and burns

Hawaii lives and breathes through its airports and the airlines that service them. We are the only state where air travel is the only practical way to get residents from one point in the state to another and the only state that cannot be reached by land. Our airports are the first and last impressions millions of visitors get of our state. These are same visitors who support our largest industry, tourism, the economic driver for the state. And their numbers are growing (or at least they were until the latest eruption overreaction in the national press). Here in Kona alone, airline seat capacity in the first quarter of 2018 was 30 percent above what it was in 2017.

Yet it cannot be denied that we are not exactly putting our best foot forward with our airports. Yes, we are currently in the midst of a renovation of Kona International Airport. But that is long overdue, and while commendable, it is really an example of Hawaii’s lag behind the rest of the nation in ongoing airport maintenance and renovation. It’s taken a long time to get the Kona airport project going.


“Airports are very fluid and dynamic entities,” says Hawaiian Airlines’ Blaine Miyasato, co-chair of Airlines Committee of Hawaii. “They operate 24/7, serve millions of people, require significant capital investments, and need to be nimble enough to react to changes in market conditions.”

The ACH, a group representing the 22 airlines serving Hawaii, was one of the organizations supporting Senate Bill 2996, which would take the management of Hawaii’s airports out from under the Department of Transportation and create an independent airport authority. They supported legislation to that effect last year, and then again, this year. That legislation failed both times.

The proposed legislation was based on a 2016 DOT feasibility study, recognizing independent airport authorities as a best practice in the aviation industry. This is the model that has been adopted by 47 of the 50 states, with the exceptions being Alaska, Maryland and Hawaii.

The DOT website notes the deficits of the current structure: “The current process requires nearly 50 detailed and time-consuming steps in order to complete a single construction project.” It goes on to take notice of “a redundant process that can lead to lengthy and costly delays … multiple agencies that impact decision making … stalled improvement programs … lost economic contribution and jobs… and progressive deterioration of the quality of terminal facilities.”

Last session’s legislation ran afoul of the Office of Hawaiian Affairs, employee unions, and the construction industry. OHA was concerned about land issues, the union was concerned about employee rights, and the construction industry was concerned about projects being exempted from the state procurement system.

Applying the lessons learned from that experience, this year the ACH met extensively with all three groups objecting to the bill last year and felt confident that not only were the groups’ issues met but that in several instances specific language changes relating to their concerns were added to the bill.

Well, that didn’t work. To the amazement of all parties, it failed again. It’s easy to understand the general sense of shock. The bill was based on sound reasoning, it was widely expected to pass, it followed recognized best practices, objections from affected parties had been actively addressed, and it had the support of almost every state department and special interest group offering testimony.

In addition, it was heard successfully in four committees: Senate Transportation and Energy and Senate Ways and Means, and House Labor and Public Employment and House Finance, and was passed out of both Senate and House with little opposition.

But note the above use of “almost.” The special interest group that did not support the bill was the construction industry, and their main sticking point seems to have been the bill’s exemption of the airport authority from the state’s procurement process. That’s the same time-consuming procurement process noted above that results in costly delays and lost economic contributions.


The House version of the bill took out that exemption, and as usual, when the House version of a bill does not agree with the Senate version, the bill goes to Conference Committee, where the differences can be worked out. But this time the Legislature held a party and … nobody came. Both Senate and House members to it were appointed, the time was set, and re-set, and then set again and then the House members were “discharged”, i.e. they didn’t show up. Huh? This can happen? Only in Hawaii.

Will the ACH come back again next year on this issue? We’ll see. The Committee is still apparently licking its wounds and reviewing its options. One thing is certain, “Kamaaina should have the airports they deserve,” says Blaine Miyasato. If the construction industry has its way, maybe we have them.

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