 Welcome again to Think Tech, another edition of Tourism 101. We have a very special guest today that we're going to talk story with, and that's Chris Tatum. He's the president and CEO of the Hawaii Tourism Association. Chris, thank you for agreeing to be here today and being on our show. Thank you very much. Well, it's a pleasure to be here and look forward to talking about tourism. Yeah, well, let's start right from the very beginning. Let's talk about where you grew up and the question we always ask folks, where you went to school? Well, actually, my family moved here in 1965, and we never left. So I grew up in Foster Village and went to school at Radford High School. I actually went to Intermediate School at Aliamanu, and so this is home for me. And we lived here all the way through high school. I ended up going to Michigan State and then get a hotel degree and worked for Marriott for 37 years. But fortunately, Marriott brought me back here about 15 years ago, and so I was able to raise my family here too. Now, all those that remember government back in the days of Governor Arayoshi, very familiar with the name, a woman named Betty Tatum. Yeah, thank you so much for bringing that up. So my mother was a, she worked for the National Federation of Independent Business. She was a lobbyist for them for 25 years, and so she spent a lot of time in the capital, and it's really helped me in my new job. My former job with Marriott, I talked to the legislators periodically, but in this new job, I spent a lot of time at the capital championing with you on the things that are important to the industry. And my mom led the way, and she had a great reputation, and so it gave me an opportunity to get into a lot of offices that people want to talk about with mom. So thank you for bringing that up. What's your fondest memory of Radford High School? The school that also produced Bette Midler, amongst other things. Ken Neal Matalo. There's a lot of great memories. Radford was great for me. We lived right down the street from it. And I played baseball in high school. That's right. You're quite a star in baseball. We did all right, and it was funny you mentioned that because I was talking to, you know that Scott Chan from the stadium, we were talking about, 40 years ago was the last pre-season game in 1976. That was also the year that Scott threw his touchdown pass, and it was also the year I had my 19 in in game, all in a low stadium. A special year. Yeah, so it's a small town with a lot of great memories. Well, let's talk about your current role at Hawaii Tourism Authority. Now, what made you leave a very successful career with Marriott? I mean, you had a job that took you to different places around the world. You were doing very well. You're one of the pillars of our tourism industry. I would always look to you for counsel, for advice, because you were chair of the Hawaii Lodging and Tourism Association, the chair of the Hawaii Visitors Convention Bureau, Oahu Chapter Chair, Oahu Visitors Bureau Chair. I mean, you had a lot of experience there. You were doing well. Why would you want to go into the crazy world of government? That's a good question. You know, after 37 years, I really enjoyed the industry. Marriott was a great company to work with. They took care of me and my family over that time, which gave me the basis of how I do business on taking care of people, and they'll take care of the business. Over, you know, after 37 years, you know, my wife and I, who we're talking about, our kids had grown up, moved out, and we wanted the next level of our life. So we decided I was going to retire and look at different opportunities. And then the HTA CEO job came up, and I thought this is an opportunity to hopefully not only use the experience that I have from Marriott, but also hopefully have an impact on the state. I think there's a lot of great things we can do. Tourism is a big part of the state's economy, but that's just a tax revenue. Managing tourism is what attracted me. How can we do a better job not only continuing to promote Hawaii and bring visitors in that bring in important revenue to the state, but also how do we engage the community, perpetuate the Hawaiian culture? There's a lot of great things we can do, working with the different entities throughout Hawaii, including HLTA, DLNR, HVCB. If we work together, I think we can continue to make tourism very, very successful for Hawaii, but also realize that we need to make sure we take into account the community and their quality of life. Now, when most people think of HTA, they think about the marketing mission, if you will. When you've introduced a new concept that I think is starting to resonate with folks, you talk about your primary focus, or one of your primary objectives is to manage tourism. I think that's a very important concept because there's a lot of people talking about are we reaching the point where we have too many tourists coming here? What are we doing to ensure that local people, local residents who always feel part of this industry, not just being directly employed, but everything else that goes with it? Can you elaborate on those thoughts of yours? Sure. Coming from the industry that I was in, to me it's not really that complicated because when you ran hotels, you could market and drive business, but if you didn't maintain the facility and train and support the team and improve the experience of the visitor, it would be a very short-term success. So, bringing that to the Hawaii Tourism Authority, we can market and I have enough experience, I believe, to do the right thing on marketing Hawaii, how much resources we put towards that. But if we don't reinvest into our product, and especially nowadays because with social media, everyone ends up in all the parks and the trails, the places you and I used to go to when we were kids that no one knew about before, now they're finding out about it. So, we have to reinvest in that, not only physically, but we have to have the experience and we have to educate the visitors on why those areas are important to us as residents. And we want to share that with them, but we also want them to respect where they're visiting. And I've found that if you educate the visitor about the importance of the place they're going, they do respect it and they want to do the right thing. So, hopefully as we move forward, that's really that managing piece and balance will be the important part of sustaining long-term tourism success in Hawaii. Let's talk a little bit about the importance of the Hawaiian culture because you mentioned that and I know you've been big on that. You were a strong supporter of that as an executive at Marriott and you seem to have taken that philosophy over at the Hawaii Tourism Authority. Are there any specific things that you guys are going to do that's going to make sure that those who regard the Hawaiian culture is very important? Of course we should all do in the hospitality industry and everything else. Specific initiatives that you're taking in that regard? Well, the first thing we did is so in the organization of Hawaii Tourism Authority, it used to be that you had the CEO, you had a chief administrative officer and a marketing person. And then everyone reported to them. That's the first thing I changed. Now the gentleman Kalani who supports our Hawaiian, perpetuating the Hawaiian culture reports directly to me. He's now on that level. You've elevated that position. I elevated his role. So I can be more engaged and also we need to communicate that that role and responsibility is vital to the future of tourism. And I say that because not only does it give us a competitive advantage by having the Hawaiian culture as part of our thought process and how we market, but it's our obligation to do the right thing, not only for the land but for the culture and perpetuate the language and the music. Everything that makes Hawaii Hawaii that we grew up with, we need to make sure we're supporting that as a tourism industry because in the long run, that's what's going to make us successful. I know you must have everyone tugging at your sleeve here and wondering what's the process by which if you have an event and activity that you'd like to see funded through the HTA, what's the criteria that you've set up for those type of activities, whether they come from the mainland, something internationally or more importantly, someone here locally that has a really good marketing idea or I should say an event that he or she feels would warrant HTA dollars. So I mentioned Kalani and she now reports to me. The other person that now reports directly to me, her name is Caroline Anderson, her responsibility is engaging in the community and we also have a component of our responsibility is community enrichment and to answer your question, relative to anything, any activities, festivals, promotions from a perpetuating the Hawaiian culture to community engagement that will not only be positive for the visitor, but for our community. We actually have an RFP process. We do work for the state and we do have a process. You can't just put out that. No, I like that person or I like that event. I'm going to fund it. Yeah. In fact, we don't really write grants. We do contracts. And so what happens every year and we're coming on that time of year because we work off a fiscal year from July to June, we'll be starting to put our RFPs to the public and the RFPs will be broken down with the scope, both from a community enrichment sample and perpetuating the Hawaiian culture. We'll have a scope on what the requirements are and people can put in their request on requesting to be contracted for their events. And then we have a committee. Obviously on the Hawaiian culture, we have Thalani and a team of we see them as advisors to give us feedback on who we should focus on and what makes sense. And then on the community side, the same thing. And it's really important for us is that we engage HLTA, HVCB and the island chapters on making those decisions because one of the things we're going to do differently this year is the money that we put aside for those two opportunities will be split four ways. It's not even though obviously O'ahu has a lot more activity, a lot more revenue coming in. We believe it's really important from the tourism industry that the neighbor islands are as engaged as anyone. So we're just going to split it by four, put it out there to each of the islands and then the chapters and the people in those communities will be making decisions working with the counties on the programs they want us to support. You recently had a big announcement that made everybody chicken skin and feel that, man, this is the best news I've heard in a long time. And that is the announcement that the Los Angeles Rams are going to be playing a game here in August. Talk about that and all that all came about. It's very exciting. Again, you and I grown up here at the Pro Bowl here for so many years. And then actually the Rams approached us last year and they had an interest in talking about an opportunity to get more exposure and actually go after our fan base which is very, you know, I think it's very creative and very smart on their standpoint. So we talked about a number of things and they talked to us about a pre-season game. And so we went back and forth with them for a number of months and signed the deal last fall. And then yesterday we announced the actual date of August 17th and they're playing the Dallas Cowboys. So it was a great opportunity with the Rams and they're perfect for us because of that market. Our big market is on the West Coast. But then for them to bring in the Dallas Cowboys is just phenomenal. Not only is that market great out of Texas and that part of the country, but the Dallas Cowboy brand and the Rams brand, we couldn't ask for two better teams to come in from the NFL. Because you're so big on community engagement, I know that you've emphasized to the Rams that you'd like to see them doing their stay here, but also try to see what they can do to reach out to those aspiring high school players that may want to be the next Marcus Mariota, the next Tua Tonga Vai Law. Can you talk about that? Sure. Actually the Rams are the ones who first brought it up. They really feel it's important for their brand and to do the right thing in any market that they go into, to engage the community, especially the kids. How do we take the opportunity to have our pro players engage with the kids of Hawaii? They are excited about it and then I got smart and I actually asked the guy who runs HLTA that has a lot of contacts to help me in engaging with the high schools and the community. I was blown away during our press conference yesterday. We had, I think, 12 high school football coaches at the conference, along with June Jones and a lot of ex-football players, which actually I had nothing to do with. Mufi did that all and it really made a difference and show that the NFL and the Rams, the commitment from the community and from the high schools, I think it gives us an opportunity to show them that this is a great place and have an NFL game. We actually had two former Rams where they're Leo Gowas and Greg Salas. You're listening here to a talk story session that we're having with Chris Statham, the head of the White Tourism Association. We're going to take a pause for the cause and we'll be right back and more here on Tourism 101. Hey, Stan Energyman here on Think Tech Hawaii and they won't let me do political commentary so I'm stuck doing energy stuff but I really like energy stuff so I'm going to keep on doing it. Join me every Friday on Stan Energyman at lunchtime, at noon, on my lunch hour. We're going to talk about everything energy, especially if it begins with the word hydrogen. We're going to definitely be talking about it. We'll talk about how we can make Hawaii cleaner, how we can make the world a better place, just basically save the planet. Even Miss America can't even talk about stuff like that anymore. We got it nailed down here. I'll see you at noon with Stan Energyman, aloha. Hi, I'm Rusty Komori, host of Beyond the Lines on Think Tech Hawaii. My show is based on my book, also titled Beyond the Lines, and it's about creating a superior culture of excellence, leadership, and finding greatness. I interview guests who are successful in business, sports, and life, which is sure to inspire you in finding your greatness. Join me every Monday as we go Beyond the Lines at 11 a.m., aloha. Welcome again, everybody. We have here today, we're talking started with Chris Tatum and his new responsibility as the head of the Hawaii Tourism Authority. Chris, you mentioned earlier that one of the things that you learned from your mom was how to weave her way around, how she wove her way around the Capitol, had a lot of credibility. I was with Governor Ariosi's administration at that time, and of course we all knew, that Tatum is speaking for small businesses, you need to listen. What are the challenges and issues that you are facing at the state legislature and how you're dealing with it? Sure, obviously I'll never be as good as my mom, but I did learn a lot of things from her, and her comment is always just be truthful, be candid with people, and relationships are important. So, you know, in this job, what a lot of people don't realize is, so the HTA is funded by a portion of the TAT, which comes from the hotels and transit accommodation tax. So we generate about, TAT generates about $630 million, and we get $79 million of it. But when I say we get it, the legislature gets that, and they allocate it to us, so it's the state's money. So knowing that, that's why I need to make sure that we're sharing with legislators why it's so important that they continue to fund our ability to manage tourism. So as we do that, a number of the items that are on the board, but the biggest one, to be honest with you, is transient accommodation, illegal transient accommodations. Obviously legal transient accommodations, we will continue to be part of the way that we can promote those. But if the illegal ones that are not sanctioned by the state or the city and counties, those are a challenge for us. We've gone from 8 million visitors to 10 million visitors over the last few years with no additional legal accommodations. So you can imagine when you're trying to manage tourism, and those numbers are going up and you can't control the inventory, it becomes a challenge. And we've asked the legislature and the counties, and to be honest with you, the neighbor islands have addressed it in a number of ways, and the city and county is working through it. They've got a couple of bills they're working with us on. Hopefully that would be able to have enforcement that is reasonable. At the end of the day, we're not against additional inventory. We just think I think that that decision should be made by the residents and the leaders in the legislature and the city and county, not by the platforms. If they decide to make them legal, then we will support them. Until this happens, we need to manage that because at the end of the day, if it's unlimited, there's a real demand for Hawaii. They'll keep coming and the numbers will keep going up. There are those that say, we can't do without having more accommodations since the hotels are kind of restricted in many ways of expanding or renovating or even building new accommodations. So there has to be a certain amount of rentals out there. How do you respond to that? I think there's two pieces. One is we talk about the bed and breakfast of the people that want to rent a room in their home in order to make some additional income. I don't think that's the big issue. We found that more than 80% of the illegal vacation rentals are wholly owned homes. A lot of them are owned by people who don't actually live in Hawaii. So there's an opportunity to make a lot of money. I think the important thing to answer your question is that Hawaii has to decide what we want to be. We have resort areas that we have resorts. We have the facilities and infrastructure to take care of those guests. And we have our neighborhoods that we all live in throughout the day and experience and go home at night and enjoy our neighborhoods. And the legislature and the counties and the residents have to decide, do you want Kailua to be the resort area or do you want it to be a residential area? Whatever they decide to me is what we need to support. Right now, their zone does not having the ability to do short-term rentals. And there's a reason for that historically. So however if they change their mind and decide that Lani Kai should be a resort, then that's the decision that those residents in the community need to make. But until then, those residents that live over there should be able to go home at night enjoy the neighborhood engage with their community and not have to worry about illegal transient accommodations. So what do you see as the perfect balance to strike in a legislative measure that needs to come out, especially at the county level where the enforcement and the registration and the identification of who's actually operating a TVR residential home. What's the ideal legislative piece? I think what we have to do is get control of the current situation first. Before we go back and evaluate if we're able to add additional rental inventory. And again, that's the decision made by our leaders. But we already have laws and zoning in place. And to have that enforcement put in place and follow through with that and have control of that first the leaders can decide through the community how much more they want to put in different parts of the island. So that would be the first step I think is to have the enforcement and to make sure that who is legal and illegal is clear and that we're able to enforce it in a practical way. You talked about HTA collecting or receiving $630 million of the transient accommodation tax and that the portion that goes to marketing is about $79 million. So actually of the $79 million about $45 of it goes to marketing. And then we also put about $8 million towards sports marketing which is things like the Rams. We worked with the Clippers. We're going to do Beach Volleyball. We had soccer with Pacific Cup this year. Tennis golf that help us with our branding. So we support that. And then we do about $20 million of it goes towards perpetuating the Hawaiian culture and investing in our natural resources and enriching the community. The rest, the other piece is we have a responsibility as statute to do the research and the data that comes out every month on what our occupancies are, what the rates are. That's part of our statute. So that is part of and we have a research team that does that for us. So what about the other part of the balance of that $630 million? Where is it going to? It goes to the general fund and that's, you know obviously over the years that's grown and that's what the legislators use to support other priorities for them throughout the state. And obviously they get pulled a lot of different ways on what they use that money for but it just goes into the general fund and they allocate that. Well, as you've noticed when you're in the private sector and now that you've taken this job through the years there's always been a natural tendency at the state and county level. Whenever they're short of money to fund a particular project you'll look to the tourism industry. So what's the best way to kind of say to those folks that may think that tourism should be the funding source for every project whether it has a nexus of tourism or not. What's the best answer to say be cautious about once again just taking it all from tourism because there's other challenges ahead of us in their life. Obviously they have to balance. I would tell them from the tourism standpoint we'll always share with them what other markets are doing to make sure that we're competing and if the taxes are impacting the overall cost of the vacations to be impacted. The individual traveler probably does not look at that that close when they're booking but what's important for us is to realize that we want to make sure that we also are a attractive destination for convention business. Convention business is the ideal business for us to have a base of that business because not only does it help us fill our convention center which the state owns and we'd like to get as much revenue as we can out of that but it gives us a good base of business. Visitors usually spend more outside the hotels and they're much more engaged within the resort communities and they're not as much going everywhere else because they're a little more contained on what their goal is when they come. So they're an important piece of our puzzle but as you add additional expenses to the overall package that they're offered between us and say Mexico and South America and other destinations that potentially could get her from a competitive standpoint. Chris what's the tourism outlook going forward? We've had seven straight years of increases in tourism arrivals. Some folks think that maybe we're going to start to flatten out. Some say no, no, no, they're going to continue to come in. There's announcement at Southwest Airlines now it's going to bring people to Hawaii. What's your take on that? I clearly don't have a crystal ball I couldn't do when I was in Marriott and I can't do it but my initial when I look at the pace as I see the information that I'm getting the first quarter of this year is probably down a little bit but I will tell you the first quarter last year was way up so it's relative to you know if you take back a couple years it's still not terrible it's still in good shape. Going past April then you've got the A380s coming in from ANA which will bring Japanese customers which are very important that market is very important to us so we want to continue to grow that market I think we're going to I think we're not going to have double digit growth that we've had in the past it's just not realistic but as we look at how we again going back to managing tourism that's really the measurement I see the measurement access moving forward is resident sentiment visitor satisfaction we know we can drive business but those other pieces are very important as we move forward well our guest today has been Chris Tatum as you can see he comes with a plethora of ideas and initiatives that he wants to embark upon we need to bring you back on this show Chris because we didn't even touch upon a wonderful new initiative that he's doing to create more opportunities for our young people to be engaged in the hospitality industry and that scholarship opportunities with people in high school and the community colleges to be able to pursue their dream as a result of a partnership that we're developing between HTA and HLTA Chris thank you very much for being on the show you're doing a wonderful job you are a breath of fresh air and certainly someone who's been a veteran of the industry I can tell you right now I'm excited by the prospects of Chris Tatum being there and all the wonderful things he's doing for Hawaii Thank you Mofi, appreciate it