- The Washington Times - Monday, April 6, 2009

HONOLULU | Tourism industry leaders in Hawaii coping with the sharp downturn in business travel are seeking help from a native son - President Obama.

Gov. Linda Lingle, 90 business leaders and Hawaii’s four mayors wrote to Mr. Obama last week urging him to oppose any measure restricting companies that receive federal funds from using business meetings “as a legitimate business tool.”

As the economy faltered and federal aid recipients came under fire for sponsoring gatherings at flashy destinations, 132 groups and companies canceled meetings and incentive trips to Hawaii in the first three months of this year. The state’s economy lost an estimated $98 million as a result. Other popular destinations such as Las Vegas, Florida and Arizona are seeing similar cancellations.

“This has had a huge effect on the economy in the areas and jobs in the industry,” Hawaii tourism liaison Marsha Wienert said.

Fearing Congress will pass legislation that further weakens the lucrative conventions, meetings and incentive travel market, the industry has launched a campaign to change perceptions of business travel.

Hawaii has a large stake in the campaign’s success: About 442,000 business travelers visited the state last year to attend meetings, accounting for 7 percent of total visitors and at least 12 percent of all visitor spending, said Michael Murray, who heads corporate meetings for the Hawaii Visitors and Convention Bureau.

“It’s a very lucrative market,” Mr. Murray said.

Industry leaders blame this year’s drop-off on the media and legislators’ response to spending by companies that have received federal bailout funds. But the industry had been dealing for a year with companies tightening their budgets in tough economic times when business travel became a political issue this winter.

Hawaii has rolled out a flurry of incentives, programs and deep discounts in hopes of luring back companies. The convention bureau launched a Web site with special offers that tout the islands as a place for business.

Fortune 500 companies long used trips to the islands to reward top employees. Some would book entire resorts, rent out golf courses and host extravagant parties. In 2007, for example, Toyota Motor Sales USA paid $500,000 to rent out the lower campus of the University of Hawaii for a private concert by Aerosmith for 6,000 dealers and their guests.

Those days are gone.

Among the 132 cancellations was a Wells Fargo Co. corporate meeting booked at the sprawling 3,543-room Hilton Hawaiian Village Beach Resort in May. In February, the bank abruptly canceled a Las Vegas trip after criticism that it was misusing $25 billion in bailout money.

“Let’s get this straight: These guys are going to Vegas to roll the dice on the taxpayer dime?” said Rep. Shelley Moore Capito, a West Virginia Republican who sits on the House Financial Services Committee. “They’re tone deaf. It’s outrageous.”

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