Visitors Spend $12.58 Billion in 2011

According to a report released by the Hawaii Tourism Authority, visitors to the Hawaiian Islands spent a total of $12.58 billion in 2011.  This equates to the second highest annual total ever, surpassed only the record set in 2007 of $12.63 billion.  A total of 7.28 million visitors arrived in Hawaii in 2011.  Hawaii Tourism Authority President and CEO, Mike McCartney, stated, “We will continue to work together with our marketing partners and the visitor industry to sustain the momentum we saw last year and achieve steady growth for another momentous year in 2012.”

However, there is some concern from industry experts who are feeling the competition from other tropical destinations like Mexico.  President of Pleasant Holidays LLC, Jack Richards, commented, “Mexico is spending a lot of money in the U.S., and we’re seeing a shift in business to Mexico from Hawaii.  The Mexico tourism board is comparing itself to Hawaii in their ads. They’re saying Hawaii is too expensive.”  Richards added, “There are a lot of reasons to be optimistic, but it has to be guarded optimism.”

Source: Honolulu Star Advertiser, 1-31-2012, www.staradvertiser.com
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Hawaii Symphony Orchestra Debut on March 4, 2012

The Hawaii Symphony Orchestra will be making their debut on March 4, 2012 at the Blaisdell Concert Hall, much to the delight of classical music supporters in the state.  In 2009, the 110 year-old Honolulu Symphony was forced to disband after years of financial troubles.  The Hawaii Symphony Orchestra stated that they hope to produce a financially and artistically sound product.  For additional information, please go to www.hawaiisymphony.net

Source: Honolulu Star Advertiser, 1-30-2012, www.staradvertiser.com

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State Required to Reach Full Compliance With Food Stamp Applications

U.S. District Judge David Ezra has ordered the state of Hawaii's Department of Human Services to reach full compliance in terms of processing food stamp applications by the end of 2012.  Under federal law, all food stamp applications must be processed within 30 days from receipt.  In 2011, the state of Hawaii was only able to process 76.5 percent of the applications within a 30 day deadline for 2011.  Judge Ezra stated that this was not acceptable.  State of Hawaii officials contested that there has been an increase in applications due to the economic downturn and that the Department of Human Services has also experienced layoffs due to government cutbacks.

According to a recent report, there are approximately 173,000 people in Hawaii who receive "food stamps" from the federally funded Supplemental Nutrition Assistance Program.  This comes out to an annual cost of $440 million.  The Department of Human Services receives approximately 5,000 to 7,000 new applications per month.  If there is a delay in the application review process, applicants may be forced to wait several months to receive their food stamps.

An applicant may also file for an "emergency application" which the Department of Human Services must review within a federally required seven days.  The DHS is also running behind in processing these applications.  As a result, in 2010 a class-action lawsuit was filed against the state of Hawaii due to their "failure to process applications in a timely manner means that thousands of households are denied desperately needed assistance to help them feed their families and suffer hunger as a result."

Source: Honolulu Star Advertiser, 1-30-2012, www.staradvertiser.com
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University of Hawaii Plans to Build Biosafety Laboratory in West Oahu

The University of Hawaii has announced plans to build a $47.5 million biosafety laboratory at Kalaeloa in West Oahu.  To be named the Pacific Health Research Lab, the facility will specialize in the study and treatment of infectious diseases.  The National Institute of Health will provide a $32.5 million grant for the construction of the facility while the state of Hawaii will provide the remaining $15 million.  It is estimated that the site will employ 20 people and will open in 2016.

Originally, the University of Hawaii had planned to build the facility next to the John A. Burns School of Medicine in Kakaako, however, the University of Hawaii Cancer Center was built there instead.  Lynn Waters, the spokewoman for the University of Hawaii, stated, "Hawaii is the most geographically isolated populated land mass on the planet, yet we are a global crossroads for travelers.  Our ability to detect, treat and prevent diseases at an early stage is essential to Hawaii's health and well-being."

Source: Honolulu Star Advertiser, 1-29-2012, www.staradvertiser.com

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Fee Interest Being Offered for Foster Tower Condominium

Queen Liliuokalani Trust has just announced that they will be offering the fee interest for the Foster Tower condominium.  Located at 2500 Kalakaua Avenue, Foster Tower consists of 141 units in studio, one bedroom/one bath, and two bedroom/two bath models.  According to representatives from the Liliuokalani Trust, they will be taking the cash raised from the sale of the fee interest and use it to develop other lands that the trust owns.  The lease was set to expire in 2034.

Source: Honolulu Star Advertiser, 1-29-2012

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Major Waikiki Sewer Repair Project to Start in March 2012

The City and County of Honolulu has announced that they will begin a major sewer repair project for the Waikiki area starting in March 2012.  The project is expected to take 500 days and will cost approximately $5.7 million as the city repairs manholes and fixes or replaces sewer lines.  While some people are concerned about the construction noise, road closures and traffic disruptions, many residents in Waikiki understand that the repairs are necessary.  Chairman of the Waikiki Neighborhood Board, Robert Finley, stated, "We still remember what happened in 2006 when the breaks in the line on Kaiolu Street caused millions of gallons of raw sewage to be dumped in the Ala Wai.  I think people know how important the sewer repairs are; we don't want sewage in the canal or backing up into our homes and hotel rooms."

The city has been granted a noise variance, which will allow them to work 24 hours a day, seven days a week.  Officials have promised that louder repairs will be planned for daytime hours.  Mark Smith, a Waikiki Neighborhood Board Member, expressed concern with this.  Smith stated, "I find it beyond belief that the state would grant a variance to exceed the noise ordinance without a limit. No one is going to be able to sleep.  What happens if a resident calls and says it's really noisy? You can't call anyone because they've been given carte blanche to exceed noise levels."

Waikiki is home to approximately 20,000 residents and 75,000 tourists at any given time.

Source: Honolulu Star Advertiser, 1-29-2012, www.staradvertiser.com

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Island Dairy Inc Purchased by Whitesides Dairy

Whitesides Dairy, based out of Idaho, has just purchased Island Dairy Inc, which is the largest dairy in the state of Hawaii.  According to a report released by the State Department of Land and Natural Resources, the 900 milking cow farm was purchased for $13 million.  The DLNR leases the farm approximately 2,00 acres of land for the cows.  Steve Whitesides, owner of Whitesides Dairy, has stated that the Hawaii company will now operate under the name Big Island Dairly LLC, he added that he hopes to increase the business and plans to grow more of the food for the cows himself.

Source: Honolulu Star Advertiser, 1-28-2012, www.staradvertiser.com

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Additional 1,000 Marines May Be Stationed in Hawaii

The United States Marine Corps has announced that they are planning a reduction of their force from 202,000 troops to 182,000 troops over the next 10 years.  However, as the Marine Corps goes through their restructuring of its Pacific Force, it seems highly likely the Hawaii would receive an additional 1,000 Marines from one of its base in Okinawa.  There are currently 8,000 Marines and 9,000 dependents on Okinawa, and the majority of them will be relocated to a base on Guam.  No official word has been released by the Marine Corps as to if and when these Marines would be moved to the Hawaiian islands.

Source: Honolulu Star Advertiser, 1-27-2012, www.staradvertiser.com

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Honolulu Rail Project - First Rail Delay Costs Honolulu $19 Million

In 2009, the city of Honolulu had awarded Kiewit Infrastructure West Company a $483 million contract to design and build the first section of the Rail Project.  However, delays by the Federal Transit Administration to approve the environmental impact statement will raise the cost to $502 million.  Interim Executive Director for the Honolulu Authority for Rapid Transportation, Toru Hamayasu, stated, "Kiewit, with our request, mobilized the people so that essentially the equipment, the lease, whatever, all of those are accumulating.  Kiewit is incurring the cost."  Hamayasu warned that additional costs could occur if there are additional delays in the process.

According to city officials, there has been a total of $860 million set aside in contingency funding to cope with delays, change orders and other unexpected cost increases. The city remains optimistic that the project will still come within the $5.27 billion total budget.  However, not everyone is pleased with the additional costs.  Tom Coffman, a board member of the environmental group Hawaii's Thousand Friends, stated, "It is taxpayers' money wasted based on their timetable not progressing as they had planned it out.  They have rushed it, and it has resulted in additional cost in the form of insurance and the form of penalties from delay."  Hawaii's Thousand Friends is part of a lawsuit in federal court to halt construction until the city completes a supplemental environmental impact statement.

Source: Honolulu Star Advertiser, 1-27-2012, www.staradvertiser.com

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Honolulu Rail Project - City has Spent $1.87 Million on Legal Fees for Rail Project

According to a report released by the City Council, the city of Honolulu has already spent $1.87 million on legal fees related to the rail project.  The city has hired a total of seven private law firms, and has just asked the City Council to approve an additional $400,000 in new anticipated legal costs.  The Honolulu Authority for Rapid Transportation (HART) released a statement that said, "While we are conscientious about all expenses incurred, please note that the $1.87 million spent to date on legal contracts make up less than 1⁄2 percent of all (general excise tax) revenue spent on the project."

Source: Honolulu Star Advertiser, 1-26-2012, www.staradvertiser.com

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Property Development Centers Sells Kapahulu Safeway to Invesco

Property Development Centers has just announced that they have just concluded the sale of its Kapahulu Safeway location to an Atlanta based investment company called Invesco.  The 4.7 acre center has a total of 10 tenants in addition to Safeway and has a 78,608 sq ft of lease able space.  Director of Public Affairs for Safeway, Susan Houghton, stated, "The sale of the shopping center does not affect the store there. We are committed to Kapahulu and Safeway will remain."  The exact terms of the sale were not disclosed.

Safeway operates approximately 1,700 stores across North America.  They have just opened a new store on the corner of Piikoi and South Beretania in Honolulu.  The company also has plans to build additional centers in Ewa Beach, Lihue and Hilo.

Source: Honolulu Star Advertiser, 1-26-2012, www.staradvertiser.com

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Honolulu Rail Project - Contingency Plan Needed for Rail Project Funding

In December 2011, the Federal Transit Administration (FTA) warned the city of Honolulu that its financial plan "must be further strengthened" prior to the FTA awarding up to $1.55 billion to help pay for the project.  In their report, the Federal Transit Administration asked the city to demonstrate that they would have additional sources of revenue in case there were unexpected cost increases of funding shortfalls for the $5.27 billion rail system.

Honolulu Mayor Peter Carlisle stated that the city's rail funding plan is strong, but has asked the City Council for approval for a "contingency plan" if additional funding would be necessary.  Carlisle stated, "(The FTA) have their own methods of making sure before you get the full funding grant agreement that you have other instruments in place that will deal with any contingencies.  That's all it is. It is just one more layer of making sure that we are 100 percent capable of doing this project."

Currently, there is a half-percent surcharge on the general excise tax for all Oahu residents and visitors, which will continue until December 31, 2022.  One option for Mayor Carlisle and the City Council would be to extend this surcharge for an additional two years, to help pay for any unexpected costs. Carlisle added, "We are now to the point where all of the contingencies have been essentially dealt with.  You have to understand, a lot of this is to my mind pretty much kabuki theater because we're already at the point where if under the worst circumstances it ended up costing us much more than they thought it would, it would take exactly five more quarters of the GET to be able to take care of that, which is already written into the program."

Source: Honolulu Star Advertiser, 1-25-2012, www.staradvertiser.com

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Negotitations Continue Between NFL and Hawaii Tourism Authority

The National Football League (NFL) and the Hawaii Tourism Authority (HTA) continue negotiation talks regarding extending their 32-year long relationship of having the Pro Bowl game on Oahu.  This year, the state is paying the NFL $4 million plus $152,500 in stadium operating costs.  Governor Neil Abercrombie, who has questioned the expense in the past, stated, "We would like to continue to have (the game) and we're going to do everything we can to make sure that comes about in a fashion that will make everybody very, very happy.  I certainly want to make certain that it is crystal clear that, of course, we'd like to continue to have the Pro Bowl here. The only question has always been is: How do we work all this out in a way that will meet everybody's needs."

Source: Honolulu Star Advertiser, 1-25-2012, www.staradvertiser.com

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Hawaiian Airlines Announces Partnership with JetBlue Airways

Hawaiian Airlines has announced that they will be entering a partnership with JetBlue Airways which will allow passengers to purchase a single ticket that will combine travel on both airlines.  President and CEO of Hawaiian Airlines, Mark Dunkerley, stated, "What's important about this is connectivity on the East Coast.  So in addition to New York, Hawaiian with its partnership with JetBlue will be able to bring all the major cities of the East Coast within an easy connection to Hawaii.  We think the combination will be unstoppable."

The two airlines will allow members to earn loyalty points or miles while travel on the their respective carrier.  President and CEO of JetBlue, Dave Barger, stated, "We're thrilled to partner with Hawaiian Airlines and look forward to welcoming them to our home in the Big Apple later this year.  Our customers have long asked for options to the Aloha State."

Source: Honolulu Star Advertiser, 1-24-2012, www.staradvertiser.com

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State Gets Ready for 2012 Pro Bowl

The State of Hawaii will be hosting the 2012 Pro Bowl for the National Football League this coming Sunday, January 29, 2012.  However, there has been some concern about what will happen after this year as the NFL and the Hawaii Tourism Authority are still in negotiation about the future of the Pro Bowl.  President and Chief Executive of the Hawaii Tourism Authority, Mike McCartney, stated, "We have enjoyed a wonderful partnership with the NFL, and we look forward to continuing this relationship as well as welcoming the NFL players, their families and all the fans for an exciting game on Sunday."

Each year the state of Hawaii pays the National Football League approximately $4 million to have the privilege of hosting the Pro Bowl in the state.  However, some local officials including Governor Neil Abercrombie have questioned is the value to the state.  According to data released by the Hawaii Tourism Authority, a total of 49,331 people attended the 2011 Pro Bowl and spent approximately $28.15 million in the islands.  This generated the state $3.07 million in taxes during the event itself.  Mike McCartney also noted that, "Viewership in 2011 was up 42.6 percent over 2009, the last time the Pro Bowl was hosted in Hawaii, providing football fans across the nation an opportunity to see our beautiful, warm state during the typically cold winter months."

Source: Honolulu Star Advertiser, 1-24-2012, www.staradvertiser.com

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Governor Abercrombies' 2012 State of the State Address

On Monday, January 23, 2012, Governor Neil Abercrombie gave his State of the State address to the people of Hawaii.  The governor's basic message was that the state has done a good job in balancing the budget and now must look forward in creating opportunities to improve its economic future.  Abercrombie stated, "by working together and through shared sacrifice, we have started to turn the corner. This past year has not been easy, but we have accomplished our purpose."

Governor Abercrombie's suggestions include creating $300 million worth of bond-financed state construction projects to help the job market.  The state would use that money to repair and renovate public schools, medical centers and other public buildings.  He also called for support to install an undersea cable that would link wind and other energy sources between the islands to stablize energy prices.  Abercrombie also promised that he would unveil a new plan shortly regarding alternative energy for the state to reduce the dependency on imported oil.  The governor added, "Why do we continue to send billions of dollars a year outside the islands to meet our energy needs?  If there's one thing we export from Hawaii, it's dollars. It's our major export -- for oil, for food, for prisons. We've got to keep these dollars here in Hawaii."

Gene Ward (R), the House Minority Leader, reacted to the Governor's State of the State address by giving the following comments to the media: "Remember, this governor is a Picasso. He can paint with words, pictures that are excellent.  But to deliver them, to put it in a frame, to put it on the wall without cracking anything, without breaking any of the glass -- that's really the part where we're in it, because we're down at the legislative policy level and we need to know details."

Source: Honolulu Star Advertiser, 1-24-2012, www.staradvertiser.com

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Honolulu Rail Project - Former Governor Ben Cayetano to Run for Mayor to Stop Rail Project

Former Governor of the state of Hawaii, Ben Cayetano, will be running for Honolulu Mayor with a platform of if he is elected, he would put a stop to the rail project.  Ben Cayetano was served as a governor for the state from 1994 to 2002.  Last year, Cayetano joined together with several other rail opponents and filed a lawsuit in federal court to stop the project.

Supporters of the rail project, are very nervous about the intentions of Cayetano.  Doug Chin, the City Managing Director, stated, "Last year voters created the Honolulu Authority for Rapid Transportation as a semi-autonomous agency to remove politics from the rail project.  It's spelled out in the charter what HART, a mayor or the City Council can or cannot do, and all city officers including a mayor have sworn to uphold this. A delay or stop to the project now would forfeit up to $1.55 billion in federal assistance that Hono­lulu is poised to receive, invite costly litigation and provide no viable alternative to traffic congestion on Oahu. This would be a large and unnecessary setback for us and future generations."

Ben Cayetano clearly stated that he would not cooperate with the Honolulu Authority for Rapid Transporation.  Cayetano noted that if he is elected, "The mayor doesn't have to release money. The mayor can veto appropriations, and I think that if I get elected, quite frankly, the Federal Transit Administration will say, ‘That's it, Why should we give this city money when they have a mayor who doesn't support the system?'"

Source: Honolulu Star Advertiser, 1-23-2012, www.staradvertiser.com

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Many in Waikiki Hope to See Zoning Law Changes

Back in 1976, there was a significant concern from the residents of Waikiki that the area was being developed too quickly and that it would become an "urban jungle" filled with too many hotels and touristic attractions.  That year, the Waikiki Special District Land Use Ordinance was put into law, restricting the height, density, and setback requirements for much of Central and West Waikiki.  This neighborhood, now known as the "backside of Waikiki", is suffering from deferred maintenance which includes boarded-up building, inexpensive rental units, vacant lots covered in weeds, and illegal parking lots.  Owners of properties are frustrated that the zoning requirements are too strict and that they are unable to make the necessary changes to their property to improve its value.

Over the last two years, members of the community including the Waikiki Improvement Association and the Waikiki Neighborhood Board have been working with the city to get this part of Waikiki rezoned.  Their hope is that by doing so, there will be truly positive change in these areas.  One investor who owns a building in this area, Eric Sacks, stated that the new amendments to the law would make it easier for owners like himself to make improvements.  Sacks noted, "When I got the building, there were squatters living in it.  Empty buildings are attractive nuisances. They attract homeless people, vandals and drug users.  I've been told by businesses on Kalakaua that they are thankful that we bought the building.  A police officer told me that it was really a bad place before, but that they haven't had recent calls."

Source: Honolulu Star Advertiser, 1-22-2012, www.staradvertiser.com

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Teachers Vote Against Proposed Contract

Approximately 67 percent of the members of the Hawaii State Teachers Association voted against a new contract proposal with the state of Hawaii.  According to union members who were interviewed by the media, the biggest challenge with the proposal, was a line in the contract stating that future teacher's pay raises would be based upon an evaluation system.  Per the proposal, teachers that were rated "effective" or "highly effective" would be eligible for annual pay raises, while those who were rated below that would not be.  The exact evaluation system has not been established.

The biggest concern for state officials and the Department of Education is the fact that the labor dispute may put approximately $75 million of federal funding at risk.  Under the Race to the Top Grant, a state would have to prove to the federal government that they are turning around low-performing schools, boosting student achievement and increasing teacher effectiveness.  If the union decides that their best option would be to go on strike, the federal goals and guidelines may not be met.

Source: Honolulu Star Advertiser, 1-20-2012, www.staradvertiser.com

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Obama Announces National Travel Strategy

State of Hawaii officials are praising President Barack Obama's new national travel strategy plan which aims to promote the United States as a tourism destination.  Under Obama's plan, it will be easier for foreign visitors, especially those from China and Taiwan, to get visas into the country.  Governor Neil Abercrombie stated, "The president's announcement today is a wonderful New Year's gift to the people of Hawaii.  President Obama clearly understands that improving the visa and foreign visitor processing and travel promotion will spur economic growth. We look forward to experiencing that growth here in Hawaii."

Source: Honolulu Star Advertiser, 1-20-2012, www.staradvertiser.com

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Residents Support Building of Waikiki Entertainment Center that Includes Casino

According to a results of survey paid for by the Waikiki Improvement Association, approximately 76 percent of the 1,000 Hawaii residents interviewed across the state would support the building of a Waikiki entertainment center that would include live shows, movie theaters and a casino.  The actual survey was conducted by the SMS Research & Marketing Services and has a margin of error of 3.1 percent.

President and CEO of the Waikiki Improvement Association, Rick Egged, stated, "We asked this question because there is clearly less entertainment to attract local people to Waikiki, especially at nighttime, than in the past.  In the 1990s, there were more than a half dozen movie theaters, multiple shows that featured such well-known names as Don Ho, the Cazimero Brothers and more high quality places for music and dancing. Today, there are a few live shows and music places, but there is certainly not as many as in the past. Even all the movie theaters are now gone. All that has probably impacted our visits by local people."

Hawaii and Utah are the only two states in the country which has absolutely no form of legalized gambling.  Chairman of the House Tourism Committee, State Representative Tom Brower, stated that lawmakers need to be open to discussing building a Waikiki Casino.  Brower added that in order to compete with top Pacific tourism destinations which include Singapore, Macau and the Philippines, Hawaii has to consider gambling.

Source: Honolulu Star Advertiser, 1-20-2012, www.staradvertiser.com

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More Employers and Fewer Job Hunters at Job Quest Fair

A total of 150 businesses and government agencies showed up at the Job Quest job fair, held at the Blaisdell Center earlier this week.  This was an increase from the 135 groups that were in attendance in January 2011.  There were also fewer job seekers, with approximately 3,500 people turning out for the event, a decrease from the 5,000 people who attended a year prior.  The executive director of Job Quest, Beth Busch, stated, "I'm seeing a turnaround.  We have more clients — and not just at the job fair, but every day — who have more openings."

Several employers were doing large-scale hirings including Hawaii Pacific Health which sought to fill 260 positions and Walmart which was looking to hire 300 employees for their new Kapolei store, set to open in the spring.  Even more encouraging was the fact that there were several construction companies who were in attendance at Job Quest looking to do some recruiting and hiring.

Source: Honolulu Star Advertiser, 1-19-2012, www.staradvertiser.com

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State Legislature Leaders Hope to Avoid Increasing Taxes

In their opening session for 2012, the State of Hawaii House and Senate leaders made several joint announcements including the promise to avoid creating new taxes or major spending increases for the coming year.  Calvin Say, the House Speaker, stated, “For the short term, we must maintain stability with respect to the state budget.  Maintaining stability means no new taxes for state government from residents and businesses.  Maintaining stability means no major general fund appropriation increases for the expansion of state programs.”

Shan Tsutsui, the Senate President, suggested creating a $500 Million construction bond to help repair public schools, hospitals and state buildings.  Tsutsui stated, “This bill will have two primary objectives.  One, to aggressively cut into the state’s multibillion-dollar deferred repair and maintenance backlog. And two, it would immediately create jobs for our local residents.”

Source: Honolulu Star Advertiser, 1-19-2012, www.staradvertiser.com

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Army General to Keep Pacific Force The Same Size

General Raymond T. Odierno of the United States Army has announced that the plan is to keep the Pacific force at the same size over the next decade.  Odierno is the 38th Army chief of staff, and during a recent stop over in Hawaii stated, "The number of soldiers assigned to the Pacific will be generally the same.  You won't see a significant decrease here, and the additional thing you'll see, as we reduce our commitments now that we're out of Iraq, and now that we're reducing our structure in Afghanistan, you'll see more of the (continental)-based force who will be available to conduct operations in support of any of the combatant commanders, but also to support what's going on here in the Pacific."

This is good news for the state of Hawaii, as the United States Army currently has about 23,000 soldiers in the islands.  The Pacific force has another 28,500 soldiers in South Korea, 2,700 in Japan, and 13,000 troops in Alaska.

Source: Honolulu Star Advertiser, 1-18-2012, www.staradvertiser.com

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Cruises to Hawaii Become More Popular in 2011

According to a report released by the cruise industry, approximately 104,000 travelers arrived in Hawaii in the first 11 months of 2011 by cruise ship.  This represented a 14.5 percent increase from the same period a year prior, though it will not surpass the record set in 2007 when 130,000 passengers arrived in Hawaii.  Vice president of brand management at the Hawaii Tourism Authority, David Uchiyama, stated that the HTA does promote Hawaii around the world as a great cruise destination.  Uchiyama noted that many cruise ship companies have opted to keep their vessels in the Pacific Ocean instead of taking them to the Atlantic Ocean.

Source: Honolulu Star Advertiser, 1-17-2012, www.staradvertiser.com

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Department of Education Official Suggests Condominium Buildings on School Property

In an effort to raise money to help rebuild some of Hawaii's aging schools, the assistant superintendent of the Department of Education's Office of School Facilities and Support Services, Randy Moore, has suggested that the state should allow private developers to build condominiums on school land. Moore used, as an example, Queen Kaahumanu Elementary School which is located on the corner of Beretania and Piikoi streets.  Moore stated that the state could keep the school and a small condominium building completely separate from one another on the property, and use the revenue generated to improve the school as well as other public schools in the area.

While the topic is still in the early stages of discussion, there are many who agree with Moore that this might be a the best way to save Hawaii's public schools.  Alan Oshima, a board member of the Hawaii Institute for Public Affairs, added, "Hawaii has such valuable real estate, especially in the urban core and in some resort areas.  If you start using the land more efficiently, and you find some financing mechanisms that can provide a dedicated source of financing, then you can work on all the schools no matter where they're located because you want that equity. You don't want it all to be in the high-density areas. You want it statewide."

Source: Honolulu Star Advertiser, 1-15-2012, www.staradvertiser.com

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Ko'olani Condominium Still Fighting to Repair Construction Defects

The Ko'olani condominium tower located in Kakaako on the island of Oahu was completed only six years ago by Miami-based real estate developer Crescent Heights.  However, residents and the owners association are still fighting to get several construction defects and problems fixed including severe water leaks, uneven air conditioning and algae growing on the roof.In 2007, the owners association took the developer through arbitration.  After a three year process, arbitrator Keith Hunter of Dispute Prevention & Resolution Inc. awarded the residents a total of $12.4 million to repair about 40 defect claims.  A state judge confirmed the award.  However attorneys hired by the developer and sub contractors continue to fight in court over who is to be held liable for the amount, and the association has not seen the money.

Two years ago each of the building's 370 residents were assessed by the owners association $13,000 each to replace waterlines to their units.  A new special assessment of approximately $3,600 per unit was requested this year to cover new legal costs.  Owners who wish to sell their unit are experiencing difficulty since new prospective buyers have a hard time obtaining bank financing due to the unresolved defect liability.

Source: Honolulu Star Advertiser, 1-15-2012, www.staradvertiser.com

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Honolulu Rail Project - Expert Believes Honolulu Rail Project Costs Underestimated and Ridership Overestimated

According to Wendell Cox, a former member of the Los Angeles County Transportation Commission and the Amtrak Reform Council, the Honolulu Rail Project's costs have been significantly underestimated and its ridership significantly overestimated.  Cox, who was speaking at the annual SmartBusiness Hawaii Conference, pointed out that the city plans to have 116,300 passengers per day by 2030 and believed that this number was approximately 40 percent too high.  He also recommended that the city take time to do a more in depth study to make sure that they have enough funds to support the project.

Interim executive director of the Honolulu Authority for Rapid Transportation, Toru Hamayasu, defended the cities predictions of ridership and costs by stating, "The Federal Transit Administration over the last several years has worked closely with the city on the Honolulu rail project in making sure our finances and ridership projections are sound.  Because of FTA's stringent oversight and continued confidence in our project, the project was just approved to enter into the final design phase. The entry into Final Design is a significant step toward the final agreement and commitment by the federal authority to contribute $1.55 billion for the project."

Source: Honolulu Star Advertiser, 1-14-2012, www.staradvertiser.com

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Hawaiian Airlines to Create Hub on Maui

Hawaiian Airlines has announced that they will be dramatically increasing its service to the Maui in 2012 and will actually create a major airline hub on the Valley Isle.  In their press release, Hawaiian Airlines stated that they will add between 23 to 25 per day to Maui, including additional nonstop service from the island to the Big Island and Kauai.  President and CEO of Hawaiian, Mark Dunkerley, stated, "Hopefully, this will make everyone in the islands happy.  This clearly brings greater focus on Maui, helps us build flights on Maui and gets us well situated to compete on Maui. For other neighbor islands, it gives them connectivity to Maui. It gives the other neighbor islands the ability to do a round trip without connecting in Honolulu, and it means a great deal for them."

Dunkerley noted that they will be hiring new employees for the Maui airport, but stated that the company was still "working through the numbers".  Dunkerley added, "Clearly, with an enormous investment like the one we announced today, what we want to see if it is financially successful and lead to further investments.  Our medium- and long-term view is if we can get the right airport facility to operate efficiently on Maui, if we fill our airplanes and if we can operate our services on a financially viable basis, we'll be eager to see additional flights to Maui."

Source: Honolulu Star Advertiser, 1-13-2012, www.staradvertiser.com

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Waikiki Magazine to Make its Debut

Waikiki Magazine has announced that it will be making its debut in Hawaii starting on January 25, 2012.  The magazine will be published by the Star-Advertiser and will focus on entertainment, shopping, dining and recreation in Waikiki.  It will be printed in both English and Japanese.

President and Publisher of the Star-Advertiser, Dennis Francis, stated, "While Waikiki has traditionally been the playground of visitors and local residents, there's never been a publication specifically dedicated to the rich shopping, dining and recreational experiences the area has to offer.  Francis noted that a total of 80,000 copies will be distributed to the 66 hotels in Waikiki, as well free-standing boxes in the area and airports, military bases and other areas with high tourism traffic.

Senior Vice President of Marketing, Dave Kennedy, added, "We want it to be the voice of Waikiki," which is "home to some of the finest restaurants, retailers and night life in the world, all set against the backdrop of white, sandy beaches and azure waters.  Such a special place deserves the highest-quality publication possible to properly highlight everything the area has to offer, and that's what we're doing with Waikiki Magazine."

Source: Honolulu Star Advertiser, 1-13-2012, www.staradvertiser.com

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Hawaiian Airlines to Use New Plane for Osaka Route

Hawaiian Airlines has announced that it will be using the new Airbus A330-200 for its Osaka, Japan Route starting on April 21, 2012.  This larger plane has 30 more passenger seats then the currently used Boeing 767-300ER.  This will equate to almost 11,000 extra seats per year for the Osaka route.  Hawaiian Airline President and CEO, Mark Dunkerley, stated, "Introducing our new A330 aircraft to Osaka service will further improve the travel experience for our customers traveling from Kansai and help meet growing demand."

Source: Honolulu Star Advertiser, 1-11-2012, www.staradvertiser.com

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Residential Electric Rates Fall on Oahu in January 2012

According to a report released by the Hawaiian Electric Company, residential electrical rates on the island of Oahu will drop from the 35.1 cents per kilowatt-hour charged in December to 32.6 cents per kilowatt-hour for the month of January 2012.  This is welcome news for Oahu residents who saw rate increases for each of the past four months. HECO spokesman Peter Rosegg stated, "While this dip is good news, we caution customers that fuel prices are not expected to continue significant drops.  Overall, rates remain high, creating a difficult burden for families and businesses.  The long-term solution is to continue to pursue local renewable electricity and fuel sources that can be purchased with long-term fixed-price contracts."

Electrical rates on Kauai were posted at 40.3 cents per kilowatt-hour for January.  On the Big Island of Hawaii, rates were 42.1 cents per kilowatt-hour, and on Maui, rates were 37.6 cents per kilowatt-hour.

Source: Honolulu Star Advertiser, 1-11-2012, www.staradvertiser.com

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Big Island and Kauai Sales Data for December 2011

Information Provided by Hawaii Information Service:

Single Family Home Sales for the Big Island of Hawaii:
December 2011 - 123 homes sold - $287,500 median price
December 2010 - 144 homes sold - $235,950 median price

Condominium Sales for the Big Island of Hawaii:
December 2011 - 61 condos sold - $212,000 median price
December 2010 - 62 condos sold - $252,500 median price

Source: Honolulu Star Advertiser, 1-10-2012, www.staradvertiser.com

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Oahu Real Estate Sales Data for December 2011

Information provided by the Honolulu Board of Realtors:

Single Family Home Sales for the Island of Oahu:
December 2011 - 268 homes sold - $605,000 median price
December 2010 - 312 homes sold - $585,000 median price

Condominium Sales for the Island of Oahu:
December 2011 - 333 condos sold - $285,000 median price
December 2010 - 356 condos sold - $300,000 median price.

Source: Honolulu Star Advertiser, 1-10-2012, www.staradvertiser.com

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Tax Increases Considered by Governor's Office

Faced with budget shortfalls for the state of Hawaii, the office of Governor Neil Abercrombie has stated that they have not ruled out increasing taxes or adding other revenue generating measures to help make ends meet.  The state Council of Revenues announced last week that Hawaii will have a projected 11.5 percent revenue growth in the coming fiscal year, which was a decrease from the 14.5 percent predicted previously.  This 3 percent difference would mean a decrease in revenue of approximately $130 million for this fiscal year and $138 million for the next fiscal year.  State representative Barbara Marumoto commented that the state should first look at reducing their spending.  Marumoto stated, "We really should be mending our ways and reducing spending this year, otherwise we will be facing very large tax increases in the future."

Source: Honolulu Star Advertiser, 1-10-2012, www.staradvertiser.com

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