Hawaii Tourism Authority staff may have violated state procurement law during solicitation for the U.S. tourism contract, typically worth more than $100 million over a five-year period, according to information found in approximately 2,700 pages of public records provided to the Honolulu Star-Advertiser by HTA and other sources.

Persistent questions loom over the controversial procurement process for HTA’s top business contract, which is now heading into a second year of uncertainty, and perhaps a third solicitation. Public records show that there were flaws in the process from the start.

HTA awarded its U.S. brand management and global support services contract on June 2 to the Council for Native Hawaiian Advancement (CNHA). The new contract, worth more than $34 million in the first two years, was expected to start June 30 and is slated to end Dec. 31, 2024. The contract comes with an option to extend for an additional two years.

The solicitation was originally awarded in December 2021 to the Hawaii Visitors and Convention Bureau (HVCB) as a multiyear U.S. tourism contract worth $22.5 million the first year. It was later rescinded following an unresolved protest from the CNHA. When HTA embarked on a second round in the request-for-­proposals (RFP) process, HVCB lost to CNHA.

Ronald D. Rodriguez, former HTA procurement officer/senior contract specialist, sent emails in December 2021 during the U.S. tourism contract’s first procurement informing HTA President and CEO John De Fries, HTA Board Chairman George Kam, HTA Chief Brand Officer Kalani Ka‘ana‘ana and HTA Public Affairs Officer Ilihia Gionson that the presence of outsiders at an evaluation committee meeting could trigger a procurement protest.

Rodriguez, who could not be reached for comment by the Star-Advertiser, sent an email on Dec. 3, 2021, informing HTA leaders that state procurement code HAR §3-122-51 says “proposals and modifications shall be shown only to members of the evaluation committee and state personnel or other designees having a legitimate interest in them.”

“What happened at the oral presentations went well beyond access to the proposals (I consider presentations to be part of the proposal),” said Rodriguez, whose role was to run HTA procurement and not act as their attorney. “Outside influences—Ilihia (Gionson), Iwalani (Kualii Kahoohanohano) , and even you, John (De Fries) — were allowed in the evaluation room, and were allowed to provide their opinions without the gravity and responsibility that comes with being on the actual committee. I think that was a mistake.”

Rodriguez sent another email to the four on Dec. 5, 2021, ‘I have spoken with someone, another attorney, in confidence and they confirmed what I was afraid of: If word were to get out that there were people in the evaluation room, who were not on the committee, and that those people not on the committee were providing their opinions, or worse, influence, regarding that contractor choice … that could result in a valid protest of a procurement violation and we would lose.”

Rodriguez tells the group that he will need to preface the next evaluation meeting to “counter this narrative.”

“I will probably say something to the effect that the evaluators are independent, that their respective judgments should be reached independently, and that they should not allow themselves to be swayed by outside pressure or influences from outside of the evaluation committee,” he said.

Another email from Rodriguez dated Dec. 13, 2021, discusses the possibility that insider information was shared with CNHA before its request for a debriefing, one of the first steps in a protest process. Rodriguez sent that email to Ka‘ana‘ana, De Fries, HTA Chief Administrative Officer Keith Regan, and HTA brand manager for North America Laci Goshi. Goshi resigned from HTA as of May 20 and Regan as of Aug. 3.

“Unfortunately, the questions included in the attachment indicate that some insider information was probably shared. They are requesting the score breakdown by evaluator and a copy of the winning proposal. The issues raised are as follows: Outlier scores. (Karen Hughes’) HVCB history.”

HVCB cited Rodriguez’s Dec. 13, 2021, email in its protest, which alleged unfairness.

CNHA CEO Kuhio Lewis could not immediately respond to the Star-Advertiser for this story. However, CNHA said Lewis addressed Rodriguez’s Dec. 13, 2021, email as well as HVCB’s assertions in a Sept. 14 written response to HVCB’s second supplemental protest.

“HVCB does not present a single shred of actual evidence — as it must — that ‘insider information’ was shared with CNHA. Rather, HVCB offers only Mr. Rodriguez’s speculation, and fails to specify what information was shared with CNHA, or how this alleged information-sharing affected the outcome of CNHA’s protest of the Initial RFP,” Lewis said. “Without any substantiating facts, HVCB’s assertions that it was ‘unduly disadvantaged and CNHA gained an unfair advantage in the procurement process,’ and that ‘the contract awardee had been predetermined at the outset,’ are completely unsupportable and, indeed, reckless.”

Public records show that another irregularity also came up during the debriefing when CNHA was improperly given HVCB’s competitive proposal.

Bonnie Kahakui, acting administrator of the state Procurement Office, wrote in a Jan. 4 email to state Department of Business, Economic Development &Tourism director Mike McCartney that, “CNHA was provided information in a debriefing that should have been withheld (copy of HVCB proposal. Hopefully, HTA redacted any confidential/proprietary information.)”

Kahakui advises McCartney to honor, in the interest of fairness, HVCB’s request for CNHA’s protest letter and proposal. However, HVCB did not receive the public records until after the protest period for that solicitation had passed.

The eventual basis of CNHA’s protest was that evaluator Karen Hughes had given them a low, outlier score that skewed the averages causing them to lose the award despite having a majority of evaluators select them. They also alleged that Hughes was biased toward HVCB since she had formerly worked for them.

HTA declined to respond to the Star-Advertiser’s questions about the emails.

The Star-Advertiser contacted Hughes because her name and some of her emails came up in the batch of public records released by HTA. She consented to speak about the emails as they were already part of the public record. Hughes said she recalled inappropriate attendance in the applicant presentations and evaluation committee meeting and that Rodriguez’s email was self-explanatory.

“I cannot say whether or not anyone on the committee felt pressured by comments made by these additional attendees. I have to say that I was not influenced by their comments as I was an independent evaluator who did not work for HTA,” Hughes said. “I was asked to use my broad tourism experience to guide the evaluation of each applicant against their demonstrated ability to meet each requirement in each section of the RFP written by HTA. ”

Rodriguez later drafted a recommendation to deny CNHA’s protest. The draft was not in the batch of emails provided to the Star-Advertiser; however, there were several documents that were redacted in their entirety. Rodriguez’s opinion, however, is noted in a December 20, 2021, email to De Fries, Ka‘ana‘ana and Regan.

“If CNHA does not appeal that would be the end of it. If, however, you decide not to send the protest response and to, instead, take a more rash approach, then you might want to let the committee know,” Rodriguez said. “Please understand though that, as I leave, I am anxious to wrap things up. Taking an alternate approach would essentially be like pushing a domino, setting into motion a whole series of unfortunate events. Since I am leaving, I should not be the one to push that domino.”

HVCB brought up Rodriguez’s denial as a point in its protest. Lewis also addressed it in his response to HVCB’s protest.

“HVCB notes that the initial draft response to CNHA’s protest of the Initial RFP, prepared by the then-procurement officer Mr. Rodriguez, would have affirmed the award to HVCB, and that, in light of this, the ultimate decision by the (Head of the Purchasing Agency or HOPA), Mr. McCarthy, to rescind the award to HVCB somehow indicates that ‘the contract awardee had been predetermined at the outset.’ HVCB’s argument is nonsense,” Lewis said. “If anything, the fact that the HOPA rejected Mr. Rodriguez’s early, tentative draft and reached the opposite conclusion is evidence of a robust and fair deliberative process.”

Rodriguez, who was part of the contracts and procurement team that was awarded 2020 DBEDT Team of the Year, resigned on Dec. 6, 2021, to become a state deputy attorney general for the education division. His last day at HTA was on Dec. 31, 2021.

Despite HTA’s efforts to manage the process, the result so far has been two protests, and likely two rescinded awards.

McCartney told the Senate Committee on Ways and Means on Monday that he now favors rescinding CNHA’s award and going to a third procurement, which would nullify HVCB’s still active protest.

State Sen. Sharon Moriwaki, a Ways and Means member who represents the tourism-heavy district of Waikiki, said she thinks HTA and DBEDT should have involved the state Procurement Office more often throughout the process.

Moriwaki, (D, Kakaako-­McCully-Waikiki), said state legislators removed HTA’s procurement exemption during the 2021 session to make them more accountable and to address complaints about lack of transparency.

“You would think that after what they went through (at that) session that they would darn well get good training and call Bonnie (Kahakui from the state Procurement Office) at the front end, ‘How do we do this,’ but they didn’t,” she said.

Roberta Rinker-Ludloff, who has held top tourism and hospitality leadership positions in Hawaii, the Los Angeles Tourism &Convention Board, and at the corporate offices of hotel brands like Hilton and Starwood, said the emails show that “there was a bias.”

Rinker-Ludloff, now an owner in the marketing consultancy Concept Designs LLC, said it’s disconcerting that the process continued even after Rodriguez’s emails without further review by the HTA board or the state Procurement Office.

“It just seems like there should have immediately been a pause at this point,” she said, adding that perhaps the HTA leadership should be removed totally from the procurement process if it heads to round three.

Sen. Glenn Wakai, (D, Kalihi-­Salt Lake-Aliamanu), who serves on the Ways and Means committee, said the procurement issues that are surfacing are not the fault of the HTA board, who were kept in the dark. However, he said they “need to put their foot down and get way more active about what’s going on down there.”

The Star-Advertiser shared Rodriguez’s emails with former HTA board member Kyoko Kimura, whose term ended in the summer. Kimura expressed concern that the board was not informed about Rodriguez’s emails or his procurement concerns.

“At least the current board should look at these violations if they existed,” she said. “It should be the board’s responsibility. If they violated state procurement, the public should be informed.”

David Arakawa, speaking to the Star-Advertiser as an HTA board member and not in his capacity as an evaluation committee member for the U.S. tourism contract, said he had not seen Rodriguez’s emails. After the Star-Advertiser read them to him, he said that they should have been brought to the HTA board at least in executive session.

“From the very beginning of the process, as I understood it, the HTA staff and members of the evaluators committees had the best interest of Hawaii in mind,” Arakawa said. “If mistakes were made along the way, we need to correct them and implement training and guidance.”