Senate Standing Committee on Economic Development and Tourism

Aloha and welcome to the hearing with the Senate Committee. Hello and welcome to the Senate Committee on Economic Development Tourism. Today is Thursday, February 5, 2026. This is our 1:00pm agenda and we are in Conference Room 2 to 9. This hearing is being streamed live on YouTube.

In the unlikely event that we must abruptly end this hearing due to technical difficulties, the Committee will reconvene on Tuesday, February 102026 at 1pm in Conference Room 2 to 9. We have a one minute time limit for all tester fires as we have various agendas to get through this afternoon.

This agenda has six bills and first up is Senate Bill 2359 relating to registration of timeshares. But before we go into that, I wanted to have Senator Favela introduce himself and what district he represents.

Oh, 96706 ever be baby.

All right, let's get started. Okay. First up, Senate Bill 2359 relating to registration of timeshares. First testifier testifying off of behalf of DCCA is Laurie Bet Van Ken.

Department stands on it.

Thank you. Next up, Robin Suz with Marriott Vacation Worldwide in support and intensifying on the African American resort development association. Mr. Blake. Thank you. Also we have Stephanie Donojo from Kohala coast in support Darales Vega Fernandez of Travel and Leisure. And support Stacey he and support from Arda as well as Robert Ishihara from Hilton Vacations Waikoloa.

Anybody else wishing to testify on this measure? Seeing none. Senator Favela. Any questions?

Okay.

DCCA please. Thank you. So. So the Bill intends to streamline the department's review and approve of annual renewals and amendments to the plans. How long does the Department usually take to review the submissions?

It depends if there's amendments attached to it. So one of my comments I made was to help it go quicker to take out that them allowing to submit amendments to the disclosure statements. So that will help streamline it? It depends. It could take anywhere from. Depends how busy we are.

Some of them we have not gotten our letters out. So I know that has been an issue for some of the people once it's been approved. So is it.

Is it because manpower or part of it?

Exactly.

So if the change is proposed in the Bill reduce the time it takes to review this renewals and plan amendments.

I'm sorry?

Will the changes in the pro. Will the changes proposed in the Bill reduce the time it takes to review for the renewals?

If we take out that one section about the disclosure that would reduce the time to review on some of them. We still would like some time to review it instead of being automatic acceptance. So we're working with ARTA to come up with that time frame that would be acceptable to both sides. Okay.

Okay, thank you. Next up, Senate Bill 2169 relating to agribusiness Development Corporation. First up, Lauren Yasaka for Department of Land and Natural Resources.

Stephen Domingo on. On behalf of Lauren, we stand by our testimony.

Okay, thank you. Next up, Wendy G For Agri Development Corporation.

Good afternoon Chair Wendy Gady and we stand in support and are here for any comments.

Thank you. Next up, Brian M. On behalf of Hawaii Farm Bureau.

Aloha Chair. The Hoy Farm Bureau will stand on its written testimony in support.

Thank you. Anybody else wishing to testify on this measure? Seeing none. Senator from the other side, do you have any questions? Okay, ADC please. So you guys have any current. Do you currently have any lands that you guys looking at condemning but without the authorization provided in this Bill?

Good afternoon, Senator Wendy Gady with ADC and we do not.

Don't you don't have any?

No.

Okay, thank you. Next up, Senate Bill 2170 relating to North Kohala Kinnersley east site land parcel. First up, sorry ADC Wendy Gady.

Good afternoon. Stand in support and are here for any comments.

Thank you. Next up, Hawaii Farm Bureau Miyamoto.

Thank each other Hawaii Farm testimony in support.

Thank you. Anybody else wishing to testify in this measure? Seeing none. Just a quick question, Wendy, please. How large. How large is this land you guys wanting to purchase and what do you foresee being grown on that parcel?

So we. These are class C lands from the classification and so it's very suitable for cucumber, eggplant, tomato, all of the items that the DOE currently has on their short list.

Okay, perfect. Thank you. Next up, Senate Bill 2263, relating to business competitiveness. First up, Department of Economic Development and Tourism.

Chair, Members of the Committee. Deputy Director, Dane Wicker, and we stand...we stand on our testimony.

Thank you. Next up, Jennifer Chun, Acting Administrator of DBEDT, testifying for DBEDT.

Chair, we stand on our written testimony. Thank you.

Thank you. Next up, Kaohi Manu Lydia Dan Akiona, Okala Coast Urgent Care, in support, Lauren Zerbo testifying behalf of Hawaii Food Industry Association, on zoom.

Not present on zoom, Chair.

Thank you. Next up, Brian Miyamoto on behalf of Hawaii Farm Bureau.

The Hawaii Farm Bureau will stand on its written testimony in support.

Thank you. Sher Manor on behalf of the Chamber of Hawaii of Commerce.

Members of the Committee...on behalf of the Chamber of Commerce, I stand in support.

Thank you. Next up, Tina Yamaki—Yamasaki—testifying on behalf of Hawaii Transportation Association. Tina, sorry, Tina Yamaki on Zoom.

Not present on Zoom, Chair.

Thank you. In support. Matt Pelberg.

I'm Matt Pelberg, on behalf of Pulumu Collaborative. We'll stand on our, on our written testimony in support.

Thank you. Pam Tunpap on behalf of Maui Chamber of Commerce, in support. Jacob Weinsek in support. And then Matt—oh, they got me twice. Or Matt, on behalf of Millie James. Yeah, twice. In support. Anybody else wishing to testify on this measure?

Good afternoon. My name is Seth Colby. I'm Acting Director of Budget and Finance.

I've been involved in this Business Revitalization Task Force as a—through the Department of Taxation, later as administrative support and research support through during my time as the Chief Economist and just wanted to be here and say, you know this, this Bill is also important for our budget because without economic growth, it's very hard to support our budget needs.

And just wanted to say I'm available for any questions that you may have.

Thank you, sir. Anybody else wishing to testify? Please. And state your name.

Aloha, Chair DeCoite and Senator Fevella. My name is Dr. Stephen Von Smith. I'm an assistant professor at UHERO. My testimony is submitted as written comments as an individual, not as a representative of the University of Hawaii or UHERO. I've made a number of written comments. I'll just briefly give an overview.

I strongly support the intent to measure Hawaii's economic environment and hold policymakers accountable for improving economic performance and wellbeing. Transparent, evidence-based indicators, I think, are essential for understanding where the state is succeeding and where we can do better. However, I have several concerns with relying on a mainland oriented composite index as a benchmark for Hawaii.

These rankings are not designed for an island economy. They often embed structural and geographic assumptions that are inherently biased against Hawaii by definition and mix policy controllable factors with a number of conditions that the state cannot change.

As a result, I think they risk mischaracterizing Hawaii's economy, its economic conditions, and they provide misleading signals for policy and investment decisions. I go into a lot more detail in my written testimony, but I think a good summary comes today from the Chamber of Commerce's State of the Economy Event.

This morning, they had Scott Cohen from CNBC presenting about their index and I asked a question about how policymakers can use the CNBC ranking to improve Hawaii's ranking in Hawaii's, to support efforts to improve the economic climate in Hawaii, and his response was to look at what you can control.

And I think this is the critical issue. The Bill aims to focus policymakers attention on economic factors that it can control, but currently measuring them on a composite index across the country combined with many factors that it cannot control and, and many of the controllable factors on the mainland are also inappropriate for Hawaii, such as proximity to markets with rail freight infrastructure to connect to those markets.

And so, on that basis, I have some suggestions in my written testimony about direct measures that you could use for monitoring the economic climate rather than a national ranking. Thank you.

Thank you. Anybody else wishing to testify in this measure? Seeing none. Seth. Seth, what do you have to say to that testimony that just happened?

Hawaii operates in a competitive landscape with the rest of the United States. So, we don't have control over everything that happens, but we have control about how we're going to compete. And the fact that we are—we're looking for a ranking that shows how we're doing relative to the rest of the United States.

Because the people in Hawaii, they move to the rest of the United States, the businesses that operate here, they can choose to operate in other places in the rest of the United States. So, we will never do it exactly like that we do it in other states. And it's important to remember and emphasize our comparative advantages.

On the other hand, one of the reasons we chose this ranking is because we are in a competitive landscape and we want to rank ourselves within that competitive landscape.

Thank you. Thank you, sir. DBEDT. So...can you describe the current efforts to improve Hawaii's business and competitiveness in regards to what you guys have been doing?

Sure. Members of Committee, Dane Wicker, Deputy Director at DBEDT. So, just kind of listening to the discussion, the prior speakers, we've watched the CNBC metrics come out every year. Broadly, they're applicable. You're talking about workforce development, infrastructure, and business climate. So, from an economist—I'm not an economist—but from a planning background perspective.

You know, they're not always correct, so, I like your perspective on stuff like this.

Our Research Economic Analysis Division does an emerging sector report every year. What determines what those sectors are is government through policy, through the resources we get. And so yes, we do influence our own metrics.

So if we look at what the national trends are and where we got to make those investments for DBEDT, that's where we're focused on. A lot of it is infrastructure and facilities. In fact, if you actually look at some of UHERO's reports and findings, a lot of it points to manufacturing, small business.

And so, when we look at the drop off points of where if we're really, truly going to diversify our economy, those small to medium businesses, their drop offs are a lack of access to certain facilities, certain infrastructure. That's a starting point.

If we can put in those actual open access facilities to help them anchor and scale up, we can also start to not only help them expand products, whether for domestic sales or exporting internationally, but then we can also tap and leverage our own ecosystem such as our business development support division through Hawaii made and what they do. That's applicable to just the manufacturing side.

So, in the other areas, another metric with the workforce development, we are working closely with Department of Education and the School for Adults and trying to understand what the drop off points are for those high school students that graduate that do not go on the post-secondary.

How do we look at what industries that align with the CTE programs and what facilities are needed so that they can transition straight into jobs? But infrastructure is a key one, Senator. And where DBEDT is focused a lot on the investment of that, whether it's through land acquisition and then through the development of those actual facilities.

So, do you agree with how the working group and the report that of course they would have to bring back to the Legislature? Because I know you've been in several of those meetings.

So, I did participate and sit on a few meetings up front, so I cannot speak to, in fact all the work. Although at the time, Dr. Colby did provide updates. I agreed with his approach. What this Bill does is it puts teeth behind if we're going to be serious about increasing our competitiveness. We did it with energy.

We put a mandate on energy. We put a mandate on food production, doubling food production. We put goals on housing. So, if we want to be competitive, this helps drive it.

And it holds both Executive and Legislative Branch accountable by saying, okay, if you want to increase where this Bill says we're getting at the top 10, DBEDT, what's the plan to get there? And we'll be coming back. Okay, here's our plan, here's the resources that are needed.

Thank you. Any questions? Okay, thank you. Moving on, Senate Bill 2360, relating to state enterprise zone. First up, Dennis Ling, Department of Business Economic Development.

Aloha, Chair, Committee Members. Dennis Ling with the Business Development and Support Division of DBEDT, and we stand on our written testimony providing comments.

Thank you. Next up, Dane Wicker, Deputy Director for DBEDT.

DBEDT stands on our testimony in support.

Thank you. Department of Taxation. Thank you. Next up, Wendy Gady with ADC.

Good afternoon, Chair, Vice Chair, Members of the Committee. I'm Wendy Gady with ADC, and I stand in support of this bill.

Thank you. Benson Medina on behalf of Hawaii Department of Research and Development in support. Amy Asselbaye testifying for City and County of Honolulu Office of Economic Revitalization in support. Dave Erdman, Interim President for Retail Merchants Hawaii on Zoom.

Not present on Zoom, Chair.

Thank you. Tom Yamachika on behalf of Tax Foundation of Hawaii.

Aloha. Colleen Teramae with Tax Foundation on behalf of our President, Tom Yamachika. Tax Foundation of Hawaii stands on our written testimony and comments. Mahalo.

Thank you. Brian Miyamoto, Hawaii Farm Bureau.

Thank you, Chair. The Hawaii Farm Bureau will stand on its written testimony in support.

Thank you. Next up, Sherry Menor testifying on behalf of the Chamber of Commerce. Thank you. Next up, Matt Prellberg, Holomua Collaborative.

Matt Prellberg, Holomua Collaborative. We stand on our written testimony in strong support. Available for any questions.

Thank you. Next up, Lauren Zirbel on behalf of Hawaii Food Industry Alliance Association on Zoom.

Not present on Zoom, Chair.

Thank you. In support. And then Pamela Tumpap on behalf of Maui Chamber of Commerce in support. And then Matt Prellberg again on behalf of Meli James. Thank you. Andrew Min testifying for Min Plastics and Supply.

Good afternoon, Chair and Committee. Andrew Min with Min Plastics. This year was our first year part of the enterprise zone program. And I would say 90% of our work is custom manufacturing and specialty work for the state. It was kind of sad to see that we did qualify.

Although the incentive benefit only impacts maybe like 10% of what we actually did. So anything to revise the definition is much appreciated. I think we do have to employ a lot of great people. I think the state support in manufacturing in our sector is much appreciated and... Yeah.

No, thank you. I was going to tell you for sit down. You making me nervous standing up like that. Thank you. Now that's the House side. Thank you. Anybody else wishing to testify in this measure? Thank you.

Good afternoon, Senator. I brought my football in a Super Bowl weekend today. I know the LA Rams should have won against Seattle Seahawks. But since the Seahawks won, so we got to root for the Seahawks and the West Coast teams. As you know, they're the blue states.

So I'm here to testify on the state enterprise zone. As you know, that is a state enterprise zone is a place where you don't have to pay state taxes if you conduct business. But for myself, I like to combine with the federal foreign trade zone, which we have in Pier 7 and certain Mililani Technology Park is designed as a foreign trade zone.

So if we combine both foreign trade zone and the state enterprise zone, we can have a free trade area like a no tariffs area. So we can designate, like I know that President Trump and the administration is going with the tariffs right now, but we can eventually that's going to phase out and become known no tariffs.

And with the new administration hopefully comes in and brings like a free trade area for Indo Pacific region again and meeting the APEC's Bogor Doctrine and Putrajaya Agreement, which by year 2040 all APEC countries in the Indo Pacific region must have a free trade agreement, which we made a requirement already with during the Barack Obama administration and Joe Biden administration.

We had the TPP going, we had the economic framework for Indo Pacific region. So we still want to proceed with the multilateral kind of free trade agreement and making Hawaii the place so we can work with other countries, other cities, other states that have a free trade area. And we're going to move in that direction.

So we'll be the first state in the nation to initiate a free trade area in the Indo Pacific area. So everybody can come here and sign a free trade agreement. Just like duty free shoppers. You go in their shop, you don't have to pay non tariffs. Unfortunately duty free shoppers closed that last month. So we lost that Waikiki Gallery. Because I wanted to use the second floor there as a free trade area, and I talked to the people there.

Can you wrap up your testimony please?

So I do support the bill, but I just want the... We need to reassess the enterprise zone so we can combine them with the foreign trade zone and make it happen. Thank you very much.

Thank you. Anybody else wishing to testify on this matter? Seeing none. Members, any questions? Oh yeah, DBEDT. Sorry. So as of today, Dane, where are the enterprise zones on each island?

I'm have to call up Jason. He's memorized them. Jason Ushijima from our Business Development Support Division, and he's the head of the enterprise zone.

Hi. Good afternoon, Chair, Committee Members. Jason Ushijima, Business Development and Support Division.

Jason, can you tell us where are the enterprise zones and if every island has an enterprise zone?

Yes, every island currently has a zone. Right now the majority of the neighbor islands are encompassed in enterprise zone. For Honolulu County, it is much of the North Shore, the West Side, Kaka'ako, and Waimānalo, and much of the Central Oahu as well.

So how have they stimulated business, whether it be agricultural and industrial growth in those areas?

So with looking at our most recent annual report, the enterprise zones, it had stimulated, I want to say, it was a 271 million in revenues for the businesses who did report and who are a part of the program. Additionally, the program is currently supporting 939 jobs across all of the enterprise zones and the companies who are enrolled and reported.

So is the reporting mandatory? Because you said for those that did report.

The reporting is not mandatory. The reporting is required if the companies do want to take the benefit. However, there's no enforcement mechanism within the program to force everybody to provide annual results.

So do you see more companies asking for that enterprise zone in their areas to stimulate the economy?

Yes. So our office does get a number of inquiries throughout the year when we do a lot of outreach to question whether or not their company can qualify for it, if and when their certain location can become an enterprise zone. So there's a strict definition for what an enterprise zone is and how they can be designated. So unfortunately not the entire state can be an enterprise zone.

So I know, like, what's your thought on the tech parks? Incorporating tech and aerospace into enterprise zones?

I think it would be a good sector to include in the enterprise zone program. So not only is the geography one of the requirements for joining the program, but also the current list of business activities. Right now, technology production, manufacturing, and creation is included as one of the business activities. I think it might be a good idea to consider technology services as we look at companies who work with AI or more on the service side. Right now, they do not qualify for the program.

What about creative industry? Do you see and asking creative industry whether just and more so I'm looking at targeted... Would it be neighbor island also asking for that or are we just looking at urban Honolulu Central of creative industry type?

I think if my memory is correct recently maybe only one or two in the creative side have requested or asked about the program itself, and they've been Honolulu County based.

Thank you. Senator Fukunaga.

You know, with the, I guess extended opportunity zone credits, how do they factor into the mix? You know, because enterprise zones, you have to have a particular income level and specific qualifications for that zone. Right? Are there any instances where, you know, Hawaii has some potential opportunity zones that might mesh with or integrate with what we have on the enterprise side?

In the first inception of the opportunity zone programs, enterprise zone and the location of the enterprise zone was one of the criteria that was looked at when determining what was going to be an opportunity zone. And I believe 23 out of the 25 opportunity zones are also enterprise zones.

Can we have your department provide a list to the committee? Thank you. Thank you.

Thank you. Okay, moving on. We'll move on to Senate Bill 3084 in regard to related to Hawaii Technology Development Corporation. First up, Department of Business Economic Development.

Deputy Director of dvet. And DBEDT stands on his testimonies of course.

Thank you. Next up, Trung Lan for Hawaii Technology Development Corporation Chair Members of the Committee.

Trung Lan of the Hawaii Technology Development Corporation. And we stand on a written testimony.

Thank you. Next up, Chamber of Hawaii Julian .

Chairman Of the Committee Julian Kiyabu with the Chamber of Commerce. Why may we stand on our written testimony and support.

Thank you. Naomi Kukok testifying for Simone Pietri Enterprises. In support, Lauren Zerbo, Hawaii Food Industry association on Zoom.

Not present on Zoom chair.

Thank you. Next up, Patrick Sullivan testifying for Oceanet in support. And Pam Tupac, Maui Chamber of Commerce in support. Anybody else wishing to testify on this measure? Seeing non Members. Any questions? I got one for you, Trung.

So by expanding the allowable uses of funds under this program, do you expect more businesses to apply for these grants and how many grants are currently awarded per year?

We currently award about 20 out of. Around 50 applicants per year from the current program. We're seeing changes on the federal side. Where the types of grants that are. Coming down are much more varied. So this Bill allows us to support. Local companies as different opportunities for federal R and D grants come down.

So we're not just restricted to the CIBBER program. Thank you. Thank you.

Okay, we're going to take a short recess.

Hi. We're going to decision-make on today's agenda for February 5th. First up, Senate Bill 2359. Recommendation is to pass with an SD 1 by incorporating the following amendment recommended by DCCA to increase from 45 days to 60 days; on page 7, line 17, and on page 8, line 5, making any technical non-substantive amendments as necessary and defecting the effective date to January 1st, 2050. Members, any discussion? Seeing none, Vice Chair for the vote. Chair goes aye.

Thank you. Senator Wakai is excused. I vote aye. Senator Kim is excused. [Roll call]. Thank you. Your recommendation is adopted.

Thank you. Next up, Senate Bill 2169. Looking at passing with an SD 1 by making any technical non-substantive amendments is necessary and defecting the effective date to July 1st, 2050. Any discussion? Seeing none. Vice Chair for the vote. Chair goes aye.

Thank you. For the members that are present, are there any voting with reservations or objections? Hearing none, your recommendation is adopted.

Thank you. Next up, Senate Bill 2170. Passing with an SD 1 by blanking out the the GO bond appropriation amount but note deleted amounts in committee report, making any technical, non-substantive amendments as necessary, and defecting the effective date to July 1st, 2050. Any discussion? Seeing none, Vice Chair for the vote. Chair goes aye.

Thank you. Of the members present, any voting with reservations or objections? Hearing none, measure-- your recommendation is adopted.

Thank you.

Next up, Senate Bill 2263. Passing with an SD 1 by blanking out the appropriation amount but noting deleted amounts in the committee report and inserting a definition section that defines Department as the Department of Business, Economic Development & Tourism, and Director as the Director of Business, Economic Development & Tourism for the newly created part, and making any technical, non-substantive amendments as necessary, and defecting the effective date to July 1st, 2050. Any discussion, members? Seeing none, Vice Chair for the vote. Chair goes aye.

Thank you. Of the members present, any voting with reservations or objections? Hearing none, your recommendation is adopted.

Thank you. Next up, Senate Bill 2360. Again, looking at passing with amendments with an SD 1 by making any technical, non-substantive amendments as necessary and defecting the effective date to July 1st, 2050. Any discussion, members? Seeing none, Vice Chair for the vote, please. Chair goes aye.

Thank you. Of the members present, any voting with reservations or objections? Hearing none, measure is adopted.

Thank you. Next up Senate Bill 3084 we're looking at passing this with amendments with an SD1 by blanking out the appropriation amount note deleted amounts in the Committee report and making any technical non substantive amendments as necessary and defecting the effective date to July 1st, 2050.

Any discussion Members seeing none vice chair for the vote Chair votes aye .

thank you Of the Members present any voting with reservations or objections hearing none. Your recommendation is adopted.

Thank you Members and thank you for coming today. With that we are adjourned.