House Standing Committee on Economic Development & Technology

Welcome everybody to our informational briefing. Today is, Friday, 06/19/2026. One it's 1PM, and we are at Conference Room 423. You are here on our committee on economic development to go over this agenda today. And what we will be doing is going through the different programs under this committee.

And for this first informational hearing, we are gonna go through the research development division under DBEDT. And we're also looking at UHERO, the University of Hawaii Economic Research Organization, because they serve very similar missions. And our purpose of this informational briefing is to get an understanding of the different departments and to be able to understand what they do, what their mission is so we can coordinate better and really collaborate at at the end.

And this is very this is gonna be educational, And what we hope to do is maybe plan out some idea of what they want to do in the future so we can help better support them as time goes by. So before we go into our first item on the agenda, let's just go around the room and introduce the members.

Representative Templo, would you like to just state your name?

Okay. Hi, everyone. Thank you for being here. Shirley Templo, House District 30, Kalihi Kalihi, Kahei Lagoon at Hickam Village.

Aloha. Joe Gedeon from District 18 representing Hawaii Kai, Kalama Valley, and Portla.

I'm Gregory Illigan, your Chair for economic development representing Puna. And I know you're not a rep, but let's go to the next rep.

Oh hi. Cov Ratcliffe District 28 Chinatown, Sand Island, Iwilei.

Okay. Thank you. Our first, department coming up with their presentation will be, Reid with the research and development division under DBEDT. Jennifer, would you start off our presentation and start us off?

Yes. Thank you, Chairs and Members. I am going to share my screen. Sharing it and getting the presentation up.

Well, Jennifer is going through that. I just want to share with everybody that the number is Bed130, and it's economic planning and research program objective. It's to enhance and contribute to the economic planning and development of the state by providing economic data analysis and forecast, to conduct and report on basic research onto the state's economy, to compile and publish data on Hawaii's emerging industry, business activity, the economy, and demographic characteristics to maintain a statewide statistical reporting system. Jennifer, I know you're gonna go into detail.

Yeah. We we we do all of that. So, I'm here as the acting administrator for Reed. I my normal job is as the director of tourism research. So what I'd like to share with you is I first of all, people think of us when you mentioned forecast.

We just did our forecast. People think, oh, yeah. You guys do forecast, and that makes you, like, similar to you hero and that and, yes, they have their own forecast. But, you know, what we do at Reid is a lot broader. We are very much a public facing division.

Like we're not doing these reports and creating statistics for ourselves. It's for other people like the legislature to make decisions for departments to use for private business to use, all the stakeholders out there. So, unlike a lot of other agencies and divisions within the state, we are very much public facing and, we are there to provide data for people to use and make good decisions.

You know, we do have a vision statement, and we developed this with doctor Eugene Tian, and he wanted us to be a user friendly first place for people to go for economic data analysis. And, you know, over time, we have been developing more dashboards and other things to make the data more accessible to people, and you'll see more of that as I go through this presentation.

So first of all, this is what our division looks like. We are part of DBEDT. We're one of the core agencies. We have 32 positions. A few of them are vacant, but we're actively trying to fill them right now.

And we're located in two places. Half the group, 15 of us are located at the Hemmeter Building right over there, and the other half of us are located at the Hawaii Convention Center. So we have 17 at the Convention Center. And we're gonna go through the branches, and we're gonna go from left to right. So the economic research branch, statistics and data branch, the tourism research branch, labor research, and then the administrative branch, and so we're gonna go that way.

So I'm gonna bring up my colleague, Joe Roos. He is the chief, branch chief of the economic research branch. And he can tell you more about his branch. So, Joe, come on up.

Thank you, for the opportunity and the invite today. We really appreciate it. So, my name is Joe Roos. I work for Jennifer. I'm the branch chief of the economic research branch.

We have, three economists under our branch. And our function is to collect data and do economic forecasts regarding Hawaii's economy. We collect and analyze data from various sources including but not limited to the Bureau of Economic Analysis, the Bureau of Labor Statistics, and the US Census Bureau. We also collaborate with other agencies, divisions, and universities for research. We produce reports as mandated by the legislature.

And during the legislative session, we draft testimony regarding research related bills. And we also have I'll go over this a little bit. We have a input output model that, for example, if there's upcoming project in Hawaii's economy, for example, a construction project, we can calculate using our input output model the what we call the trickle down effects within other sectors of the economy due to, for example, a construction project or other project that produces marginal output within the economy.

The next slide has we'll go over some recent That's

the slide. Oh. I'm Yourself.

Oh, I do it myself. Yeah. That's Pinged down.

Okay. Sorry.

No. We're fine. Yeah. Apologies. So the next slides, I'll go over some recent projects that we have done.

Act one forty two of 2024 session laws required a business revitalization task force, research and economic analysis division, took the lead on the resort research portion of that. The working group, examined cost of doing business in Hawaii, business friendliness and, workforce and access to capital technology and innovation and cost of living. And on our website, we have a report regarding the recommendations from the task force that included, government officials, industry people, and other stakeholders. Okay.

Another project I'd like to go over is our genuine progress indicator data.

This goes beyond the economic indicators and includes social and environmental impacts. For example, what's the societal cost of crime? What's the environmental impact of increased carbon in the atmosphere? And, yeah, that's an annual public publication. And another report we did recently was a consumer debt report.

This report examined Hawaii's consumers and their debt loads. The report basically found that mostly due to mortgages, Hawaii has higher debt loads than The US overall. However, Hawaii is better able to manage their debt loads because they had lower default rates. And yeah. So that's on our website.

And then I discussed this a little bit in October 2025. We updated our model, the input output model. The title is the 22 benchmark report and it came out in 2025 and that is because it's based on 2022 economic census data that comes out every five years. So it came out in 2022. Normally, there's a two to three year lag time for the time this data comes out from the US Census Bureau, and then we publish.

So our next one will be the 2027 benchmark report.

If I could add in. So, you know, the thing about the IO model, that's kind of unique to Hawaii. When we talk about other states and how they look at their economic impact and everything, they use other models like InPlan or REMI or other things. You know, Hawaii is creating our we have our own IO model and we've had it for a really long time. And it takes into account all the uniqueness of the state.

And we're now we're we will soon publish the county version of the IO model, but, you know, this is tailored for Hawaii versus some of the bigger models work great for mainland cities, but they don't work as great down here.

Yeah. And so the last two slides, I just listed some recent reports that we have done. And, yeah, I just like to conclude that we admire and appreciate Carl and Steven, and we're probably one of the greatest consumers of their products. And with that, eyes were.

Yeah. It's like the mutual admiration society. We love UHERO, and, they help us do all kind of things because they host, for example, our, data warehouse. So we appreciate that about them. So, you know, so Joe talked about some of the reports that we do and that his branch takes on the burden when you guys, pass some legislation and says there's gonna be a report that needs to be done.

Usually, that's Joe's team. So this next, I'm gonna go through is the statistics and data support branch. And they they take all the data from all kind of sources, and they put it together and, like, they compile it. They visualize it and everything. So going back to our structure of how Reed works.

So the labor research branch, they are the field team. They field, research, and they're actively contacting people and and getting samples and everything like that for the Federal Bureau of Labor Statistics. So they're the field team. My team, we also field and we compile and we produce statistics. So and then this branch, which is headed up by doctor Yongseung Kim, she is everything in the state that is available.

She likes to compile it. You wanna know how many dog licenses there are? All these kinds of things. It's in that Hawaii state data book, and she's really working on making it accessible. So, like, she's, like, been creating all these, you know, all these dashboards and everything to make things more user friendly for the people in Hawaii.

So they're also in charge of the Census Bureau. So, like, there. So we do have censushawaii.gov, and that's run by this team. And, you know, if you wanna know about population, you wanna know all kinds of stuff, there's, like, so much information that she has available. And, so it it's just, like, I don't know how she manages it.

There's, like, a huge wealth of information for just census alone, but the amount of data products that they put out. And they also do statistical reports, for different topics and which and those reports are different from what Joe's group puts out. So, you know, so they have, as you can see on the screen, daily, weekly, monthly, annual, quarterly publication. So we have the daily passenger count reports, which a lot of people rely on, because they wanna know what the volume of the people are coming in.

They use it for staffing, planning, other purposes.

You know, we have a weekly update of the unemployment claims. We have, monthly economic indicators. We have energy trends. And they help put out and they do all of the visualization for our quarterly statistical and economic reports, which also includes our forecast. And then they also have the county data book.

They have state data books. They even have a facts and figure page. There's all kinds of stuff that this team produces. And then there's the data warehouses, which, as I said, our friends at UHERO help us the hosting of the data warehouses. We have a bunch of data warehouses.

The primary one is the economic data warehouse, and we have data on, you know, population taxes, all those things that are in the data book. And then we have a specialized tourism data warehouse that looks more at some of those characteristics that we have for tourism because it's a whole another whole pile of data that we have there for tourism.

And as I mentioned, the these these dashboards that they created, so many dashboards and, you know, there that team is really good at it because they they think about it. And, like, for example, after the pan not after the pandemic. After the Maui fires, we came up with this Maui data dashboard.

And because we wanted everybody to know, like, what's going on with what's happening with Maui and, you know, the unemployment claims, and then we eventually started tracking building permits and everything. And recently, doctor Kim and Aye, we, like, kind of changed it. Because, like, okay. Now that we're out of past the fires, you know, we're we're now focusing on the recovery. We're focusing now on the building permits.

Those kinds of things. And it's not so much about the volume of people coming in or anything like that. That so it's like, as we need to change the focus of these dashboards, we do. And then we as I said, she collaborates with the US Census Bureau. So there's this thing called the state data center, and they are there to help the public.

People call into the state data center all the time. We try and make things as self-service as we can because as many like, even though we have 32 positions, every time somebody goes on vacation or somebody sick, we feel it. We we all cover for each other, but it's not it seems like a big team, but the amount of volume of work that we're doing, we we feel it every time somebody gets sick.

So, you know, and we and we work with the Federal Government on that too. So so here are some examples of some statistical reports that this team has done.

You know, they did, reports on different race groups. They did report on the tax credit activity. There are solar PV batteries. They did they started a new thing called tourism and economy, which I can tell you my people on the tourism side love the reading that report. Demographic reports, you know, looking at the urban and rural areas, commuter, adjusted population.

So I just got a call the other day asking about de facto population, and I was like, this is the team that puts off the de facto population for the state. So now it's, as I mentioned, the tourism research branch, that's my team. And, you know, I have this chart because people get confused about where my team lives. Yes. It keeps moving at the whim of the legislature, and we're happy to be wherever you wanna put us as long as we still have jobs.

We, you know, we know that the work we do is important, and we'll do it wherever department you put us. But, you know so I have to tell people, we're not really at HTA, but we've kinda had HTA because we live in the HTA offices. You know, we're there at the convention center. And so, you know, I do participate in their activities, and we do all the staff activities with the HTA. So we're kinda part of their team, but we know we're not.

And we we know that we're in the d bed line. But so I it's helpful for people to understand where we are. And our projects are into four major categories. So we do the visitors statistics and characteristics, which you guys see every month, because, you know, that's our press release. We do it, and we finalize it on an annual basis.

We do tourism industry performance mark by honoring. So that's our benchmarking report. So we have the hotel report, The vacation rental report. We have, time share report. We have those.

We also have, the you know, like the visitor plan inventory. Tell you how many lodging units there are in the state, and we also have some program evaluation and performance majors, which include the visitor satisfaction survey and the resident sentiment survey. And then we also have all kinda other market research that we, produce. And so we have frequent reports. Like, we cut back a little bit because Eugene, told us, well, maybe you guys have too many reports.

So when we he first asked the account, we had 400 reports annually. And and he's like, so we we now have maybe 300 something reports instead of 400 something reports. And this is a schedule of our publication, and it's also confusing because some of our reports are on the DBED website. Some of our reports are on the HTA website, and some are on both. You know?

And I get calls all the time like, how can I find this? And I was like, okay. Well, here it is. And part of that is the infrastructure of the d bed website is a little old, and adding pages is a little hard. But doctor Kim has been helping me refresh the tourism pages on the d bed website.

So, eventually, we'll get there, and the same information will be on both sites. HTA is also in the process of redoing their website, and we've, working with them on that. So I wanted to highlight our annual visitor research report. This comes out in late summer, and this is the these are what's considered the final numbers. So lots of people think that visitor stats are only from the forms that are on the plane, and that is only one component.

You know? So with Akamai arrivals in the digital tourism survey, it's kinda changed the way that we do things because we're not, you know, going to the airport every day and scanning all the forms kind of thing. But there are always other components. There's the departure survey. So there's international, visitation.

We have also an island departure survey. There's a cruise survey. We get, information directly from the airlines. So recently, the Department of Transportation Airport made all the airlines report their passenger counts flight by flight. And I was like, that's good in some ways.

It was a lot more work, you know, but but we adapted to it, and, you know, we use that kind of stuff. And then also the Federal Governments, we have a really close relationship with the NTTO, the National Travel and Tourism Office, and, you know, they create special reports for Hawaii.

And, you know, one of the things that, example I use is that, you know, when all the budgets were being cut on federal and they're shutting the, Federal Government down, like, they snuck in at the very last minute. They're like, Jen, here's our Hawaii data. I was like, yes.

You know? It's like, thank you guys. They're they're awesome over there on the federal level. And so they really help us, and all of that comes together to, do the final annual visitor research report. And then we have more analysis than we do on a monthly basis so we could slice and dice things and produce that report.

Our visitor satisfaction report, it's fielded all year round. And, you had to come to Hawaii, so there's an opt in on the form saying, yes. I would like to take an additional, visitor satisfaction survey. So that was always on the ag forums, and now it's on the digital form, and it's all and also on the departure forms and the cruise forms. And so we ask people about their most recent trip.

Did we like it? And one of the things that's important to know about VSAT is that it's not a statewide report or, you know, like a whole visitor market report. We only have so much budget to do markets. So you compare US to US, you compare Korea to Korea, and China to China. You don't necessarily you can't say, okay.

Take them all together, and we have a total. It it doesn't work that way. And the way that international visitors respond to things like, does this exceed your expectation? Well, if your expectations are super high, then, like, no. But, you know, but US visitors seem to be like, yeah.

Everything's great. We love Hawaii. You know? And they always give us super high marks. But the international visitors might give us lower marks, but they might be still good marks for that market.

So you just kinda have to understand how that goes. We have it quarterly. We made a infographic so people can digest it better. And the annual report has this huge file that has, like, thousands of tables. Resident sentiment survey, this is actually unique because we started this in 1988 in Hawaii, and states around the country are just kinda starting to do resident sentiment now.

And we do it every year, and the next report's gonna come out probably July. Visitor plant inventory, I mentioned that it counts all the units in the state, and it was first done by the visitors bureau in 1964. And now it's Labor Research branch. So these guys, these are mostly federally funded and or half half positions. So, we work closely with the, Bureau of Labor Statistics and, trust me, we get emails, like, daily from them.

So there are a whole bunch of programs. So first of all, the local area unemployment, we call it LOS. But, you know, it's looking at that unemployment rate, and, it's feeding that data up. And when we talk about those weekly updates, that's where we're coming for. We're also looking at, you know, the labor force estimates, for the state and by county, and then also looking at seasonally adjusted numbers and other things like that.

So monthly, we have a press release on the unemployment rates in the labor force. The, current employment statistics, we're looking at it by industry for this team. And then OEWS, which is the occupant occupational employment wage statistics. So this is they're contacting all the businesses in the state of Hawaii to talk about these estimates. And, you know, we break it down by, different types of businesses.

QCEW, which is the quarterly census of employment and wages. You know, it sounds like it's similar, but the work that they do is really different. And, you know, they're looking at all the jobs and they're putting it into the different industries that way. This is this is one that we do that's not so fun about the occupational injuries and illnesses, like who gets hurt at work and things like that, and who who dies at work.

These are unfortunate things that we're measuring, but we're collecting data on that.

This is the one about the sense of fatal. It's like like, again, this is the people who actually die at work. And then this is the schedule of when these products come out for the labor research branch. K? And then last but not least, we have the administration branch.

So the administration branch is headed up by the administrator for Reed. And there are our office staff. We have a secretary and office assistant, and we have two economists. And they do some of the special reports that we do internally, like the state bond rating documents, you know, come like, presentations that are when they ask for an economist to present for the community, like, what the economic outlook is, you know, like, they present on the forecast, and they do some specialized reports.

So one of the reports that, Seth Coby, who is now budget and finance, has asked for us to look at a housing funding report, and that's something that we're actually meeting, with HHFDC this afternoon to start talking about that and, getting that report done so you guys can have that information in time for the next legislative session.

So they have a bunch of reports. This is when they're putting out their reports as far as that schedule goes. And you'll be happy to know that's it.

Well done, Jennifer. Thank you.

Stop sharing.

I want to get into questions. But before we go into that, it sounded like there were around five to six different branches in how many? Because there was

I can put that slide back up. Let me share again.

And you oversee all the different branches. Right?

Well, temporarily until they get somebody real in the job.

Right. So you oversee the tourism research branch. Are

you are you

making sure that that branch chief is doing a good job.

Yeah. I tell myself every day, did you get enough work done? No. You need to work longer.

Oh, man. That conversation is good.

Yeah. So, we have four people here in that economic research branch. There are one, two, three, four, five, six, seven in the stats branch. There's seven of us in tourism research. There's 10 people in labor research.

There's four people and the administrator in the administration side. So 32 total of which 15 are at Hamidar and 17 are at the Convention Center.

Nice. Alright. I just wanted to ground us there. But let's open it up to any members with questions. Go ahead. Who's in charge of the agricultural related data?

Okay. So if you're talking about the ag forum.

Oh, I'm not. Oh, no. Like, agriculture productions.

Oh. Agencies. The Ag Department. Yeah. Yeah.

Yeah. Department of agriculture.

Oh, I see.

Yeah. Yeah.

I noticed that, like, there's almost no data about the column production.

Yeah. So that would be that would be them. They do have specialized reports by crop. I haven't looked at their website recently, but that's their kuleana. Because, like, one of the things that you'll notice when we present about jobs, it says specifically non agricultural civilian jobs.

So that's them. Okay. Sorry.

No problem. So they used

to have statisticians there back in the '2 early two thousands, and then they they cut those positions actually during the Lingle administration.

Just to expand on the question, I assume that the Databook has ag data that you compile from the Department of Ag?

It has some, but but not to the level that you're looking for. Like, we wouldn't be reporting their reports necessarily, but, like, or higher level stuff if they have. We we would have something, but not a lot.

So you have some AG data in that

data book? That we get from them.

Yeah. So if they don't produce it, then we don't publish it.

That you get from them.

So one could say that the data book is a compilation of many different reports from different departments?

Yes. Including counties. So we get county data too.

Is there any other reports that, your division produced that relates to ag? Or not your department produce, but you collect?

Not necessarily. A a number of years ago, we had a request by the Hawaii tourism authority to, look at tourism's impact on local agriculture, but that report hasn't been updated. And we did work with the Department of Agriculture to get those data. I don't know if the data that we use are still existing to do an update or not. But agriculture in particular, because there was, as Carl mentioned, a whole team, we kind of left them to do their thing.

Got it. There is AG data in the QCEW and so there's actual AG employment in the QCW data which.

Could you just remind us what's the QC?

Quarterly census of economics and employment. Excuse me of Wage. Wage employment and wages. QCEW, quarterly census of employment and wages. And so there are there is AG employment there and then there's also income and GDP data for agriculture.

But

Yes. As an industry.

Not in any kind of, you know, detailed breakdown. Is it kalo? Is it bananas? Is it that kind of thing? Just total

AG as an industry. Yes.

Alright. Alright. Let's open it up to more questions from the Members. Does anyone have any questions? Go ahead.

Okay. My question is more actually more on the process. So if Okay. So we we wanted to request a certain type of study to be done, what is the process to get the follow-up?

So you should just email us to see if we are are like, and tell us what you're looking for. And it might be something that we're already working on. And if it's not and if it's big, then you might need, like, something to go through the legislature where you request that report, allocate it to us, and allocate some funding.

Because depending on what it is and whether or not the data are available or not, that makes a difference about whether or not we can do it because, like, if you're asking us, like, for example, if we were to take over the agriculture reports, we we don't have expertise in that. We don't have budget to do that.

We would probably need more staffing. But we wouldn't necessarily I mean, we wouldn't say no if you gave us money and people. Right? So

And please CC me for when you make a decision. Yeah. Yeah. I know. Just go

through the record. I don't have anything in mind, but just

Okay. Trying to learn more of

the process and and who do we email?

You well, for now, you can email me until they get somebody real.

Any more questions, Joe? Alright. It looks like there's no more questions, so I'm gonna ask

Stop sharing.

Some questions for you.

Sure.

I think that well, one, you're doing an amazing job. The data that you're collecting is really helping us figure out what how to make better decisions. You've been in this role for quite a while, and you've seen your branch and your division work together. What do you think are some missing data or missing area that you feel could be added into with additional funding that would help grow this department and be bet better provide data across the state?

So if I'm talking just about tourism research side

Let's start there.

Okay. Let's start there.

Okay. Since that's your expertise.

Right. So there's some more technologies out there, that are developing and some that are becoming less successful. But one of the things people ask me all the time is, like, what's the ROI for HTA and what they're doing? And they're asking well, yes. They're asking me.

You know they are. Yeah.

Positive ROI.

Well but see, the thing is that okay. So what they do is complicated. Marketing there's marketing, advertising campaigns, and things like that. And HTA, in general, they're providing branding and education. They're not necessarily selling things.

The people doing the convention center, they are selling things. You can measure the people that are doing sales. And when they have specific campaigns, like, for example, when they are doing that $6,000,000 to recover from the Mali wildfires, They had specific parameters. They were working with specific partners. They were getting data.

That is measurable. You can do the ROI on that. But when you look at marketing, marketing is harder to do an ROI for because it's not we did some advertising, and then the payoff is now. The marketing has, like, a super long tail. People still dream of coming to Hawaii because of, you know, like, Hawaii Five-O, Magnum PI, like, all these blue Hawaii Elvis.

These are things, and they're not necessarily marketing things. Right? But that's part of the brand of Hawaii, and the tail is super long. And so when they do, like, imaging, they people still think about campaigns that HPCB might have done, like, ten years ago when they're thinking about Hawaii because that's part of their dreaming of Hawaii and that bucket list. So it it's really hard to measure marketing overall.

So that's why when people ask me, I was like, woah. Okay. Well, there are parts of it you can measure. You can't measure all of HDA. And you can't say they spent this much money now, and there were this many visitors because you know what?

Those visitors were not probably influenced by that marketing that you just did, you know, that kind of thing. So we do have, so I shouldn't say we. So Hawaii tourism authority, they right now, they have an RFP out to look at campaign spending and how that might translate into some kind of measurable outcome. So when they did this project in the past with this specific vendor, they looked at people who saw the marketing and people who didn't see the marketing, and they had various types.

This is the video Instagram blah blah blah.

And, you know, how many of those people came on their own? How many people came because they were influenced by the market? And was there a difference in spending? I thought that was a great report. They only had enough money to do US and Japan.

So it would be great for them to do more. And, you know, in theory, if Reed had the money, we could sponsor that. Also, festivals and events, people always wanna know, you know, like, okay. So what did the marathon do? Like, we just got asked, what did RIMPAC?

What's the impact of RIMPAC? I was like, we had read. We don't know that. But if we had you know, maybe we had more time, we had more people, we could go and, you know, work with the organizers of past Rimpaks and see what the economic impact is and all that kind of stuff. But right now, we don't we don't have that.

So, you know, that's not necessarily tourism. But there is a tourism impact because the hotels in Waikiki, they feel it when we have rent back. Right? So there there's a lot more that could be done. You know, there are a lot more tools that have been developed and they're out there that could help, like, for example, you know, selling a convention center or the single property or other things like that.

And, you know, if I had more money, I would love to give it to them. But I make do with what I have, and I try and dig deeper into the projects that I have, so I can give more value and because I'm pocket. So I wanna get every last thing I can get out of these projects because we've paid for them. Right?

Could could I also hear from Joe? Yeah. Sure.

So my first thought is the tourism gaming working group Oh, yes. Came up with some suggestions. There were two bills. I don't know them offhand, but I believe, representative Patilagan, you were involved in the house side, and and they didn't pass. And there were some valid points brought up in testimony, But I think I still think that's a good bill with maybe a few tweaks.

There was talks about did we have the right measures for how do you rep how do you measure improvements in the economy? And that those were all valid inputs during the testimony. But I do think that I'd I'd just like to simply say that traditional economics is land, labor, capital with AI being incorporated. Right now, we have the build out. You're seeing impacts on GDP on just the data center build out.

But once those data centers are up and running, the economy is gonna move so fast that it would really be good to, with the bill several percent last year, have have a position or are funded studies that just keep track of what areas are the economy I mean, we we do this with the current reports, but just kind of the impact of a changing economy.

I our current reports track the current economy, but you really need, in my opinion, funded positions to just keep up with what's gonna happen in the next ten years. And that that would be my only suggestion. It's bills that were introduced last year and maybe tweaked and and reintroduced. Yeah. Thank you.

So if I may add, since Joe brought up the, tourism and gaming working group, you know, one of I've been watching all of the the all the meetings even though I haven't been physically in the room. And one of the things that unless they're gonna present it, in a future working group meeting, nobody's talked about the market for these gaming products. It's just an assumption that people are gonna do gaming in Hawaii. And I think that is a study that would be needed.

We and we don't have the capacity to do it right now.

But, you know, if we were given resources, I mean, I think that would be helpful for this conversation that your working group is having.

Okay. Thank you. Go ahead.

ahead. Thank you. Yeah. My question is in a broader Okay. So in the past we have done we talked to Tian.

We've done studies back in 2017 where we had you guys do the study on property taxes and how Hawaii is different. And so it's so it yeah. So it's comparing nationally. Right? Now so so some of these things may be, you know, federal level and things like that, but I think that there's there's value for certain things that we we compare ourselves to other states or other areas and things like that.

Are there things that you think that we should be comparing on a regular basis with other states so that we have an understanding of where we're at and how we're improving or getting worse?

Well, I think all of the things that were in the, what, business revitalization working group, measuring all of those things, I mean, that's, like, part that's all part of it. Like, it would be good for us to measure these things and compare us to other states, even even not just to, like, get higher up the ladder. You know what I mean? In the rankings. I mean, I think that would be a good thing.

And, you know, after Eugene Tion left and Seth Colby was briefly our, chief economist, we talked about, well, what else can we do, you know, that, what kind of new research can we do to help all of you guys make better decisions? And, Not to say that your decision is not good, but I'm just saying, you know, to say to just help along the process and what else can we do for the state. And then, you know, there are reports that, like you said, 2017.

There are reports that we did in the past that we haven't necessarily done again. It's, like, evaluate.

Do we need to do them again? And then there's some reports that we're maybe doing more too frequently, and maybe we don't need to have that updated every year. Maybe it's every three years or something. So we're taking a look at, you know, the body of work that we have, you know, in the legacy of the division and looking at it that way. But, yeah, it's like, you know, we have very enthusiastic staff.

We we all would love to, do more. Because, I mean, part of being in research and analysis, you know, is that basic curiosity. Like, we wanna know the answer too. You know what I mean? And and to the extent that it can help people, that's even better.

So, we are looking at those things. So yes.

Because some of the crossover into other jurisdictions. For example, right, k, property tax bill, actually, is the counties and things like that. Right?

Counties.

Yeah. But it's good information for us to understand it. Right? And and and taxes in general. Right? So I had my staff do an evaluation 10 ago, whatever it was.

And we gathered information from across the county at the state and county level every that we could find. Every fee and every tax at both levels. And and gave us an idea of right? Because the the argument in well, has always been that know, Hawaii is the highest tax state. But if you aggregate and you compare because, right, we do things at the county and state level that are very different.

And but if you did it, you know, I at that point in time, I we weren't the highest because we we put it together. We were more in the middle some place. Right? So and then to track those kind of things going forward and to get, you know, the you know, Forbes always comes out and say how Hawaii is. Well, Hawaii is because we pay for more things than any other state.

Right? So it's not a fair comparison. So we we need to do have that kind of evaluation so that it goes out into the public and the public always says, but we're a high tax state and not necessarily true.

Right. And I agree with you because we've talked internally about doing, like, some kind of, like, database of all the taxes and fees. And I mean and there's just a lot of them. Like, I mean, if if there was looking just on even on the tourism side, on all the fees that, are impacting our visitors, like, even, like, you know, gasoline and all that kind of stuff. I mean, it it's just so much.

And so we don't have we probably have to work with the tax departments and each of the counties to talk about all of that, each of the finance departments in each of the counties. Yeah.

I think it's up to you. All of us do

is, like, all of us that we we we sit down and figure out which ones that we should be looking at on a regular basis and and then, you know, work out something where we give you the resources and get both of those.

Okay. Questions?

I did have two quick things. One is, I think we're still waiting on data for the last couple of months on tourism.

So yes. We need to provide the characteristics data. So we provided top line data because we had to manually compile it because we had an issue. And so my team went and we manually calculated all the top line stuff for the major markets: the US, Japan, Canada, the other markets, and the state. And so all of those top line statistics, visitor arrivals, days, expenditures, per person per day spending, average length of stay, all that kind of stuff, we did that.

And now we have solved our issue as of Monday, and we are working to get that. And so we looked at the different timelines. Like, well, how long would it take for us to get March done, and how about April and May. And so we made it, or I made a decision, that we would concentrate on May, and we'll get the May numbers out.

At the correct time, you're gonna have all the normal reports for May, and we're gonna backfill March and April by mid July, before the next round of monthly data comes out.

So there is data there for a lot of stuff, just not the characteristic data and not by island. So we need to do that because, honestly, and I have to give my team a lot of credit, the amount of manual calculations we did to get out what we did was a lot. Because, like I said earlier, there's many moving parts with visitor stats. It's not just one data source, but if one data source has a problem, then it affects the rest, the whole thing.

So we solved the problem with that one data source, and now we're moving forward. And we're gonna publish May on time by the end of the month. And then, like I said, we're gonna catch up with March and April.

You can ask yourself in your presentation. Do you have any questions on this side? No.

I wanted to follow up with Representative Yamashita's question. Have you reached out to organizations like CSG, like Council of State Government, who has data from other states that are maybe economic data? Have you reached out to those to try to collect their data and put it in a dashboard or a report? By chance, have you collaborated in that sense?

Have you guys done that?

We have not, but I'll certainly take a look at that.

Okay. So I guess what I wanna ask is, what I see your role is is to collect data regardless of what source it's from, whether it's a nonprofit, private, or government. And I think one untapped potential from other states are the state organizations that we actually pay dues to, which is the Council of State Government.

We will look into that.

NCSL. And I think there's economic data from that.

Yeah. Because, like I said, in the data book, we have many different things. Like, you know, we have the Honolulu marathon finishers and things like that, and that is obviously a not for profit. So as people, as there are data sources available to us, we like to add it to the data book. But we will look into this to see if it makes sense for us to do it.

But I'm not sure that the data book is the right place for it to be. It might have to be a new publication. And, again, we're a little constrained with the number of people, but we will at least look at this and what they have.

Okay. My other question is, I'm familiar with the data book as one of the staple reports that you provide. From your perspective as the acting administrator, what are the top three products that you feel your division produces as very beneficial for our state?

Well, the economic forecast is super important. You know, even though our forecast differs from UHERO's forecast because we have different philosophies, it's good to have both points of view. And so I think that's an important function for our team. Again, the data book is super important. And,

I mean, of course, I'm biased because I think the production of tourism statistics is very important. But, you know, all these reports that you ask for from the legislature, us fulfilling that ask, I think that's important. So I guess that's four things. But yeah.

What's your thoughts, Joe?

Oh, I have very similar thoughts. Just, yeah, very similar thoughts. You know, an important function in it, as Jennifer mentioned, is we do need to fulfill the obligations of reports that are mandated by the legislature. Yeah. I will. Yeah. I'd agree.

On that line, have you caught up with all the requests from the legislature on reports? Are there any other questions?

I do have one more. I noticed that you had 14 dashboards. And what is the criteria for you on creating a dashboard?

So part of it is people from the general public ask us things. And what we're trying to do, based on what we perceive as demand from people and the questions that they're asking, is to make things self-service. So, for example, you know, one of the dashboards which we created, which at first I was like, oh, that's really interesting that there's a demand for this, is the languages spoken at home. But, apparently, people have been asking for that information.

And the census data is like, there's these huge spreadsheets, and the data's all there.

It's all on the website. Whether you can find it or not is a whole another thing. So, you know, in response to people asking, we try and create, I mean, like, some of the dashboards are kinda like no brainers where, like, the labor dashboard where you can look at it by island and by industry and things like that. I mean, people self-service that all the time. People look at our tourism dashboards.

You know, they look at our forecast. They look at all these different dashboards that we have, like, and I said, like, the daily passenger counts.

So I wanna know what the criteria is of deciding that this should be a dashboard.

So it is where, if there seems to be a need for it, like, we don't make it just because it's fun, because that would be silly, because there's so many things we could visualize. Yeah. So, like I said, if there are requests and we look at the things that people are asking for because, like I said, so the state data center, that's a number that's, like, open to the public and they get all kind of questions and things like that.

And so when you see census data being visualized, that's probably in response to questions that we're getting from either the state data center or through the DBEDT website or through the DBEDT director's office. We get asked things, like, all the time.

Like, I don't think a week goes by without somebody asking for something from us.

Sharon, follow-up question. Sure. In regards to the dashboards, are you guys able to track how many people are accessing it so we can find out which ones are being used the most?

So the answer is yes and no. We, because we don't have access to detailed Google Analytics for the pages. So we are provided by the DBEDT webmaster, like, you know, page hits and things like that. So we could ask them to give us this information, but right now, we in READ don't have access, but somebody in the DBEDT IT team has to have access.

So is it as simple as seeing a click number with the dashboard or something?

I think we would have to ask them to go into the Google Analytics and see how many page views that they have for the search and page views, because each of the dashboards lives on a separate website, or not website, but web page. So they should be able to get metrics for those pages, but we don't have them. But we can ask.

Okay. I just found my first request to submit.

Okay.

Google Analytics can give you some very in-depth, you know, insight into that. And it sounds like it's just a matter of just removing a barrier or just getting access to that with the webmaster. Right?

Or, I yeah, I would ask the webmaster to, because they wouldn't really wanna give us access. But they would write reports for us if we asked them. Yes.

Any more? Okay. So I'm gonna close with this. I know this role is an acting role for you. It'd be good to have the permanent person who would be filling this position to really speak on this. But next year, 2027, we are gonna have this informational hearing again. And what I am hearing from this division is that right now, you have caught up with the requests of the legislature and administration in filling out any sort of reports or surveys that you are tasked to.

It sounds like at this moment, a status quo operation of your division would be to keep you in the same functioning ability. If you do get more money, you are able to do more reports and so on. However, from what I'm hearing, you're able to operate and do what you need to do with existing staff that you have.

Right. And do some, well, not small, but some limited amounts of new projects. As I mentioned, the housing funding project that we're starting today, to go and initiate, and we're gonna get that done before the legislative session. So we have to prioritize based on the staffing that we have, because, you know, we have a whole bunch of really smart people, but they don't have unlimited amounts of time.

And you don't wanna take on too much. Yeah. In a full capacity where something might come up and you need to free up your staff to be able to do that. Right. So I understand that where you're at right now is a great position to be. So next year, I'm assuming that it's gonna be the same talk.

And I think what we could do from here on out is understand some of your process. And maybe what we could also do is link you to organizations that are using the data that you provide, and it's gonna be very helpful for them. I am not sure, but I assume that all your outreach is done by the branch chiefs or by you. Like, when an organization wants to understand tourism and the data, I'm guessing they're requesting for you to go over to them and you present and share that data.

That, yes.

We also have the newsletter.

Oh, yeah. We do have a newsletter where we're pushing out information about what READ did. So DBEDT has their own newsletter, but READ has its own newsletter where we tell people what kind of new research we have and other things like that. And, like I said, we do get requests.

Could you just tell us how to sign up for this newsletter or how to gain access?

I will, you know, I should just tell, I don't know if you're not on the newsletter distribution, but I think

I am.

Yeah. Because I think that Lacy Goschi included all of the elected officials, so you should all be getting our newsletter.

Okay. But for the public, that is

For the public, there's a place, I believe, to sign up on the DBEDT website for the newsletter. I think it's on the bottom of the page or something.

Okay.

Just to clarify that the READ newsletter is separate from the DBEDT one.

Yes.

Okay. And all legislators should

You should be getting it. And if you're not getting it, please let us know, because hopefully it's not in your spam.

Alright. Well, Jennifer, Joe, thank you for your presentation.

Thank you. Yep. Alright.

Okay. Do you want to take a recess, to just get into recess?

We are back from recess, and our next presentation is from UHERO, the University of Hawaii Economic Research Organization. Now, I am not really sure where you're housed, and I don't think you're actually under the purview of our committee.

But we thought it was very important to have you here to just have a better understanding, the similarities and the differences between Reid and UHERO. So, Carl, if you don't mind, could you please tell us exactly where you're, you're housed, and your organization, and what you do?

Absolutely, and thank you. I appreciate the invitation and the opportunity to, to share information about UHERO and about how we interact with, with Reid, mostly with Reid, but, but all of DBEDT, all the different divisions play an important role in what we're doing. So, I'll start with our mission. And basically, so, UHERO is—let me tell you first where we are.

So, UHERO is a research—basically, a research institute in the University of Hawaii on Manoa campus within the College of Social Sciences. Specifically, we are in the Social Science Research Institute. So, if you'd looked at the org chart for the university and you looked at the college, you'd see SSRI, and then we would be a box underneath that org chart. I'll share you a, a little bit of history. UHERO started in 1997.

Myself, Byron Gangness, couple of other faculty, Summer McCroy, couple of other faculty, basically saw a gap in rigorous economic analysis at the state level for the state of Hawaii. You know, if you look across the rest of the country in, in many places, there are multiple think tanks and multiple organizations doing economic research. Here, it was very limited. We had the, and actually, one of the motivations for starting UHERO was the banks were shutting down their research divisions.

This was back when Bank of Hawaii and First Hawaiian Bank had research divisions.

And actually, at the time, DBEDT was, I would argue, was underfunded in, in the very, in the mid '90s. Right? We've been doing some financial problems at the state level. So, anyway, we started UHERO with no resources. We basically said we're many of us are already working on economic research.

We're working on forecasting for the state because we want to. It's something that we're interested—we had an academic interest in it. So, we formed UHERO with essentially no resources. And then basically, January 1997, we took a contract with the Weil Electric Company, and we started doing forecasting for electric utility.

And so, that gives you an idea of where our funding comes from. Our funding, at the time, was almost a 100% contracts and grants. Right? Over time, we have—so, we were full-time faculty member with full-time teaching loads, full-time research agendas, and then, on—essentially on the side, right, nights and weekends and summers, we were doing this contract work mostly at the time, almost exclusively forecasting. Right?

And over the decades, we built up a, a forecasting reputation and a team of people, but mostly funded—almost exclusively funded by contracts and grants. It was roughly a decade later that we got included in the university budget. My current dean, Dr. Denise Conan, was the acting Chancellor at the time, and she helped us to get into the university budget, and we got two and a half positions in the university budget. That was the first time we had positions that were fully funded specifically for UHERO.

And since that time, we've, we've grown.

We now have nine faculty. So, we are nine faculty, some of them are joint positions. They're not all full-time UHERO. So, for example, we have one faculty member who is three quarters time in urban planning, one quarter time in UHERO, and he is in our endowed professorship in affordable housing. We have some faculty who are a 100% UHERO. Steven Bott Smith is, is one of those.

I'm one of those. We've got other faculty who are joined with the Water Resource Research Center. So, we, we cover a, a wide variety of topics. I'll come back to our mission for a second. So, basically, our mission is to conduct rigorous independent research on really everything economics about state of Hawaii and then to broadly publicize that.

So, one of the things that we really focus on is trying to get the information that we're generating out to the public, whether it's through the press, or through—we, we probably do, between Steven and I, and sometimes Summer McCrory, and, and, and Justin Tindall, and a few others, we'd probably do three to four public speaking engagements every single month. Sometimes it's more like four to eight depending on how bad the crisis is.

And so our goal is to do rigorous independent research, which is part about being at the university. Right? So it's really sort of an academic effort, and we peer review.

So when we generate a report, we do work on a work research project. So Steven might be working on a project. He offers a report. It gets circulated across faculty to be criticized and to be evaluated before it's ever ever released publicly. So I mentioned we have nine faculty.

All this inform I mean, all this information is on our website. There's a nice little pretty picture of our of our faculty. And in addition so we're actually are we we just hired two new ones. So we will have 11 faculty come August, assuming that one of them gets his visa. And, the reason that much like so every faculty every faculty member that we have hired since that initial two and a half positions has been sort of fortuitous.

And it's generally it's so for example, it's come because we got an endowment. And that endowment helped us to induce the university to allow us to hire a faculty member. In this case, the governor put it into in his budget request two years ago, he put in a request to fund two more positions for UHERO, I think largely in response to the work that we did during the pandemic and the work that we've been doing since then that is aimed at supporting the state overall.

So nine faculty currently. If you look at the we also have what we call research fellows.

Research fellows are just faculty who are somewhere else in the university. They they are not you hero faculty, so, they do whatever research they want. Right? We they they really don't I don't control the research they do in any way, but we support them. Right?

So if they so for for example, Ruben Juarez is our HMSA endowed professor of of health economics. He's running the Maui wildfire exposure study, and so UHERO's staff manages all that for him. Right? They help him manage the the hiring, with the promotion of the the research. And so we facilitate the research that these fellows fellows do.

And there's a large number of fellows. Some of them are very active. Some of them are not very active. Now the faculty are are paid by state funds. Right?

They're university faculty. The staff, all but one of them are completely soft money. Right? So and we have nine or 10 staff members right now. Probably four or five PhD staff researchers.

The rest are MAs or recent recent graduates, and they're a 100% funded by soft money. And when I so our budget is roughly half state money and half contracts, grants, and philanthropy. And philanthropy has has grown dramatically in its role really since the pandemic. In fact, during the pandemic, we we raised enough money to pay to hire two new faculty, pay their salaries for three years, and then the university picked them up after that. So philanthropy is increasingly important.

So so I spent a lot of my time, interacting with donors. The graduate assistants of which we have any any given moment, we have 9, 10, 11 graduate students. So these are students who are working on their m a's or their PhD. They're a 100% soft money funded. That's a little bit of a stretch because the university gives them a tuition waiver.

Right? So there there's sort of a a joint funding there as well, but their bay their salaries are all paid off a soft money. And then we we routinely have 6, 7, 8 undergraduates who are working as interns for us, and they're being paid. All these every one of these positions are paid. So nine faculty and 20 to 30 support staff mostly mostly paid for almost exclusively paid for by soft money.

So then so there's an an another difference between us and DBEDT. Right? DBEDT doesn't do contract work. Right? And and we have no choice but to do con we wouldn't be here today if it weren't for the contract that that we originally and actually we're still working for Hawaiian Electric Company doing we we do forecast for the for Big Island, Maui County, Oahu, for HECO every single year.

And the kinds of things that we work on are sort of spelled out in our in our focus areas so analytics is our sort of our statistics division and we we cover, like I said, almost anything that has anything to do with economics. So education, energy. Energy is really led by some some research fellows. We don't have any faculty who are heavily engaged in that now. Environment is one of our stronger groups.

We we have three or four PhD economists working there. And as an example of philanthropy, we just received a pretty sizable, I can't remember the dollar amount, over a million dollars, I think, or roughly a million dollars from the Bezos Foundation to focus on wildfire prevention from a land use management perspective. Right? And so that that was a a major new project.

That group focuses on water resources, restoration of of watersheds, a whole variety of things around invasive species that's Kim Burnett and Leah Brimmer and to some extent McKenna Kaufman who runs ISR at the university.

The forecast team is is one of our bigger teams. I don't know there's probably seven or eight people involved in that and Steven, myself, an Emeritus faculty who is a research fellow, Byron Gangnes, Peter Folecki, So half dozen PhDs working on that and lots of students. And, yeah, we devoted enormous amount of time to that. Basically, we finish a forecast. So we released a forecast in May.

By mid July, we'll start working on the next one, and we're producing those once a quarter. We do forecast at the county level. We do forecast at the state level, and we distribute those. I mean, everybody in the lead should be getting our our emails. Right?

We have a email distribution list. We have a large public distribution list. And a lot of our supporters, the people who are supporting us philanthropically, that's one of the reasons they're doing it is that they they want that information, and they and they wanna have interactions with us to talk about it. Right? It's not it's really storytelling about what we think is happening in in the Hawaii economy.

Health the area of health research is really led by Ruben Juarez and most of that right now, that effort is very, very focused on Maui wildfire recovery. Unfortunately, the Maui County budget included funding that should keep the Maui wildfire exposure study going for at least another year, and then we'll go out and find funding to keep it going after that. Housing is is an area so one of the things that's that's happened at UHERO over and I've been there since the beginning.

And, basically, every time we add a faculty member, what we tend to do is we build a team around them. And so we got an we we received an endowment of roughly a million dollar endowment from the Hawaii Community Reinvestment Corporation, to create this affordable housing, an endowed professorship in affordable housing.

We hired someone to that into that position in one year. The next year, we added another faculty, because of a vacancy who was also working in housing. And then about a year ago, we added Trey Gortner, who is very engaged in the housing. We created the the housing fact book, which is now I think in its third year.

And so that's another large team that's very, very focused on, you know, understanding what the challenges are that we face in Hawaii in terms of of housing costs, how it's housing production.

So that that group did did reports on I think the most really exciting one that we released recently was on housing filtering that basically demonstrated how you build a a condo tower, say, in in actually, they were focused on the can't remember which tower it was. Anyway, it's on Kapiolani. And they demonstrated that that condo tower of, say, four, five hundred units freed up another four or 500 units in the rest of the community as people moved into that building.

And what you see is the the further you go through the chain of moves, the less expensive the units are. So you were effectively by building market rate units, you free up affordable housing, multiple moves down the down the road.

So if all you're doing is looking at, oh, well, that unit's not affordable. It's too expensive for for local residents. That that's true for some group of local residents, but as the moves happen, it creates affordable housing. So that just one example of some of the housing research. The other research that is I think was very impactful is looking at the total cost that we think the regulatory burden brings to bear from in terms of housing.

So we've done measures of that and it's pretty shockingly high numbers. And we've done, studies where we took national data on permitting times and regulatory burden and surveyed the planning commit the departments of planning and permitting on all the islands and constructed an index that compared Hawaii to the rest of the country. And lo and behold, we found out that Hawaii wins when it comes to stopping housing from being built. Right?

We have the most strict regulatory the most owners regulatory burden of any place in the country according to that research.

So I could talk housing all day long. It's one of my interests. Tax is a relatively new one. We finally were able to add a faculty member in public finance during the pandemic, the same time when we hired Steve actually, one year after we hired Steven with this philanthropic money that we we raised during the pandemic. We hired Dylan Moore, who is a An example of of what that's allowed us to do now is we have partly because of of rep Yamashita's efforts.

We have there was a resolution, I think, two years ago that said, well, you hear it. We'll work with the Department of Taxation.

We had already begun working with Department of Taxation under Seth, and we had a pretty good working relationship trying to figure out better ways, to share data and to and to share research, and that has continued to grow and we're we're developing and have developed models of Hawaii's tax system that should be able to help us answer the kinds of questions that Kyle is very interested in.

And also, I think we're probably gonna put a proposal into to DOTAX to support the tax review commission this year. And our new faculty member who's joining us in a few weeks is also in public finance.

So So in other words, it's in another example that we once we have some degree of expertise, we try to build around that. We haven't added anybody to to help Stephen out on the economic development side. And for some reason, we don't have the economic development listed here as a category, but that is a Steven has done an enormous amount of work since joining us on, you know, diversifying Hawaii's economy.

There was a question earlier about comparing data with other states and Steven's work on the is Hawaii left behind, which came out over the last three or four months, one of the things that he does is he compares Hawaii's economic performance to the rest of the country after doing the analysis that's necessary to make that comparison valid.

So making sure that we're adjusting for price differences, cost of living differences across all, and it's pretty disturbing research as you're well aware because it basically shows that Hawaii keeps falling farther and farther behind.

And if we continue on that trajectory, we're this is this is a really good existential threat to keeping our population, keeping our Keiki, bringing our Keiki home, and the governor's office has actually funded research for sort of next steps in in thinking about how can we do a better job at economic development policy going forward. So I didn't obviously, I didn't prepare a a slide deck. I'm happy to happy to answer any any questions.

One sort of quick slideshow of the stuff that we're working on is our environmental group, looking at watershed management and in this case, the Ala Wai, and then, of course, our last forecast report. Fortunately, the storm clouds seem to be clearing a little bit, although I hear that they have postponed the talks because Israel and Hezbollah started throwing bombs at each other again.

So we'll see. The there's the release of our 2026 housing fact book, which digs down so one of the features of that fact book is it digs down it to the ZIP code level on housing data. So a lot of that is census data, but it's some of it's also permit data, right, that stuff that you you struggle with. And it for instance, you can look at essentially housing affordability, rent affordability all the way down to the zip code level, and it maps it.

And you can you can build your own reports.

And then I think that's probably Oh, so that's that's the report that that you may remember some of the discussion that happened in this session about LNG. One of our research fellows is Michael Michael Roberts, who worked a lot with Matthias Ripp, who was front and center in some of that discussion. And so this is a a report that looks at what's really driving the cost savings from plans to switch to LNG. And they're basically arguing that the primary driver is is actually the the machinery.

It's the equipment.

It's the the generators that are so much better under these plans as opposed to, price savings from from LNG. And then, Maui wildfire exposure study. So we put out I have no idea how many reports we do. I know we're not doing 400 a year. Thank goodness.

And but all of those come out with our email blast and as I said, you should all be on those lists. I'm happy to answer any any questions.

Thank you for your presentation. Let's open it up for questions. Is there any questions for the members? Alright. So I have some questions for you, Carl.

I I am a user of your reports as well as Reeds, and I wanted to ask you, out of all the reports that you provide, what are the top three reports you feel the public should be aware of? And we could go we could date it all the way five to ten years. What's what's your top three reports that New Hero has produced?

Well, I guess I would list our forecast reports simply because there's clear overwhelming community demand for that information. And I'm not sure it's really what the community should be should be focused on because it's those are those forecast reports are, you know, about the next two years. And but when you're in a crisis, that's what people that's what people want to know. Right? They they they wanna have an understanding about, you know, how are we gonna get out of this pandemic?

How long is it going to take? Will my will my prospects ever get better? And and mostly, I I I think I mentioned this. Those are really storytelling. They're trying to explain, and I think that's that's actually what I would say UHERO, is known for is putting economics into English.

And, you know, when when we when Steven and I and others at UHERO go and give presentations, what, you know, always makes me feel really good about the work we're doing is when someone says, gosh, I could understand exactly what you were talking about. Right? You really put that into in English. That probably that comes from being faculty who try to do that in the classroom. But the more important reports I think than the forecast stuff is really the stuff that Steven's doing on economic development.

The stuff that Justin and Trey and Junior are doing on housing. And the I mean, I honestly, I'm not sure I could I could pick three, but each of the areas that we're working on so see, we choose what we work on. Right? No one is well, on occasion, Kyle says, do this, and we do it. No.

I mean, usually, we might get a strong urging, but, you know, we're looking at the landscape and saying, these are the big problems. These are the things that we have to tackle. And then if we have the resources, we do. And so over time, in in my mind, it's been housing, economic development, tax policy. My colleagues would say environmental.

Right? So, the environmental team would say, no. The environment is more important, and the health team would say, no. Health is more important. Well, they're all important, and they're all way more important than the forecast in in reality.

Right? Because they they they matter for for what our economy, what our state, what our society is going to look like ten years from now, twenty years from now. You know, will we have a hollowed out middle class because housing is too expensive and people can't afford to live here because their incomes haven't gone up because we haven't diversified the economy and because our tax code's a mess and people are leaving. So that, you know, that's something that matters for the next fifty years.

So I I I I'm not sure I could come up with three.

I think those are those are all really important.

Stephen, do you wanna

understand a little bit the the role of the forecast? And then

it's

it's very demanded by our supporters. And so I think it's the largest generation of soft Good point. That we have. It also keeps us front and center in the media every quarter. But as and so that, you know, that maintains that trust and relationship that we have with the public.

Everybody knows you're always helping on the conversation with you. Like, that seems a bit quirky, but everybody knows who we who we are because they're much of the hearing headlines on

and and

So reviews and so on. But I think also the role of the forecast is that our ears to the ground are constantly hand on the tailors of what's going on in the economy right now. And that understanding then also spills over into the rest of the research that we're doing as well. So the work that I do on the economic development also relates to what we're seeing in the economy as we go month to month, quarter to quarter.

Those things have meshed together very well rather than the individual reports.

These things all overlap as, you know, spillovers between them

That's those are really good points. I mean, the so I was giving a presentation at the Mortgage Bankers Association for Hawaii at the Hawaii Prince on Wednesday, And I was waiting for my car valet because I had to rush to the next meeting, and this valet who wasn't getting my car pulls up in front and he rolls down the window of the car he was in. He says, you're at Right? I said, yeah.

He's and he started telling me about his daughter who had just graduated, and I thought he was telling me that she had graduated from UH, no.

He was telling me a bit that she graduated from somewhere else. She wanted to come home, but she couldn't. So I'm assuming he's seeing the stuff that we've been doing on housing and economic. So I got a big kick out of that. And so I think I think, Steven is right.

When we do the forecast reports, we send out a press release, and we hold we do a virtual press conference now, and we're getting 8, 9, 10 press sources in that virtual. And so remember, part of our mission is is to do the research, but it's to make sure that it gets widely distributed and and understood.

And so we're now we're increasingly getting detailed coverage and detailed questions and answers on every island for and and we've increasingly started doing that with our other reports as well. So anytime it's like we release a housing fact book, we'll do a press release, and we'll gather press from Civil Beat to Hawaii Free Press to take your pick. Right?

And and we started doing videos to go along with these things too, and we're hearing pretty positive feedback on on those videos. And it's all about trying to make sure we're communicating. So actually, any suggestions for how we can do a better job of communicating, they're they're very welcome.

Thank you. Question?

I got a couple.

I guess I was the harder one first. So the in general, you know, you had that focus areas and Yep. What you worked on and, you know, all those things. At the end of the day, I think, you know, what's what's useful about the when you do those things and what we look at, it it helps us come up with policy and and things like that going forward. One of the things that right?

You said that, you know, housing is a problem, high cost of living, people are living, those are known things. But lately, I've been asking the question, right, where where did we go wrong? Right? So and it and it stems from and I just was talking to Cherry Ligon about this, is, you know, I'm in my sixties now, but when I was in my early twenties yeah.

When I was in my early twenties, right, my wife and I just got married, and and we were living here at this time in Honolulu and we bought a house, a three bedroom, two bath house without help from anybody and but we could do it.

Yeah. It was an entry level both of us entry level career jobs. Right? And we were able to buy a house. We struggled.

We made it work. And I don't think people could do that even if they want to struggle. Right? So why could you do it back then? And, you know, and when I thought about, okay, what was the subsidy?

Yeah.

The subsidy was Hula Mae. Right? It was the financing that made the dividend. That was technically the only end, you know. But it was possible.

Right? But over the years, things changed and Right? It's

That's the subject of Steven's research on why I left behind.

Well, it it's it's so so some of it is the policies we've been putting forward. Yep. Right? We made it more difficult to do housing, something something you just brought up. Right?

Our how we're taxing and who we're taxing and right, we you know, this year, we just put something forward. We're taxing the rich. I I I think that's gonna have some kind of impact later. Right? I I don't think that's a good thing because they they they I'm worried

about it too.

Go ahead. Yeah. Because there's there's actual studies that say they they're not gonna that Hawaii lags was that was that Kauffman Foundation study that Kinda alluded to that Hawaii lags the nation of reinvestment. Businesses reinvesting in Hawaii. Right?

So, right and when you think about it because everybody is now passed through entities, right, if you tax high income earners, that's the businesses and if they're not reinvesting and, you know and they're the ones that create jobs, right, for for everybody. And so did some concerns there and all that kind of stuff. But anyway and then you have, you know, you have your environmental guides and your your health guides and everything like that. Right? They're conflicting with some of the things that other people did.

So because you're looking at both, do you do an evaluation of all that data and say, okay. We we put, you know, not to pick you know, everybody wants to protect the environment. Right? But at the end of the day, maybe some of the policy we put together there has made it more difficult to do certain things and and has has added. Right?

So the the latest thing I've been kinda telling everybody is it's it's we we never did anything intentionally to make things bad, But we we've we've we've added one thing and then we said, okay. It's only one thing.

And then we did.

Make sure we add another thing. And then Yeah. It piles on. Right? Right along.

I remember, like, in the early years when I first got into the legislature, there were, like, 10 ideas that were, like, really extreme and, you know, it was a progressive idea. And we kinda said, okay. We'll do one. But, right, but the next year, we did one more. And then ten years go by and we did all 10.

Right? You know? And then and then how is that, like, added to cost, right, of of doing things like things like that? And and it's kinda like that frost that you keep turning up the heat and they don't know every time. That that that's kinda what we're doing.

Right? So

That that that's all. So so yes, we do look at that, but we primarily we have primarily looked at that from the perspective of housing. Yeah. Stephen's going to start looking at that more

Yeah.

From the perspective of economic growth and businesses. And, you know, they some of the exam and and I I think you're you're right. And in most cases, you know, this wasn't an intent to squash the economy, and it really was incremental regulatory burden, right, or tax policy. And the and yet some of that regulatory burden, you just think about the permitting challenges that that's not your Kuleana. Right?

It it the county permitting rules that mean that a small business

to wait six months to a year to get a permit to refurbish, the example I like to use because they're to convert a Jamba Juice into a Starbucks. Right? It takes you six months to get a permit. Right. These things matter.

has

No.

So that's what Cherry Lee got. Right? He's he has that speed task force that's, you know so all, you know, we're

working toward

trying to fix those things.

But those aren't the those aren't the only things going on. Right? There's fundamental changes in our economy that come come about from what's really the slowing of tourism going all the way back to the mid nineties. Right? That's now a mature industry, but it also gets back to reinvestment.

Right? The rules that we set up that make it really difficult to reinvest in Waikiki, for example. So you take a a older hotel, maybe off beach, and you want to dramatically renovate it, maybe maybe add a floor, you're talking like almost an impossibility. And that's how you drive visitor spending is by one way to drive higher visitor spend is to rein reinvent yourself, reinvest in your properties. Right?

And we make that really, really hard to do. So, Steven, I'm not gonna say he's gonna solve all the problems, but he's gonna try to address most of these issues in a comprehensive way.

I think what would be helpful and and that's why I asked it in the way. Right? Where where did we go wrong? Right? So and it was so I think why why could somebody, 20 years old, buy a house now and why it's impossible today.

Right? So

And that's that income that's the income story

that that Right. It it's

On that specific question, if you look at I think we just essentially stopped building now and what happened. So You look at the house in stock and when they were built, there were thousands of houses being built in the seventies, and that number has just dramatically Well

well, all the way to the late eighties, early nineties, we were building

Our housing stock just dramatically slowed down in nineties and stayed low. Yeah. And so that that supply constraint then makes housing really expensive. So that's the specific thing for housing. But there's other specific things for other areas, for other industries too.

At the same time, you had tourism which essentially peaked in 1989 and it stayed about the same since, but we also haven't had other industries that have come along. And for each industry, there's gonna be different types of bottlenecks. I think And the people that know about what those bottlenecks are, the people that are involved in those industries. No politician or economist is gonna know exactly what is slowing down, particular industry in tech.

I think we wanna know everything, like, you know, what you're talking about. And then end of the day, then all all the factors that are driving, you know, us to this where we are today. But from the legislature's perspective, right, I'm trying to, start working backwards and saying, okay. It was things that we put in place. We meaning the legislature from way back.

Right? And maybe we need to roll back some of those things, right, that that actually was well intended with good intent to make things better, but actually had an a negative outcome into where we are today. Right? So, you know, one of the things that I talked about in the past was, you know, once the counties became term limited. Right?

And, right, they did it they lost long range thinkers, you know, like, kind of stuff with all due respect to them. And then but but at the same time, you know, they they are for short period of time, so they didn't wanna raise taxes anymore. So they didn't wanna raise property taxes. Right? And and then, you know, you know, this argument that I make that right with you.

By keeping it low, it created this applicator model state. But the because they didn't wanna raise taxes, they made the developer pay. Right? And because the developer had to pay and then we're mandate and then they mandated affordable housing. Right?

They're saying, okay. We cannot build we cannot build affordable housing with some kind of to pay for this sewer infrastructure that you're making us pay, water, right, parks, and all these different things, but they have these impact fees and all that kind of stuff. So then they came to the legislature and said, we want the rental housing revolving fund increase in. We want tier two. We want their funds and everything.

So when you really really follow the money, you think about it. What we're doing is we're subsidizing what the county used to pay for by by by giving the developer this money. Right? So and that right? So but the interesting thing is that that same thing has happened everywhere else in the country.

Yeah.

Right? So there's really a political economy around that. And, you know, everywhere you look, the cost of infrastructure has been pushed off to the developer. It used to all be a state and county, mostly a county responsibility. Right?

And so, yeah, the story you just told is really pretty fascinating if you think about it. But it's also kind of fascinating to think that same kind of things happening everywhere else.

Yeah. So what in it anyway

And if, you know, the if you did a comparison of pure housing prices, you would find that Hawaii hasn't doubts, you know, we we've always been expensive, but we're not our our home prices aren't growing faster than the rest of the country. That's not I would argue that's not the core problem. The core problem is our incomes aren't growing.

And, you know, if your incomes are growing just as fast as home prices, then, you know, you've kinda got this equilibrium and maybe you don't like it. You still have to figure out how to come up with a down payment, which is another problem.

But the and actually, over the last decade or so, our home prices have risen more slowly than the rest of the country, but our incomes have grown even more slowly than that. Yeah. And and yeah. That actually

I think those students are probably related as well. I think it's just difficult to build and then adds cost and also makes it difficult to invest in the first place, which then makes it that that

Yes. In general, I think what I'm asking is just I think it you know, we have more have more discussion, but we we need to figure out where we went wrong. Right? And what we need to relook at. I think that.

And to some extent, that is kind of one of the pieces that Steven's hoping to work on. And, actually, we had a conversation with with Dane. I don't know if he ever talked to you about it about possibly collaborating with DBEDT some on that. And, actually, I think I think Ilagan

was there, was looking at the history of economic development policies, but it could be broader than that.

So I have a, yeah, two year project about economic development policy. Part of that is to look at what are the structural factors that are really holding back. And one of those things is infrastructure within that you can include house and energy costs. Yeah. And as part of that study as well, I wanna just sort of review of what have we done in the past, what went well with those things, what went wrong with those things.

And often, I think there were a lot of good ideas, but it was perhaps on implementation that something went wrong. It wasn't necessary, you know, that it didn't go exactly as intended for

practical purposes. But it kept going on and on and on.

But understanding, yeah, how it come from, what went wrong, what was well, what was in Hawaii, what doesn't. That will all feed into the recommendations that I made gonna make. None of this is to how to go about economic development policy.

The second question was, on your earlier comment where a lot of your funding comes from philanthropy and, right, you're you're getting in front of, private sector and everything. So, you talked about that the the banks used to have. Right? Uber Baker used to work for South Africa. Everybody had that.

Right? So if the banks aren't doing it anymore, are they giving you money to do it?

Yes. Okay. Yeah. I mean, the banks are are some of our biggest supporters, but also nonprofits. Hawaii Community Foundation, First Hawaiian Bank, Bank of Hawaii, American Savings Bank, those Central Pacific Bank, those are our biggest supporters.

And one of our it's important that from the philanthropic side, we have a large number of supporters, and that's I think that's important because it basically means so we're we're still independent. Right? We're not working specifically for any of these groups. And if we lost one supporter because I said something in public that they didn't like, we can survive that. So the idea is to have a large number, a diverse group.

Right? So everything from h g HGEA. Right? Randy Pereira has been a supporter for a long time and the unions to philanthropic groups like Hawaii Community Foundation, like now the Bezos Foundation, pretty large list of

Okay. I also think they particularly like that we have that independent voice. We can't say things that that might have said them. That's what they wanna hear. They wanna hear the actual, you know, real answers rather than someone who says what they wanna hear.

Thank you.

Thank you. Go ahead.

Just a clarifying question. So you guys are working on some type of advisory study for regulation reform. Is that correct? It's around economic development.

Oh, but there is another there is another project specifically for City County Honolulu that so so I'll finish then. You can jump in. So we have a contract with Sydney County Honolulu that is actually looking at what regulations could be changed that look like they would have the biggest bang for the buck for making it easier to develop housing. And that's that's there was a draft that was released, I wanna say, a month or so ago, and it's ongoing work. And then, Steven

I'm working on the second one development. I don't know why you're asking about what we'll be doing next And rather than asking about what should we do next? It's at the right principles level. And then how do we, you know, monitor and govern the types of things that get supported. But it's around designing what that sort of framework is like.

So how do you do economic development policy as opposed to what do you do? It's and and how do you do it in a way so that you don't end up having something that's essentially failing, but lives on for fifteen or twenty years. Right? So that's the governance side of it. How how do you decide what to do as part of governance as well?

In other words, how do you vet different ideas, everything from accelerating permitting to investing in a meat packing plant or or whatever. What's the process for vetting those ideas and deciding whether or not they should receive state support or whether it just needs a rule change. So all of that could be handled in one process and then once there is state support, following it and tracking progress, making sure that things are working the way it was intended.

And then if they're not, how do you wind it down? Right? How do you change direction?

So

So It means that you're

of asking that question that maybe you fund something and think about it five years down the track instead you're asking, is this thing that we're doing getting us closer to where we wanna be? And that's a question that you can constantly ask and constantly check up on and constantly adapt to depending on what the answers are. It's just different parts to that. But a lot as to is the the how are we going.

you're asking you a question. What are we doing instead of tourism, Tikoro, economy instead

So you guys are also looking at the history right now. Right? And we're trying to see what we can change or take away that type of deal. I'm gonna

look at what I'm gonna certainly look at their their current status quo, but what has been done in the past, what has been working well. Some of those things will leave status quo. Some of those Some of those policies that have already gotten rid of because they were eventually realized as being failures, but understanding why those failed.

It wasn't necessarily it might not have been a bad idea in the first place, but it just was poorly implemented or some steps like these these elements are to figure out. Which fits work well, which fits to them.

Thank you. Thank you, Chair.

We have four more minutes. Does anybody have any questions? Alright. Well, Carl, I really do appreciate the presentation, and, unfortunately, we don't really have authority over your and so it was a pleasure, to hear what you do and to understand that those quarterly, is it quarterly that you provide? Quarterly forecast is very important to understand the situation we're all in.

So, round of applause for the presentation. And thank you as well, Reed. That concludes our informational hearing, and, till next time.