STAND. COM. REP. NO. 1907

 

Honolulu, Hawaii

                  

 

RE:    GOV. MSG. NO. 269

 

 

 

Honorable Colleen Hanabusa

President of the Senate

Twenty-Fourth State Legislature

Regular Session of 2007

State of Hawaii

 

Madam:

 

     Your Committees on Economic Development and Taxation and Tourism and Government Operations, to which was referred Governor's Message No. 269, submitting for study and consideration the nomination of: 

 

Director of the Department of Business, Economic Development and Tourism

 

G.M. No. 269

THEODORE E. LIU,

for a term to expire 12-6-2010,

 

beg leave to report as follows:

 

     Theodore E. Liu has served as Director of Business, Economic Development, and Tourism since 2003, where he is responsible for overseeing the Department of Business, Economic Development, and Tourism (Department) and its seven attached agencies.  Prior to this, he was Co-Founder and Partner of PacifiCap Group, LLC from 2000 to 2003, and Managing Director of the Investment Banking Department at Morgan Stanley & Co., Incorporated, from 1996 to 1999.  Mr. Liu also spent several years in Beijing, China as Deputy Chief Executive Officer of China International Capital Corporation, in Hong Kong and New York as Senior Associate with Skadden Arps Slate Meagher & Flom, and in Shanghai as Chief Executive Officer with Public International Investments Ltd., First Shanghai Investments Ltd.

 

     Mr. Liu has a J.D. degree from New York University School of Law and a B.G.S degree in Economics and Political Science from the University of Michigan.

 

     Testimony in support of Mr. Liu was received from United States Department of Agriculture Rural Development; U.S. Small Business Administration; Department of Business, Economic Development, and Tourism; and nine of its administrators; Aloha Tower Development Corporation; Hawaii Community Development Authority and the Chairperson of the Authority; Hawaii Housing Finance and Development Corporation and two of its Board members; Hawaii Strategic Development Corporation; three members of the Board of High Technology Development Corporation; Office of Planning; Small Business Regulatory Review Board and a member of the Board; Hawaii Convention Center; Workforce Development Council; Public Utilities Commission; Department of Transportation; University of Hawaii System and twenty-nine members of its administration and faculty, and the Office of Hawaiian Affairs.

 

     Testimony in support of the nominee was also received from The Chamber of Commerce of Hawaii; Economic Development Alliance of Hawaii; Enterprise Honolulu; Hawaii Science & Technology Council; HiBEAM; Chinese Chamber of Commerce of Hawaii; Hawaii Chinese Tourism Association; Hawaii Teo Chew Association; Hong Kong Business Association of Hawaii; Government Affairs Committee of the Honolulu Japanese Chamber of Commerce; BIA-Hawaii; Hawaii Arts Alliance; Hawaii Pacific Export Council; Big Island Fishermen's Association; senior administrators from Chaminade University and Hawaii Pacific University; Catholic Charities Hawaii; Hawaii Family Forum; Faith Action for Community Equity; Hawaii Global Youth Center; Empower Oahu; Hawaii Capital Cultural District; and Windward Ahupuaa Alliance.

 

     Supportive testimony was also provided by The Gas Company; Hawaiian Electric Company, Inc.; Hawaii Renewable Energy Alliance; Aloha Petroleum, Ltd.; BlueEarth Biofuels LLC; ClearFuels Technology, Inc.; Energy Industries; HSI Electric; Imperium Renewables Hawaii LLC; Kauai Ethanol LLC; PowerLight Corporation; Puna Geothermal Venture; and Sopogy, Inc.

 

     Additional testimony in support was received from Alexander & Baldwin, Inc.; AIG Hawaii Insurance Company, Inc.; Advantage Capital Partners; AGIS Network; Aloha Island, Inc.; AT Marketing; Avalon Development Company; BAE Systems; Belt Collins Hawaii Ltd.; Bowen Hunsaker Hirai Consulting, Inc.; CBL Lending; CMC Consulting Group; CTA Solutions; Castle & Cooke Homes Hawaii, Inc.; Cavanah Associates, Inc.; Cellular Bioengineering, Inc.; Center for Tomorrow's Leaders; Central Pacific Bank; ChipIn, Inc.; City Mill Company, Ltd.; Coldwell Bankers Pacific Properties; DragonBridge Capital Merchant Bank; E Noa Corporation & Waikiki Trolleys; EnviroServices & Training Center, LLC; The Estate of James Campbell; Events International; Ferraro Choi; First Hawaiian Bank; First Insurance Company of Hawaii, Ltd.; Gay & Robinson, Inc.; Global Brain, Inc.; Hamakua Macadamia Nut Company; Hawaii Chinese News; Hawaii Pacific Health; Hawaii Superferry; Hawaiian Airlines; Hawaiian Cement; Hawaiian Dredging; Hawaiian Telcom; Hawaiya Technologies, LLC; Sam O. Hirota, Inc.; Harbor Wing Technologies, Inc.; Hoākea Communications; International Finance Group; KUD International; KTA Super Stores; Koa Trading Company; Kolohala Holdings; Kona Brewing Co.; Koyo USA Corp.; L&L Franchise, Inc.; Market City, Limited; NLP Music, Inc.; Oceanic Time Warner Cable; Oceanit; ORMAT Technologies, Inc.; Outrigger Enterprises, Inc.; Panda Group; PacMar Inc.; People Bridge; Quantum Leap Interactive, Inc.; Referentia Systems Incorporated; Roeca, Louie & Hiraoka; SJ Investments, Ltd.; Sanford Murata, Inc.; Sony Hawaii Company; Starwood Hotels & Resorts Worldwide, Inc.; 3Point; TIMCORP International Marketing Co., Ltd.; Thomas J. Mitrano, Inc.; Townsend Capital, LLC; TREX Enterprises; Vantage Counsel LLC; Ventana Capital; Wimberly Allison Tong & Goo; World Journal, and over sixty individuals.

 

     Kipahulu Ohana and three individuals submitted testimony with reservations or in opposition.

 

     In his statement, Mr. Liu noted that, at his first advice and consent hearing in 2003, he outlined his vision for the Department – "To build a responsive, effective and accountable team with a culture of excellence that provides relevant service, solves problems, facilitates business and provides leadership in innovative ideas that impact a broad sector, all with the objective of promoting broad value creation for and improving the standard of living for Hawaii citizens."

 

He stated that he remains committed to that vision through a reorganized Department aligned toward clear strategic goals; greater transparency and accountability; major initiatives, including spearheading the initial focus in 2004 on the State's affordable housing crisis, the Economic Momentum Commission in 2005, the "Energy for Tomorrow" policy and legislation package passed by the Legislature in 2006, and the "Innovation Initiative" in 2007.

     Mr. Liu also outlined what he sees as the opportunities and challenges over the next period for Hawaii's economy: bringing about a "soft landing" and sustaining the recent economic growth; evening out the boom-and-bust economic cycles; and creating a more diversified and innovative economy.  To meet these economic challenges, the Department is focused on six areas: increasing workforce housing; developing competitive workforce skills; achieving energy sufficiency and security; developing human capital and innovation capacity; increasing exports of goods and services; and improving the business environment.

 

     Members of your Committees had a number of questions for Mr. Liu regarding Department programs and initiatives, including: development plans for Kakaako and Kalaeloa under the Hawaii Community Development Authority; the effectiveness and costs of foreign trade missions; costs, particularly personnel, for the Overseas Offices; funding and expenditures related to the Community Based Economic Development program; expenditures related to the Integrated Development Group (IDG) federal funds; and the status of the U.S. Citizens and Immigration Service related to the EB-5 Immigrant Investors program.  Members also questioned Mr. Liu regarding his use of departmental resources, including equipment and staff time, in soliciting letters of support for his confirmation.

 

     Mr. Liu responded both in writing and through further discussion with Committee members on all of the above concerns.  He noted that the questions by the Committees have raised a number of issues that he will consider fully in future decisions related to the activities of the Department.

 

     As affirmed by the records of votes of the members of your Committees on Economic Development and Taxation and Tourism and Government Operations that are attached to this report, your Committees, after full consideration of the background, experience, and qualifications of the nominee, has found the nominee to be qualified for the position to which nominated and recommend that the Senate advise and consent to the nomination.

 


Respectfully submitted on behalf of the members of the Committees on Economic Development and Taxation and Tourism and Government Operations,

 

____________________________

CLARENCE K. NISHIHARA, Chair

 

____________________________

CAROL FUKUNAGA, Chair