Saturday BriefingPage 1

March 9, 2013 A MESSAGE FROM RICHARD R. KELLEY TO OUR OUTRIGGER ‘OHANA

®

Sandra Sakka Promoted!By Hans Weger

I join Human Resources in congratulating Sandra Sakka on her promotion to the position of director – regional reporting in our Finance department. Sandra will report to Shari Fujita, vice president of accounting, effective April 1, 2013.

In this newly created role, Sandra will be responsible for Outrigger® Enterprises Group’s regional accounting oversight and management including the accurate and timely preparation of financial statements, account reconciliations, budgets and forecasts for all of our regional accounting

reporting entities. Sandra will provide leadership for the accounting staff and ensure appropriate accounting controls and procedures are in place. In addition, the financial and accounting oversight of Company Services will fall under Sandra, as well as the development and maintenance of cash management policies and procedures and credit and collections regionally and systems administration.

Sandra was part of the Embassy Suites® – Waikiki Beach Walk® opening team and from 2006 to present has been the property controller. Often sought out to assist us with special projects like the management transition of the Courtyard® by Marriott® Waikiki Beach, Sandra is currently an integral team member of our Kaukahi project that unifies our various core business functions through the JDE E-1 system.

Prior to Embassy Suites® – Waikiki Beach Walk®, Sandra was controller for the Outrigger Waikiki for six years and earlier in her career led the Outrigger Prince Kuhio accounting satellite office as assistant controller. Prior to Outrigger, Sandra was an auditor for Coopers & Lybrand (currently known as PricewaterhouseCoopers) in San Francisco. She and husband Bryan lived in Berkeley, California, for three years while Bryan attended medical school.

Sandra holds a Bachelor’s in Business Administration and a Master’s of Accounting from the University of Hawai‘i at Mānoa.

Born and raised in Kāne‘ohe, Sandra attended J.B. Castle High School. She and Bryan have one son, Brandan (16), and they enjoy attending his football and baseball games. Although she enjoys playing the school activity supporter mom, Sandra shared that she can’t wait to get back on the golf course once her son heads off to college.

Sandra Sakka

Congratulations >> 3 Tax >> 3

With the costs of Obamacare and other federal entitlements soaring, the United States is facing a financial crisis similar to what we are seeing in Europe.

Keep Hotel Room Tax Law As It Stands:

Don’t Gamble On Continued

World Peace and Prosperity

By Dr. Richard Kelley

As the Hawai‘i Legislature moves past the halfway point of its 2013 session, members of the Senate and House of Representatives are reading reports of record tourism numbers for Hawai‘i in 2012 and bullish predictions for Hawai‘i’s No. 1 industry in 2013. As a result, some want to increase the state’s transient accommodations tax (TAT or “hotel room tax”). My advice: Don’t do it! Things can change very quickly. We must keep Hawai‘i competitive.

If there is one thing I have learned in my 66 years in Travel & Tourism, it is that tourism is very cyclical and may change quickly, often when you least expect it. I have been through countless booms and busts since my parents opened the Islander Hotel in 1947. Some years, we could not build hotel rooms fast enough and even rented out rooms in buildings still under construction with a

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Saturday Briefing is published by and for

employees of Outrigger Enterprises Group (OEG)

Editor-In-Chief: Richard Kelley

Supervising Editor: Pila Hanson

Senior Editor: Kathy Foley

Proofing Assistant: Char Luning

Contributing Writers: Employees of OEG

Visit us online at:

www.saturdaybriefing.outrigger.com

Submissions to Kathy Foley

at kathysb@outrigger.com,

via interoffice mail to OEH/HR,

or by phone at (808) 921-6957.

© 2013 Outrigger Hotels Hawaii An Equal Opportunity Employer

Political FundraiserBy the OHHPAC Committee

Senator Glenn Wakai

District 15 - Kalihi, Mapunapuna, Airport, Salt Lake, Āliamanu, Foster Village, Hickam, and Pearl Harbor

Tuesday, March 12 • 5:30 to 7:30 p.m.

Hawai‘i State Art Museum, Sculpture Garden

250 South Hotel Street

Senator Gil Keith-Agaran

District 5: Wailuku, Waihe‘e, and Kahului

Thursday, March 14 • 5:30 - 7:30 p.m.

The Mandalay Restaurant • 1055 Alakea Street

If you are interested in a fundraiser, please email Kathy Foley at kathysb@outrigger.com.

Happy Birthday!Mar 20: Delmer T. Albano, Teresa Beringuela, Iliseva Cua, Analyn S. Gima, Mariel Diane T. Lomongo, Marivin C. Nastor, Ambrose O. Parangan, Susan A.O. Park, and Apinan Saksri.

Mar 21: Jiro Kim, Iliseva Likucia, Sirilak Manoon, Ok Sim Pae, Hans K. Sakurai, Fina F. Salvador, and Ma. Jowena Santos.

Mar 22: Leigh-Ann K. Bulseco, Kanchanarat Choothong, Worawit Chumkong, Raymundo T. Labtingao, Jakkrit Lanthai, Catalina Lardizabal, Susana Namoce, Kathryn O’Brien, Tadthap Poollap, Ratu Wame Raviyawa, and Kiattisak Sarak.

Mar 23: Jaycris Bondoc, Joseva Buasoro, Don L. Claro, Romencio Corpuz, Masako Inatome, Anthony Karan, Bradley Murciano, Somkhit Sanitchai, Shane N. Tappe, Nu-Yang Wei, and Fu Chao Wong.

Mar 24: Robert E. Churney, Lalita Jantem, Shaneel Naidu, Tracey L. Nakama, Jhon-Jhon S. Pelayo, Salanieta Qutokara, Susan Thompson, Nihal Tolbert, and Pieter Adrianus van der Hoeven.

Mar 25: Alohalani S. Alapai, Florence M. Alo, Marfa Bossy, Repeka Duaibe, Ann-Marie Holt, Yoly P. Ingeniero, Francisca V. Lim, Lepanoni Nakilimoce, Cho Ji Pae, Lourdes M. Queen, Atisha Reddy, and Mi Ok Son.

Mar 26: Wayan Adi, Timothy D. Bruns, Racheal Cowan, Samantha I. Kawaakoa, Tarisi Nailiko, Niumai Navatu, Patsakorn Samsom, Sharilyn E.K. Souza, Nannicha Tantipiriyakul, and Jamie C. Wong.

Employment Opportunities If you are interested in a position listed below and meet the qualifications, you may apply online. Please go to Outrigger.com, click on ABOUT OUTRIGGER, then EMPLOYMENT. We only accept online applications for the open-listed positions from internal candidates. If you have any questions, please call Chad Teramae at (808) 921-6989. Application deadline for the following positions is March 15, 2013.

Guest Services Representative (Part-Time)

A minimum of one year customer service and cashiering experience, preferably in the hospitality industry required. Must have basic computer skills and be able to type 30 wpm. Must also be a team player with excellent communication skills and ability to work any day and shift.

Guest Services Representative (Full-Time)

A minimum of one year customer service and cashiering experience, preferably in the hospitality industry required. Must have basic computer skills and be able to type 30 wpm. Must also be a team player with excellent communication skills and ability to work any day and shift.

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Congratulations<< From 1

Sandra’s knowledge and experience, together with her exceptional work ethic, make her an excellent candidate for this new and exciting position. We are thrilled for her, as she continues to work and grow with Outrigger. Congratulations, Sandra!

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Hawai‘i’s Transient Accommodations Tax Rates

blanket tacked over the doorway for privacy because the doors had not yet been delivered.

Other years, there was hardly any business at all. We literally gave rooms away just to have people in the lobby, shops and restaurants. Once, business was so bad that the Hyatt Regency Waikiki turned the lights off and shut down one of its two towers.

In times like those, we have to market well and keep prices very competitive if we expect business to return. Yes, price does matter, particularly when we are talking about a leisure destination like Hawai‘i where most visitors are using after-tax dollars to fund their travel, unlike many other destinations which have a much higher proportion of business travelers.

The TAT definitely adds to the cost of a vacation in Hawai‘i. It has been steadily increased over the years.

As presently written, the statute governing the TAT is scheduled to bring the rate back down to 7.25 percent in July 2015. This is the level at which the TAT was fixed before the Great Recession triggered a state government budget crisis, causing the rate to be raised one percentage point in 2009 and one point more in 2010. Let’s hope the scheduled return to 7.25 percent takes place, because the continual piling on of taxes and fees has made Hawai‘i less and less affordable and attractive for a family vacation.

In fact, I fear we may already have reached the point where high visitor taxes are decreasing Hawai‘i’s total earnings from Travel & Tourism. A recent analysis by noted economist Paul Brewbaker clearly shows that when adjusted for inflation, Hawai‘i’s earnings from tourism peaked nearly a quarter of a century ago (in 1989) at $17.23 billion (in 2012 dollars). They have been trending downward since then. (See Hawai‘i earnings chart top of Page 6.)

Is it really just a coincidence that the decline in Hawai‘i’s earnings began just two years after the TAT was first imposed?

Now consider that Hawai‘i’s current tourism boom is the result of several unique situations, which have created a once-in-a-lifetime tourism year.

• There has been some economic recovery in the U.S.

• Competition from Mexico has been all but eliminated by the sad, ugly drug wars in that country.

• The decrease in the value of the U.S. dollar has made Hawai‘i once again very attractive to visitors from Canada, Australia, New Zealand and many other countries.

Mark Your Calendars!

By The Charity Walk Committee

The theme for this year’s Visitor Industry Charity Walk (VICW) is “Put Your Best Slippah Forward,” so break out your “slippahs” and mark your calendars for Saturday, May 18, 2013.

The VICW is the largest single-day fundraiser in the State and is sponsored by the lodging industry. The purpose of the walk is to raise monies for Hawai‘i’s local charities; however, the main attraction is the energy surrounding each of the festive checkpoints and of course, the food! It’s so popular walker counts are anticipated to be over 7,000 and that’s just on O‘ahu!

Outrigger will again host a checkpoint at Waikiki Beach Walk® and our creative talents are at work crafting another specially designed Outrigger Charity Walk T-shirt.

Stay tuned to find out more information on the walk and how to participate. In the meantime, mark your calendar for Saturday, May 18 and plan to come together as an industry, get a little exercise, have some fun and enjoy some ‘ono grinds all in the spirit of giving.

Donna Leong and Hans Weger cheering for charity

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Groundhog Day ShadowingBy Chad Teramae

Groundhog Day is celebrated on Feb. 2. According to folklore, if it is cloudy when a groundhog emerges from its burrow on this day, then spring will come early; if it is sunny, the groundhog will supposedly see its shadow and retreat back into its burrow, and the winter weather will continue for six more weeks.

Today’s customs of the holiday involve celebrations where early

morning festivals are held to watch the groundhog emerging from its burrow. Here at Outrigger, we use the Groundhog Day name for our “shadowing” program. Held each year around Groundhog Day, we host students to a day of career shadowing.

Nine students f rom Waipahu High School ’s Hospitality and Tourism Academy “shadowed” at the Outrigger Reef on the Beach, Outrigger Waikiki on the Beach, Wyndham Waikiki Beach Walk®, OHANA Waikiki East, and OHANA Waikiki West. They were able to see and experience firsthand the daily operations of the hotel and meet with employees to talk about career possibilities in our industry.

Mr. Todd Nakayama, director of the Hospitality and Tourism Academy, does a great job each year coordinating visits for his students to gain invaluable experiences and a better understanding of a typical business day at a hotel.

Mahalo to our property general managers and their staffs for hosting these students and sharing their knowledge, hospitality and aloha to our state’s future tourism industry professionals!

John and Alyssa enjoyed their experience at the Outrigger Waikiki on the Beach

Students Ashley and Sofia shadow at the OHANA Waikiki West

with Donna Ferreira and Ligaya Martin

Outrigger® Guam Resort Celebrates “Chamorro Month”

By Lisa Lenckowski

Throughout the month of March 2013, the Outrigger Guam Resort pays tribute to the beauty and brilliance of the Chamorro culture and heritage through cultural activities and performances.

We kicked off the month with a celebration Friday, March 1, 2013, at Tasi Terrace with a cultural dance performance. Daily activities include: Flower lei making, Outrigger canoe modeling, mwar-mwar making, and cultural dance performances. Chamorro Month festivities will showcase daily the talents of Inetnon Gefpa’go and hosts from the Outrigger Guam Resort in the hotel lobby.

Cultural activities are free and everyone is encouraged to join in the daily events.

Inetnon Gefpa’go cultural dance performers

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Clean Up Australia DayBy Niel Mason

The Outrigger Little Hastings Street Resort and Spa team joined forces with Clean Up Australia as the first-ever local resort to be registered with a designated site in Noosa. Front Office Manager Lynne Scanlan organised the event and was nominated site supervisor for the day.

After days of torrential rain and the highest rainfall on record for three years, motivation remaind “undampened” and staff and their families took an early Sunday morning start. The team set off in wet and humid conditions and collected over a dozen bags of litter, various car parts and odd bits of household refuse from the Noosa National Park lookout down to David Low Way.

In 2012 an estimated 591,400 volunteers cleaned up 16,169 tonnes* in 7,363 sites across Australia. This year there was over 20 local sites registered across the Noosa region where volunteers took part. Lynne was recognised by the event organisers as a site manager overseeing one of the largest collections of rubbish accomplished on the day.

Clean Up Australia Day is a simple way we can take action to clean up, take pride in and conserve our prized Australian environment. The team at Outrigger Little Hastings Street Resort and Spa work every day within the Noosa National Park surrounds so it was only fitting that we embraced our values (Wahi/Place) in supporting such a great initiative.

Joel Anderson, Josh Saunders, Lynne Scanlan, Adam McKenzie,

Fiona Roma, Sandy Welk and Niel Mason

*Tonne = 1,000 kilograms, 2,204.6 pounds, or 1 Mg (megagram)

Outrigger Luana Waikiki“Thank you so much to you [Angela Hiranaga] and all the staff for making this family Christmas vacation a trip of a lifetime for us! This room made it so much more special with the space and all the convenience of home…not to mention the beautiful views from the lanai! All the staff have been so friendly and welcoming and helpful. Everything from your warm smile on our arrival when we were so exhausted to the guys patiently and cheerfully parking our car many times a day! Mahalo…and all the best of health and happiness to everyone in the New Year!”David & Gloria JuvonenGrand Marais, Manitoba, Canada

Outrigger Twin Towns Resort“I felt I needed to email you on the wonderful stay we have experience in your beautiful hotel. We are visiting from the UK and as a Mother’s Day gift my son gave us a 2 night

stay. I wish to commend your front desk manager Christopher [Chris De Closey] for being so helpful when we arrived. I am sure that your company will be in good hands when Christopher is there at front desk, nothing was a problem to him and he certainly went the extra

mile for us and today I have witnessed the same beautiful smile and personality to everyone he has dealt with. As we are going back to the UK in a few days can I say this has been a memorable experience which my husband and I will never forget on our retirement celebration.”Mr. & Mrs. J and H A M Martin

Kona Hawaiian Resort“Once again I write to apprise you of one of the natural treasures of Hawaii, just like the papayas, the sunsets, and tradewinds. Joy Rothe, Activities Manager at Kona Hawaiian Resort, works tirelessly to promote everyone’s enjoyment of the resort and the culture of Hawaii. She is a teacher who is able to share with anyone and everyone with patience and caring. She has strong loyalty to her guests, to nature, and to the Wyndham mission of ensuring a wonderful vacation experience. We never cease to be amazed by Joy’s dedication to her profession, to the resort, and to the guests. My wife Linda and I have been fortunate to visit over two dozen Wyndham properties. I do not hesitate to tell my friends that KHR is THE gem of Wyndham. The “Joy of Aloha” is a prime factor in my reaching this conclusion. As such, I ask that you extend to Joy Rothe the accolades she so richly deserves.”Louis HarrisSan Mateo, CA

Moments of Aloha

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Hawai‘i 2012Increase in International Visitor Arrivals

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• The booming economies of China and other Asian countries have brought a significant increase in visitors from those areas.

Unfortunately, both the U.S. and many other nations’ economies are going through a unique time of challenge that could result in widespread financial troubles that might suddenly and dramatically affect tourism everywhere, particularly the leisure tourism that is the mainstay of Hawai‘i’s economy.

Spending by the U.S. government, currently $3.8 trillion per year, is out of control and the national debt exceeds $16.6 trillion. (See chart top right.)

Yet, we cannot agree on even $85 billion in spending cuts, equivalent to a 2.23 percent decrease in spending, under the “sequestration” plan. But these cuts, as implemented by the Obama administration, will affect tourism in Hawai‘i with furloughs, a decrease in government travel, possible disruptions in air traffic control, border agents, TSA personnel, etc.

Budget Deficit as a Percentage of GDP by Administration

With the costs of Obamacare and other federal entitlements soaring, the United States is facing a financial crisis down the road similar to what we are now seeing in Greece and elsewhere in Europe, where government revenues simply cannot pay for the social spending, government payrolls and pension obligations to which these governments are committed.

Many are predicting that China will also begin to experience an economic slowdown, if not outright crisis, by the end of 2013.

Japan is experiencing economic stagnation and is considering devaluation of the yen. That would make Hawai‘i hotel prices and the TAT look more expensive to the potential 1.5 million travelers we host from that country each year.

Yes, the world is a spooky place in this “Year of the Snake.” There is no need to amend the existing TAT legislation to make the 9.25 percent rate permanent. That is a shortsighted idea.

Keep the rate where is right now by law and plan ahead for its scheduled decrease to 7.25 percent in mid-2015. Better yet, bring it back down to 7.25 percent this year.

And certainly be prepared to reduce it immediately in the event of economic crash, war, increased terrorism, etc., in order to keep Hawai‘i competitive in the world tourism markets.

Why? Because In Hawai‘i, Tourism Is Everybody’s Business!

Hawai‘i’s earnings from tourism, when adjusted for inflation, peaked in 1989

at $17.23 billion (in 2012 dollars) and have been trending down since then

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