Indianapolis thugs in PLA 'labor-peace' extortion

A City-County Council resolution prohibiting any labor union-led work stoppages at a convention headquarters hotel project Downtown has raised concerns that the last-minute change could kill the deal.

The resolution, which will be considered at Monday's council meeting, would require that the $325 million JW Marriott project have a "labor peace agreement" before the city issues $66 million in bonds to get the development off the ground.

The city's Bond Bank committed to the financing -- which includes $48 million in tax incentives -- in May but has not reached a final agreement with the developers.
The resolution says the city's investment would be threatened if a labor dispute, boycott or strike were to occur at the hotel.

Under the agreement, labor groups would pledge not to picket or to stage work stoppages, boycotts or "any other economic interference" with the hotel for at least the first five years of its operation.

The agreement would not require or compel hotel employees to be members of any labor organization. Opponents, however, say entering the agreement would open the door for organizing by a union.

"There's a lot at stake here," said Councilman Phil Borst, the GOP minority leader. "This would be a deal-stopper. We promised that hotel, and losing it could cost us convention business, the Final Four and our Super Bowl aspirations."

The developers, REI Real Estate Services of Carmel and Merrillville-based White Lodging, increased the project's size at the city's request. It would be the largest hotel in Indianapolis, with 1,000 rooms and enough meeting space to simultaneously host two large conventions. Three sister hotels would have 568 rooms.

A similar attempt to require a labor peace agreement failed in May, but the project's supporters said this attempt could derail negotiations. Neither developer could be reached Friday.

Borst said he told Mike Wells, president of REI, that a labor agreement should be a matter left to the company and its employees -- not the government. He said it would be unfair to make last-minute changes to a deal on which the council has already signed off.

But Councilwoman Joanne Sanders, a Democrat sponsoring the proposal, told the council's Rules Committee earlier this month that the resolution is simply meant to protect the city's investment. She said the agreement would ensure that construction wouldn't be interrupted by labor disagreements.

John Livengood, president of the Indiana Hotel & Lodging Association, disagreed.
He said the Dec. 3 resolution flew under the radar until this week because hotel interests didn't realize the effect it could have. He said the resolution's language nearly guarantees unionization.

"What employer would want their relationship with workers dictated by the city?" he asked.

Livengood also raised questions about the sponsoring council members' connections to Unite Here, a labor union that represents about 450,000 hotel and clothing industry workers.

He said the two Democratic sponsors, Sanders and Dane Mahern, joined hotel workers demanding union recognition at the Westin Hotel this year. Sanders works for another union.

"It raises questions about conflict of interest," Livengood said. "It's interesting that (Councilman) Bob Cockrum recused himself because his son works for the developer, but the others are pushing this."

Unite Here paid for TV commercials, rare in council races, for Mahern during the fall campaign.

The union also gave a Republican sponsor, Lincoln Plowman, $5,000 in campaign contributions, though he did not have an opponent.

Sanders and Mahern could not be reached for comment.

Plowman denied that the resolution had anything to do with support he received during the campaign. He said he has always supported the working men and women of Marion County.

"If I have to give $66 million in taxpayer money, we should have some say to make sure there is labor peace," Plowman said. "It's not saying there has to be a union."
Antony Dugdale, a spokesman for Unite Here, said concerns about the resolution were overblown.

"My experience is that it has not been a deal killer in other places," he said.
If the council passes the resolution, Mayor Bart Peterson, who worked with developers to put together the hotel deal, will have 10 days to sign the measure or it will not go into effect. He also could veto it. Administration officials did not respond to calls for comment Friday.

What: A 29-story tower with 1,000 rooms -- the largest hotel in the city -- 50 percent more meeting and exhibit space than first planned, and 1,000 indoor parking spots. Two dozen condos will occupy the top four floors, and 200 of the hotel rooms will be more upscale and tailored to corporate travelers, who will have their own elevators. Three smaller hotels with 568 rooms will be built next door.

Where: At West and Washington streets.

Cost: $325 million.

Who's developing it: REI Real Estate Services and White Lodging.

What the city is kicking in: At least $48 million in tax incentives.

When it will open: 2010.

How many jobs: About 1,000.

-- Source: Star archives


An excerpt:

"Whereas the city's investment would be threatened if a labor dispute, boycott, or strike were to occur ... and whereas language to prevent labor disputes has been secured covering similar convention hotels (in other cities) ... no bonds shall be issued pursuant to this resolution unless ... the project is subject to an enforceable labor peace agreement with the labor organization most active in representing and seeking to represent hotel workers in Indiana. The labor peace agreement must be a valid agreement which prohibits the labor organization and its members from engaging in any picketing, work stoppages, boycotts, or any other economic interference with the hotel for at least the first five years of the hotel's operation.

"The labor peace agreement shall not include any provision that would require or compel an employee to be a member of any labor organization."


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