Monday, July 20, 2009 | When Ballpark Village, a $1.4 billion downtown hotel and office project proposed adjacent to Petco Park, had union guarantees, the local hotel workers union didn’t oppose it.
But those guarantees, which would allow hotel workers to unionize more easily, are gone. They disappeared last summer when Marriott International withdrew its plans for a 1,900-room hotel next to the ballpark.
With the project scheduled to take a small step forward at the Centre City Development Corp. this week — now without union guarantees — Unite Here Local 30 is now questioning whether the project has been unduly tainted by the undisclosed financial relationships of two former CCDC employees.
In a 20-page memo sent to CCDC today, the union’s attorneys say an underlying agreement that provides the framework for the $1.4 billion development may be void because of those undisclosed conflicts. The memo — and the litigation threat it represents — gives the union leverage to try to get those guarantees back.
Nancy Graham, CCDC’s former president who resigned last summer and has since pleaded no contest to a charge of failing to disclose her financial interests, was business partners with Lennar Corp., a developer that partly owns the 7.1 acres on which the project would be built.
Helen Peak, CCDC’s former attorney, also resigned last summer after acknowledging that her law firm had represented Lennar Corp. while she worked for CCDC.
The union attorneys say that CCDC’s investigation into the conflicts last summer fell short, failing to examine key aspects of a relevant state law that forbids officials from having any financial connection to a contract they participate in making.
The memo highlights one of the concerns raised by JMI Realty, the project’s primary developer, when the Graham scandal unfolded last summer — that the scandal would become lawsuit fodder for anyone who didn’t like the project.
While the City Council has the final say over the project, CCDC is responsible for overseeing its design and specifications on behalf of the city and makes approval recommendations to the council.
JMI and CCDC originally reached agreement in 2005 on what was allowed to be built at Ballpark Village. When Marriott was later recruited to build a hotel there, JMI and CCDC began negotiating an amendment to that agreement, so they could clear the way for the hotel. Graham hadn’t been hired when the 2005 agreement was signed, but participated extensively in the later amendment.
Her involvement and undisclosed financial ties to Lennar prompted JMI last year to scrap all of its work on the amendment. The union’s lawyers, though, say even the original agreement is questionable. Though they don’t provide specific examples of either Graham or Peak influencing the 2005 deal, the attorneys say the two had the opportunity to impact it.
Peak was sitting as CCDC’s corporate counsel during at least one meeting where the project was discussed. While CCDC’s investigation concluded that she didn’t say anything that could’ve been influential, the union attorneys say that even the possibility that she could’ve influenced the project creates a problem.
The attorneys also question whether Graham may have been able to influence the project before she was officially hired in late 2005 or when the agreement was formally executed in 2006.
Steve Peace, an advisor to JMI, the company owned by Padres owner John Moores, dismissed the union’s position as “ridiculous.”
“As soon as we have a card-check agreement, the union will have the opposite position,” he said. A card-check agreement allows hotel workers to decide whether they want to join a union and allows union representatives on site to lobby them to do so.
That is what the hotel workers union wants.
“In our minds, unless we have a guarantee that we’re going to have good jobs, we can’t be supportive of the project,” said Brigette Browning, president of Unite Here Local 30, which represents 4,500 San Diego workers.
Marriott did have a card-check agreement with Unite Here. But since the company pulled out last year, no subsequent hotel operator has been found. Peace said a card-check agreement is premature. JMI hopes to have a hotel operator identified by late fall. “At that point it’ll be an appropriate time for the unions to engage,” Peace said.
The union wants JMI to make the agreement now. Peace said JMI will not.
Fred Maas, CCDC’s chairman, said he was confident in the findings of the investigation the agency undertook last year.
“We went through a laborious public dialogue and public process to hire an outside counsel to investigate these issues,” he said. “Now, to raise them in the context of attempting to gain leverage over other policy issues, seems to be a little out of line.”
Browning said the union does not have an immediate plan to file suit to stop the project but would first lobby the City Council to reject it. If that fails, she said, “we’re prepared to do whatever we need to do.”
CCDC’s board is scheduled Wednesday to vote on two smaller aspects of the large development: Giving JMI flexibility to move 287 ballgame parking spots and extending the window that the company is allowed to shift density from the ballpark site to the adjacent development.
If JMI finds a hotel operator later this year, that specific project would need a separate approval from CCDC and the city before it would advance.
Please contact Rob Davis directly at firstname.lastname@example.org with your thoughts, ideas, personal stories or tips. Or set the tone of the debate with a letter to the editor.