Downtown Jobs Fight Not Simple as PD Describes

If you read The Plain Dealer about the court fight among the City of Cleveland, the Downtown Cleveland Alliance (DCA) and Laborers Local 1099, over jobs downtown, you would think, “Boy those city workers are really a greedy bunch.”

No, the Laborers Union 1099 is just looking after the economic interests of its members. That’s the job of a labor union. Maybe The Plain Dealer doesn’t understand that. The DCA, meanwhile, tries to provide services for its interests downtown. However, DCA does work that is encroaching upon someone else’s turf, said arbitrator Gregory James Van Pelt correctly. The use of a private workforce to do public jobs raises serious questions.

With low paying jobs especially you’d think that the PD would show concern about city workers. Unfortunately, no such thing. The PD frets about their downtown friends.

The Plain Dealer, of course, got huffy on the side of downtown interests. The arbitrator’s decision favoring the union was “ridiculous,” said a PD editorial. It called the union “greedy” and “petty” for protecting its members.

Actually, the PD itself is naively ridiculous when it claims that the Alliance “doesn’t use city funds” but depends upon “some small donations.” Not quite true.

Actually, the Alliance uses funding mechanism via a state law that allows property owners to assess themselves based on their property to run its operation. That should be a matter of concern, too.

The great irony, which escapes The Plain Dealer, is that the DCA has set-up a mechanism that allows “assessments” that mirror property taxes. However, these “assessments” on property are kept from the ordinary public uses of property taxes, which are shared by schools, county and city. These assessments go only to the interests of the private bodies.

The Downtown Cleveland Improvement Corp. (DCIC) is funded via a Special Improvement District (SID). It turns over these funds to the DCA. DCA says, “Funding is provided by Downtown Cleveland property owners who have jointly agreed to a special assessment to augment services.” Further, they say that this is not a tax. Well, I’d say it is a camouflaged tax.

It really functions as a tax on properties to provide special services.

The funds go through the closely related non-profit DCIC, which simply diverts the assessment money to the Alliance. The Downtown Cleveland Improvement Corp. provided in 2006 some $2,250,000 directly to the Alliance. This is not, as The Plain Dealer editorialized, “some small donations.” This is a very well thought out scheme to divert what should be property taxes from their normal use.

DCA says it pays its workers an average of $12 an hour compared to the city union employees doing such work, who receive from $16.41 to $17.25 an hour. I’m told that the DCA provides health benefits.

I talked with five Alliance workers downtown last week. The workers I spoke with were very visible, having identifiable clothing and pushing a yellow barrel on wheels. They told me they start at $9.50 an hour in pay. After three months on the job the pay should go to $10, although one worker said she’s been working four months and gets $9.75 an hour and has to work another job. Another worker said he has worked for the Alliance for one-and-a-half years and makes about $13 an hour. They work 40 hours a week from 7AM to 3:30PM.

I was told by employees that they pay $14 each week for health benefits.

Two of five workers were reluctant to talk. They said they’ve been warned not to talk to reporters. One worker wouldn’t talk fearful, the employee said, of losing the job. The worker looked disturbed when I mentioned what the city employees involved made per hour.

City union workers obviously are slightly better paid and have better city benefits, including health, which are usually very good for low paying city jobs.

Still the Alliance is paying some employees more than the meager “living wage” city legislation asks. Neither the city nor the Alliance pays what should be a living wage for a family. One Alliance worker, for example, said a second job was necessary to meet a $700 a month rent.

Here’s the situation: the arbitrator ruled that city workers were owed money because employees hired by the DCA performed tasks ordinarily done by city workers under a union contract. Therefore, the city workers, the arbitrator ruled, should be paid for the work even though they didn’t do the work. The work consists mostly of cleaning up in downtown Cleveland. A figure hasn’t been set for the payment.

To me this is a warning to a private enterprise that it doesn’t have the right to take public jobs.

You have to know a little more.

The DCIC’s only purpose appears to be to collect added assessment to property taxes within the SID, created by downtown interests. Both non-profits are operated by Joseph Marinucci, former economic development director for the city and former chairman of the Gateway Economic Development Corp.

The Alliance is chaired by another familiar name – John Carney, a major downtown developer and former chairman and still member of the Cleveland-Cuyahoga Port Authority. The Port has become the main funder of many downtown developments, including the Rock and Roll Hall of Fame. The DCIC is chaired by Douglas Miller of the Richard Jacobs Group.

It all makes for a cozy grouping.

Marinucci is paid $205,000 (2006 figure) a year, or twice as much as Mayor Frank Jackson. Maybe Marinucci should take over the functions of an elected mayor. That’s the reasoning if you follow the PD line.

These non-profit creations, which I call corporate front groups, seek advantages that ordinary people – who remain unorganized – don’t or can’t achieve.

Council members, who should represent the interests of constituents, often are deeply indebted to these organizations and their corporate board members.

For example, downtown Councilman Joe Cimperman is a board member of the DCIC. He’s a powerful one-man lobby for downtown interests. He is chair of the Council Planning Committee, vice chair of the Finance Committee, through which all city legislation flows and a member of the City Planning Commission, through which downtown plans simply slide through. He also has been a heavy recipient of political donations from downtown business figures.

These downtown non-profits are typically fed generously by corporate (including The Plain Dealer) money and from many cooperating Cleveland-based foundations.

They, of course, do the bidding of developers and other corporate interests and become the Real Government. These non-profits nourish inequality by depriving neighborhoods of services. How? As downtown draws significant services and resources, the remainder of the city suffers deprivation on all levels.

The DCA’s finances, some $2.2 million annually, comes directly from the DCIC’s coffers via the assessments on property owners within the SID (For more information check the Alliance’s web page: http://www.downtownclevelandalliance.com/sid.asp.

So you could say that public money is being used to finance cheap labor to steal work from city union workers.

The $2.2 million a year in funding really represent property taxes disguised as “assessments” under a convenient state law.

A couple of things wrong with this:

- One, it sets up an immediate inequality of public services. Private interests can buy better services not available to others. And they can write off the payments on income as cost of doing business. The rest of citizens must depend upon a shrinking city budget and, therefore, fewer services.

- Two, downtown property owners, with their lawyers, continually go to the County Board of Revision and the Ohio Tax Board to get the value of their properties reduced, and thus their taxes lowered. Ordinary homeowners usually do not have easy legal services to seek lower values on property and often even lack the knowledge to do so.

For example, Forest City Enterprises, owner of the Terminal Tower and Tower City, often attempts and succeeds in having its property values lowered. Lower value means lower taxes paid. Back in 1997, I wrote that Forest City was seeking $8 million in tax reductions for it Public Square holdings. Earlier in the 1990s I reported that Forest City was seeking tax value reductions of $25.5 million at Tower City and $15.2 million at its Halle building. Almost every year such requests are made routinely.

(It’s no surprise that both DCA and the Improvement Corp. have offices in the Terminal Tower. The DCA’s books are kept – to further show the incestuous relationships – by the Greater Cleveland Partnership, also located in the Terminal Tower. Why not move City Hall and the County Administration building there?)

Marinucci help create a similar district called a Business Improvement District (BID) here that allowed property owners to agree to an extra property tax assessment when he was with the Playhouse Square Foundation.

The continued use of either such districts by those with money and resources can help create two “cities” within the boundaries of Cleveland proper– one nourished by extra tax levies and the other deprived by fewer and fewer services.

John Edwards talked about the Two Americas.

Marinucci and the gang have insured two Clevelands.

CORRECTION: In last week’s column I had Tim Hagan marrying James Carney (that couldn’t happen). Actually, Hagan married the daughter of the elder John Carney, former auditor and judge and father of the Port Authority’s John Carney. Sorry for that error.

From Cool Cleveland contributor Roldo Bartimole roldoATroadrunner.com

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