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Labor unions at odds over West Oakland hotel development

on November 22, 2019

Every theater seat was occupied in Oakland’s city council chamber on Tuesday night, with more community members spilling into the hallway, as members of two of the city’s biggest unions turned out to take opposite sides on a proposal to build a hotel in West Oakland.

In November 2016, Architectural Dimensions, an Oakland architecture and planning firm, filed an application to build a six-story 220-room hotel on what is currently an empty lot on Mandela Parkway along Oakland’s border with Emeryville. It was approved by the Oakland Planning Commission in June 2018.

At the meeting, carpenters in fluorescent yellow vests representing the Carpenters’ Union Local 2236 were there to support the project, saying it will bring well-paying union jobs to the laborers of Oakland.

On the other side of the chamber, members of Unite Here Local 2850, a union that represents hotel and food service workers, wore shirts that said “One Job Should Be Enough” and flashed yellow signs that read “No Wage Theft.” They raised concerns that hotel workers will not be paid a living wage and will not be able to afford East Bay rents. 

In June of 2018, Ty Hudson, the research analyst and spokesperson for Unite Here, had filed an appeal against the commission’s approval of the project on behalf of the union. The appeal focused on a section of city planning code which requires the commission to make a series of findings for hotel developments, including that “the proposal considers the impact of the employees of the hotel or motel on the demand in the City for housing, public transit, and social services.”

In the appeal, union officials alleged that the commission had ignored the requirement to do this analysis.

The planning commission responded in a memo that it did indeed address this section, noting the site’s proximity to public transit lines, and through the findings that the proposed local hiring is intended to mitigate the need for new housing. It also noted that the commission took action previously to address the wage issues by adding the condition that employees will be paid $15 an hour, instead of the $13.32 minimum wage. 

On Tuesday night, Hudson asked the council, “Will the hotel provide stable jobs that pay a living wage so that the employees can afford decent housing in Oakland and have the necessary income to support themselves and their families? Or will it create mostly low wage dead-end jobs that add to the city’s need for subsidized affordable housing?” 

But James Heilbronner, the project’s architect, spoke in favor of the project, saying that his firm and Rahm investments, the funders behind the project, are expending a “major effort to bring the community in and get local workers for construction.” He said that they have committed to making half of all hires among local residents, for both construction workers and permanent hotel employees. 

Councilmember Lynette Gibson McElhaney (District 3) said though she usually supports this kind of West Oakland development project “pom poms out and lipstick on, celebrating,” she added that she has concerns about the lack of a planning commission analysis, as required by the section of the planning code that the Unite Here appeal cites.

She also spoke about the need for employment for Black residents in West Oakland, and said she was worried about the lack of “enforceable agreements” in the proposal. Although the company intends to hire locally, Gibson McElheney said they did not negotiate a binding agreement with the city to ensure that they will hire Oakland residents.

Gibson McElheney motioned to continue the hearing until the council’s second meeting in February to allow the planning commission time to do more analysis on the effects of the project.

Councilmember Dan Kalb (District 1) seconded the motion and said that all parties essentially want the same things: a hotel built on the empty lot that will provide as many good union jobs as possible. “I think there’s a shared goal here,” he said. 

Councilmember Nikki Fortunato Bas (District 2) spoke in support of the motion, emphasizing the importance of access to good jobs for members of her district. She said, agreeing with Gibson McElhaney, that a goal of hiring locally for 50 percent of employees is not enough. “These have to be solid requirements that we can enforce, otherwise they are meaningless,” she said.

Councilmember Larry Reid (District 7) was a dissenting voice. “Let folks build a hotel,” he said. “It’s frustrating as hell to live in the city and remember 35 years ago what we were attempting to do to grow the city, and for Oakland to finally reach its turn and see the kind of growth that we’re seeing. There are some folks who don’t want this city to change. Well, I want it to change. That’s why I ran for city council.” 

The council voted to take up the debate again in February. 

In other business, the council voted to approve amendments to the city’s building code to comply with changes in state law, and agreed to schedule discussion of further amendments in the next Community and Economic Development meeting in January. These additional amendments will address updates to the building codes for live/work spaces, which had been erroneously removed from the building code in what appeared to be a clerical error.

The other big action item of the evening was a proposal by Councilmembers Kalb and Sheng Thao (District 4) to reduce the cannabis business taxes in order to support local businesses, and merge medical and non-medical cannabis business classifications. 

The current business tax rate for non-medical cannabis is 10 percent of gross receipts and 5 percent for medical businesses. The Kalb and Thao proposal is a tiered tax reduction that will eventually cap at 5 percent for non-medical businesses by the year 2022. 

They noted that the cannabis tax is the highest of any business tax in Oakland, and should be lowered to remain competitive with neighboring Berkeley and Richmond, which both offer a lower tax rate. The non-medical business license cannabis tax for both Berkeley and Richmond’s is 5 percent.

The motion to advance the debate on a tax reduction passed with a second reading is slated for December 10. 

Members of the union Unite Here Local 2850 gathered at Tuesday’s city council meeting to protest a proposal to build a new hotel on the city’s border with Emeryville. Photo by David Sekiranda.

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