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Let’s get it right this time

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Illinois

The Illinois General Assembly was back in Springfield for one day this week, but they might return again.

The House and Senate had to come back to make sure there were no delays in the state’s massive infrastructure program.

The Senate Democrats had tacked some budget spending onto a bill authorizing the construction, but the House had refused to go along. The Senate backed down this week, so everything is still on track.

The media tended to misinform about the Senate’s add-ons, neglecting to report that the Senate Democrats actually paid for much of that spending by redirecting money within the state budget. And if history is any guide, if the General Assembly has to double-back to Springfield once more this summer, the media will misinform again.

Talk is in the air of a special session to deal with a federal judge’s ruling that the state’s McCormick Place reforms violated federal law.

Unions at McCormick Place have forever been blamed for the high costs of conventions. And while I’d agree that many of the work rules were way out of hand, much of this is overblown.

The biggest problem at McCormick Place is the markup. Federal Judge Ron Guzman went out of his way to point out that problem when he ruled earlier this year that the state’s new “reforms” of union rules violated federal law.

Guzman refused to set aside his ruling this week while McCormick Place appeals, which prompted McPier czar Jim Reilly to suggest Thursday that an emergency legislative session could be needed.

Rosemont’s convention center uses the same unions and the same workers operating under the same rules as McCormick Place. Yet, for example, prices to move exhibits from Rosemont’s loading docks to its convention floor are 38 percent lower than at McCormick Place, according to a Crain’s Chicago Business report.

Rosemont acts as its own contractor. McCormick Place uses private contractors to handle its shows. Two of those contractors, GES and Freeman, are by far the largest.

So, why not just crack down on the contractors? If it were that simple, it would’ve been done already. Two contractors control most of the shows at McCormick Place as well as most of the big shows around the country.

Rosemont focuses on smaller shows. Because it isn’t trying to tap into the really big shows, it doesn’t need to bother dealing with those two contractors. But without those big shows, McCormick Place goes belly up. You might as well turn it into the world’s largest indoor skateboard park. McCormick Place has no choice but to submit to those two contractors.

If it’s that bad, you may ask, then why don’t the exhibitors revolt against the contractors and force them to lower their prices? That happens in some instances, and part of the new reform law allows it.

But most of the exhibitors belong to trade associations, and those trade associations make much of their annual profits with their conventions by jacking up the prices even higher. The trade groups are sometimes even showered with perks by the contractors.

Legislative leaders were deathly afraid of angering the two big contractors when they drafted their reform legislation last year. All proposals to cap contractor markups were ignored. But if the appellate court doesn’t lift Judge Guzman’s stay, then a special session may have to be held.

Gov. Quinn said Thursday that he wants all sides to sit down and negotiate a solution. But if the contractors refuse to budge, there’s nothing much anyone can do.

Whatever happens, it would be nice if the media in this town started reporting the full story.

* From Crain’s…

Convention and trade-show workers at McCormick Place may have to be made public employees if the federal courts continue to quash labor reforms, according to the city’s top convention official.

In his first extensive remarks since a federal judge spiked new state-mandated rules on Wednesday, Jim Reilly said he’s hoping the court order either will be overturned by the 7th Circuit Court of Appeals or at least stayed while the appeal is heard.

Mr. Reilly heads the Metropolitan Pier & Exposition Authority, which operates McCormick Place and was on the losing end of a decision by U.S. District Court Judge Ronald Guzman.

If the 7th Circuit will not stay Judge Guzman’s order, “I think we’ll have to seriously consider asking the presiding officers to call the Legislature back” into emergency session, Mr Reilly said. And the most likely option would be to make McCormick Place workers government employees.

* More from the Tribune…

The legal maneuver is not a new one, and was once considered by legislators before being abandoned, said Terrance McGann, an attorney representing the Chicago Council of Carpenters. The council and Teamsters Local 727 were the two union organizations that initiated the challenge of the new work rules.

“They wanted to amend a portion of the Illinois code to lump the trades people in with firefighters and police, and it simply doesn’t fit the profile,” he said. “When you talk about the need for public safety, relative to no-strike clauses, it doesn’t fit.” […]

[Gov. Pat Quinn] said he hopes to work with legislators and labor leaders in the coming months to devise McCormick Place reform legislation that meets federal standards.

“We’ll just hash out a law that will survive any kind of legal scrutiny. That’s imperative,” Quinn said. “I want to tell all our conventioneers this is going to happen, and it will happen in a prompt fashion.”

Discuss.

posted by Rich Miller
Friday, Jun 24, 11 @ 8:50 am

Comments

I’m trying to figure out the public employee angle. Would that make MPEA the de facto contractor, allowing them to set the markups for their “subcontractors,” i.e. Freeman and GES?

Comment by wordslinger Friday, Jun 24, 11 @ 9:22 am
Two contractors control most of the shows at McCormick Place as well as most of the big shows around the country

If that is really true, then there is a level playing field between McCormick Place, and the other large venues. After all, why would those two jack up prices in Chicago, and not in Vegas, or Florida, or where ever.

So, that surely can’t be the answer.

Comment by Pat collins Friday, Jun 24, 11 @ 9:23 am
- After all, why would those two jack up prices in Chicago, and not in Vegas, or Florida, or where ever.

So, that surely can’t be the answer. -

Sure it can. A large number of shows still come to Chicago with the higher prices, so obviously there is something that attracts them to this location over Vegas or Florida.

Comment by Small Town Liberal Friday, Jun 24, 11 @ 9:33 am
—so obviously there is something that attracts them to this location over Vegas or Florida–

Some big shows don’t want the distractions of the casinos, strip clubs and golf courses in Vegas, or the theme parks and golf courses in Orlando. They want their people on the floors.

The number of direct international and domestic flights into Chicago are also a big advantage.

Put it this way: One of the biggest shows in the world, the Radiological Society of North America, holds their annual show in Chicago the week after Thanksgiving. They’re not doing that for the climate.

Comment by wordslinger Friday, Jun 24, 11 @ 9:57 am
I know we disagreed on one detail yesterday on this topic but let me share my view as a national exhibit vendor (albeit now retired). Sitting in my corporate job I looked at Value and not just costs. We wanted to go to shows in cities where our customers were most likely to show up.

Customers vary greatly by industry. For some (horrible) period we went to the annual show of an association that really did care about low-low costs for their vendors and attendees. They alternated their AUGUST convention between New Orleans and Las Vegas. Try NO once in August and you’ll pay anything to go a mainstream city in better weather. But their industry members needed to say they went to the cheapest place possible.

The cost of the booth at any large show (Vegas, NY, Orlando, Chicago) is outrageous. The differences between cities may be significant to researchers/journalists looking at it from an outside perspective but what is being missed is my goal for the event and my budget, which has to cover all of my internal expenses too. One time I had 100 staffers showing up for some part of the week. Do the math on the T&E costs and it makes the booth costs a non-issue.

I hated hated hated the unions in Chicago and NY but that’s what I paid GES to deal with. (Note, this was a relationship separate from overall show management deal they may have had. They were our national vendor for all shows.)

It is my guess that the answer to the question about how show vendors pick cities is that it is a money game: The place where the association can make the most for their own pocket is tops.

I’m not arguing that there are not things to be fixed at McPier but I also think that there are a lot of other things that Chicago needs to do to make it a more competitive city. We need a music district or two, for example. That casino will help if it is done in a way for convention goers (which is NOT anywhere near McCormick Place, by the way). And national advertising.

Chicago needs a new ‘brand’ for the 21st Century. Hog butcher-to-the-nation still gets mentioned too many times.

Comment by Redbright Friday, Jun 24, 11 @ 9:58 am
Something about this whole mess reminds me of FIFA.

Actually, a lot of things.

Comment by Yellow Dog Democrat Friday, Jun 24, 11 @ 10:28 am