Gaylord Bids Chula Vista Adieu

Gaylord Entertainment canceled its plans to build a $1 billion hotel-convention center project along the bayfront in Chula Vista, Calif., after it failed to reach an agreement with local construction labor unions.

A July 6 letter from Bennett Westbrook, Gaylord's senior vice president for development, design and construction, to Chula Vista Mayor Cheryl Cox, Port of San Diego Board Chairperson Sylvia Rios and city council members, stated: "After a year of unproductive discussions with the San Diego Building Trades Council, we have concluded that their unwavering, unreasonable demands render the project unfeasible for our company and our shareholders."

Tom Lemmon, the building council's business manager, said of Gaylord's decision; "We're disappointed because they were willing to abandon the bayfront project because we would not sacrifice local men and women who live in Chula Vista."

Cox said Colin Reed, Gaylord's chairman and CEO, called her with the news that the company was pulling out of the project. She reacted strongly to the loss in a public statement, also released July 6. "Robbing the people of Chula Vista of this extraordinary project is unconscionable," Cox said. "This is a travesty. Chula Vista has lost jobs. We have lost improvements to our waterfront. Opportunity has been taken away from the people of this city."

Although Gaylord and the service workers' union, UNITE HERE Local 30, reached an agreement months ago, construction unions were a sticking point.

Following a June 29 meeting between Gaylord and construction union representatives, Jennifer Badgely, spokesperson for the Intl. Brotherhood of Electrical Workers Local 569, said, "We asked them (Gaylord) for a legal commitment to hire in the local workforce. It's the only way to ensure locals are working on the project."

After negotiations had dragged on for a year, Gaylord set June 30 as a deadline to reach an agreement with the unions. When the June 29 meeting ended without a resolution, Lemmon said Gaylord was "reportedly pulling out of Chula Vista."

Gaylord wasn't commenting at that point on whether it had indeed dropped the project, so the city stepped in and Denny Stone, economic development officer, defended the company and criticized the unions in a written update, also June 29, to Cox: "Although Gaylord has already agreed to a framework for ensuring the hiring of local workers, the labor organizations' representatives continue to insist this is an unresolved issue. Throughout the discussions, Gaylord has also agreed to pay workers wages comparable to union hourly rates."

Stone's report also said the real issue was "labor's insistence on an extraordinarily restrictive bidding process that would effectively exclude non-union contractors and workers from the project." He added that the process requested by the union would have driven the cost of the project up by between $50 million and $75 million, "making the project financially unfeasible."

Though the city had no say on what happened between Gaylord and the unions, it did recognize Gaylord could easily pull the plug on the project. On July 3, Cox held a press conference on the bayfront during which she said, "I'm not accustomed to pointing any fingers at who is to blame here, but I've got to tell you that, labor leaders, it's up to you now. I repeat, go to Nashville and get this deal done."

Up the road from Chula Vista, the San Diego Convention Center Corp. was following what happened with a watchful eye, because the new project could have represented future competition. When the plans fell apart, however, there was no rejoicing.

"We're disappointed because we felt it was going to add value to the destination," said Steven Johnson, vice president of public affairs for the SDCCC. "It's unfortunate and a loss to the region."

The stakes were high, not only because of the number of jobs the Gaylord project would have brought to the area as it was being built, but also because of the overall impact the hotel-convention center would have had on the local economy once completed.

Plans called for a 2 million square foot convention center and resort that would have included 400,000 sq. ft. of exhibit and meeting space and a 1,500-room hotel.

But, as of press time, the project seemed to be doomed.