Politics & Government

Supervisor Schmitt 'Sick' About County's Wage Action on Tosa Hotel

Imposing pay requirements at union's behest was 'unfair' and puts developers, UWM and Tosa at a competitive disadvantage, district representative says.

A vote by the Milwaukee County Board to impose above-market wage levels on any hotel owner who wants to build on UWM's Innovation Campus was unfair and a precedent-setting mistake, Supervisor Jim "Luigi" Schmitt said Friday.

The County Board on Thursday voted 10-8 to require the management of any hotel built on the County Grounds site to pay any full-time employee 125 percent of the federal poverty-level wage for a family of four – which would amount to about $12.50 an hour.

The vote also requires any hotelier to give all full-timers at least five days of paid sick leave a year, with part-timers given equivalent sick leave pro-rated to their percentage of full-time employment.

Those conditions were imposed on a request by the University of Wisconsin-Milwaukee and Wauwatosa to amend the building plan for Innovation Campus to allow for a proposed hotel.

The developer, Hospitality Specialists Inc., told board members the wage and leave demands would effectively kill their project, Schmitt said – and Schmitt said he believed it would turn away any other prospective hotel developer.

"The board members who voted for this said it was to create family-supporting jobs," said Schmitt, who represents much of Wauwatosa including the County Grounds. "Well, everybody wants jobs, but if this kills the project, then where are those jobs?"

"Maybe those are noble goals – those in favor were philosophical, all about ideals – but you have to have some practicality," Schmitt said. "The market drives this. Markets do set pay scales.

"It puts you at a competitive disadvantage, and this is precedent-setting. Nowhere in Milwaukee has this been done before, nowhere in the Midwest.

"To cherry-pick one hotel, it makes it uncompetitive."

Supervisor Dave Cullen, who also represents part of Wauwatosa, voted with Schmitt against the amendments.

Schmitt also blasted his colleagues who voted supported the move for the way the way it was done. The wage and leave requirements were introduced a week before the final vote, at a meeting of the board's Economic Development Committee.

"The amendments were not shared with UWM, not shared with Wauwatosa, not even shared with me," said Schmitt, a member of the committee.

"After an hour of presentations, Supervisor (John) Weishan introduced these amendments," Schmitt said. "There was no public debate, no further hearing. It's really unfair to Wauwatosa and UWM, and I felt it was disrespectful to me."

"To change the rules at the 11th hour – I was sick about it," Schmitt said. "This was UWM and Wauwatosa's decision, to ask for a hotel. Our only decision was whether a hotel was appropriate, not to set conditions on it."

The vote in the Economic Development Committee was 3-3, effectively no recommendation to the full County Board. Schmitt said he spoke to every member of the board before Thursday's vote and thought he had the 10 necessary to turn away Weishan's amendments.

But, he said, "there was a lot of pressure" from the Service Employees International Union, including a Facebook campaign, over the week before the final vote, leading to one flipped vote, all it took to pass the amendments and likely deep-six the hotel.

"I am disappointed, because this has the potential to be a wonderful development, and a hotel does fit in," Schmitt said. "It meant a lot of jobs.

"We've come a long and difficult way to get here. We've come to a lot of compromises. All these groups had come together."

Wauwatosa, in its presentation in favor of the proposed hotel, without knowing the wage requirement would be introduced, showed that another development following on the incoming ABB Inc. building would have substantially solidified the tax-supported financing base for the whole UWM project.

If other potential developers are scared away by the Milwaukee County action, the Innovation Campus financing plan could stall just when it had finally gained momentum.

Schmitt said he believes not only that the board action was a bad decision and precedent, there was actually precedent against it – Crowne Plaza Hotel was built under similar, almost parallel, circumstances in a Milwaukee County development zone.

"When the County Research Park was almost filled in, one of the last pieces was a hotel," Schmitt said. "There was a need for it. And the Crowne Plaza has been great. There were no such requirements placed on it."


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