LVCVA board OKs new union contract

By Richard N. Velotta

Friday, July 17, 2009 | 3 a.m.

Lousy economy? What lousy economy?

The Las Vegas Convention and Visitors Authority board of directors, in a rare split vote, agreed to a five-year union contract that includes a 3.5 percent cost-of-living raise for workers by early next year.

Combined with a previously approved 4 percent step increase in all authority salaries, the 350 union workers and 87 nonunion laborers — who usually receive the same benefits as their union counterparts — will be seeing 7.5 percent more in their paychecks after all the increases kick in Jan. 10.

The board voted 8-4 to approve the contract with the split largely along the lines of elected officials favoring the deal and private enterprise members opposed. Casino executives Charles Bowling of MGM Mirage, Tom Jenkin of Harrah’s Entertainment and Scott Nielson of Station Casinos and Las Vegas Chamber of Commerce CEO Kara Kelley opposed the measure.

Boyd Gaming CEO Keith Smith sided with the elected officials, and Wynn Resorts executive Andrew Pascal was absent.

The vote was a highlight of the July 14 meeting at which several major issues and high-profile decisions came to a head. The board also approved a revamped advertising and marketing communications agreement with R&R Partners, approved spending $4.5 million to complete a portion of the Convention Center renovation and supported a resolution backing the California-Nevada Super Speed Train Commission’s maglev proposal.

The contract with the Service Employees International Union Local 1107 has been festering since May 2008 when negotiations began. Laborers have been working without a contract for more than a year.

Board member Tom Collins of the Clark County Commission and an avid union supporter applauded the work done by laborers and noted that they pressed ahead despite not having a contract.

Mark Olson, vice president of human resources for the authority and its lead negotiator, recommended approving the deal, noting that failure to approve it would result in the contract going to arbitration. Las Vegas Mayor Oscar Goodman, who heads the authority board, said he wanted to resolve the matter immediately and not rely on an arbitrator who may not understand Las Vegas.

Under terms of the agreement, employees will receive a 1 percent pay increase retroactive to January, a 1.5 percent increase that was effective July 12 and another 1 percent increase to be effective Jan. 10. Increases effective on July 1 of the next three years are subject to renegotiation under terms of the agreement.

The rest of the 55-page agreement, ratified by the union in April, had minor policy changes.

The pay increases will cost the authority $78,900 for the retroactive six months of Fiscal Year 2008-09 and $199,600 for Fiscal Year 2009-10.

Management and executives wouldn’t benefit from the contract. They’re in the midst of a year-old salary freeze, and no merit increases or bonuses were allocated in the budget approved in May.

The nonunion pay increases will cost the authority $24,900 for the retroactive six months of Fiscal Year 2008-09 and $63,400 for Fiscal Year 2009-10. In an 11-1 vote, the board decided to include the nonunion employees for cost-of-living increases as they have in the past.

On the R&R ad contract, the board unanimously approved a three-year contract with a possible three-year extension, but terms of the deal were significantly modified from provisions approved in contracts R&R has had with the authority for the past three decades.

Some key changes are a reduction of media and outside production and services commissions from 15 percent to 12.5 percent, but adding a $400,000 monthly agency services fee. In the next fiscal year, the authority expects to save $2 million on media buys with the new payment structure. The $400,000 monthly fee pays for the resources of six people in public relations, five in digital marketing, four in research, a 14-person strategic team, including three agency principals, and a 12-person production services team.

R&R is expanding the scope of the work it will do, adding digital marketing, sponsorships and partnerships, branding promotions, expanded outlying destinations, international public relations, media integrations and social media work.

The new agreement requires R&R to conform to the authority’s travel and entertainment policies.

The approval of $4.5 million of work on the stalled $890 million Convention Center refurbishment involves moving storm drain, sewer and water lines to protect against flood damage and to complete work to allow use of two parking lots. Unforeseen underground and environmental conditions led to a cost overrun that administrators determined would be best addressed before further damage could occur.

The resolution in support of a maglev train between Las Vegas and Anaheim, Calif., came a month after the board approved a similar resolution supporting the proposed DesertXpress high-speed rail train linking Las Vegas with Victorville, Calif. The board is neutral in choosing one proposal over the other, backing any plan that would bring more tourists to Las Vegas.