Tuesday, April 06, 2010

Unions and Mayor Daley Continue to Drive Conventions From McCormick Place

It was bad enough 18 years ago when I was in business. I understand it is getting more costly at McCormick Place. I agree 100% with this article from the Chicago Tribune. Why do the unions and their Democrat minions think we are losing more business to 46 other states?

Merle Widmer

High costs at McCormick Place are driving conventions and trade shows out of Chicago. We can fix that, or we can watch the jobs and dollars keep marching to other cities.

The people who run the shows and attend the shows love this city. They love the convention facilities. But the onerous costs and other hassles — starting and ending with McCormick Place work rules — are chasing them away.

Goodbye, Chicago. We'll send a postcard from Orlando.

That was the blunt message the managers of some of the biggest trade shows delivered to Illinois legislators on Thursday. The venue was a Thompson Center hearing before a 16-member Senate-House committee that's desperately looking for a way to stop the exodus of shows and conventions.

It's not news that the Metropolitan Pier and Exposition Authority, the state- and city-run organization known as McPier that operates the city's convention venues, needs an overhaul. Its dysfunction has been apparent for years. What was different and refreshing Thursday was a sense of urgency that punctuated testimony over three hours at the packed-to-capacity hearing run by Senate President John Cullerton, D-Chicago.

Five organizations testified: the National Restaurant Association, American College of Surgeons, International Housewares Association, Society of Manufacturing Engineers and Graphics Arts Show Co. Their shows brought nearly $300 million worth of economic activity to Chicago last year. They all might leave because of the high costs fueled by special handling fees, surcharges, overtime and general level of difficulty that come from dealing with the various jurisdictions connected to McCormick Place.

Some nuggets:

• Contracting for electrical service at Orlando's convention facilities costs 40 percent less than in Chicago, said Mary Pat Heftman of the restaurant association: "I can't explain that 40 percent differential to my exhibitors. Exhibitors in other cities can drive up to the dock and unload equipment themselves. Not in Chicago."

• Setting up a stage for an opening ceremony (with black drape, logos, flags, lighting, etc.) costs $46,000 in Chicago — and $32,000 in San Francisco, said Felix Niespodziewanski of the College of Surgeons. Organizers have to deal with a bewildering array of unions with different minimum rates, overtime rules, break times, etc.

• Chris Price of the Graphic Arts Show Co. said the quality of work at McCormick Place is top-notch, but the work rules make it uncompetitive. Example: 100 Chicago laborers are being flown to Orlando to help set up the plastics show there. "They will be put up in hotels, fed, and all the rest, and it's still cheaper to do business there than here," he said.

• Setting up an ice machine in Orlando costs $720. Setting one up in Chicago costs $1,700, said Eric Holm of Manitowoc Foodservice. Ordering power for the company's booth in Orlando costs $9,200. Chicago? $12,800, plus $5,000 for labor. The cost for 24-hour service for one refrigerator is $48 in Orlando, $400 in Chicago.

You get the idea. Everybody's tired of getting fleeced here. They're leaving. That's going to put a lot of Chicagoans out of work.

Legislators will hear Wednesday from McPier's managers and unions. It won't help if they use that opportunity to point fingers elsewhere. They need to propose radical changes in the structure of management and labor. The reconstituted McPier board has some old faces, but it also has some new, no-nonsense members whose instinct will be to force changes now. We're counting on them to rise to the crisis.

Other cities are watching what's happening here. They're banking on our lethargy.

"Most are convinced nothing will change," Deborah Sexton, president of the Professional Convention Management Association, told the lawmakers. "They hope nothing will change."
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Copyright © 2010, Chicago Tribune


Billy Dennis said...

Merle: How do Chicago's rates compare to New York? Los Angeles? Las Vegas?

Merle Widmer said...


Much higher. Have been for a long, long time, but people prefer to go to Chicago over the cheaper cities.

For conventions, Chicago is more centralized, has a much more attrative venue for a variety of things to do. The unions know that and will charge what the market will bear. When things get too expensive, business look for other areas. They are moving out of Illinois as I've quoted in one of my blogs. Haulers who relocate more business out of Illinois than they haul in.

Look at what's happening at Caterpillar in Morton and Mossville.

Rates would depend on the rates of all the different unions.

This article is merely calling attention to the existence of an ongoing situation. I was in business and used McCormick place several times to ship in, set up and ship out. Did the same at Vegas. Never had a choice because that is where the conventions where held so I'd pay what they charge.

Merle Widmer said...

Billy, Contact those personell who set up convention showplaces like State Farm or Caterpillar. They will give you rates.

Chicago is more expensive and has been for years.

dd said...

Merle, the fact nuggets in the article are disputed. I refer you to Eric Zorn's Chicago Tribune Blog where he has allowed union workers to respond to the allegations. I hope everyone would take a look at them:


Merle Widmer said...

Radical union workers would unionize the whole country if they could. Where government is involved, they are succeeding.

Why do you think Cat is relocating to right-to-work states and why Obama is trying his best (and succeeding, somewhat; airline baggage inspectors in all states must belong to a union)?