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Disagreements between developer, labor unions loom over Concord reuse project

The Concord City Council may have directed both the master developer and a labor consortium poised to begin development of the former Concord Naval Weapons Station property to work out their differences, but letters from both the developer and the unions indicate those talks may not be smooth, at least right away.

The city has received separate letters, both dated Jan. 17, from the developer Lennar and from the Contra Costa Building and Construction Trades Council. And the key points of disagreement that led to an impasse being declared in October to reaching labor agreements for the weapons station remake (formally known as the Concord Community Reuse Project) appear to remain.

In its letter to the city, Lennar President Jonathan Jaffe said the extent of union labor called for by the Building Trades Council is unworkable financially.

Jaffe said in his company’s letter:

“The city’s own expert conclusively found that the present demands of labor make the project infeasible.”

That city analysis, the letter states, shows using the trades council’s recommended proportion of union labor “could result in a negative rate of return” for the first phase of the reuse project.

Lennar officials have said that the difference between its own overall labor offer and the Building Trades Council’s overall request is about $546 million.

Daniel Schwen/Wikimedia Commons An aerial view of the former Concord Naval Weapons Station in Concord, Calif.

Bill Whitney, CEO of the building trades council, in his Jan. 17 letter reminded the city that it is the council that said the Reuse Project’s work should meet specific “Concord First” goals including 40 percent of labor hires being from Concord, an approved apprenticeship program, priority for veterans in hiring and training and paying at least a “prevailing wage” to hired labor. The project labor agreements, Whitney said, should reflect that.

Whitney, who also said his labor council would welcome involvement of a mediator familiar with large-scale project labor agreements, said:

“There is no secret about our frustration with Lennar’s approach to the PLA negotiations thus far.” 

The reuse plan for the 5,000-acre weapons station site — one of the biggest such projects in Northern California — calls for building 13,000 residences, commercial and office space, a college campus and other amenities on 2,300 acres. Most of the development would be near the North Concord-Martinez BART station, just south of state Highway 4 on Concord’s northeast edge.

On Jan. 8, Kofi Bonner, co-COO of FivePoint-Lennar and of the reuse project, told the City Council he wasn’t sure the city’s request for Lennar and the unions to resume talks is a significant way to break the impasse. But beyond that, near the end of the second day of that long hearing, officials from both Lennar and the Building Trades Council agreed to meet soon, at a date to be determined.

Pi.1415926535/Wikimedia Commons BART tracks near the North Concord-Martinez station in North Concord, Calif. Surrounding land is part of the former Concord Naval Weapons Station.

He also said at that same hearing that if a suitable group of labor agreements can’t be reached, that Lennar would withdraw as master developer of the reuse project.

And in Jaffe’s Jan. 17 letter to Concord, he laid out four items he requests the city do by Feb. 11 “to move forward with the project”:

  • Confirm that Lennar has acted in good faith with the city and the unions.
  • Confirm that negotiating with one of more individual unions, rather than the trades council, will satisfy the city’s expectations for reaching out to labor.
  • Confirm “prevailing wages” according to the overall agreement.
  • Approve a six-month extension of the overarching agreement to negotiate these various labor agreements.

In his own letter to the labor council’s Whitney, dated Jan. 16, Concord Mayor Tim McGallian implored the building trades council to work on an agreement with Lennar.

McGallian wrote:

“While we appreciate that this may be an effort-intensive process, and that compromise on both sides will be required, we are confident that (Building Trades Council) and Lennar will craft a resolution that enables the (reuse) project to Progress.”

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