President's Corner

 

January 2021 Light at the End of the Tunnel

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President’s Corner

Brothers and Sisters, 

It has been far too long since we have all been together for a meeting, and I am pleased to say that coming out of a truly surreal year, I have a lot of good news to share with you. In addition to an encouraging work outlook for 2021, our benefit funds are in great shape, and we are seeing positive light at the end of the tunnel on several of the political challenges that the union has confronted over the past year. 

On the benefit side, I want to start with something that has been a frequent topic of discussion over the past few months. As we approached the end of the last fiscal year in March 2020, the financial markets had crashed and were in an unpredictable state of disarray. Without knowing what the pandemic’s effects would be on our Pension Fund, we made a challenging decision to postpone by one year the pension improvements that were approved the previous fall. Instead of accruing all contributions (and discontinuing any future “bucket” money) starting on April 1, 2020, we moved the effective date to April 1, 2021. Our current fiscal year doesn’t end until March 31st, but with the recovery and general positive trend of the financial markets and our pension investments over the last 10 months, we are in a better place than we were when we delayed the implementation. 

This was a decision not made lightly by any of the Fund Trustees, but we knew that it was our only chance to stay out of the “yellow zone” if the markets continued to decline. Enacting a benefit improvement that drives the fund into endangered status is an exercise in futility, because that new status would require us to make benefit concessions. With this in mind, I appreciate all of the members who have shared their understanding of the necessity of this move. 

Through a truly remarkable year, our Welfare Fund has remained strong, and by offering telehealth appointments through the Operators’ Health Centers, we were able to see more members and reduce the per-appointment cost. Being able to pivot quickly to continue to meet members’ medical needs while many medical facilities were not accepting patients is a massive accomplishment, and to be able to do so in a way that saved our fund money is just an added benefit. Thank you to all of you for being patient with this new way of seeing your doctors, and a big thanks to the staff of the Welfare Fund and the Operators’ Health Centers for delivering such a great experience. 

I want to remind active and retired members of an opportunity to preserve some of your retirement savings through our Retirement Enhancement Fund (REF), which is administered by Fidelity. As I have reported here many times over the past decade, we have continued to be successful using the growing balance of the REF to negotiate a lower fee structure from Fidelity. With a typical individual retirement account, a broker typically charges participants an administrative or management fee of around one percent of their accounts, and each investment fund carries additional fees. For example, most mutual funds carry a fee of around one percent. So if you have an IRA, 401(k), or another investment account, you might be paying two percent or more in fees, which ultimately eats into your gains. 

The REF currently has an all-in fee structure of around 0.87 percent, and you have the option of rolling other qualified retirement plans into your REF if you wish to. Of course, you would want to ensure that you know what your current fees are and think carefully on it, but a number of members have chosen to roll their other accounts into the REF and reduced their fee structure considerably in the process. 

Finally, on the benefits side, we have received an increasing number of calls about the availability of COVID-19 vaccines for the membership. I can tell you that we have had dialogues with the Governors of Illinois and Indiana, and we are working to secure vaccines that could be administered to our members through the Operators’ Health Centers or pharmacies, but there is no certainty on a timeline as I write this. As you can imagine, everyone is fighting to access vaccines, and we will continue to report on our efforts, but in the meantime, if you have an opportunity to get a vaccine, take it. Vaccination costs are covered by the federal government, and without a timeline on our ability to provide them, I do not recommend that anyone decline an opportunity to get vaccinated if they have it. 

In my lifetime, politics have never felt so divisive. Local 150 members, like all Americans, find themselves firmly planted on both sides of the political spectrum – and everywhere in between. It was for this reason that we did not make an endorsement for the Presidential race in 2020. With that said, our nation has a new administration, and we have seen several developments in its early days that impact our union and our membership. 

First, I want to start off with some great news. Peter Robb, the union-busting General Counsel of the National Labor Relations Board (NLRB), was fired the day after the inauguration after refusing calls to resign. Robb singlehandedly waged wars against Scabby the Rat and our right to organize that have consumed massive amounts of our time and effort to combat over the past two years. Our organizers and Legal Department have been met with nothing but hostility and senseless lawsuits from the NLRB, an agency that is meant to promote labor harmony. 

Robb’s firing is great news for a couple of reasons. First, it reduces the likelihood that we will have to dedicate our resources to defending our most basic established rights and can get back on the offense. Secondly, it demonstrates that this administration has close enough ties to organized labor to understand the importance of dumping a hack like Peter Robb quickly. We have been calling for his removal for years and having him out of there will leave each and every member’s rights a little bit more secure. 

I was disappointed by the termination of the Keystone XL project’s permits on the first day of the new administration. It is my understanding that this is a continued fight to change the route of the pipeline, but our International encompasses members working on both sides of the U.S.-Canada border and will be working with the administration to find a way to continue moving this project forward. While this particular pipeline doesn’t have major employment implications for Local 150, we do have members who make their living working on pipelines, and it is important that decisions regarding energy infrastructure are made with thorough consideration of their impact on current and future employment. 

While he has hinted at a broad and robust infrastructure plan, President Biden has not yet released the full details at the time of writing. I am encouraged by statements from within his administration that infrastructure investment will be treated as the national priority that it is, both in the short term and for years to come. There is certainly a place in an economic stimulus plan for immediate infrastructure spending, but America also needs a long-term sustainable plan with as much investment as possible. Lawmakers in Illinois and Indiana have proven that increasing revenue sources like motor fuel taxes do deliver major job creation, and the time has come for those in Washington to show the same level of dedication. 

The work outlook for 2021 is generally quite positive at this time. Some of the uncertainty that impacted construction in the early phases of the pandemic has dissipated, and the availability of cheap money for developers has them back to planning projects. 

Across our jurisdiction, infrastructure will continue to be our bread and butter. The Illinois Tollway’s $1.5 billion budget is its largest ever, and it is accompanied by a $3.1 billion budget from the Illinois Department of Transportation, which is the result of our efforts to push a motor fuel tax increase. We are also expecting a strong year from the Indiana Department of Transportation. As road and bridge work begins to ramp up, so will the slag industry as well as pits and quarries. 

Gas infrastructure work in and around the City of Chicago is going to continue to put Local 150 members to work this year, with a budget of around $700 million for capital projects in 2021. We were able to extend the project labor agreements we have with both Nicor and Peoples Gas. Both PLAs have included gas distribution work, and we have expanded the scope of the agreement with Nicor to include mainline pipeline work. We are in the process of finalizing a similar agreement with Peoples. 

In downtown Chicago, 15 tower cranes will go up in the first three months of this year. While this isn’t a surefire indicator of the economy, it is a marked improvement over how things were looking only a few months ago. As I said, developers have access to cheap money, and they look eager to get back in the game. 

The suburban residential market has seen incredible demand over the past six months, which has led to increases in both prices and demand. We are expecting to see more growth in residential construction, which will support our land-banking efforts. For decades, land has been a profitable investment for our union, and that trend continues. We were negotiating the purchase of some land in St. Charles, Illinois when the pandemic began. The uncertainty in the real estate market at that time allowed us to purchase the land for a lower price than we planned, and thanks to the new residential boom, we sold the land to a homebuilder at a profit with agreements in place to ensure that all of our work is done union. 

One of the industries that was hit hardest by the pandemic was the steel industry, where many of our members in Indiana perform maintenance work. It was truly a difficult year for those members, and we worked quickly to open up training opportunities that would help them find work in other industries. ArcelorMittal was purchased by Cleveland-Cliffs, and that is likely to result in some large capital projects. Steel production is increasing generally at this time, and the employment for our members in the mills should continue to improve. 

Finally, I am humbled to share with you that IUOE General President Callahan and the General Executive Board have appointed me to serve as the General Secretary-Treasurer of the International Union. I would only accept this appointment on the condition that I could fulfill it while continuing to serve as President-Business Manager of Local 150. I will continue to work from Countryside, and I remain steadfast in my dedication to our membership. 

This is a tremendous honor, and I am looking forward to helping General President Callahan continue to strengthen our International Union. I believe that our union is an example of what a union can achieve when its members are involved and united, and I am proud to be able to represent Local 150’s membership at the highest level. 

United We Stand, Divided We Fall.