(a) In the course of managing real property that it owns or in otherwise carrying out its functions in the public interest, the District may participate in real property developments as a property owner, lessor, proprietor, lender, or guarantor, facing similar risks and liabilities as other business entities participating in such ventures. As a result, the District has an ongoing proprietary interest in these developments and a direct interest in their financial performance.
(b) The District must make prudent management decisions, similar to any private business entity, to ensure efficient management of its business concerns and to maximize benefits and minimize risks. One risk is the possibility of labor-management conflict.
(c) A major potential outcome of labor-management conflict is economic action by labor unions against employers. Experience of municipal and other investors demonstrates, for example, that organizing drives pursuant to the formal and adversarial union certification process often deteriorate into protracted and acrimonious labor-management conflict. Labor-management conflict can result in construction delays, work stoppages, picketing, strikes, consumer boycotts, and other forms of adverse economic pressure. Such conflict may adversely affect the District's financial or other proprietary business interests by causing delay in the completion of a project, reducing the revenues or increasing the costs of the project, and by generating negative publicity.
(d) These risks are heightened in the hotel industry because this industry is so closely related to tourism, which is a linchpin of the District economy. Labor-management conflict in hotel projects in which the District is an economic participant can jeopardize the operation of related tourist and commercial facilities, as well as the District's national reputation as a tourist and convention destination.
(e) One method of reducing the risk to the District's proprietary interests is to require, as a condition of the District's investment or other economic participation in a development project, that employers taking part in the development project seek agreements with labor organizations in which the labor organizations agree to forbear from adverse economic action against the employers' operations.
CREDIT(S)
(Apr. 2, 2003, D.C. Law 14-266, § 2, 50 DCR 412.)
HISTORICAL AND STATUTORY NOTES
Legislative History of Laws
Law 14-266, the “Hotel Development Projects Labor Peace Agreement Act of 2002”, was introduced in Council and assigned Bill No. 14-7, which was referred to the Committee on Economic Development. The Bill was adopted on first and second readings on December 3, 2002, and December 17, 2002, respectively. Signed by the Mayor on January 7, 2003, it was assigned Act No. 14-577 and transmitted to both Houses of Congress for its review. D.C. Law 14-266 became effective on April 2, 2003.