New rules seek to cut costs at McCormick Place

April 21, 2010 (CHICAGO)

A board that oversees McCormick Place is looking for lawmakers' approval to dissolve some union work rules, refinance debt and allow exhibitors to order in outside food.

It's sounding a lot like new leaders at McCormick Place want to be the Southwest Airlines of the convention business. They said Wednesday McCormick Place needs to be a low cost provider, even if that means it won't produce a profit for the city or state.

The board is tasked with turning around McCormick Place to ensure it continues to draw conventions and crowds.

"Recommendations we have made today are sweeping and they are bold," said John Gates, Jr., Metropolitan Pier and Exposition Authority.

The changes are in response to a revolt by convention planners who say Chicago has the highest cost and most red tape.

Among the recommendations:

  • Make union workers public employees, so they can't strike and will likely have to change work rules.
  • Dissolve "Focus One," the in-house group that provides electrical, plumbing and other utilities. Soon, exhibitors may have the right to hire outside contractors.
  • McCormick Place's exclusive catering contract would also be canned, allowing customers to order in their own food. That's of concern to 16-year-old cashier Bertha McGee.
  • "There will be no quality, no control along with the fact that a lot of workers will be out of work," said McGee.

    "I don't think you have anyone on that panel today that knows what it takes to put a trade show on," said Rob Fulton, Riggers Local 136.

    McCormick Place workers would still be union members, but clearly they'll be asked to make more concessions. Board members say by eliminating McCormick Place's piece of the profit pie on things like electrical work and food they'll be able to compete on price.

    "The time to act is now. This is not about the past. It's about the future," said Gates.

    "I think it was a group of people that sat on that panel and said 'we have to do something whether it's right, wrong or indifferent," said Fulton.

    McCormick Place is burning through cash now. How will it give up revenue from food and labor and still break even? Board members say Springfield needs to allow them to refinance debt currently covered by sales tax dollars. They insist the savings will cover any profits lost. Some, not all, of these changes need approval from Springfield. That debate has only just begun.

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