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2017 Issue Brief: Labor Peace Agreement Mandate BACKGROUND: There have been proposals during recent sessions of the Minnesota Legislature to require a “labor peace agreement” for any hospitality project which receives financial assistance from the state or a local government. Qualifying projects could include hotels, major or minor league sports facilities, convention centers, civic centers or cultural venues with food and beverage operations, catering or cafeteria facilities. A labor peace agreement is a binding contract between the owner or developer of a hospitality facility and any labor organization seeking to represent hospitality workers. POSITION: Oppose passage of a Labor Peace Agreement mandate. SUPPORTING STATEMENTS: • This proposal is a massive intrusion into free markets which makes Minnesota a much less attractive place to build, own or franchise a hotel. Developers with other options will find it more attractive and economical to expand in states that do not have the labor peace agreement provision. • The bill appears to apply to hotels of any size that receive even a very small amount of assistance. A 50-room, limited-service hotel in a suburb where the city helps with a traffic signal shouldn’t be treated the same way as a very large project with significant assistance. • An unlevel playing field is created between communities because the bill could apply differently in different cities. This isn’t fair to communities that may want and need development. • The requirement for binding arbitration is very aggressive and unreasonable. A developer or operator who is required to negotiate a labor peace agreement prior to commencing construction is essentially being asked to negotiate against themselves. The voice of Minesota’s lodging industry 1959 Sloan Place, Suite 120, Saint Paul, MN 55117-2070 (651) 778-2400 industry website www.mnlodging.org consumer website www.hotelsmn.com