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Gaming Guru

Arnold M. Knightly
 

Strip construction sites back to work

4 June 2008

and Howard Stutz

LAS VEGAS, NEVADA -- Construction workers ended a one-day strike and returned to work on two Strip resort projects Tuesday night, after the projects' general contractor agreed to take steps to address union officials' safety concerns about the job sites.

"We have come to an arrangement and an understanding," Steve Ross, secretary-treasurer of the Southern Nevada Building and Construction Trades Council, said Tuesday afternoon at a news conference that took place on the Las Vegas Boulevard median in front of the $9.2 billion CityCenter development. "I am happy to say our long- lasting relationship is going to continue."

Perini Building Co. agreed to all the council's demands "and then some," allowing the union alliance to let its workers return to work at the CityCenter and Cosmopolitan job sites less than 24 hours after workers shut down all work on the two Strip projects.

Perini is general contractor on both CityCenter and the $3.9 billion Cosmopolitan, where a total of eight workers have died in the past 16 months.

"A lot of people have died, too many," said Paul Jones, 47, an electrician who was walking the picket line near the CityCenter construction offices on Frank Sinatra Drive earlier Tuesday. "They need to tighten safety up."

Workers at the Cosmopolitan project were scheduled to return to work at 9 p.m. with work resuming at the CityCenter site at midnight, Ross said.

Union workers began packing away their picket signs around 3 p.m. Tuesday after being informed of the agreement.

Earlier in the day, the workers had been in front of CityCenter carrying signs reading "On Strike/Unsafe Job Site" and chanting "CityCemetery" and "No More Death."

The union group agreed to let workers return to work after Perini agreed to:

* Allow the Center for Construction Research and Training to perform a safety assessment of the work sites.

* Allow the center to implement on-site training for all construction workers.

* Agreed to give union and safety officials full access to the work sites.

"Perini is on board with us, and we are moving in that direction," Ross said Tuesday afternoon.

Perini officials, who did not attend the news conference, were not available to comment beyond a statement released late Tuesday afternoon.

The company said it was concerned about the "recent incidents" at its Las Vegas projects but is committed to working with the building trades, subcontractors and suppliers to improve safety efforts.

"Our policy has been to provide OSHA 10 training to all supervisory employees on Perini's current Las Vegas projects," the statement read. "We have agreed with the Building Trades Council and local unions to identify all trades employees working at the CityCenter and Cosmopolitan job sites who have not already completed OSHA 10 training and to make such training available during work hours to all current trade employees on-site."

MGM Mirage, which is building the massive CityCenter as a joint venture with Dubai World, the investment arm of the Persian Gulf state of Dubai, welcomed the end of the walkout.

"We have been informed of today's agreement between Perini and the Building Trades," the company said in a statement released Tuesday afternoon. "We will continue to insist that Perini, its subcontractors, and the unions work together to ensure that safety awareness and individual responsibility is foremost in the minds of every worker every day on the job site."

MGM Mirage officials were not part of the discussions, and allowed Perini to handle the dispute.

Shares of MGM Mirage were down throughout the day on the New York Stock Exchange, closing at $47.05, down 86 cents or 1.79 percent although it was unclear whether news of the work stoppage influenced MGM Mirage's standing in the financial markets Tuesday.

Gaming analysts said revenue reports from Macau during May, where the company operates the MGM Grand Macau, had more effect on investors' spending habits.

Macquarie Securities gaming analyst Joel Simkins said the deaths of construction workers at CityCenter and accidents at other Strip job sites have given MGM Mirage and other casino developers "a black eye."

"It is unclear how the recent action will affect the timing of this project," Simkins said in an investors note. "Given the recent challenges that some operators have had in opening casino resorts before all of the work has been completed, this could complicate the opening and initial success of CityCenter."

Neither MGM Mirage nor the labor council had an estimate on how much the walkout cost the company or the workers in lost wages.

The CityCenter project had been employing about 4,500 people during the last month, with a payroll of more than $1 million a day.

CityCenter includes its centerpiece, the 61-story, 4,000-room Aria hotel-casino, and four high-rise residential and boutique nongaming hotels. City Center will also house The Crystals, a 500,000 square-foot retail, dining and entertainment complex.

CityCenter is expected to open in phases starting in August 2009 with Vdara, a 57-story condominium-hotel complex that was topped off last month. The entire project was expected to be open by December 2009.

While MGM Mirage controls CityCenter, the Cosmopolitan, a 2,998-room condominium and hotel project, is being funded by Wall Street investment firm Deutsche Bank while a new owner is sought.

Foreclosure proceedings began in January on the project's owner, New York-based developer Bruce Eichner.

Monday's walkout was driven by Saturday's death of 39-year-old Dustin Tarter at CityCenter, the sixth fatal accident on the 76-acre job site since February 2007.

"After this sixth death had occurred the other day, something had to be done," said Ross, a Las Vegas city councilman.

Tate McGinty, president of the local plumbers and pipe fitters union, said that while the agreement would improve working conditions on the CityCenter job site, the change would be a slow process and danger would remain as workers hustle to meet a planned opening in late 2009.

"They need to slow down a little bit," McGinty said.

Tony Illia of Business Press and The Associated Press contributed to this report.