First & Spring:  Labor and business groups in L.A. are united against one housing measure — and divided by another

The bruising political fight over housing construction in Los Angeles just got way more complicated.

For months, labor unions and business groups have been working together to defeat a ballot proposal, known as the Neighborhood Integrity Initiative, that’s been billed as a crackdown on real estate “overdevelopment.” They have tried to present a unified front, arguing the proposal would bring housing production to a sudden halt.

But that alliance came under serious strain last week, after union leaders revealed they had, without the support of business groups, submitted a competing measure for the Nov. 8 ballot, one that puts new hiring and affordable housing requirements on real estate projects.

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Business leaders, some of them caught by surprise by the new proposal, said it too is a threat to the development of new homes.

“The labor initiative is just going to kill small and mid-sized apartment projects in the city of Los Angeles. They’re just not going to get built,” said Stuart Waldman, president of the Valley Industry and Commerce Assn.

How labor and business get along in coming months could have major implications for the city, which is grappling with steadily rising rents and growing homelessness.

The Neighborhood Integrity Initiative, still in the signature-gathering stage, calls for a two-year moratorium on major development projects that require changes to planning and zoning rules. Backers of the proposal, including the AIDS Healthcare Foundation, say it will provide relief to Angelenos who are seeing rent-controlled apartment buildings razed and replaced by luxury housing developments.

Fighting that measure is a coalition of unions, business groups, affordable housing advocates and other organizations. But the business leaders now face a potentially awkward task: work with labor leaders to stop one L.A. housing measure while simultaneously combating them on a second housing measure in the same election.

“It puts business in a tough spot because labor is probably the most important ally in fighting the Neighborhood Integrity Initiative,” said real estate developer Mott Smith. “But if you are pro-housing production … you probably have to oppose this [union measure] too, which would alienate labor.”

Waldman and other foes of the AIDS Healthcare measure dismissed the idea that their coalition, which has been meeting privately for weeks, is in any way fractured as a result of the union ballot proposal.

“Everybody understands the extreme threat that the anti-housing initiative poses to the city’s economy, affordable housing and housing for middle-class families,” said Mike Shimpock, a spokesman for the coalition’s campaign. “And that’s going to override any ideological or political differences people might have.”

Those assurances have not entirely silenced the frustration. Carol Schatz, who heads the downtown Central City Assn., said her group belongs to the coalition fighting the AIDS Healthcare measure. Nevertheless, labor officials in that coalition never told the Central City Assn. they were working on a separate ballot proposal, she said.

“It’s outrageous,” Schatz added.

The behind-the-scenes machinations come in the midst of a real estate boom that is bringing high-rise residential projects to downtown, Hollywood, Koreatown and other neighborhoods. Backers of both the union measure and the AIDS Healthcare proposal say the burst of construction activity is producing a negligible amount of affordable housing.

Nevertheless, supporters of the AIDS Healthcare measure reject the notion that their proposal will cause housing construction to stop in the city. They contend their measure would affect only a small percentage of the city’s real estate projects — those that need changes to existing planning and zoning laws.

The Neighborhood Integrity Initiative “says no more rezoning piece by piece, no more overnight millionaires because [developers] cut a deal with the City Council to put a huge building on a tiny lot,” said Jill Stewart, spokeswoman for the Coalition to Preserve L.A., which formed to promote the measure.

The union measure, backed by the Los Angeles County Federation of Labor, also targets real estate projects that need changes to planning and zoning rules, such as those that regulate a building’s height. But under the union proposal, developers of those projects would, in many cases, need to pay for affordable housing and ensure that a percentage of their construction workers live in Los Angeles and are economically disadvantaged.

Supporters of the union measure, formally known as the Campaign for a Better L.A., say they remain committed to stopping the Neighborhood Integrity Initiative. At the same time, they made clear they had done little to sell their own housing measure to members of the business community.

Instead, organizers obtained support from anti-poverty advocates, construction trade unions and the Southern California Assn. of Non-Profit Housing, a group that represents nonprofit developers.

“For us, the most important business group is the folks who on a daily basis build the affordable housing for the low-income amongst us,” said Kokayi Kwa Jitahidi, the labor federation’s director of policy.

Business leaders were not kept entirely out of the loop. Two days before the union measure was submitted to the city clerk, the labor federation sent its final draft to the Los Angeles Area Chamber of Commerce.

The proposal was also discussed at a Feb. 11 meeting called by City Council President Herb Wesson for business and housing leaders to discuss the November election. During that meeting, union leaders offered a “broad brush strokes outline” of their ballot proposal, said Wesson spokeswoman Vanessa Rodriguez.

Wesson has not taken a position yet on the measure because it has not qualified for the ballot, she said.

Both proposals will need 61,486 valid signatures to qualify for the ballot, according to city officials.

City Hall lobbyist Jerry Neuman, an opponent of the AIDS Healthcare measure, said he wished that business leaders had been given an opportunity to shape the union proposal. Nevertheless, he said he is prepared to keep working with labor officials in fighting the Neighborhood Integrity Initiative.

“I think we have aligned interests,” he said.

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Twitter: @davidzahniser

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