Union pension funds’ $1 Billion investment in Missouri projects demonstrates yet another value of unions to our state’s economy

By ED FINKELSTEIN

Publisher

© Labor Tribune Publishing Company

Union pension fund investments helping build Missouri, creating both construction and follow-on permanent jobs, and stimulating tremendous economic growth are nearing the $2.3 BILLION mark – $928,714,381 in specific cash investments and $1.4 Billion in the ripple impact of those investments – a Labor Tribune survey of the four major union lending organizations reveals.

This is the equivalent of building 6.3 Busch Stadiums, which cost $365 million to complete.

These numbers do not take into account hundreds of millions of additional dollars that were pumped into these projects by their owners. One example is the projects financed by the AFL-CIO Housing Investment Trust (HIT); the HIT commitment for their 29 Missouri projects was for $464,581,500. The projects’ owners put up an additional $327,786,484 to make them a reality. Additional investment numbers for the other three groups were not immediately available.

The organizations using union pension funds for financing Missouri projects are:

• AFL-CIO Housing Investment Trust (HIT): $464,581,500 for 29 projects;

• Multi-Employers Pension Trust (MEPT): $238,000,000 for 11 projects;

• AFL-CIO Building Investment Trust (BIT): $139,026,381 for 10 projects;

• Union Labor Life Insurance Company (ULLIC): $87,106,500 for nine projects.

LOTS OF WORK HOURS

In construction man-hours alone, an estimated total of 21,637,389 man-hours were created to build the 59 individual projects in Missouri.

The investments were made for multi-family housing, warehouses, industrial and office buildings, apartments, retirement centers, assisted living facilities, elderly housing, retail facilities and industrial parks, both for new construction and renovations.

Investments were made across Missouri: in St. Louis, Kansas City, Arnold, St. Charles, Hannibal, Festus, Olivette, Independence, Shrewsbury, and O’Fallon.

“In an environment where jobs and economic growth are critically needed to turn this country around, we believe that state and local leader ought to be looking for ways to encourage this kind of investment,” noted Mike Ibarra, MEPT senior vice president, investor relations.

PERILOUS DEATHHOLD TO RIPOFF THE WORKERS

As the Republican deathhold on the Missouri legislature continues its relentless drive to castrate labor unions, they ignore at their own peril, and the peril of Missouri’s economy, the tremendous economic engine unions and their pension funds provide to help Missouri survive the recession.

If successful in their current efforts to kill the prevailing wage law, impose paycheck deception on public employees and pass the phony, anti-worker Ripoff The Workers (right-to-work for less or the new jargon, “freedom”-to-work) law, lawmakers will destroy tens of thousands of jobs created by this union investment and threaten future employment for tens of thousands of Missourians when additional union pension fund investments in Missouri dry up as a result.

BUT EVEN MORE IS AT STAKE

“This is only one aspect of the union investments in Missouri

that are at stake,” said Bob Soutier, president, St. Louis Labor Council. “When you consider the actual payments made to our members for pensions, payments to hospitals and medical providers for health care from our Health Care Funds and the actual wages earned by our members that go right back into the economy of every community in Missouri, all of which pumps billions more into our state’s economy, what the Republican leadership is trying to do to our union members is not only a travesty, it’s immoral.”

“Attacking union families and their unions is backwards thinking and unconscionable,” added Jeff Aboussie, executive-secretary-treasurer of the St. Louis Building Trades Council, “when you realize the investment our construction unions and employers make every year for training, some $78 million from their own paychecks, money the state doesn’t have to invest in skills training, the tens of thousands of man-hours our members donate to every conceivable charity for desperately needed renovations or new construction, to say nothing of the outright donations our unions and members make directly to their favorite charities, their churches or synagogues and other groups.”

‘FAMILY BUSTING’

“This is more than union busting, it’s family busting,” said Hugh McVey, president, Missouri AFL-CIO. “By trying to destroy or cripple our unions, legislators are really crippling Missouri’s union families, many who are their constituents. In an effort to do the bidding of some big business interests, these Republican legislators are being short-sighted and are willing to sacrifice the future of our state’s economy and the welfare of Missouri families, both union and non-union because the goal of their benefactors is simply to lower wages and working conditions so that more money goes to the corporations’ bottom line.

“Too many of our new lawmakers simple don’t understand what’s really at stake; they appear to be more interested in collecting donations for their next election than in doing the peoples’ work of helping workers everywhere. When working families prosper, the entire state prospers and visa versa,” McVey added.

UNION INVESTMENT GROUPS

The four investment groups that use union pension funds and their Missouri investments are:

• AFL-CIO Housing Investment Trust (HIT): The AFL-CIO’s HIT takes great pride in its history of investing union pension fund to achieve competitive risk-adjusted returns while also pursuing socially responsible objectives important to working men and women. Those social benefits include expanding the supply of affordable housing, creating family-supporting union jobs, opening doors to homeownership for working families, and revitalizing communities where union members live and work.

Just since 2009, in a period when few others were investing in construction, the HIT’s Construction Jobs Initiative financed 57 projects  in 29 cities across the country. These investments have generated some 16,000 union jobs and created or preserved nearly 20,000 housing or healthcare units. HIT investments of nearly $1.3 billion together with $68 million of New Markets Tax Credits from Building America have launched more than $3 billion of development through this initiative.

• Multi-Employers Pension Trust (MEPT): Founded in 1982, MEPT now has over $5.60 billion in net assets and has become one of the largest real estate equity funds in the U.S. Recognized as a pioneer in responsible property investing, MEPT is the largest commingled real estate fund in the U.S signatory to the United Nations Principles for Responsible Investment. It maintains a Responsible Contractor Policy that requires that all contractors working on its portfolio properties be signatory to collective bargaining agreements with legitimate trade unions.

• AFL-CIO Building Investment Trust (BIT): Created by the AFL-CIO in 1988 BIT’s principal objectives are to generate competitive income and long-term capital appreciation while protecting pension fund capital to provide retirement security for union members. BIT also created and operates with one of the most comprehensive union labor policies in the U.S. real estate industry, helping to create union jobs throughout the country.

BIT investments have created approximately 54 million hours of union construction work, plus thousands of union jobs in the maintenance and operation of BIT properties. BIT has invested $4.3 billion to finance over 25 million square feet of commercial real estate and more than 12,000 apartment units over the past 20 years.

• Union Labor Life Insurance Company (ULLICO): At a time when life insurance was not available to union members, Samuel Gompers, the first and longest-serving president of the American Federation of Labor (AFL), saw the value of a union-owned insurance company.

As a result, on May 1, 1927 The Union Labor Life Insurance Company (ULLICO) – the only labor-owned insurance and investment company in America – opened for business. Since the first group life insurance policy was issued to Federal Employees Local 105 in Washington, D.C., ULLICO has stood shoulder-to-shoulder with union members and employers to ensure financial security and peace of mind.

From insurance products for union members- medical stop loss, group term life, accidental death and dismemberment, group disability, vision, prescription benefits management- and innovative risk management solutions for contractors and employers to investments in infrastructure that have created thousands of union jobs around the country through its “J for Jobs” program, ULLICO has been devoted to making life better for millions of Americans.

Chairman of the Board is St. Louis’ Joe Hunt, former business manager of Iron Workers Local 396 and past president of the Iron Workers International Union. Chief Executive Officer (and former president) is Ed Smith, formerly business manager of the Laborers District Council in Southern Illinois.