Contractor complains about local hiring at development

by Caroline Connors

The redevelopment of the northwest corner of 111th Street and Kedzie Avenue may be a sign of hope for the economy of the Mt. Greenwood community, but it isn’t necessarily creating jobs for local tradespeople looking for work.

After learning that a northwest suburban company was awarded the contract for work he had bid on, a Morgan Park contractor, who declined to be identified in this article, is questioning the number of local residents or contractors hired to construct a 1.9-acre, 17,500-square-foot retail plaza that will include a new Walgreens, an outdoor seating area and parking lot.

The $10.5-million project is being developed by Terraco Development, a Wilmette-based real estate development and management company, and constructed by G.A. Johnson & Son, an Evanston-based commercial builder and general contractor. Both companies specialize in shopping centers and retail developments, with an emphasis on food and drug stores, according to their Web sites.

Although he could not specify how many 19th Ward residents were hired for construction of the project, which is located in a Tax Increment Financing (TIF) district, Terraco Development President Scott Gendell said the project is being performed in compliance with requirements set forth by the city of Chicago for a TIF-funded project.

According to Susan Massel, spokeswoman for the Chicago Department of Community Development, those requirements stipulate that 50 percent of the labor hours associated with the construction budget must be awarded to city residents; 24 percent of the dollar volume of the construction budget must be awarded to city-certified minority business enterprises (MBE); and 4 percent of the dollar volume of the construction budget must be awarded to city-certified women business enterprises (WBE).

The developer is also required to pay prevailing wages for the project, which are determined by the Illinois Department of Labor, and to submit weekly or bi-weekly payroll documentation to the monitoring and compliance board of the city’s Department of Community Development, Massel said.

Mary Beth Waller, chief of staff for 19th Ward Ald. Ginger Rugai, said Rugai spoke to Terraco officials about hiring from the community well before ground was broken at the site, but the company is not legally obligated to do so.

“There are all sorts of rules that apply, but Ginger asked that preference be given to residents of the 19th Ward,” Waller said. “Would she want to see our people get the work? Absolutely.”

John Creigh, vice president of G.A. Johnson & Son, denied a request for a list of subcontractors hired for the project, and phone calls and e-mails to G.A. Johnson requesting the total number of tradespeople employed for the project were not returned.

While they are not required to hire from within the community in which they are working, some developers do participate in workforce hiring programs in Chicago. In its $900-million expansion project that included $75 million in TIF money, for instance, Rush University Medical Center set a goal for its on-site workforce hours to include 5 percent community residents, with preference given to residents of the 2nd and 27th wards.

The contractor for the Rush project also agreed to hire graduates from the Dawson Technical Institute at Kennedy-King College, with preference given to graduates residing in the 2nd and 27th wards.

In addition, during construction of Marshfield Plaza at 119th Street and Marshfield Avenue in Chicago, developer Primestor collaborated with Dawson and Community Assistance Programs (CAP), a notfor- profit employment agency that provides employment training and job placement services. The developer posted an “employment interest form” on the Marshfield Plaza Web site and held a pre-construction orientation at the CAP facility, 240 W. 107th Pl., with the goal of preparing and placing local residents into positions of skilled construction on the Marshfield Plaza project.

At the June 5 grand opening of Marshfield Plaza, 34th Ward Ald. Carrie Austin praised the development for creating new jobs in the community, but a phone call requesting the specific number of construction jobs for the project was not returned.

This is part of the June 30, 2010 online edition of The Beverly Review.

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