Article 43


Monday, July 31, 2006

Developers Nix or Delay Condo Projects

Developers Across the Country Nix or Delay Condo Projects As Sales Slow and Costs Rise
By Deborah Yao, AP Business Writer
July 30, 2006

PHILADELPHIA (AP)—In a city cluttered with condominium construction, Old City 205 aspired to shine as an ultramodern residence for the well-heeled with its zinc and glass facade, loft-style homes and windows that span floor to ceiling.

Too bad no one will get to move in now: The $40 million project in Philadelphia’s Old City neighborhood won’t break ground after the housing market softened and increasingly picky buyers balked at its price tags from $400,000 for a studio to over $2 million for a three-bedroom penthouse.

Brown Hill Development, the company behind the project, noticed slower traffic and decided it didn’t want to be left with unsold units, said partner Greg Hill.

From coast to coast, developers are nixing or delaying condominium projects as HOME SALES DECELERATE, construction costs soar and lenders start to balk at financing units that might not sell. What’s making it worse is the glut of high-priced condos and too few people who can afford them.

“We’ve gone through the biggest real estate boom in the last eight or nine years and some of these projects haven’t started yet. DO YOU THINK THEY’RE GOING TO START BUYING NOW?” said real estate executive Allan Domb, dubbed Philadelphia’s “condo king.”

In Las Vegas, projects nixed include high-profile developments such as Aqua Blue, a $600 million, 825-unit luxury condominium-hotel resort that counted Michael Jordan as an investor; the $3 billion, 4,400-unit Las Ramblas resort, backed by George Clooney; and Ivana Las Vegas, a $700 million, 945-unit tower named after Donald Trump’s ex-wife.

Related Las Vegas, one of the two developers for Las Ramblas, had cited rising construction costs and slowing sales for the cancellation.

In South Florida, canceled condo developments include 1390 Brickell Bay and ICE in Miami, Fort Lauderdale’s The Waves Las Olas, and Promenade in Palm Beach County. WCI Communities Inc., a luxury home builder based in Bonita Springs, Fla., said in June that new orders for its high-rise condominiums fell by 84 percent in the second quarter. The company will now go forward with only three to five condo projects in 2006, down from as many as 15 to 17, mostly in Florida.

With HOUSING LOOKING INCREASINGLY ANEMIC, it’s not surprising that developers are bailing out.

Domb said he’s gotten about half a dozen phone calls over the past four weeks from developers asking if he would like to buy their properties.

In May, the volume of apartment-to-condo conversions plunged to $334 million from $1.65 billion a year ago, said Gleb Nechayev, senior economist at Torto Wheaton Research, a real estate research firm in Boston owned by CB Richard Ellis. The all-time high was $4 billion, hit last September.

Builder confidence, as measured by the National Association of Home Builders/Wells Fargo Housing Market Index, fell in June to its lowest level since April 1995. Confidence took a hit due to rising mortgage rates, high home prices and investors and speculators fleeing the market.

The index surveyed builders of single-family homes, where the sales decline hasn’t been as severe as for condos.

Jack McCabe, chief executive of McCabe Research and Consulting in Deerfield Beach, Fla., said desperate developers with finished condos are offering plenty of incentives in South Florida.

Freebies range from one year’s free mortgage to the use of a yacht or upgraded kitchen packages. McCabe thinks some developers might even sell units at cost if condo sales continue to weaken.

McCabe considers the condo market, especially the luxury end, at risk of a crash. Over the next few years, he sees prices falling by double-digit percentages.

The luxury condo surplus is to blame. McCabe said about 25,000 condos are under construction in Miami-Dade County, with two-thirds costing $700,000 or higher; another 25,000 units have gotten building permits and 50,000 have been announced for future construction.

McCabe said the median household income in the county qualifies local buyers for a $225,000 home, so the luxury units are targeted mainly toward affluent, out-of-state buyers.

Meanwhile, speculators have driven up prices by flipping units, he said. But they’re now leaving the market—driving down demand—and putting up for sale properties they own, adding to the glut.

Aside from Miami, he said areas at risk include Boston, San Diego, Las Vegas, Seattle, Chicago, Orlando, Fla., Washington, D.C., and Manhattan.

A big part of the problem is that many condo projects are priced high, in part because developers have to recoup the high prices they paid for land. But most buyers can’t afford it.

“The sweet spot of the market is probably $250,000 to $700,000,” Domb said. “That’s what the majority of the population can afford. Many condos are priced higher. That’s part of the problem.”

Tell that to The Donald. Real estate mogul Donald Trump told The Associated Press he’s going ahead with his 45-story waterfront luxury high rise called Trump Tower Philadelphia.

“It’s doing fine,” Trump said. “It’s been intense. So many people want to move there.”

He added interest has been high for the project, which he said doesn’t surprise him because his name sells.


Credit: Eduardo Felix

Posted by Elvis on 07/31/06 •
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Tuesday, July 25, 2006

Judge Balks At Closure Of AT&T, Verizon Mergers

By Anne Broache, CNET
ZDNet News
July 25, 2006

A federal judge on Tuesday said he can’t sign off on the mergers of SBC and AT&T and of Verizon and MCI until he gets more information. 

"The court is not currently in a position to grant or deny the proposed consent decree,” U.S. District Judge Emmet Sullivan said at a status conference here.

The pair of deals WON APPROVAL last October from the Federal Communications Commission and the Justice Department’s antitrust division. Both Verizon and SBC have already closed their books on the acquisitions.

At issue before Sullivan is whether proposed agreements between the Justice Department and the telecommunications companies satisfy the public interest under a 1974 federal antitrust law called the Tunney Act. (The federal judge overseeing the final half of the Microsoft antitrust trial INVOKED THE TUNNEY ACT when altering the settlement agreement before approving it.)

Sullivan has formally asked the government and the phone companies to submit “any materials” that show why the agreements reached between the Justice Department and the telecommunications companies satisfy the “public interest” requirements.

Federal judges picked up additional authority in such proceedings in 2004, when Congress made changes to the Tunney Act. The law now says judges “shall"--rather than “may,” as in the previous statute--evaluate the effectiveness of consent decrees and whether those decrees will protect the public interest. Judges are also supposed to consider the impact of the deal on “competition in the relevant market or markets.”

Justice Department Attorney Claude Scott said the government would attempt to distill the “millions” of documents scrutinized during their reviews of the mergers into a few affidavits for the judge.

“We will have to go back and determine what’s useful to you,” he told the judge.

When approving the deal, the Justice Department imposed minor requirements on SBC and Verizon--namely, that they ensure that their competitors could gain access to fiber-optic connections in a few hundred commercial buildings across the country where competition levels were questionable.

“There must have been reasons, there must have been facts, there must have been bases for those challenges,” Sullivan said of the Justice Department complaint that prompted those conditions.

Sullivan said at a JULY 12 HEARING that he was concerned the government and the phone companies hadn’t submitted enough factual evidence to back up the agreements allowing for the megamergers. He also warned he was pondering the idea of holding an evidentiary hearing at which expert witnesses would describe why the mergers should go forward--an idea that drew misgivings from the Justice Department, Verizon and AT&T’s lawyers.

Sullivan backpedaled on that idea on Tuesday, saying he is “firmly of the opinion that it is premature to commence evidentiary hearings at this juncture.”

At the JUDGE’S REQUEST, the U.S. government last week filed with the court unredacted versions of the Federal Communications Commission orders approving the twin mergers. Those documents were submitted under seal because of their “highly confidential” and “competitively sensitive” contents.

The court has already heard objections to the deal from Comptel, a trade association representing the Bells’ competitors, and the Alliance for Competition in Telecommunications, or Actel, a new organization that apparently formed just to oppose the mergers in question. Actel is represented by Gary Reback, a Silicon Valley lawyer who played a major role years ago in convincing the Justice Department to investigate Microsoft for possible antitrust violations.

Last week, the National Association of State Utility Consumer Advocates and the New Jersey Division of Rate Counsel, two consumer advocacy groups, and New York Attorney General Eliot Spitzer filed documents seeking to present the views of expert witnesses they had picked, all of whom were prepared to discuss what they perceived as drawbacks of the mergers. The judge on Tuesday said that the state utility groups, Spitzer and Sprint-Nextel--along with Comptel and Actel--would be allowed to respond to the government’s new filings.

The judge’s actions drew praise from Jeannine Kenney, senior policy analyst for the advocacy group Consumers Union. She said in a statement issued jointly with Comptel that the court “sent the encouraging message that it will carefully scrutinize, not merely rubberstamp, these merger agreements.”

Sullivan gave the government until Aug. 7 to file the supporting documents with the court. Then the outside groups will have 10 days to respond to those filings, and the government will have 10 additional days to file its own response.


Posted by Elvis on 07/25/06 •
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Thursday, July 20, 2006

Minimum Wage May Go Up A Buck

The Senate voted 37-12 for a $1-per-hour increase in the minimum wage to $6.15, a year after the idea appeared dead thanks to support from pro-business legislators and high poll numbers. The House approved one several weeks ago.

An increase in the minimum wage, which has been at $5.15 SINCE 1997, should put more in the wallets of nearly 140,000 workers who currently receive less than $6.15 per hour starting in January 2007.

The current minimum wage earns a worker $10,712 annually, or about $2,500 below the federal poverty level for a family of two. Increasing the minimum wage would give the worker another $173 per month, but still wouldn’t exceed that poverty threshhold.

“It’s just a small increase that we’re asking for,” said MaryBe McMillan, secretary-treasurer of the North Carolina State AFL-CIO, which was part of a COALITION this year pushing for the wage. “You shouldn’t be in poverty while you work.”

Sen. Janet Cowell, D-Wake, called the increase “a step in the right direction” for the poorest North Carolinians.

“There’s a lot of folks out there working hard who still aren’t making a living and can’t even afford basic things like health care and housing,” Cowell said.

But small business advocates, who largely have been the sole voices in opposition to raising the minimum wage in recent months, said the increase will lead to shorter hours or layoffs, particularly in rural areas.

“The minimum wage throws a curve ball at the small businesses of our state,” Sen. Fred Smith, R-Johnston, who owns a development company with nearly 700 workers. He said he doesn’t pay anyone below $6.15 per hour but doesn’t support a mandated minimum wage: “I don’t believe that’s the role of the government, to interfere in the private economy and the free market.”

Sen. Phil Berger, R-Rockingham, said the increase would hurt the state economy.

“I think we could lose jobs as a result of it,” Berger said. “Jobs that would have been created or currently exist at entry-level positions will probably be non-existent.”

Still, Ramon Hernandez, who owns a sub shop in Raleigh, said he already pays a starting wage of more than $6.15 an hour to attract enough workers.

“You’re not going to find anybody who can speak the language ... and work for $5.15,” Hernandez said.

The House defeated a $1-per-hour increase in June 2005, but House leaders revived it when they combined an 85-cent increase with a small business health insurance tax credit. The current bill doesn’t contain the credit, which was approved in this year’s budget.

Polls also showed that up to 80 percent of North Carolina voters wanted an increase helped raise support among legislative leaders and pro-business Democrats during an election year. State Treasurer Richard Moore also lined up in support.

More than 20 states currently have minimum wages that are higher than the federal rate of $5.15 per hour, according to the Let Justice Roll Living Wage Campaign. Florida is the only other state in the Southeast with a minimum wage higher than $5.15 an hour.

The Rev. William Barber with the state chapter of the National Association for the Advancement of Colored People called the $1-per-hour increase a first step toward a living wage for North Carolina’s low-income workers or indexing the wage. At least four states already adjust their rates annually based on inflation.

“Any great state or great nation must care about the least of the people among them,” Barber said. “This is the right thing to do.”


Posted by Elvis on 07/20/06 •
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Monday, July 10, 2006

A July Fourth Declaration

By Katrina vanden Heuvel
The Nation
July 4, 2006

It is clear that the American CONSTITUTION is in grave danger. It is time to make the defense of the Constitution a national theme for all candidates in this year’s electoral contests.

The THREAT to the Constitutionfrom President BUSH, his administration, and an accomplice Republican Congress is all too obvious. In clear violation of established law and centuries-old political precedent, they have WIRETAPPED American citizens; imprisoned citizens without warrants, charges, or means of redress; sanctioned and abetted the torture of foreign nationals; ignored clear Congressional legislative intent with the likes of 750 signing statements; disabled Congressional oversight of their actions; undertaken an assault on the press’ right to publish the truth; and suppressed dissent and public-minded INFORMATION disclosure within the Executive branch itself.

This abuse and overreach of Presidential power directly challenges the “checks and balances” at the core of our constitutional design. It proposes a government fundamentally different from that declared by the Founding Fathers.

The ADMINISTRATION aggressively DEFENDS IT’S ACTIONS on the grounds of national security and “unitary” executive power. It argues that we are in a state of war, of indefinite duration, which gives the Commander in Chief extraordinary autonomous powers. It argues, too, that the President has final control over all employees of the Executive branch including those with no military function - and extending to the control of information they are permitted to provide to the public. As the Decider, President Bush decides what the public can or cannot know. 

Simply put, to accept these arguments would be to accept the end of our DEMOCRACY.

Central to the defense of this nation is defense of its constitutional values as well as its physical security. To sacrifice the Constitution in the name of “national defense” would be a grave mistake, for it destroys the very nation worthy of defense in the first place. This country has faced perils no less than today’s including those vanquished in a Civil War and World War II without abandoning that conviction. To abandon it now would disgrace us before those who fought and sacrificed and gave us the gift of this nation.

Nor does prudence recommend this course. As we have relearned in recent years—in instances as diverse as the Iraq War, the response to Hurricane Katrina, and Medicare reform—a President who can suppress “unwanted” information breeds dangerous incompetence, and a government that acts on bad information becomes a bad government.

The actions of the Executive branch have a real and powerful impact on our lives. We simply cannot afford a “unitary executive” who silences independent voices, lets politics determine science, threatens our first amendment rights, withholds critical information from even enforcement personnel, and elevates personal loyalty to him above the duty to inform the public.

The American people’s most powerful weapon in defending the Constitution is their vote in Presidential elections. But we cannot afford to wait until 2008. The danger to our Constitution is clear and present. Hence our call to all patriots to put the issue before the public in this November’s elections and ask of all candidates, “Do you accept or condemn the President’s assault on our Constitution?”

Some will object that using an election to defend the Constitution threatens to debase it to an instrument of partisan politics. The objection is misplaced. In fact, an electoral contest over Constitutional first principles will not debase those principles, but elevate the discourse, meaning, and substance of the contests themselves. There is no better use of parties, elections, and our votes.

Some will shrink from defending the Constitution out of fear that the public is not interested in such a discussion or lacks a real commitment to constitutional government--that it’s a losing issue. They should have more faith in the American people. Given a clear choice, Americans will choose defenders of the Constitution over those who would destroy it. But the choice must be put clearly before them.

Declare our current crisis, and invite those who would serve as our elected representatives to defend the Constitution against our current President and an accomplice Republican Party.


Posted by Elvis on 07/10/06 •
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Sunday, July 09, 2006

Lawless Workplaces

By Stewart Acuff and Sheldon Friedman
July 7, 2006

The last thing America’s workers need is another economic kick in the groin, but the Bush labor board may soon deliver what could be its lowest blow yet.

In a series of pending cases known as Kentucky River, the Bush board could strip what remains of federal LABOR LAW PROTECTIONS from hundreds of thousands - perhaps millions - of workers whose jobs include even minor, incidental or occasional supervisory duties. The pending cases involve charge nurses in a hospital and a nursing home and lead workers in a manufacturing plant, but these workers could be just the tip of the iceberg.

The Bush National Labor Relations Board is easily the most anti-worker labor board in history, but even against this sorry backdrop, the scope of what they now are contemplating is breathtaking.

The consequences of bad labor board rulings in these cases have the potential to strip coverage in every nook and cranny of the workforce and create innumerable new opportunities for mischief by employers bent on denying workers’ their fundamental human right to form a union. Long established collective bargaining relationships will also unravel, as employers emboldened by the NLRB’s rulings assert that they no longer have a duty under federal labor law to recognize or bargain with their employees’ unions. It will be back to the law of the jungle in industries like health care, where disruptions from labor disputes became so severe in the early 1970s that Congress passed special legislation to bring employees of private non-profit hospitals under federal labor law coverage.

The stakes are high for the public, too. In health care, for example, scholarly research has documented that heart attack survival rates are higher for patients in hospitals where nurses have a union than in hospitals where nurses do not.

Already in 2000, months before George W. Bush was declared president, Human Rights Watch issued a powerful report that found U.S. labor laws were grossly out of compliance with international human rights norms. That organizations bill of particulars was lengthy, but the first item on their list was the failure of U.S. labor law to cover millions of workers, including among others, managers and supervisors in the private sector.

Two years later, the Government Accountability Office estimated that 32 million workers lacked coverage under U.S. labor laws and thus were denied even the minimal protections afforded by these laws. Included in this number were nearly 11 million private sector managers and supervisors, even before the NLRB’s rulings in Kentucky River.

The ink was barely dry on the GAO report before the huge numbers they reported became out of date, in the wake of a full-scale assault on workers’ rights by the Bush administration, its labor board and right-wing Republican governors in several states. In the private sector, the Bush board stripped coverage from graduate student employees, certain disabled workers and employees of temporary help agencies. These retrograde rulings harmed large numbers of workers, but are a drop in the bucket compared with the possible impact of Kentucky River.

Congress opened the door in 1947 by excluding supervisors from coverage as part of the notoriously anti-worker Taft-Hartley amendments to the National Labor Relations Act. Even that reactionary Congress, however, made it clear that it did not intend to deny coverage to professional workers, lead workers or others whose jobs did not include responsibility to hire, fire and discipline other employees.

Ever since, a shameful series of decisions by unelected judges and NLRB members has steadily expanded the supervisory exclusion. In its notorious 1980 Yeshiva decision, for example, the Supreme Court ruled that because professors at private universities participate in campus governance, they were supervisors and therefore not covered by federal labor law. Henceforth private universities could and did snuff out faculty organizing campaigns with impunity. Within a few years of Yeshiva, private university faculty collective bargaining virtually vanished.

The decisions pending in Kentucky River could be Yeshiva on steroids for workers who have ever given incidental direction to a colleague or coworker in the performance of their job. The United States is already paying a high price for its failure to protect workers’ freedom to form unions; the Bush labor board’s rulings may be about to make a bad situation dramatically worse.

It is therefore imperative to push back against the Bush board’s assault on workers’ rights. We must, moreover, go beyond good defense; we must win serious protections for workers’ rights. The Employee Free Choice Act (EFCA) is the most significant federal legislative proposal in nearly 30 years to protect the freedom of America’s workers to form unions and bargain collectively. Since its introduction in the 109th Congress by Ted Kennedy, D-Mass., and Arlen Specter, R-Pa., in the Senate (S. 842), and by George Miller, D-Calif., and Peter King, R-N.Y., in the House (H.R. 1696), EFCA has garnered 215 House cosponsors, just three shy of a majority, and 43 in the Senate.

EFCA’s three main provisions are democratic majority sign-up, first-contract arbitration and stiffer penalties for illegal employer conduct. When EFCA becomes law, workers will be able to form and join unions without fear and coercion. EFCA will honor workers’ choices, discourage employer interference, and create more democratic workplaces.

The AFL-CIO has declared a national week of action starting July 10 to protest against the Bush labor board at NLRB headquarters in Washington and at regional NLRB offices and other sites around the country. Members of Congress have been asked to urge the NLRB to permit oral arguments by workers who will be adversely affected by the pending decisions. This is the least the board can do before ruling in a matter of such importance, but so far its Bush-appointed Chairman Battista shows every indication that he will deny even this modest request to allow these workers to be heard.

The need is urgent and the stakes are high. These are important fights to protect workers’ rights.

Stewart Acuff is the director of the AFL-CIO’s Organizing Department; Sheldon Friedman is research coordinator, AFL-CIO Voice@Work Campaign.



Posted by Elvis on 07/09/06 •
Section Dying America • Section Workplace
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