Union says Port’s giveaways of public funds to private corporations violate federal law and Oregon Constitution; demands all funds remain in public hands
PORTLAND,OR (August 16, 2012) – Today, the ILWU filed a federal lawsuit against the Port of Portland and Bill Wyatt, its Executive Director, for unlawfully gifting nearly $5 million in public funds to a private Philippines-based company, ICTSI Oregon, Inc., and tens of thousands more to ocean carriers. The ILWU lawsuit seeks an injunction against the expenditures and demands that the illegally granted funds remain in public hands.
“The Port violated the trust of local taxpayers when it gave $4.7 million in public funds to a private company that made $135 million in profits last year and whose CEO is worth $3.6 billion,” said Leal Sundet, ILWU Coast Committeeman and resident of Clackamas County. “The Port’s handout to ICTSI is not only illegal, it’s wrong. Our lawsuit aims to stop the Port’s direct interference in a private labor dispute and to keep the money in public hands, where it can be invested in local infrastructure and for other purposes that serve the public good.”
Sundet also blasted the Port for spending public monies, without so much as a vote from commissioners, to lure Pacific Maritime Association member carriers back to the port in spite of unresolved labor issues. “The Port is literally bribing PMA companies to call Portland, where doing so is a violation of their collective bargaining agreement with the ILWU,” Sundet said.
On July 11, 2012, the Port Commission authorized, at Wyatt’s recommendation, the payment of tens of thousands of dollars to shipping lines “to help compensate them for their losses” due to “challenges” arising from the labor dispute between ICTSI and the ILWU at Terminal 6.(1). On August 8, 2012, the Port Commission authorized, again at Wyatt’s recommendation, the payout of nearly $4.7 million to ICTSI “to offset a portion of ICTSI’s incremental operating costs and lost revenues directly attributable to the labor dispute impacting the container line of business at Terminal 6.”(2)
Today’s lawsuit explains how the Port’s actions violate federal labor law and Article XI, § 9 of the Oregon Constitution:
Violation of federal law: The Port’s own authorization language for the expenditure of its funds explicitly states that its purpose is to assist ICTSI and other private companies and “offset” their losses arising from the labor dispute. This is an unlawful purpose because the gifting improperly interferes with and alters the economic tools and pressures between labor and management, which are regulated exclusively by federal labor law in the private sector. Public entities like the Port are prohibited from helping one side or the other in a private sector labor dispute.(3)
Violation of state law: The expenditure likewise violates Article XI, § 9 of the Oregon Constitution, which states: “No county, city or other municipal corporation [which includes the Port] … shall … raise money for, or loan its credit to, or in aid of any … company, corporation or association.” Nor does the gifting fall within the permissible exception of certain business activities which the Oregon Constitution grants to the Port.
The Port of Portland got out of the terminal operating business in 2010 when it leased Terminal 6 to ICTSI Oregon, a subsidiary of Philippines-based ICTSI. ICTSI is a member of the Pacific Maritime Association, which comprises 70 waterfront employers on the West Coast and which has negotiated a collective bargaining agreement with the ILWU since the 1930’s. ICTSI is demanding that it be the only PMA member that can choose to follow some provisions of the contract and ignore others. ILWU and PMA have jointly sued ICTSI to bring the company into compliance with the ILWU-PMA contract.
The ILWU was formed by dockworkers in 1934 and represents 50,000 men and women in Oregon, Washington, California, Alaska and Hawaii, on the docks and in other industries.
(1) July 11, 2012 Port of PortlandRegular Commission Meeting Minutes
(2) August 8, 2012 Cost-SharingAgreement Between the Port of Portland and ICTSI
(3) The U.S. Supreme Court decisions in Golden State Transit Corp. v.City of Los Angeles, 475 U.S. 608 (1986); Golden State Transit Corp. v. City of Los Angeles, 494 U.S. 103 (1989); andChamber of Commerce of U.S. v. Brown, 564 U.S. 60 (2008).
– ILWU Coast Longshore Division News Release