John Barrette

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March 20, 2013
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Berkadia chief's comment stirs debate about pros, cons of right-to-work

Positive comments about right-to-work state status from the head of a business tied to billionaire Warren Buffett brought mixed yet muted Northern Nevada reactions.

Hugh Frater, who heads Berkadia Commercial Mortgage LLC, said apartments in states with right-to-work laws might fare better than property elsewhere.

He zeroed in on such states in the Southeast, contrasting them with what he called old industrial hub states. Nevada is a right-to-work state but isn’t in the Southeast and hasn’t been a magnet for major industrial concerns.

Ray Bacon of the Nevada Manufacturers Association, a right-to-work supporter, said there is huge confusion about the status and indicated it’s a factor in some circumstances, not so much at others.

For example, he said, it might mean more in Las Vegas casinos than it does in this region of the Silver State.

“Does it make a difference in this state as far as companies moving here?” he asked rhetorically. “Some, but it’s hard to put a number of that. It’s a factor from company to company. I don’t think it’s an A list” factor.

He also said some workers prefer employment in such states, while others go to areas where the law doesn’t bar what has been called union-shop or closed-shop representation. A well-trained work force is really important now, he said.

Basically, right-to-work laws ban unions from collecting mandatory dues.

Frater said in a Bloomberg article that he wasn’t making a political statement, just figuring a U.S. manufacturing resurgence would be geared toward right-to-work states.

Keith Uriarte, chief of staff for AFSCME Local 4041 in Carson City, agreed with Bacon about public confusion on right-to-work.

As a detractor, he lumped Nevada with other such states “that sell themselves on the cheap” and said all pay a price.

“Who are you attracting?” he asked. Creating or preserving a low-wage environment means cheap apartments and economic problems, Uriarte said.

That brings “an environment that’s not sustainable” with marginal or transient workers, he said.

“Jobs mean consumers,” Uriarte said. “Creating consumers — that’s what we should be doing.”

Frater’s comments came as Berkadia expanded its bet on apartments and agreed to buy Hendricks & Partners, a firm in multifamily real estate.

Berkadia is a joint holding of Buffett’s Berkshire Hathaway and Leucadia National. It was formed in 2009 to take advantage of a potential real estate rebound.

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The Nevada Appeal Updated Mar 20, 2013 02:02AM Published Mar 20, 2013 01:48AM Copyright 2013 The Nevada Appeal. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.