What You Need to Know About the Cheval Blanc Hotel Petition

In November City Council granted approvals for the Cheval Blanc hotel which is proposed to span four parcels between North Beverly Drive and Rodeo Drive south of Santa Monica Boulevard. Four buildings including the former Paley Museum would be replaced by one structure rising nine floors with 115 hotel rooms at an anticipated room rate of $2,000 as befits a luxury hotel with restaurants and a private club (the penthouse asks $30,000 nightly). It’s not a done deal, however, because a petition is circulating to send this project to the voters in a referendum with a Monday deadline. Sign or not sign?

About the Petition

The UNITE Here Local 11 union is circulating two petitions that would put this project to a vote of the people. The two petitions are complimentary: one would qualify a referendum on the negotiated development agreement that would provide a public benefit in exchange for rezoning a substantial part of the business triangle for a use that the current zoning does not allow; and the other would qualify a referendum on the ordinance adopted by City Council to approve the project’s specific plan and related zoning amendments.

A signature on either petition (or both) would put the project to the voters. Some residents with long memories will recall the earlier Montage and Hilton referenda which sent complicated projects to the ballot. The Montage referendum was passed by voters with the most narrow margin and it is still dogged by allegations of voter fraud. The Hilton plan went to the ballot but evolved into the mega project that was approved by City Council last year.

What About Affordable Housing?

It is worth noting that neither the Montage nor the Hilton will provide any affordable housing. Luxury mixed-use condo developments like 9200 Wilshire (54 units) and 9908 South Santa Monica (Friar’s Club, 25 units) won’t provide even a single affordable unit either. In fact the city’s recently-adopted Housing Element in a table shows how only 3 units out of the 487 market-rate dwelling units that were permitted during the last housing cycle are actually deed-restricted as ‘affordable.’ (Two additional were leased last year on Burton Way.)

Housing Element approved affordable units table
The recently-adopted Housing Element which is required by the state attests to scant progress in moving deed-restricted affordable units to the market.

If the city won’t compel luxury developers to include affordable units, why not require those public benefit contributions to go into the city’s Affordable Housing Trust Fund? The fund was created in 2016 but today it holds only $1.5 million. That may build two affordable units but it won’t solve our housing crisis.

Incidentally, the last time the city took an active role in affordable housing development was in 1988. The city entered into an agreement with the Menorah nonprofit to operate senior housing above Whole Foods in a structure that the city owns.

The Argument from UNITE HERE Local 11

UNITE HERE Local 11 is sponsoring the petition drive to put on the ballot the two referenda that would challenge project approvals. First is a petition to overturn ordinance 22-O–2867 which formally adopted the development agreement as negotiated by councilmembers Lili Bosse and Julian Gold and agreed by Council. The agreement confers development rights in exchange for a public benefit. The second is a petition to overturn resolution 22-O–2866 which was adopted by City Council and which implements the specific plan and amends the city’s zoning code and zoning map which is the legal basis to construct the hotel.

The union’s objections are formally stated in comments about the project’s draft environmental report:

  • The city disregards numerous Land Use and Housing goals and policies under the General Plan by allowing only commercial uses at a location suitable for mixed-use including housing;
  • The project will not help to realize the city’s affordable housing obligations which are approximately 3,000 net new dwelling units pursuant to the state’s Regional Housing Needs Assessment;
  • The project’s environmental review fails to properly assess traffic impacts and greenhouse gas emissions related to a regional project and that traffic volume will exceed the determination in the analysis that new vehicle trips will not exceed a ‘less-than-significant’ threshold.’
  • The project claims that proposed greenhouse-gas reduction measures that are “purely aspirational and non-binding on the project” in part because they are based on the city’s Sustainability Plan (2009) which “lacks any of the hallmarks of a qualified climate action plan.”

The labor union’s concerns can be summarized in a concluding comment to City Council: “The city has an affordable housing crisis — not a hotel crisis.”

Notably UNITE HERE Local 11 does not make any claim related to labor issues when circulating the petitions. It is plausible to presume that the petition drive is part of a strategy to pressure the LVHM into agreeing to allow union representation at the hotel. Qualifying the referenda will give the union added leverage.

UNITE HERE Local 11 is an organizing heavyweight that represents 32,000 workers employed in hotels, restaurants, gaming, food service, and manufacturing throughout Southern California and Arizona. They have put some heft behind the campaign. And the city is taking the effort seriously.

The deadline to submit signatures is Monday. Registered voters who want more information, or who want to sign the petition, should contact resident Darian Bojeaux at bojeaux@earthlink.net or get in touch with Renters Alliance for a telephone number.

Mayor Lili Bosse Defends Approvals

The Beverly Hills Courier on December 16, 2022 featured a cover-page ‘guest editorial’ from Mayor Lili Bosse. She championed the project as a “transformational investment for this community” and “the heart and soul of our future.” The editorial hailed the development deal that she helped to negotiate and included these points (summarizing here):

The City Council approved the project 4–1 after the Planning Commission approved it unanimously;

Applicant LVMH worked with the community to address issues “with fair and balanced solutions”;

The project will bring revenues of $788 million over a 30-year period — money she calls “unrestricted funding that can be used for housing or for any other purpose” — plus $26 million in public benefit which that is also not earmarked and $2 million earmarked “to support local art and culture.”

Lili Bosse guest editorial Courier December 17, 2022

It is unusual for a mayor to pen an editorial on the front page of our newspaper. It is even more unusual that she characterized the petition outreach as the union “making decisions about the future of our city.” In fact only Beverly Hills voters will have a say (just like any local ballot measure) and paid signature gatherers are necessary given that about 2,300 valid signatures (10% of registered city voters) must be gathered.

The mayor also charges signature gatherers with improper tactics. “I have been told by many community members that these canvassers have been aggressive and rude with residents,” she said. “Even upon being told there is no interest in signing, they often come back again and again which many have shared with me that they felt bullied, concerned by strangers knocking on their doors and incredibly concerned by the lack of respect for boundaries.”

That too is familiar from past campaigns. It may be an unavoidable consequence of paying for signatures. Such is direct democracy today! Understandably people are bothered to be bothered and gathering signatures requires persistence.

Finally the mayor takes aim at the presumed motive behind this referenda campaign: collective bargaining. “As I see it, The union does not reflect the views or priorities of Beverly Hills, and they do not have our best interests at heart,” Bosse said. “Their tactics to unionize hotels here have not worked, which is why just 3 of the 16 hotels in Beverly Hills are currently unionized.” Is collective bargaining anathema to Beverly Hills voters?

Regardless the mayor is taking seriously this effort. “For anyone who did sign a petition, you have the right to remove your name if you are having second thoughts,” she writes. “Our City Clerk can provide you with information about how to withdraw your signature.” The language mirrors the half-page LVHM advertisement just below the editorial that also encourages readers also to withdraw their signature.

The mayor presumably represents her three fellow councilmembers, and certainly a substantial share of our community, who seem to view Cheval Blanc as the way of the future with a public benefit that is sufficient to meet some of our housing and other needs.

Another View: “We Got Fleeced”

Taking a very different view of the development agreement, Councilmember John Mirisch took to Facebook to express his frustration that the city didn’t extract a public benefit more valuable than $28 million from a project owned by the richest man in the world, who spent $465 million on land acquisition and stands to double his investment. “They undoubtedly are laughing their heads off about what suckers we are,” he said.

Councilmember Mirisch opposes the project — in fact he was the only ‘no’ vote on Council — but he says that he is not personally involved in the referendum. But he takes offense at the way the referenda petition effort is characterized. “If the referendum qualifies, it will be Beverly Hills residents, not outsiders, who will decide whether the Cheval Blanc project and accompanying development agreement are good for our City.”

It is particularly wrong – not to mention ironic in so many ways – to talk about outsiders influencing our City, considering the army of well-paid lobbyists (including numerous ex-mayors and commissioners) employed by a foreign corporation, whose chairman is literally the richest man in the world….But the worst part of the deal was that the City blew the opportunity to raise funding for affordable housing by increasing the TOT (transient occupancy tax) above the 19% that has become standard for hotels.”

“The Council majority sided with a wealthy foreign corporation and wealthy hotel guests and (literally) the richest man in the world rather than with the most vulnerable within our Community,” he said. “Whatever the motivation of the union, a referendum would give the residents the chance to fix an awful deal that sells our Community short and misrepresents who we are at our core.”

Councilmember Mirisch has been the loudest, and sometimes the only, voice strongly in support of affordable housing. He called for 20% of all new units to be deed-restricted as ‘affordable” (Council agreed to only 10%) and he repeatedly lambasted luxury developments like One Beverly Hills (Hilton) and 9908 South Santa Monica (Friar’s Club) for including no affordable units (the Council majority approved those projects while he voted ‘no’).

He concludes, “A referendum would give us a chance to get it right or at least to significantly improve a one-sided deal that should be providing our Community with the value it deserves and that should allow us to address the need for affordable housing with more than just happy talk.”

Councilmember Mirisch represents a substantial part of our city who views Cheval Blanc, and One Beverly Hills before it, as the luxury playground of wealthy transients who embrace neither the broader community’s values nor concerns.

More Information

Petitions

Project documents

The city has held many hearings this year on Cheval Blanc. The Planning Commission conducted six hearings and accepted the final environmental impact report (FEIR) in June. City Council conducted a hearing in September on an appeal of the Planning Commission FEIR decision brought by UNITE HERE Local 11. (Council denied the appeal.) City Council ultimately approved the project specific plan, entitlements, and development agreement on November 1, 2022. These documents may be useful for anyone who wants a really, really deep dive into the project.