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A Surprise Election Result Ends the Palazzo Dynasty at IA Local 729

July 9, 2013 07:58 | By

LR-Louie Logerot-email

Louie Logerot won the election and then promptly resigned.

Louie Logerot won the election and then promptly resigned.

A seismic upheaval in the leadership ranks at one of the IATSE Hollywood unions is continuing to unfold in a bizarre sequence of events. George Palazzo, the business representative and secretary treasurer of IA Local 729 for the last 15 years, and one of the town’s most entrenched and respected labor chieftains, has been ousted from office as head of the Motion Picture Set Painters & Sign Writers union, after unexpectedly losing a bid for a sixth term in April.

Palazzo’s exit ends a 40-year family span of Palazzos atop Local 729. His father, Carmine Palazzo, was also business representative (often referred to as BA for “business agent”) and secretary treasurer of the painters’ union for 25 years, from 1973 to 1998. George Palazzo immediately succeeded him in 1998.

Palazzo, 53, was beaten by Louie Logerot, 63 – a paint supervisor on many award-winning shows and longtime member of the union – by 28 votes, 169 to 141. It was a low-turnout election where only about a third of the union’s 900 eligible members cast ballots. In his campaign, Logerot – whose only official position with Local 729 has been as a member of its board for nearly 10 years – attacked how Palazzo ran the union financially. Logerot alleged that Palazzo had permitted an $800,000 deficit to accumulate under his stewardship over the past decade.

Palazzo countered that the number was closer to $500,000 and that it was misleading because it did not take into account the fact that the union had purchased a building worth more than $900,000.

Logerot and other Local 729 members also criticized Palazzo for overpaying the union’s three-person staff, (four, including himself as BA and secretary treasurer). That added a personal edge to the election campaign since the three others happen to be members of Palazzo’s family, including his wife, his sister and his daughter-in-law.

In the recent election, his son, George Jr. ran for the post of recording secretary, but was overwhelmingly defeated by Lisa Walker, with a vote of 248 to 56.

Another stunning development was around the corner, when it was Logerot’s time to take over. He was sworn into office May 10, in front of a packed membership meeting. But just five minutes later he announced he was resigning. He later cited concerns about his health if he took the job – he had had a heart attack in 2010 – and said he was feeling palpitations and a pain in one arm. This followed a last-minute briefing by Palazzo on the duties of the job, which took place just prior to the swearing in. He also admitted he realized he was in over his head when it came to the administrative duties of BA.

George Palazzo is now senior director of participant services at the Motion Picture Industry Pension & Health Plans.

George Palazzo is now senior director of participant services at the Motion Picture Industry Pension & Health Plans.

So why did Logerot run in the first place? Didn’t he anticipate the complexities of the job? “I ran for business manager because our local has been in the red for the last eight out of 10 years and we didn’t like the way that George was running things,” he responded. “And a lot of members were tired of so much  money going towards the office personnel, which was his family. We wanted change so we voted him out.”

Was he surprised that he won? “Yes and no,” he said, and added, “Nobody wanted to run against George Palazzo just like nobody ever wanted to run against his dad. But we heard rumors that George was looking for other jobs, so we felt this was a good time to challenge him. Don’t get me wrong. George is a very intelligent man, and we’re not taking anything away from that – he’s a politician; he’s a great labor leader, and he’s a talker. But he didn’t take care of local 729. He was more interested in taking care of himself and the people at the IA.”

To fill the vacuum following Logerot’s sudden resignation, an effort was made by some members of Local 729 to get Palazzo to resume his BA position, at least temporarily. But Palazzo said he had already accepted a new job. In late April, Palazzo was hired by the Motion Picture Industry Pension & Health Plans to be senior director for participant services. The supervisory job entails determining worker eligibility for the coveted retirement benefits and health care coverage that approximately 15,000 members of not just the 16 IATSE Hollywood locals, but related organizations and unions such as Teamsters Local 399, rely on.

Robert Denne will serve as interim BA at IA Local 729.

Robert Denne will serve as interim BA and secretary-treasurer at IA Local 729.

As an alternative, Local 729 president Robert Denne was asked to serve as interim BA and secretary-treasurer. The plan now is for him to seek ratification at the next membership meeting on Aug. 10. Meanwhile, Greg Smith, previously vice president, has assumed the job of interim president.

“George’s loss took us all aback,” said Denne. “We didn’t expect it, and he seemed stunned, but when Louie suddenly quit we were all really in shock.” The interim boss said he felt up to the task, and in fact had long coveted the position but didn’t want to run until Palazzo decided to move on. “I’m more than willing to do the job,” he said. “I’ve had my eye on it, but the opportunity has come sooner than later.”

Palazzo’s new job may have diminished clout, but it’s hardly a step down when it comes to salary. Palazzo has told colleagues he’ll be earning more than he was at his old job. Palazzo’s most recent annual salary at Local 729, according to filings, was $123,000 plus another $15,000 for automobiles expenses, or just under $140,000. But on top of that, he was also paid for serving on the International’s executive board.

Palazzo seems to be taking a stiff upper lip approach to the loss. He admitted he had “other irons in the fire.” He is however bitter about having family members working at the painters’ union being dragged into the campaign crossfire. “There were unscrupulous attacks against me and my family that appeared on Facebook and Twitter and stuff like that, which unfairly accused me of taking money and using it inappropriately.”

He attributed his defeat both to low voter turnout due to complacency, and to disgruntled members “who are unhappy that they haven’t been working much, or if they have, it’s at rates of pay lower than they’re used to.” But, “Louie spun it a different way, and a majority of those who voted apparently believed him,” Palazzo opined.

Beyond heading the local, both Palazzos have also held influential positions in the IATSE hierarchy. That also appears, at least for the time being, to have ended. For many years, Carmen served on the IA’s 15-person executive board, headed by the IA president, currently Matthew Loeb, rising as high as the International’s 5th vice president. George, following in his father’s footsteps, served on the executive board as one of three international trustees beginning in 2005. But in April, after losing his bid for another term as Local 729’s BA, he also was obliged to quit the executive board because he was no longer an IA union official. He was replaced as trustee by Patricia White, president of New York City Theatrical Wardrobe Union, Local 764.

George Palazzo, for a time, was also chairman of the board of directors of the MPIPH where he now works as a salaried employee. His father Carmine was also a longtime member of the same board, which includes representatives from both the IA Hollywood unions and the Alliance of Motion Picture and Television Producers.

As for Logerot, he not only decided to withdraw from the top job at Local 729, but on the same day he permanently retired, even though he had an ongoing job on an ABC network television series, Switched at Birth, that he expected would continue to provide him with well-paid work for several more years. “I gave up a lot of money, but I really feel good now about my health and the rest of my life,” he said.

Looking back at his quixotic run for BA, which in the end he won but resigned from just after being sworn in and achieving his goal, he said he still feels he accomplished what he set out to do: “It was kind of like mission impossible when I ran against George, but I feel I achieved my mission. I brought the 40-year Palazzo dynasty at the union to an end.”

After the leadership tumult at Local 729 subsides, the union, under what is almost certain to be Denne’s leadership, will still have to grapple with the issues that confront its members. And they are not dissimilar from what the other Hollywood locals face – a continuing decline in available full-time work in Southern California along with pressure on pay. “My priority is to see this union always stays stable, and also to steer it in the right direction” said the interim BA, who also has deep family roots in Local 729. His father was a member of the union for 28 years, and his grandfather and great uncle also were members.

Denne said he has no plans to eliminate the jobs of the Palazzo-related women who work at the local. “The office staff works hard to support the union, and not having them would definitely make my job a lot harder,” he noted. He also pointed out that the three are also members of unions that have rules to protect them in the workplace. “Any changes we make, we have to negotiate in good faith, so it wouldn’t be in my interest to do anything that’s hasty or out of bounds,” he said.

As for the mounting tide of red ink at Local 729, Denne said it was not a problem that can be addressed by just cutting expenses, and will not be easy to solve. “We’ve been trying to raise the dues for a long time, but members keep voting it down. Meanwhile our costs keep going up.” Compounding the difficulty, the union’s investments are not growing fast enough in the current low-interest environment, which keeps the return on the savings portion of its portfolio at around 1 percent if that.

“But the main problem continues to be runaway production, not just abroad, but in other states that offer big subsidies to attract shows we used to have here,” he noted. Even though some painters in the union get to work on these out-of-state shoots, rules are often restrictive as to numbers. “I was personally working on a shoot in Georgia recently as a painting supervisor, but they wouldn’t let me bring any of my usual crew and they were hiring some non-union workers instead,” he noted.

Members of the painters’ union have traditionally been among the best-paid of the non-tech guilds, but prevailing wage scales of over $30 an hour for full-time work on movies and television are becoming more scarce. “Many of our people are working, but mostly on lower budget shows, that have negotiated lower wages,” he noted. “But our members are willing to take them in order to keep getting pension and health benefits but we’re starting to get more and more members who are desperately asking us to get them some work – any work.”

Many of these issues are likely to surface at the quadrennial IATSE, convention which will be held in Boston beginning in mid-July, with a confusing slate from Local 729. Logerot and Denne both say they will be there, as part of the union’s delegation. By the same token, the union won’t have a bona fide elected leader to represent it. And for the first time in nearly two decades, Palazzo won’t be around.