Negative ad about Rep. Jimmy Panetta has many wondering what it’s all about

MONTEREY — A 30-second spot from a labor union with members in the hotel, food service, laundry, warehouse and casino gaming industry places a local member of Congress in a negative light and has many wondering what it means.

"I'm confused like everybody else who sees (the ad)," said Rep. Jimmy Panetta, D-Carmel Valley. "They seem to equate a Las Vegas labor issue with a tax code issue."

The advertisement, paid for by Unite Here! Political Action Committee, is making the rounds on social media and television with Panetta as its focus. It says he is "proposing to ‘improve' the Trump tax bill for two billionaire brothers who own two mega-yachts." The spot goes on to say that "Panetta's legislation will subsidize these billionaire brothers an extra $500 million in tax breaks."

But the ad does not give any other context and ends with the tagline, "Ask Congressman Jimmy Panetta."

Unite Here!, a labor union in the United States and Canada, has about 300,000 active members that include hotel, food service, laundry, warehouse and casino gaming industry workers.

The ad provides a phone number whose owner did not want to be identified or answer questions but passed on a number of someone who could. That contact did not want to be quoted either but gave a number for someone else who would answer questions on the record.

Jack Gribbon, a California political director for Unite Here! said that the billionaires in the ad refers to the Fertitta brothers who own Stations Casinos in Nevada. "They're a very profitable group."

Gribbon said Unite Here! has "a huge membership and good relationship with the (gaming) industry" and wants to see workers are provided decent wages and benefits. He also added that the Fertitta's undercut union wages and health care.

"And this guy (Panetta) is working overtime to hand them a half-billion dollars," said Gribbon.

The political director for Unite Here! said the Fertitta's already get tax breaks in the Trump tax cut bill and are able recoup expenses on investments of their facilities.

The ad asserts that the casino owners stand to benefit more from the legislation that Panetta co-introduced.

Gribbon said he sees Panetta as inserting himself in a Clark County, Nevada, issue where he is undermining his colleagues in Nevada.

In March, Panetta and Rep. Jackie Walorski, R-Indiana, introduced the Restoring Investment in Improvements Act, H.R. 1869, bipartisan legislation that ensures restaurants and retailers are able to properly benefit from a tax provision meant to aid renovations and spur investment, according to a press release at the time.

In the 2017 tax law, the federal tax code changed to allow businesses to immediately write off costs associated with improving facilities instead of having to write off those expenses over 15 years.

But an inadvertent drafting error required restaurants, retailers, and other leaseholders to instead write those expenses off over a much longer period of 39 years, resulting in cost-prohibitive renovation projects and stalled investments.

The Restoring Investment in Improvements Act seeks to correct that.

"The bill benefits all restaurants and retailers, no matter their size or what community they are in, as long as it qualifies under Qualified Improvement Property," said Sarah Wolman, a Panetta spokesperson. "Congressman Panetta sponsored the bill to help local storefronts and restaurants, business owners and workers."

The bipartisan Restoring Investment in Improvements Act would ensure the full cost of store, office or building improvements can be immediately expensed as was originally intended.

The congressman said the correction is needed because this is what happens when a bill is shoved through Congress with no hearings.

"All the Nevada Democratic Congress members support this bill," said Panetta. "This is a popular bipartisan bill that will do good for businesses on the Central Coast."

There are 280 bipartisan cosponsors of the bill to fix the tax code to help small businesses and employees.

Gregory Ahn, president and CEO of Folktale Wine Group and 7th & Dolores Steakhouse in Carmel, said he has not seen the ad but heard about its a negative take on Panetta.

His understanding is that there was a glitch in the original bill and Panetta is simply trying to correct it to reflect the original intent.

"As a small business owner, it makes a big difference for us," said Ahn.

If a store wants to build out or renovate, it improves the business and increases employment for labor, which benefits the community. It will encourage owners to make the investment because they can recoup the expense immediately as originally intended, said Ahn.

"I don't understand how there can be a negative impact to anyone," said the business owner. "There is some weird myopic view" at work there.

Panetta said he is sympathetic to labor and is not sure why he is being singled out since the bill does good for employers and employees. He said the Unite Here! Local 483 in Monterey supports him and have submitted an endorsement to be finalized.

Hector Azpilcueta, secretary/treasurer of Unite Here! Local 483, said the local chapter still supports Panetta.

"Local 483 has nothing to do with the ad," said Azpilcueta. "We have no clue as to what part of the legislation is a problem for us."

Azpilcueta said the local chapter recognizes the hard work the Panetta family has done in this community.

"The Republican tax bill hurt small businesses and I'm trying to fix it. … That's my job," said Panetta.