ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet in Pakistan has given the green light to a settlement agreement with the Roosevelt Hotel Union and the New York City Government (NYCG).
According to sources, the deal will see the hotel lease out 1,025 rooms to the NYCG for three years.
The ECC meeting, which was presided over by Finance Minister Ishaq Dar on May 10, also approved an Rs. 153 million technical supplementary grant (TSG) to the Ministry of Water Resources for payment of court cases’ fee about a dispute with India under the Indus Waters Treaty.
The Ministry of Aviation had submitted a summary to the ECC, stating that the Roosevelt Hotel Corporation (RHC) was required to reach a settlement with the Union regarding the payment of severance and pensions for 469 employees.
This followed the filing of numerous lawsuits and arbitration claims by the Union and the Pension Fund in various courts.
The hotel was permitted to partially open with 300 rooms as a limited-service hotel to reduce costs and meet one of the Union’s demands.
Meanwhile, the PIA-IL management informed the ECC about an opportunity for New York City to utilize the hotel’s 1,025 rooms for immigrants over three years.
It is relevant to note that the ECC constituted a committee to negotiate with the Union and City to settle.
The committee subsequently traveled to New York for negotiations and has concluded a deal, which will also see the withdrawal of pending lawsuits between the hotel, Union, and the City.
The Ministry of Privatization has proposed that the ECC approves the execution of the settlement agreement with the Union and City, in consideration of expected financial projections for immigrant business and attached risks, and the withdrawal of pending lawsuits.
Besides, it also suggested that the unpaid liabilities of the Union, which total $28 million, would be paid by the government if the City decides to terminate the contract after 18 months.
Source: Business Recorder
