Work on downtown hotel, southside apartments allegedly performed by undocumented workers

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There are some large construction projects going on in Kokomo right now. There are new apartment complexes being erected on the south side of the city, and there is a hotel going up in the heart of downtown.

And on all three projects it’s believed there are undocumented workers – illegals, some would say – completing the jobs instead of local workers. This situation was brought to light by the Carpenters Local 615 earlier this year, as the union believes it has first-hand accounts of undocumented workers on the District Flats and Elwood apartment complexes.

“In our opinion, there are workers on the carpentry side getting paid cash, undocumented,” said Andrew Jones, business agent for the Carpenters Local 615. “They don’t necessarily present papers, but they’re working on both the District Flats and the Elwood projects.”

Jones added that the Carpenters also have evidence of undocumented workers being paid under the table on the hotel in downtown Kokomo. This information was shared with the mayor and the Kokomo Common Council via email at the beginning of 2026.

“The workers on each job site explained how they are compensated: cash payments, no withholding taxes, no Social Security payments, no workers’ compensation insurance, no unemployment insurance,” said Jones.

“We told you this was going to happen,” said Chet Fincher, representative at Carpenters Local 615. “Here we are. It’s getting so rampant. They’re not even trying to hide it anymore. And in every part of the industry, it’s starting to break into public works world.”

To be clear, there is no evidence currently that a public works project in Kokomo has been performed by undocumented workers, but the hotel project is closely connected. Mayor Tyler Moore acknowledged that he was informed of the situation, but he only expressed concern about the situation, having taken no action on the matter since being informed of it.

“Yes, that’s concerning,” said Moore. “But when we talk to the contractors who are ultimately responsible for who they’re paying, they’re saying, ‘We pay them the wage that we agreed upon. If they’re not reporting the income tax, are not reporting the other things, we’re still paying them.’

“Unfortunately, they’re leaving it up to the worker or individual to report the withholding and do things themselves. Yes, that’s a concern.”

Jones explained that contractors often are awarded a project and then subcontract the work to other vendors. Their business model might include the use of undocumented workers and leaving the responsibility of paying the various taxes to them.

“It hurts our members, because our local carpenters don’t get to work,” said Jones. “The contractor typically is not local, which means they’re bringing guys in from Texas, Tennessee, wherever. They put them up in a house and pay them bare minimum cash to build a project, and then they go to another development and do the same thing.”

Another avenue of recourse the unions have pursued in Kokomo for years is the establishment of a responsible bidder ordinance and a contractor licensing ordinance. The two measures would require contractors and subcontractors to follow labor laws, present documentation to demonstrate compliance, and to favor local labor.

“They can make it a one-page license application, or they can make the contractor licensing as stringent as they want,” said Fincher. “Basically, you just show that you’re a registered contractor, and then you show proof of your articles of incorporation that you’re an actual business, that you have liability insurance and workman’s comp insurance on your employees.

“And then every subcontractor has to follow the same rules. It could be just as simple as that to help get rid a lot of this undocumented worker stuff.”

Moore explained that the City of Kokomo already has a responsible bidder ordinance –enacted by the city council under former Mayor Greg Goodnight -- but he admitted the ordinance has little influence as written.

“It has no teeth,” said Moore. “When I first campaigned for mayor, I agreed to look into it. Part of me was surprised that the one Greg proposed wouldn’t have had more teeth, with his union background and his ties to the union community.

“We’ve tossed it around. We’ve discussed it. Most recently, (the unions) gave us a template, and we went through and redlined it and sent it back. They said it’s no better than the one that’s in place now.

“But we’re comfortable with what’s in place now. It does provide oversight on city-funded projects. I know they wanted the scope to reach to expand to any project, public or private, that taxpayer incentives are tied to.”

Mike Young, business representative for the International Brotherhood of Electrical Workers Local 873, also supports the adoption of contractor licensing and a responsible bidder ordinance. He explained the benefits such legislation would bring to the people of Kokomo.

“Contractor licensing would be beneficial, just to make sure that your fly-by-night contractors aren’t coming in and doing work in an unskilled manner that causes safety violations,” said Young. “The responsible bidder ordinance would help ensure local labor is doing the work, union or non-union. It’s nonpartisan in that regard.

“It would shore up our tax base because 68 cents of every dollar earned by local workers get spent locally. That goes right back into our small mom-and-pop shops. It stays in the community. It gets donated to United Way, to our local churches. It gets put back into our educational system locally. That goes right along with our motto: ‘Local workers, local jobs, strong local economy.’”

Indeed, Young’s assertions have long been espoused by the Greater Kokomo Chamber of Commerce. They have stated many times that one dollar spent in the local economy circulates an average of seven times. That’s a lot of commerce going elsewhere when local labor isn’t used.

“To oppose this would almost mean opposing your local craftsmen,” said Young. “I can’t imagine anyone in a position elected by the people, especially in a town like Kokomo where almost nine out of 10 people are either in a union or have direct family members in a union, would ever oppose such an ordinance.”

To be clear, Moore has not stated opposition to adopting either measure, but he has been told by industry professionals that having contractor licensing and a functional responsible bidder ordinance would hurt economic growth, locally.

“Part of the hesitation is we hear, with the cost margin with construction versus the return on investment, we would create a gap with additional fees and costs for construction,” said Moore. “We keep hearing it costs just as much to build something here as it does in the donut communities (around Indianapolis).”

Yet smaller communities around the state, such as Gas City, have the protective legislation in place. And that community recently completed the construction of the Gas City Performing Arts Center.

But Young is more concerned about the workers. He has experienced the same situations with undocumented workers not having the protections the proposed legislation would ensure.

“We do believe in protecting all workers,” said Young. “A lot of (undocumented workers) are taken advantage of. They’re brought in undocumented. They’re paid peanuts.

“What will stop these types of things? City licensing would be a component of that, and then a penalty once an undocumented worker is discovered on the job. When that happens, you have to remove those contractors and restrict that license or pull that license for a particular amount of time. Then, they would lose their incentive for using undocumented workers.

“It’s a free-market society we live in, so the bottom line is always going to be the bottom line. Our local contractors typically put a very good number on those bids, and as a result, we do heavily support the construction projects that we get to build.”

Fincher said he gets frustrated by local officials who show up for events where organized labor is represented and claim to be “here for you.” Yet, no action is taken to improve the local labor market with protective legislation.

“When it comes time to put your money where your mouth is, where are you?” said Fincher. “Why haven’t you responded? What are you doing? It’s not just a Kokomo problem, it’s an everywhere problem.”

Moore said that, despite sending back a heavily edited ordinance to the unions, he is still willing to have a conversation about responsible bidding and contractor licensing.

“We’d be willing to sit and talk to them about it, because I know it’s something that has been brought up regularly for a number of years,” said Moore.