Tag Archive for Bob Balgenorth

Getting to the Bottom of it: Backroom Administrative/Executive Deliberation Leading to Project Labor Agreement on California High-Speed Rail

UPDATE: I emailed this message to the California High-Speed Rail Authority at 4:51 p.m. on Friday, December 20, 2013:

Today is December 20, 2013, the date cited in the last correspondence from the California High-Speed Rail Authority.

“Under Government Code §6253(a), the Authority invoked a 14 day extension in order to further research your request and make a determination. A determination letter would be sent to you no later than November 18, 2013. The Authority will provide all responsive documents to you by December 20, 2013.”

http://laborissuessolutions.com/wp-content/uploads/2013/11/2013-11-18-CaHSRA-letter-to-Dayton-on-Public-Records-Request.pdf

Any news on progress to fulfill the October 24, 2013 request?

At 5:58 p.m., the California High-Speed Rail Authority emailed me this letter notifying me that “The amount of electronic records that are responsive to your request are too large to send via email. A CD-ROM with electronic records will be sent via U.S. Mail to your attention no later than December 20, 2013.”

December 20, 2013 California High-Speed Rail Authority Letter to Kevin Dayton on Public Records Request

Then, at 6:14 p.m., the California High-Speed Rail Authority emailed me this batch of letters:

Associated Builders and Contractors of California – State Building and Construction Trades Council of California – California High-Speed Rail Authority 2013 letter exchange on Project Labor Agreement

UPDATE: In a November 18, 2013 letter, the California High-Speed Rail Authority informed me that it will provide me with the requested public records by December 20, 2013.

UPDATE: In a November 4, 2013 letter, the California High-Speed Rail Authority informed me that it is taking an additional 14 days (as allowed by law) to provide me with the requested public records.


On April 29, 2013, I posted the results of my request to the Fresno County Workforce Investment Board for public records related to the development of the Project Labor Agreement with the State Building and Construction Trades Council of California for construction of the California High-Speed Rail system. (See Newly Obtained Documents Reveal Which Elected Official Was the Catalyst for the Project Labor Agreement on California High-Speed Rail: Fresno Mayor Ashley Swearengin.)

I also listed seven questions that remain to be answered about how this costly union construction monopoly was implemented. It was done without any public discussion or vote by the board of the California High-Speed Rail Authority, obviously because public scrutiny and discussion would have further damaged its reputation in California and even in Washington, D.C.

Today I submitted another request for public records related to the Project Labor Agreement, this time directly to the California High-Speed Rail Authority. I expect these records will answer those seven questions and give the public a complete picture of the backroom wheeling and dealing.


From: Kevin Dayton [mailto:kdayton@laborissuessolutions.com]
Sent: Thursday, October 24, 2013 10:45 AM
To: ‘records@hsr.ca.gov’; ‘xxxxx’
Subject: Public Records Request to California High-Speed Rail Authority: Community Benefits Agreement/Project Labor Agreement

October 24, 2013

Lisa Marie Alley
Assistant Deputy Director of Communications
California High-Speed Rail Authority
770 L Street, Suite 800
Sacramento, CA 95814

Re: Public Records Request – Community Benefits Agreement/Project Labor Agreement

Dear Ms. Alley:

Under the authority of the California Public Records Act, I am requesting the following records to determine the following:

The administrative/executive branch deliberative process within the California High-Speed Rail Authority that led to the execution of the “Community Benefits Agreement” (aka Project Labor Agreement) as signed by Robbie Hunter, President of the State Building and Construction Trades Council of California, on August 7, 2013 and by Jeff Morales, Chief Executive Officer of the California High-Speed Rail Authority, on August 13, 2013. Here’s a link to that Project Labor Agreement: Project Labor Agreement with Unions for California High-Speed Rail.

“Public records” include any writing containing information relating to the conduct of the public’s business prepared, owned, used or retained by the California High-Speed Rail Authority regardless of physical form or characteristics. “Writing” means handwriting, typewriting, printing, photostating, photocopying, photographing, transmitting by electronic mail or facsimile, and every other means of recording upon any tangible thing, any form of communication or representation, including letters, words, pictures, sounds or symbols or any combination thereof, and any record thereby created, regardless of the manner in which the record has been stored.

“Public records” shall include writing from private email addresses used by the Board and staff of the California High-Speed Rail Authority for public business. For example, if a staff member sends electronic mail through a Google mail account to schedule a meeting with Robbie Hunter, that email is a public record.

Please provide the following public records – in electronic form if possible – from the California High-Speed Rail Authority:

  • All records dated after January 1, 2012 concerning consideration, rejection, and approval from any federal or state agency for a Community Benefits Agreement/Project Labor Agreement and/or “Targeted Hiring Agreement” based on a similar agreement adopted at the Los Angeles County Metropolitan Transportation Authority.
  • All records dated after January 1, 2012 concerning evaluation or deliberation of the conditions, benefits, challenges, and negative impact of a Community Benefits Agreement/Project Labor Agreement.
  • All records dated after January 1, 2012 referencing the Community Benefits Agreement/Project Labor Agreement in communications from, to, or citing the following individuals:

a) Robbie Hunter (Current President, State Building and Construction Trades Council of California)

b) Bob Balgenorth (Past President, State Building and Construction Trades Council of California and past board member, California High-Speed Rail Authority)

c) Ashley Swearingen (Mayor of Fresno)

d) Tom Richards (Chair of Fresno Regional Workforce Investment Board and current board member, California High-Speed Rail Authority.)

e) Lee Ann Eager (Economic Development Corporation serving Fresno County)

f) Chuck Riojas (International Brotherhood of Electrical Workers – IBEW)

g) Blake Konczal (Executive Director, Fresno Regional Workforce Investment Board, and Fresno Works Consortium)

h) Ken Price (counsel for Fresno Regional Workforce Investment Board)

i) Michael Bernick (Applied Development Economics)

j) Robert Padilla (Small Business Advocate, California High-Speed Rail Authority)

  • All records dated after November 1, 2012 referencing the Community Benefits Agreement/Project Labor Agreement in communications from, to, or citing the following individuals:

a) Eric Christen (Coalition for Fair Employment in Construction)

b) Nicole Goehring (Associated Builders and Contractors, Northern California Chapter)

c) Kevin Dayton, Labor Issues Solutions, LLC

  • Any other records related to the Community Benefits Agreement/Project Labor Agreement.

Note: the California High-Speed Rail Authority does not need to provide board meeting agendas, minutes, board meeting transcripts, or staff reports for meetings already provided to the public as posted on the California High-Speed Rail Authority web site in association with board meetings. It does not need to provide the Addendum 8 version of the Project Labor Agreement (Addendum 8 Project Labor Agreement for Initial Construction Segment) or the revised Project Labor Agreement linked above (Project Labor Agreement with Unions for California High-Speed Rail).

Upon receiving this request for a copy of records, please, within 10 days, determine whether the request, in whole or in part, seeks copies of disclosable public records in the possession of the California High-Speed Rail Authority and promptly notify me of the determination and the reasons therefor.

In unusual circumstances, the time limit may be extended by written notice, setting forth the reasons for the extension and the date on which a determination is expected to be dispatched. No notice shall specify a date that would result in an extension for more than 14 days, and the notice shall provide the estimated date and time when the records will be made available.

###

Opponents of CEQA Reform Cite New Study with Union Connections (Who Wrote It, Who Paid for It?) – My Article in www.UnionWatch.org

My article Opponents of CEQA Reform Cite New Study with Union Connections was posted on www.UnionWatch.org on March 12, 2013. Here’s the introduction:

A broad coalition opposing any changes to the California Environmental Quality Act (CEQA) held a press conference today (March 12, 2013) that included the findings of a newly-released study, The Economic and Environmental Impact of the California Environmental  Quality Act.

The study was written by a University of Utah professor with a long history of academic work biased toward the construction union agenda. It was funded by the union-affiliated California Construction Industry Labor-Management Cooperation Trust. Study results were summarized at the press conference by Bob Balgenorth, chairman of the California Construction Industry Labor Management Cooperation Trust and the former head of the State Building and Construction Trades Council of California.

Read the full article here: Opponents of CEQA Reform Cite New Study with Union Connections

The Plot Develops to Require Contractors to Sign a Project Labor Agreement with Unions to Build California’s High Speed Rail

UPDATE: News Coverage of the Project Labor Agreement for California High-Speed Rail

‘Needy’ Workers Will Get Jobs on High-Speed Rail – Fresno Bee – December 7, 2012 (reveals that all five prequalified bidders for the first segment of the California High-Speed Rail project have signed a Project Labor Agreement with unions)

High-Speed Rail in Bed with Unionswww.CalWatchdog.com – December 7, 2012 (provides a thorough background on union officials seeking a monopoly on construction of the California High-Speed Rail project and cites the Dayton Public Policy Institute as a source)


The agenda for today’s (December 6, 2012) meeting of the California High Speed Rail Authority included an item to approve a policy concerning “enhanced community benefits” for construction of the high speed rail system. Construction industry observers believe the High Speed Rail Authority will use this policy as justification for contractors to sign a Project Labor Agreement with unions for construction of the rail system (including related structures such as stations).

The policy, approved unanimously by the board this morning, is here: California High Speed Rail Authority – Community Benefits Policy for Construction – December 6, 2012. The approved resolution to approve the policy is here: California High Speed Rail Authority – Community Benefits Policy for Construction – Resolution – December 6, 2012.

This “community benefits” policy seems innocuous on the surface. It is supposed to enhance employment opportunities for economically disadvantaged and low-income workers, veterans, youth, unemployed, homeless, single parents, people with criminal records, etc. and “ensure that California benefits as much as possible,” according to staff. During discussion of this policy at today’s meeting, staff emphasized that it would help with the hiring of veterans and the adoption of pre-apprenticeship programs. (These are customary union talking points in support of Project Labor Agreements).

Staff also reported at the meeting that the policy would be implemented in various ways with “different stakeholders.” I’ve long predicted that the politically powerful stakeholder known as the State Building and Construction Trades Council of California would use a scheme like this to get a monopoly on High Speed Rail construction through a Project Labor Agreement.

The High Speed Rail Authority will be awarding construction contracts using a “design-build” bidding procedure, which means it can use somewhat subjective criteria, in addition to price, as the basis for selecting its construction contractors. This approach to implementing a Project Labor Agreement will allow the board and union officials to avoid controversial and high-profile votes for the High Speed Rail Authority to negotiate and implement a Project Labor Agreement directly with union officials. In addition, the public will remain generally unaware of the Project Labor Agreement, because reporters will have difficulty researching and explaining this complicated procedure.

The High Speed Rail Authority will also avoid accountability for the Project Labor Agreement. It can portray the agreement as a private and voluntary business decision that originates internally with the design-build contractor. There are recent precedents for this approach on large government projects in California.

As I reported last month, Clark Construction has signed Project Labor Agreements for the San Diego Convention Center Expansion Phase III and the new Governor George Deukmejian Courthouse in Long Beach. The City of San Diego and the California Administrative Office of the Courts even claim that the Project Labor Agreements are not a matter of public record, and Clark Construction declines to provide them to the public.

Staff told the board that prospective contractors will indicate in their bids how they will fulfill the policy. There will be a monitoring program handled through the High Speed Rail Authority’s auditing committee, and contractors will be penalized for failing to comply.

Marvin Dean calls for fairness and opportunities for all at California High Speed Rail Authority Board Meeting - December 6, 2012.

Marvin Dean calls for fairness and opportunities for all at California High Speed Rail Authority Board Meeting – December 6, 2012.

Eric Christen of the Coalition for Fair Employment in Construction spoke at the meeting today during public comment against a Project Labor Agreement, along with Nicole Goehring of the Northern California Chapter of Associated Builders and Contractors and Richard Markuson, representing the Western Electrical Contractors Association (WECA), the Plumbing-Heating-Cooling Contractors Association of California (PHCC), and the Air Conditioning Trade Association (ACTA). In addition, Marvin Dean of the Kern Minority Contractors Association spoke during public comment and asked that both union and non-union contractors have the opportunity to work on the High Speed Rail.

Chairman Dan Richard (a former board member of the Bay Area Rapid Transit District – BART) concluded discussion of the proposed policy by remarking on the public comments against a Project Labor Agreement. Richard declared that while no decision has been made about how this policy will be implemented, he attended a meeting yesterday with the minority community, which expressed very strongly that a Project Labor Agreement was the way to achieve the policy objectives. He also claimed that Project Labor Agreements are effective in improving the efficiency of project delivery, reducing the number of conflicts, and providing a way for minority contractors to get work.

Mr. Richard also took a moment after public comment to recognize two important people in the audience: Bob Balgenorth, outgoing head of the State Building and Construction Trades Council of California and former High Speed Rail Authority board member, and Robbie Hunter, the head of the Los Angeles-Orange County Building and Construction Trades Council, who is the incoming head of the State Building and Construction Trades Council of California.

This Project Labor Agreement Scheme Has Long Been Expected…

See California’s Top Construction Union Officials Love the State’s $100 Billion High-Speed Rail Project, my January 12, 2011 blog post on www.TheTruthaboutPLAs.com that provides a history of union involvement with the High Speed Rail.

I’m not the only observer who sees what’s going on. Here’s the text of a notice sent this morning by the Coalition for Fair Employment in Construction:

PLA ALERT!: CA High Speed Rail Authority to Vote on Union-Only Project Labor Agreement TODAY!

Today at 10:00am at City Hall in Sacramento, the California High Speed Rail Authority will be doing something we have warned about ever since this ill conceived, deceitfully presented plan to create a slower and more expensive way to travel verses flying was concocted: Have this 19th Century choo-choo train built with union-only labor by way of a Project Labor Agreement or “PLA”.  That should help keep this projects runaway costs down.

Because of CFEC’s pointed questioning of Authority staff and board members at previous meetings regarding a PLA, they have been forced to state there would’t be a PLA.  So what they have done now is give this PLA the euphemism “Community Benefit Agreement.”

You can watch the proceedings live by going here.

CFEC and others have been warning taxpayers, owners, and workers for years about the fact that the California High Speed Rail Authority is a prime target for a union-only Project Labor Agreement (PLA).

With Senate Bill 1029 having passed the State is set to spend $5.85 billion to acquire land and build the “initial operating segment” of the California High-Speed Rail. This month the California High-Speed Rail Authority is scheduled to award several contracts for this first segment through an alternative bidding procedure called design-build. Five entities that are conglomerates of major engineering and heavy construction infrastructure corporations have qualified to bid under this procedure with “a goal” to have 30 percent of the work go to small businesses.

Instead of awarding contracts to design the project and then awarding contracts to the lowest responsible bidder to build it, the California High-Speed Rail Authority is authorized to award contracts to qualified corporate entities that combine project design AND construction work.

The California High-Speed Rail Authority will select the design-build entities using a somewhat subjective list of “best value criteria” that could result in design-build entities winning contracts without being the lowest price. The State Public Works Board, which will oversee the awarding of the project, and the California Department of Finance, will approve the criteria to award the design-build contract.

As required by SB 1029, by October 1, 2012, prior to awarding a contract to start construction of the first segment of the California High-Speed Rail, and prior to advertising additional contracts to be awarded in September 2013 and October 2013, the California High-Speed Rail Authority will provide a comprehensive staff management report that includes a list of “proposed steps and procedures that will be employed to ensure adequate oversight and management of contractors involved in the construction contracts funded in this act.” The California High-Speed Rail Authority will also need to submit a report with the same content requirements before additional contracts are awarded in March 2017.

With the eight-member Board of Directors of the California High-Speed Rail Authority including or having included union bosses like Bob Balgenorth, recent head of the State Building and Construction Trades Council of California, this was pretty easy to see coming.  But we will continue to expose it to California taxpayers and fight it.

At today’s meeting CFEC’s Eric Christen, among others, will be asking tough questions about the CBA. The meeting will be held at 10:00am at Sacramento City Hall located at 915 I Street in downtown Sacramento.

Contact Eric Christen at (858) 431-6337 for more information.

News Media Coverage:

Approved Policy Targets Disadvantaged People for High-Speed Rail Jobs – Fresno Bee – December 6, 2012

Union Slush Fund Sends Mailers to Costa Mesa Residents Attacking Measure V, the Proposed Charter

UPDATE (October 23, 2012): news coverage of the California Construction Industry Labor-Management Cooperative Trust contributions against Measure V, the proposed charter in Costa Mesa:

Trade, Labor Groups Spending Big to Defeat Costa Mesa Charter – Orange County Register – October 18, 2012

Construction industry trade groups and labor unions are spending aggressively against Costa Mesa’s Measure V, the city charter initiative that could severely limit labor unions’ influence. The most money so far has come from the California Construction Industry Labor Management Cooperation Trust, a Sacramento-based organization representing trade unions and major companies in the construction industry. It has contributed $100,000 this year to fight the measure, according to city campaign finance filings…

The money from outside groups has infuriated Councilman Jim Righeimer, the proposed charter’s architect and its chief advocate. He said construction labor groups are spending to preserve their high wages, as the charter would abolish the city’s requirement to pay a union-level wage for city-funded public works projects. “They don’t want to give up prevailing wage,” Righeimer said. “That’s the whole issue…”

The construction industry group says it is only natural for them to oppose a measure that could lower wages and toss out state rules on public works contracting. Lower wages ultimately harms the local economy, said Bob Balgenorth, chairman of the industry trust. His members “believe that prevailing wage benefits the community…it makes sure that low-wage contractors don’t bring in workers from out-of-state.”

Measure V Becomes a Six-Figure Battle – Newport Beach/Costa Mesa Daily Pilot – October 23, 2012

When it comes to Costa Mesa’s charter ballot initiative, organized labor so far has raised more and outspent its opposition, campaign finance records show…The majority has come from the Committee for Costa Mesa’s Future and its $100,000 contribution from the Sacramento-based California Construction Industry Labor Management Cooperation Trust.

Mayor Pro Tem Jim Righeimer — the architect of the charter, which he contends will lead to taxpayer savings — said the campaign spending demonstrates the outside influence of the labor unions trying to decide city matters.


The California Construction Industry Labor Management Cooperative Trust has provided $100,000 as of September 30, 2012 as the sole donor to “Committee for Costa Mesa’s Future – No on V – Sponsored by Labor and Management Organizations.” This a political committee established to oppose Measure V, the proposed charter on the November 6, 2012 ballot in the City of Costa Mesa, California.

The treasurer for the “Committee for Costa Mesa’s Future – No on V – Sponsored by Labor and Management Organizations” is Robbie Hunter, head of the Los Angeles-Orange County Building and Construction Trades Council.

The California Construction Industry Labor Management Cooperative Trust is a secretive group authorized by the obscure Labor-Management Cooperation Act of 1978, a law signed by President Jimmy Carter and implemented by the Federal Mediation and Conciliation Service. The head of the California Construction Industry Labor Management Cooperative Trust is Bob Balgenorth, head of the State Building and Construction Trades Council of California and California Unions for Reliable Energy (CURE).

California Construction Industry Labor Management Cooperative Trust 2010-2011 Form 990

For information about how this organization gets its money, see my www.UnionWatch.org article Mysterious Union Slush Fund Spends $100,000 Against Costa Mesa Charter.

For more information about this organization spends its money, see my article Where the California Construction Industry Labor-Management Cooperative Trust Spends Its Money: Now We See How Unions Spread It.

Here are examples of mail funded by the California Construction Industry Labor Management Cooperative Trust through the “Committee for Costa Mesa’s Future – No on V – Sponsored by Labor and Management Organizations.”

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

The California Construction Industry Labor Management Cooperative Trust funded this mailer opposing Measure V, the proposed charter in Costa Mesa, California, in the November 6, 2012 election.

 

Feds Need Better Oversight of Labor-Management Cooperation Committees, Such as the Union Slush Fund that Spent $1.1 Million in the June 2012 Election in the City of San Diego

An August 27, 2012 article on the Investigative Newsource – Southern California web site contains the latest fleeting news reference to the California Construction Industry Labor-Management Cooperation Trust. The last two paragraphs of “Outside Donors Fuel Prop. Opponents, Fund Mayoral Hopefuls” states the following about Proposition A campaign in the City of San Diego for the June 6, 2012 election:

The California Construction Industry Labor Management Cooperation Trust, a nonprofit located in Sacramento that promotes and protects project labor agreements around the state, donated more than $1 million to try unsuccessfully to defeat Prop. A, which banned project labor agreements. The agreements set some of the terms of employment, such as wage rates, on construction projects.

The Trust gets much of its money from laborers themselves. Clauses in some project labor agreements dictate that a portion of money per hour worked goes to the Trust.

The same Investigative Newsource was alone among news media groups in highlighting the extensive campaign involvement of this obscure organization before the June 6, 2012 election. From the May 25, 2012 article “Business Groups, Builders and Labor Battle over Propositions:”

All of the money for the one of the committees opposing Proposition A has come from the same donor.

Since March 18, the California Construction Industry Labor Management Cooperation Trust donated $675,000 to Taxpayers to Preserve Community Jobs.

The California Construction Industry Labor Management Cooperation Trust is a tax-exempt Sacramento-based organization, which says its mission is, among other things, to “improve public awareness of the benefit of using organized labor contractors and workers.” The group is not required by the IRS to list specific sources of funding, but in general, it reported on its 2010 tax returns collecting $678,000 in membership dues. It reported more than $3 million in assets.

And the trust fund is also cited in the June 1, 2012 Investigative Newsource article “Fundraising Amps Up for Proposition A, B Committees:”

In the past week, a union trust gave an additional $320,000 into defeating Proposition A, a ballot measure that would ban project labor agreements for San Diego city projects if passed.

That brings to $1.18 million the amount raised by the anti-Prop. A forces, far outpacing the business interests pushing Proposition A. That committee, Fair and Open Competition, has raised $755,000 so far.

Taxpayers to Preserve Community Jobs — an anti-Prop. A committee — has benefited mainly from the California Construction Industry Labor Management Cooperation Trust. The trust is responsible for more than 90 percent of its donations.

The labor trust is “heavily involved” with promoting and protecting project labor agreements (PLAs) around the state, according to secretary/treasurer Scott Strawbridge. A PLA is a type of collective bargaining agreement that a city can enter into with workers for city projects.

“We think (PLAs) are good business for our contractors and union members,” Strawbridge said.

A big part of the money in the trust comes from laborers themselves, he said. Clauses in certain PLAs specify that a small amount of money per hour worked goes into the trust.

The San Diego Union-Tribune briefly and generally mentioned the fund after the election, in the June 7, 2012 article “Impact of Proposition A on State Funds in Dispute:”

The major backer of the No on A campaign was a Sacramento-based group headed by Robert Balgenorth, the president of the State Building and Construction Trades Council of California, a statewide union, which donated $1.1 million to stop it from passing.

This brief public reference was enough to provoke Scott Strawbridge (cited in the Investigative Newsource article above) to defend the California Construction Industry Labor-Management Cooperative Trust publicly with an opinion piece in the Union-Tribune. (“In Response: Prop. A Put San Diego Citizens in Difficult Position,” June 22, 2012)

In doing so, he provided a public service in highlighting the unregulated slush fund that spent $1,095,000 to oppose Proposition A, a fair and open competition ordinance approved by 58% of San Diego voters on June 5.

This mysterious, Sacramento-based California Construction Industry Labor-Management Cooperative Trust is authorized by the obscure Labor-Management Cooperation Act of 1978, a law signed by President Jimmy Carter.

The law lists specific purposes for these trusts: “improving labor-management relationships, job security, organizational effectiveness, enhancing economic development or involving workers in decisions affecting their jobs including improving communication with respect to subjects of mutual interest and concern.” And many trusts operating under this law do just that.

Nevertheless, the California Construction Industry Labor-Management Cooperative Trust circumvents these purposes without consequence.

The Federal Mediation and Conciliation Service hasn’t implemented regulations to monitor or limit how such trusts operate. And these trusts don’t have any reporting requirements to the U.S. Department of Labor’s Office of Labor Management Standards.

Who wouldn’t enjoy having a slush fund with minimal oversight and controls?

The California Construction Industry Labor-Management Cooperative Trust recently gave $100,000 to the Apollo Alliance, $250,000 to a campaign committee opposing reforms to state eminent domain laws, and $770,000 to the biased California Construction Academy of the University of California Miguel Contreras Labor Program. It also gave $164,550 to “Other.”

How does the California Construction Industry Labor-Management Cooperative Trust get its money? Do people contribute to it through the goodness of their hearts?

Actually, owners of proposed power plants (and their construction contractors) fund it when they sign Project Labor Agreements (PLAs) that require payments to it.

Power plant owners don’t sign these union agreements because they want union monopolies on construction or appreciate the California Construction Industry Labor-Management Cooperative Trust.

Instead, they sign them to discourage California Unions for Reliable Energy (CURE) from exploiting environmental laws to interfere with approval of their proposed power plants at the California Energy Commission and other government agencies.

It’s a tangled conspiracy. Especially intriguing is that one union official is the head of the State Building and Construction Trades Council of California, the California Construction Industry Labor-Management Cooperative Trust, and California Unions for Reliable Energy.

Another interesting angle: when publicly-owned utilities sign these Project Labor Agreements, their electric customers ultimately fund the California Construction Industry Labor-Management Cooperative Trust through their bills.

Senate Bill 790 – signed into law by Governor Jerrry Brown in 2011 – allows publicly-owned utilities to pass through to ratepayers the cost of payments to trusts authorized by the Labor Management Cooperation Act of 1978.

In its annual Form 990 statements to the IRS, the California Construction Industry Labor-Management Cooperative Trust classifies its receipts as “membership dues.” How do “members” such as the Northern California Power Agency and the Southern California Public Power Authority decide to contribute $1,095,000 to the No on A campaign in the City of San Diego?

It’s time to stop these abuses. If Mitt Romney is elected President, his appointees to oversee the Federal Mediation and Conciliation Service and the Office of Labor Management Standards need to implement reasonable regulations for trusts authorized under the Labor-Management Cooperation Act of 1978.

Lodi Energy Center Dedicated Today – Official Press Release Doesn’t Mention the Project Labor Agreement or California Unions for Reliable Energy (CURE)

UPDATE: Some good news for ratepayers: the reporter for the Stockton Record newspaper was willing to evaluate the Lodi Energy Center beyond the orchestrated perspective of the Northern California Power Agency and its public relations firm Ziegler Associates. Here’s an excerpt from Staying Power: State-of-the-Art Clean Energy Behemoth Dedicated in Lodi – Stockton Record – August 11, 2011:

The project was not without its controversies. Some questioned whether construction workers were hired locally as contract guidelines required. A labor group that represents nonunion construction companies also was outspoken in criticizing a project labor agreement the NCPA entered into with union affiliates, which included a $90,000 payment from the power agency to a union group fund.

[note: hyperlinks added by me]

Officials on Friday denied those assertions, saying the Lodi Energy Center employed 80 percent of its construction workers locally and hired soldiers who returned from war.

“These union agreements would cut bid competition, raise costs, and prevent ratepayers from getting the best quality construction at the best price,” said Kevin Dayton, a former representative of the NCPA foe, Associated Builders and Contractors.

Dayton and his colleagues made little to no impact on the construction of the project, however. And, those who were key figures in building the plant maintain that the NCPA and the state are better off for it.

Meanwhile, the Lodi News-Sentinel’s August 11, 2011 article Local Officials Dedicate Cutting-Edge Lodi Energy Center fulfilled expectations with an article that only had positive things to say about the power plant, complete with with a quotation from Bob Balgenorth, head of the State Building and Construction and Trades Council of California:

“When this plant got started, we were in the depths of the depression in the construction industry. We had people who had been out of work for two or three years. This put 300 people from this area to work. … People who were now able to pay their rent, make their house payment if they still had one, put food on the table and send their kids to school and provide clean, efficient energy for the state of California.”

— Robert Balgenorth, president of the State Building and Construction Trades Council of California

The article neglects to mention there was a government-mandated requirement for those 300 people: as stated in the Project Labor Agreement, “all Covered Work will be performed by workers who are union members,” “All employees performing Covered Work shall be or shall become and then remain members in good standing of the appropriate Union as a condition of employment,” and (to make sure it’s clear) “The Unions shall be the source of all craft employees for Covered Work for the Project.”

Nor does the article mention the $90,000 check that the Northern California Power Agency sent via Fed-Ex to Bob Balgenorth on August 17, 2010.


Today (August 10, 2012), the Northern California Power Agency (NCPA) issued its press release describing the dedication of the Lodi Energy Center. (See text below).

This 300 megawatt natural gas-fired power plant was built under a Project Labor Agreement demanded by California Unions for Reliable Energy (CURE), as I described in my August 9, 2012 web post “Excluded! I’m Not One of the 300 Guests Invited by the Northern California Power Agency to Attend the August 10, 2012 Dedication of the Lodi Energy Center Power Plant.”

The August 8, 2012 media advisory from the Northern California Power Agency had reported that one of the speakers at the dedication would be “Bob Balgenorth, State Building and Construction Trades Council of California.” But his remarks weren’t included in the August 10, 2012 press release describing the event itself.

Today’s press release refers to “hundreds of high-paying jobs for Central Valley workers,” which would have happened even if contractors were NOT required to sign a Project Labor Agreement with unions. In fact, one of the non-union industrial contractors planning to bid on it before the NCPA commissioners imposed a Project Labor Agreement on it was even based in Lodi.

The press release neglects to directly reference the Project Labor Agreement or the magnanimous cooperation of the State Building and Construction Trades Council of California.

Here are some examples of earlier power plant groundbreakings and dedications:

Sutter Power Plant Dedicated – August 17, 2001 – “SBCTC President Bob Balgenorth was one of the speakers at the dedication. He praised the union members who made this project possible, and also spoke of the improving relationship with Calpine for the construction of power plants in California. PLAs have been negotiated for six plants with Calpine to date, and talks are in process for other work.”

Groundbreaking & Signing Ceremony: Niland Gas Turbine Plant – April 20, 2007 – “As Chair of California Unions for Reliable Energy and President of the State Building and Construction Trades Council of California, I want to acknowledge my appreciation to the members of the management team and the Board of IID. During the negotiations on the Project Labor Agreement, the leadership of the Imperial Irrigation District demonstrated that they have a vision for the future of the Imperial Valley.”
 
Below is the text of the press release.

From: Energy Commission [mailto:listenergia@listserver.energy.ca.gov]

Sent: Friday, August 10, 2012 1:23 PM

To: LODI@LISTSERVER.ENERGY.CA.GOV

Subject: LODI-LIST: State, Local Agencies Come Together to Dedicate State-of-the-Art Lodi Energy Center

 

For Immediate Release:

August 10, 2012

 

Contact:

Friday, August 10: Carri Ziegler or Corinne Chee

916-502-1131 (c) | carri@zieglerassociates.net

916-341-0472 (o)

916-508-1611 (c) | corinne@zieglerassociates.net

 

After Friday, August 10: Jane Cirrincione

916-781-4203 | jane.cirrincione@ncpa.com

 

Media Contact for California Energy Commission:

Amy Morgan 916-654-4989

 

State, Local Agencies Come Together to Dedicate State-of-the-Art Lodi Energy Center Natural Gas-Fired Power Plant is the Cleanest of its Kind

(Lodi, Calif.) – State and local elected officials today joined with the Northern California Power Agency (NCPA) in celebrating the completion of the 300-megawatt Lodi Energy Center (LEC), the cleanest and most efficient combined-cycle natural gas-fueled power plant in the State of California, if not the nation.

As the owner and operator of the LEC, NCPA partnered with 13 public power utilities and other agencies to construct the $388 million project in Lodi during the past two years.  When it comes online next month, the facility will serve millions of Californians by providing electricity to several participating municipal utility communities, BART and the California Department of Water Resources. 

“LEC is the future of clean, reliable energy, not just for the individual communities and agencies represented here today, but for the entire state of California,” said NCPA General Manager James H. Pope during today’s dedication ceremony. “This facility will come online quickly, burn less fuel and produce fewer emissions.”

Nine of NCPA’s 16 members, along with four other public entities, are sharing in LEC’s investment and benefits. The City of Santa Clara’s Silicon Valley Power is a major participant in the LEC with a 25 percent share of the project. The San Francisco Bay Area Rapid Transit District (BART) will use its portion of LEC’s output to help power its transit system trains, Pope said. The Modesto Irrigation District and the municipal utilities serving Lodi, Gridley, Ukiah, Healdsburg, Biggs, Lompoc, and Azusa will receive LEC energy, along with the Plumas-Sierra Rural Electric Cooperative, and the Power and Water Resources Pooling Authority.

What makes the LEC unlike any natural gas-fueled generation facility in operation today is the “fast-start” turbine at the heart of the plant, Pope said. This state-of-the-art Flex-Plant 30 combined cycle technology, designed and built by Siemens, A.G., provides a number of economic and environmental advantages over traditional natural gas-fueled plants. 

Since most conventional plant emissions occur during start-up, the LEC’s ability to significantly reduce the amount of time needed, up to 50 percent less than other units, to bring the facility up to full generating capacity increases overall efficiency and dramatically reduces emissions, Pope said. Overall, greenhouse gas emissions are being cut by 30 percent, compared to traditional combined-cycle plants.

Another important advantage of the LEC’s cutting-edge technology is its ability to rapidly ramp production up and down to match market conditions. LEC participants will be able to quickly respond to changing consumer power demand, reducing overall costs to the consumer.

The operating flexibility of the new LEC also will facilitate greater use of renewable sources of electricity, such as wind and solar resources, which have been more difficult to integrate into California’s energy resources because of their weather-dependent nature. This flexibility will allow the LEC to serve as a reliable back-up when changing weather conditions reduce electrical output.

“This innovative fast-ramping, gas-fired plant was specifically designed by Siemens as a solution to balance fluctuations on diverse power grids managing both renewable and traditional energy sources,” said Mario Azar, President of Energy Solutions Americas for Siemens. “Its clean footprint and versatility makes it an ideal solution to the growing need for stable and environmentally friendly power sources in the U.S. and around the globe. We are proud to be introducing this groundbreaking technology in partnership with NCPA.”

“The Lodi Energy Center will provide grid reliability to the Central Valley, while integrating renewable resources,” said Energy Commission Chair Robert B. Weisenmiller. “This is the future for fast-start gas-fired combined cycle power plants in the country.”

Santa Clara City Councilman Pat Kolstad agreed. “California has set very ambitious carbon reduction and renewable energy goals,” said Kolstad, referring to the landmark 2006 climate change act, and 2011’s 33 percent renewable portfolio standard requirement. “Our participation in LEC will help ensure that my community will continue to lead the way toward a cleaner, greener energy future for California.”

Steve Berberich, president and chief executive officer of the California Independent System Operator, also praised the LEC for the contribution it will make toward maintaining grid reliability as intermittent energy resources continue to make up a larger percentage of the state’s energy portfolio.

“The Lodi Energy Center’s cutting edge technology will help strengthen electrical system reliability as variable renewable resources continue to be deployed,” Berberich said.

During the more than two years it was under construction, the LEC created hundreds of high-paying jobs for Central Valley workers. At its peak, more than 300 skilled laborers, tradesmen and managers worked full time at the LEC site, located just west of Interstate 5 in southwest Lodi.

At any time during construction, a minimum of 80 percent of LEC workers resided within 50 miles of the Lodi area, ensuring that the local area economy directly benefited from the project’s construction. The focus on local employment was a key part of the appeal of the LEC project, both for NCPA and for the City of Lodi.

“NCPA’s emphasis on hiring local workers to build the LEC has produced tremendous benefits for the Lodi-area economy, both in terms of creating a significant number of high-quality local jobs and providing a reliable and affordable source of electricity for the state,” said Assembly member Alyson Huber, whose district includes the Lodi area.

Beyond the creation of jobs and the multiplier effect those jobs have on the local economy, the LEC will continue to provide economic benefits to Lodi as well.

Since LEC will only use reclaimed water in its steam generating and power plant cooling systems, NCPA has partnered with Lodi to purchase wastewater from the White Slough Water Pollution Control Facility, turning a water disposal liability into a valuable local economic asset.  In addition, sales tax on the generating equipment and a multi-decade lease for city-owned land, on which LEC is sited, will generate substantial additional revenue for Lodi.

“The Lodi Energy Center is providing tremendous benefits that reach far beyond providing an affordable and reliable energy supply for the ratepayers of the City of Lodi,” said Lodi City Councilman and NCPA Commissioner Larry Hansen. “The positive impacts will continue to be felt for years throughout our community and the state.”

The ultimate beneficiaries of the LEC, noted Healdsburg Mayor and NCPA Commission Chairman Gary Plass, are the residents of the communities that will be served by the facility.

“It’s been very gratifying,” he said, “to be associated with a project that will directly benefit my community. For my community as well as others associated with LEC consumers, keeping electricity rates affordable for our residential and business customers, while at the same time maintaining our excellent record of environmental leadership, has always been our goal.”

Lodi Energy Center Project Participants

The City of Azusa, Bay Area Rapid Transit (BART), the City of Biggs, California Department of Water Resources (CDWR), the City of Gridley, the City of Healdsburg, the City of Lodi, the City of Lompoc, Modesto Irrigation District (MID), Plumas-Sierra Rural Electric Cooperative (PSREC), the Power and Water Resources Pooling Agency (PWRPA), Silicon Valley Power (The City of Santa Clara), and the City of Ukiah.

About Northern California Power Agency (NCPA) The Northern California Power Agency (NCPA) is a joint-action agency serving public power entities located throughout Northern and Central California, including municipal and cooperatively-owned utilities and special districts. NCPA has built, and currently owns and operates, a portfolio of electricity generation resources that is 95 percent carbon-emission free. Drawing upon NCPA’s diverse mix of resources, our members collectively serve 750,000 California electricity consumers with a 20 percent eligible renewable resource portfolio.

###

Barreling Down the Tracks: Project Labor Agreement for California’s High-Speed Rail – the Biggest, Costliest Union Construction Monopoly in History

Background on Contracts for Construction of the First Section of the California High-Speed Rail, as Based on the Bill Approved by the State Senate Today (July 6, 2012)

This afternoon (July 6, 2012), the California State Senate barely passed a budget trailer bill (Senate Bill 1029) that authorizes $5.85 billion (actually, $5,849,752,000.00) to acquire land and build the “initial operating segment” of the California High-Speed Rail. According to the bill, the project will be reviewed and overseen by the (obscure) State Public Works Board.

In December 2012, the California High-Speed Rail Authority will award several contracts for this first segment through an alternative bidding procedure called design-build. Five entities that are conglomerates of major engineering and heavy construction infrastructure corporations have qualified to bid under this procedure. (This is the Big Time, although there is supposed to be a goal to have 30 percent of the work go to small businesses.)

Instead of awarding contracts to design the project and then awarding contracts to the lowest responsible bidder to build it, the California High-Speed Rail Authority is authorized to award contracts to qualified corporate entities that combine project design AND construction work. The California High-Speed Rail Authority will select the design-build entities using a somewhat subjective list of “best value criteria” that could result in design-build entities winning contracts without being the lowest price. The State Public Works Board and the California Department of Finance will approve the criteria to aware the design-build contract.

As directed by Assembly Bill 1029, the California High-Speed Rail Authority is now required to issue some reports related to construction:

1. By October 1, 2012, prior to awarding a contract to start construction of the first segment of the California High-Speed Rail, and prior to advertising additional contracts to be awarded in September 2013 and October 2013, the California High-Speed Rail Authority will provide a comprehensive staff management report that includes a list of “proposed steps and procedures that will be employed to ensure adequate oversight and management of contractors involved in the construction contracts funded in this act.” That same report will list “procedures to detect and prevent contract splitting.” The California High-Speed Rail Authority will also need to submit a report with the same content requirements before additional contracts are awarded in March 2017.

3. On or before March 1 and November 15 of each year, the California High-Speed Rail Authority will provide a Project Update Report approved by the Secretary of Business, Transportation and Housing to the budget committees and the appropriate policy committees of the Assembly and Senate on the development and implementation of the California High-Speed Rail.

4. On or before June 30, 2013, the California High-Speed Rail Authority will prepare and submit a report approved by the Secretary of Business, Transportation and Housing that provides an analysis of the net impact of the California High-Speed Rail program on the state’s greenhouse gas emissions. The report shall be submitted to the Assembly and Senate budget committees and transportation committees.

My observations about these provisions in Senate Bill 1029:

1. While it’s unclear how it will be implemented, it’s quite likely there will be a requirement for the design-build entities and their subcontractors to sign a Project Labor Agreement with unions for some or all of the construction work. I provided extensive background information about this Project Labor Agreement threat in my highly-read January 12, 2012 article in www.TheTruthaboutPLAs.com entitled California’s Top Construction Union Officials Love the State’s $100 Billion High-Speed Rail Project.

The eight-member Board of Directors of the California High-Speed Rail Authority includes Bob Balgenorth, head of the State Building and Construction Trades Council of California, and Russ Burns, head of the International Union of Operating Engineers Local No. 3. The Senate Rules Committee appointed Balgenorth, and former Assembly Speaker Karen Bass appointed Burns.

Balgenorth has spoken repeatedly and publicly in support of the California High-Speed Rail even as just about everyone with common sense has mocked the costly, beleaguered project. Surely someone will reward Balgenorth and Burns for their efforts with a requirement for contractors to sign a Project Labor Agreement with unions to work on construction of the California High-Speed Rail. Of particular benefit to the unions, a Project Labor Agreement will kill off what would have been fierce competition from non-union contractors to perform electrical work and build the stations.

2. According to its web site, the State Public Works Board (SPWB) “was created by the Legislature to oversee the fiscal matters associated with construction of projects for state agencies, and to select and acquire real property for state facilities and programs. The SPWB is also the issuer of lease-revenue bonds, which is a form of long term financing that is used to pay for capital projects.” Its five members are officials from the Department of Finance, the Department of General Services, the Department of Transportation, the State Treasurer’s Office, and the State Controller’s Office. Amazingly, there isn’t a representative of organized labor sitting in on this board.

3. According to the May 12, 2012 minutes of the State Public Works Board, the High Speed Rail Authority “anticipates acquiring 1,100 properties from Madera County to Bakersfield County over the next two years as part of the high speed train system.” Perhaps this explains why the California Construction Industry Labor-Management Cooperative Trust and its precedessor (the State Building and Construction Trades Council of California Labor-Management Cooperation Trust) made two huge campaign contributions ($1,000,000 and $250,000) to committees opposing statewide ballot measures to restrict government power to acquire property through eminent domain. (I’ll write more about this issue in a later post – it deserves its own analysis.)

4. It would seem that the report requirement in Senate Bill 1029 to explain oversight and management of the contractors on the California High-Speed Rail project would be fulfilled with implementation of the labor compliance requirements now outlined in California Labor Code Section 1771. This is language enacted in 2011 through union-backed Assembly Bill 436, a bill that also repealed language of California Labor Code 1771.9, which was enacted in 2003 by union-backed Assembly Bill 1506. That original language applied specifically to contractor labor law compliance for the California High-Speed Rail project. Note that the new 2011 law (Assembly Bill 436) allows a government entity to exempt itself from labor compliance requirements if “the awarding body has entered into a collective bargaining agreement that binds all of the contractors performing work on the project and that includes a mechanism for resolving disputes about the payment of wages.” (This is the definition of a Project Labor Agreement.)

5. What is “contract splitting,” and why does Senate Bill 1029 require the California High-Speed Rail Authority to report on its efforts to prevent it? These are interesting questions. Obviously someone somewhere is worried about something!

California Public Contract Code Section 20915 states that “It shall be unlawful to employ any means to evade the provisions of this article requiring contracts to be awarded after advertising and competitive bidding, including the splitting of projects into smaller work orders, the amendment of existing contracts, or the approval of a subcontract or subcontracts let under existing contracts. Every person who willfully violates this section shall be guilty of a misdemeanor.”

6. Senate Bill 1029 requires the California High-Speed Rail Authority to provide “an analysis of the net impact of the high-speed rail program on the state’s greenhouse gas emissions.” Realize that the construction of the California High-Speed Rail will result in significant greenhouse gas emissions from the diesel equipment used to build it. The Teamsters union was so “concerned” about greenhouse gas emissions in the Central Valley area where the first segment will be built that it filed a lawsuit in 2011 challenging the construction of a distribution facility in Visalia (where truck drivers would not necessarily be unionized).

In addition, the draft Environmental Impact Report for this project indicates that the California High-Speed Rail program may use diesel-powered switch locomotives associated with maintenance-of-way activities. See California High-Speed Train Project EIR/EIS – Fresno to Bakersfield Section – 3.3 Air Quality and Global Climate Change. (How could this be? I thought this High-Speed Rail was going to save the planet!)

The home page for California High-Speed Rail declares that “California Is Thinking Big Again.” I’ve only scratched the surface of a few of many issues involving this project, and I’m thinking California Is in Big Trouble if this project continues.

There, Fixed It: “Know Your ABC”

Today the Washington, D.C.-based Building and Construction Trades Department, AFL-CIO launched a new program trying to undermine the credibility of Associated Builders and Contractors (ABC). From 1995 through March 2012, I held various government affairs management positions with ABC, first at the national office in Washington, D.C., then with the Golden Gate Chapter in Northern California as the Vice President of Government Affairs, and then with ABC of California as its State Government Affairs Director. Now I’m gone from ABC and newly emerged as the President and CEO of Labor Issues Solutions, LLC, with its research project, the Dayton Public Policy Institute.

So I escaped the latest union blanket accusation of using the “dark arts.” Nevertheless, for old time’s sake, I’m correcting the important, ponderous prose of the introductory paragraphs on the new union web site “Know Your ABC” at http://www.knowyourabc.com:

During any number of dark periods in human history, the forces who set their designs upon absolute power and oppression subscribed to the theory that an endless stream of lies and distortions was central to achieving their aims. It was, and still is, known as propaganda, and its primary objective is to persuade people of what those seeking power and control think is right – regardless of the facts. To those seeking power, propaganda does not have to be popular, nor does is (sic) it have to be intellectually pleasing, because, according to the theory, it is not the goal of propaganda to discover intellectual truths.

In our modern system of political debate and discourse, those tenets have, unfortunately, been embraced and put into practice by various ideologues and extreme organizations. And nowhere are the dark arts of political propaganda being deployed with such outsized exactitude than inside the Associated Builders and Contractors (ABC) Building and Construction Trades Department, AFL-CIO, the State Building and Construction Trades Council of California, and their regional and local affiliates. The distortions, falsehoods and outright lies being consistently perpetrated by the ABC construction union political machine when it comes to issues such as prevailing wage laws and project labor agreements (PLAs), are prime examples of the ABC’s Big Labor’s aggressive and disciplined devotion to the propaganda playbook.

Some might consider this to be the most powerful manifesto written since the Port Huron Statement, although others might consider it ripe for parody. I never considered ABC to be a practitioner of the “dark arts.” Seventeen years ago ABC was known as The Mean Team, because “…it is tenacious and favors the take-no-prisoners approach to litigation and lobbying…it’s just another day at the office for the ABC’s pugnacious team.” But maybe things are different now in this dark period of human history.

Here’s the press release announcing the introduction of the “Know Your ABC” program, with its “special” report written by a faculty member of the soon-to-be campus-free National Labor College:

America’s Labor Leaders to Release Major Study on the Associated Builders and Contractors

California angle: Notice that “on the call and available for comment” is Bob Balgenorth of the “California State Building Trades Council.”

California’s Top Construction Union Boss Opens the Slush Fund Hydrant: $1.14 Million Full-Blast Against San Diego’s Proposition A Voter Initiative

Here’s yet another scoop from the Dayton Public Policy Institute about how unions are influencing the June 2012 elections in California: one supreme union official based in Sacramento has pumped $1.14 million into San Diego to defeat a city voter initiative called Proposition A. And some of the cash originally comes from utility ratepayers.

For readers unfamiliar with Proposition A, read immediately below. Those who know about Proposition A can proceed down to read about the union sources of $1.14 million for the No on A campaign.

Who Supports Proposition A in San Diego, and Why?

In 2011, San Diego voters signed petitions to qualify a Fair and Open Competition ordinance for consideration in the June 5, 2012 election. It was the first measure placed by voters on the city ballot since 1998. Now designated on the ballot as Proposition A, the Fair and Open Competition ordinance would prohibit the City of San Diego from requiring construction companies to sign a Project Labor Agreement (PLA) with unions as a condition of working on a taxpayer-funded project. It also contains language requiring the city to post certain contract information on-line.

The campaign to enact Proposition A is strongly supported by construction companies and construction trade associations. This is no surprise, since most construction companies work directly with their employees (either individually or collectively through a union) to determine the terms and conditions of work. They don’t want two-bit local politicians to negotiate separate 30-page to 60-page labor agreements with union officials (i.e. the politicians’ campaign contributors) and then impose those agreements on their businesses.

Many companies refuse to bid on work that includes a government-mandated Project Labor Agreement in the bid specifications. The resulting reduction in the number of bidders competing for contracts results in higher costs for taxpayers (as academic studies, basic economic theory, and common sense would predict).

See the YES on A campaign web site here and contributors to the YES on A campaign here.

Who Opposes Proposition A in San Diego, and Why?

The main opponents of Fair and Open Competition policies are obviously construction trade unions, which regard government-mandated Project Labor Agreements as an effective political tactic to cut bid competition and raise costs for their own benefit. With Project Labor Agreements, union organizers can completely avoid the unpleasant and time-consuming task of selling the benefits of unionization to skeptical workers. Instead, they simply ask their political allies in government to give them a union monopoly on construction!

Most construction unions in California belong under the umbrella of the State Building and Construction Trades Council of California, a union conglomerate based in Sacramento under the leadership of president Bob Balgenorth. If you look at the list of contributors to the No on A campaign (Taxpayers to Preserve Community Jobs, No on Measure A, sponsored by labor and management organizations), you’ll see the top two donors are Sacramento-based union-affiliated organizations under the direction of Bob Balgenorth. These two entities contributed $1.14 million to the No on A campaign, comprising 96% of all campaign receipts.

Let’s take a closer look at these two massive organizations funding the No on A campaign. One of them is a routine political action committee, but the other is a conspiracy theorist’s dream come true.

A Union Political Action Committee Gave One $45,000 Late Contribution, Comprising 3.8 Percent of the Contributions to the No on A Campaign

The Sacramento-based committee known as “Members’ Voice of the State Building Trades Council of California” made a late expenditure contribution of $45,000 to the No on A campaign on May 24. As you can see on the California Secretary of State’s web site, this committee collects money from various local construction unions and disburses the money to various campaigns for candidates and ballot measures. The Assistant Treasurer of the Members’ Voice of the State Building Trades Council of California is Bob Balgenorth.

A Mysterious Union Slush Fund, Authorized by an Obscure 1978 Federal Law to Encourage Better Relationships Between Unions and Manufacturers, Gave $1,095,000 to No on A – a Whopping 92% of All Receipts!

Something called the California Construction Industry Labor-Management Cooperative Trust contributed a total of $1,095,000 to the No on A campaign. This is an extraordinarily high amount for a political contribution from one entity, especially concerning a local ballot measure! The head of the California Construction Industry Labor-Management Cooperative Trust is Bob Balgenorth.

This is NOT a traditional Political Action Committee. It is an arcane type of union trust authorized by the obscure Labor-Management Cooperation Act of 1978, a law signed by President Jimmy Carter and implemented by the Federal Mediation and Conciliation Service. Inspired by the decline of unionized manufacturing in the Northeast, this federal law was meant to help industrial management and union officials build better personal relationships and cooperate against the threat of outside competition. There are no federal or state regulations specifically addressed toward these trusts, and these trusts do not have any reporting requirements to the U.S. Department of Labor’s Office of Labor-Management Standards. This is an ambiguous and forgotten law that’s ripe for abuse.

It’s Not Union Members that Give the Money to the California Construction Industry Labor-Management Cooperative Trust: It’s Utility Ratepayers and Contractors Working for Extorted Power Plant Owners

Since the 1990s, whenever an energy company or public utility submits an application to the California Energy Commission seeking approval of a new power plant, an organization called California Unions for Reliable Energy (CURE) often “intervenes” in the licensing process. Represented by a South San Francisco law firm called Adams Broadwell Joseph & Cardozo, CURE submits massive data requests and environmental objections to the California Energy Commission. The applicant by law is required to answer CURE’s submissions, at significant cost and delay. The chairman of California Unions for Reliable Energy (CURE) is Bob Balgenorth.

If the power plant owner agrees to sign a Project Labor Agreement and require its construction contractors to sign a Project Labor Agreement with the State Building and Construction Trades Council of California or its regional affiliates, CURE’s objections go away and the power plant can proceed unhindered through the licensing process. If the company or utility does not surrender to CURE’s demand, then CURE’s interference and lawsuits continue.

This racket – sometimes called “greenmail” because it’s the use of environmental laws to pressure developers to sign Project Labor Agreements – is well-known to the energy industry in California and has been extensively reported in the news media over the past dozen years. (For example, see Labor Coalition’s Tactics on Renewable Energy Projects Are Criticized – Los Angeles Times – February 5, 2011.)

For cases in which the power plant applicant succumbs to CURE’s harassment, the Project Labor Agreement that the power plant owner signs usually contains a provision requiring the owner or its contractors to make a lump-sum payment or series of payments to the California Construction Industry Labor-Management Cooperative Trust.

For example, the Project Labor Agreement signed by the Northern California Power Agency (a conglomerate of publicly-owned utilities) for the construction of the Lodi Energy Center required the agency to shell out $90,000 to the California Construction Industry Labor-Management Cooperative Trust. That amount was dutifully mailed to Bob Balgenorth on August 17, 2010. (For more on this payment, see High Energy: Lodi Center Designed to be a Powerhouse for Chunk of State – Stockton Record – October 4, 2011; also, the union rebuttal on the California Building Trades Council web site – ABC Falsehoods Refuted in Letter to Stockton Record – a denial that the California Construction Industry Labor-Management Cooperative Trust is used for political contributions.)

And the Project Labor Agreement signed by the Southern California Public Power Authority (another conglomerate of publicly-owned utilities) for the construction of the City of Anaheim’s Canyon Power Plant required the agency to shell out $65,000 to the California Construction Industry Labor-Management Cooperative Trust. See Section 13.1 of the Project Labor Agreement here.

The California Construction Industry Labor-Management Cooperative Trust reports these payments as “membership dues” to the Internal Revenue Service. Which brings up a question: are the local elected officials who serve as commissioners for the Northern California Power Agency and the Southern California Public Power Authority exercising their responsibilities as “members” to approve $1,095,000 in political contributions to the No on A campaign?

But Wait a Minute…Is It Legal to Have Utility Ratepayers Fund a Mysterious Union Trust Fund that Contributes to Political Campaigns, Such as No on A?

Well, in 2009 an internal committee of the Northern California Power Agency discussed whether or not a payment to the California Construction Industry Labor-Management Cooperative Trust was an illegal gift of public funds. (See here. Note the original amount to the California Construction Industry Labor-Management Cooperative Trust was supposed to be $150,000, but aggressive opposition to the Project Labor Agreement forced the unions to cut it down to $90,000 in order to win approval from the board of commissioners.)

To solve this uncertainty, in May 2011 State Senator Mark Leno (D-San Francisco) added a cryptic amendment at the request of union lobbyists and lawyers to the end of a large unrelated public utilities bill (Senate Bill 790) regarding “community choice aggregation.” It added Section 3260 to the Public Utilities Code: “Nothing in this division prohibits payments pursuant to an agreement authorized by the National Labor Relations Act (29 U.S.C. Sec. 151 et seq.), or payments permitted by the federal Labor Management Cooperation Act of 1978 (29 U.S.C. Secs. 173, 175a, and 186). Nothing in this division restricts any use permitted by federal law of money paid pursuant to these acts.”

No one in the California State Legislature – apparently not even Senator Leno – initially knew what this strange new provision meant. In the end, a few legislators such as Assemblywoman Shannon Grove (R-Bakersfield) came to understand and reveal in floor debate that it authorized public utilities to pass on the costs of payments to labor-management cooperation committees to ratepayers. Governor Brown signed the bill into law with the language tacked on the end.

For more information, see the investigative report of the Coalition for Fair Employment in Construction at this September 23, 2011 post at www.TheTruthaboutPLAs.com: A Genuine California Union Conspiracy: Senate Bill 790 and the California Building Trades Council’s Ratepayer Funded Political Slush Fund

Confused about the Conspiracy? Here’s a Chart.

A public utility or private energy company applies to the California Energy Commission for approval to build a power plant.

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California Unions for Reliable Energy (CURE) uses its “intervenor” status at the California Energy Commission to submit massive data requests and environmental complaints about the proposed power plant, as a result gumming up the licensing process and causing costly and lengthy delays for the applicant.

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Applicant for prospective power plant surrenders and agrees to sign Project Labor Agreement with State Building and Construction Trades Council of California or its regional affiliates. CURE releases its grip of legal paperwork and the project moves forward unimpeded and acclaimed as environmentally sound.

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The Project Labor Agreement contains a required payment or payments to the California Construction Industry Labor-Management Cooperative Trust. California Public Utilities Code Section 3260 – enacted by Senate Bill 790 in 2011 – allows public utilities to pass costs through to ratepayers.

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California Construction Industry Labor-Management Cooperative Trust reports those payments to the IRS as “Membership Dues,” creating questions about the rights inherent for dues-paying members.

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California Construction Industry Labor-Management Cooperative Trust makes contributions to political campaigns, such as $1,095,000 to fund 92% of the No on A campaign (Taxpayers to Preserve Community Jobs, No on Measure A, sponsored by labor and management organizations) in the City of San Diego in 2012.