Tag Archive for California Political News and Views

Watsonville City Council Imposes Requirement for Construction Contractors to Sign Project Labor Agreement with Unions

The City of Watsonville (in Santa Cruz County) has become the second city in Northern California (after Berkeley) and the sixth city in California to enact a blanket policy requiring its construction contractors to sign a Project Labor Agreement with unions as a condition of work. On October 8, the Watsonville City Council voted 5-1 (with one absence) to impose the union-backed policy as an ordinance for all projects of $600,000 or more.

Councilwoman Trina Coffman-Gomez was the only vote against the Project Labor Agreement ordinance. Please thank Councilwoman Coffman-Gomez via this web site. (Councilwoman Nancy Bilicich, who voted against the ordinance in its first reading at the September 24 meeting, was absent from the October 8 meeting.)

The $600,000 project cost threshold for the policy was a compromise. Staff had proposed a threshold of $1 million for the policy, but union officials demanded a lower threshold of $250,000, as noted in a September 10, 2013 staff report to the city council:

The Santa Cruz and Monterey Building and Trades Council have recommended a project cost of $250,000 or more to initiate the use of PLA’s for City projects. The rationale is that with a smaller cost threshold, more projects would be included under the PLA program, which would lead to more union memberships and a stronger apprenticeship program.

After the policy was approved 5-1 (with one absence) in its first reading at the city council’s September 24 meeting, union officials provided the city council and staff with a draft Project Labor Agreement.

Construction unions have tried in the past to convince the Watsonville City Council to enact policies that discourage Merit Shop contractors from bidding on city contracts. At an October 8, 2002 meeting, the city council voted 5-2 for a union-backed discriminatory apprenticeship ordinance. In 2004, unions demanded but did not get a a Project Labor Agreement for the Watsonville Civic Center – a 186,000 square foot building for city offices, Santa Cruz County Superior Courts, a library, an Agricultural Workers History Museum, and private lease space. As leverage, the Carpenters Union Local No. 505 filed a petition with the California Department of Industrial Relations for a prevailing wage coverage determination on an adjacent parking garage already under construction.

The Watsonville City Council is reportedly dominated by a local political machine led by Democrat Assemblyman Luis Alejo, who used to serve on the city council. His wife is now Mayor pro Tempore. There are seven individual council districts in this city of about 50,000 people, and city council members tend to be elected with 1000 votes or less. In the November 2012 election, the candidates for four city council seats ran unopposed.

News Coverage

Watsonville Council: Projects Over $600,000 to Require Union AgreementSanta Cruz Sentinel – October 8, 2013

Council Approves Union-Friendly OrdinanceWatsonville Register-Pajaronian – October 9, 2013

Watsonville City Council: Want City Project Work? Pay Bribes – California Political News & Views (blog) – October 9, 2013

Watsonville Mulls Pro-Labor Public Works Ordinance – Santa Cruz Sentinel – October 1, 2013

Bakersfield Becomes Latest of California’s 121 Charter Cities to Free Itself from Government-Mandated Construction Wage Rates (So-Called “Prevailing Wage”)

As I anticipated in my July 2, 2012 article Prediction: An Explosion of California Cities Freeing Themselves from Costly State-Mandated Construction Wage Rate Laws, the past three months have seen a flood of California cities seeking voter approval for charters, as well as existing charter cities establishing their own policies concerning government-mandated construction wage rates (so-called “prevailing wages”) for purely municipal construction (or private projects that receive government assistance only from the city).

These recent www.CalWatchdogs.com articles summarize what’s happening in California: Push for Charter Cities Enrages Unions and Cities Vying for Local Control on November Ballot.

Through its July 2012 decision in State Building and Construction Trades Council of California, ALF-CIO v. City of Vista, the California Supreme Court affirmed the right of California’s 121 charter cities to set their own prevailing wage policies for municipal construction and thereby free themselves from the costly, complicated, and nonsensical way that the State of California calculates state-mandated construction wage rates and defines public works.

For comprehensive information, see the 92-page guidebook Are Charter Cities Taking Advantage of State-Mandated Construction Wage Rate (“Prevailing Wage”) Exemptions?

Bakersfield is the latest charter city to establish its own policy concerning government-mandated construction wage rates. Hoping to sustain its economic boom and resist union-backed public policies dragging down economic growth and job creation in the state and other cities, the Bakersfield City Council voted 4-2 (with one city council member recusing himself) on October 17, 2012 to set its own policy. Here is the city’s agenda item description: Resolution exempting the City from prevailing wage requirements for locally funded public works contracts except where required by law.

Here’s a July 17, 2009 video report on KBAK Channel 29 (CBS) news featuring a comment from me about the need for the City of Bakersfield to free itself from state-mandated construction wage rates set based on collective bargaining agreements for urban areas: Prevailing Wage Wastes Tax Dollars in Bakersfield.

It was reported to me that unions brought busloads of people from Los Angeles to pack the council chamber, but the city council majority was not fooled and not intimidated. Here’s news coverage, with excerpts (bold highlights are mine):

Council Shakes Off Prevailing Wage Requirement – Bakersfield Californian – October 17, 2012

City staff also informally surveyed local contractors and were told that without the prevailing wage requirement, project costs could be cut by 3.5 percent to 30 percent

But just as many people spoke in favor of the resolution as against it, saying it would result in more efficient use of taxpayer money and wouldn’t lead to unfair construction wages or lower quality in projects.

“As a city council member, I have a fiduciary responsibility to taxpayers and the community to utilize funds with care and strive to provide the best value possible,” Weir said in an email earlier Wednesday. “With the approval of tonight’s resolution, we will be able to build better parks with more amenities, increase the amount of street repaving, and provide other benefits without additional cost to the taxpayers. To not pursue this opportunity would be a breach of my responsibility.”

Councilmembers added a late amendment to the resolution as a step to better protect against unqualified contractors bidding for city work. Before the resolution passed, projects valued at $1 million or more required that contractors be “pre-qualified” for their suitability to do the type of project at hand before being allowed to submit a bid. With the resolution, that threshold was lowered to $250,000.

Contractors, Unions Object to City Prevailing Wage Proposal – Bakersfield Californian –  October 16, 2012

City Manager Alan Tandy said savings for the city means more work can be done. Taking an example of 20 percent savings, he said, “If we save 20 percent on resurfacing a street, we can resurface 20 percent more streets. We have more that need resurfacing than we have money to resurface.”

Council Members Tackle High Speed Rail, Prevailing Wages in Heated Debate – KGET Channel 17 (NBC) news – October 18, 2012

Congratulations to the Bakersfield City Council. Under pressure and threats, they refused to payoff the unionsCalifornia Political News and Views – October 19, 2012

Will This Charter City Movement Lead to Genuine (or Any?) Prevailing Wage Reform?

Perhaps union officials in Bakersfield are realizing that “prevailing wage” as calculated under state law and “public works” as defined under state law are so outrageous that cities are intent on escaping them. Bakersfield’s own Assemblywoman Shannon Grove introduced two thoughtful and reasonable prevailing wage reform bills (Assembly Bill 987 and Assembly Bill 988) to make state-mandated government wage rates only apply to legitimate government projects and be more reflective of actual local market rates, but union lobbyists opposed these bills and Democrats defeated them in committee in January 2012.

In fact, as I reported in my April 20, 2012 article State-Mandated Construction Wage Rate Requirements Remain on California Projects Worth $1001 to $2000, union lobbyists and Legislative Democrats wouldn’t even support Assemblywoman Grove’s Assembly Bill 1958, which made two very modest changes to the state’s prevailing wage laws. That bill increased the project cost threshold for coverage from $1000 to $2000 to match the $2000 threshold set by the federal prevailing wage law called the Davis-Bacon Act. It also indexed the threshold to the same measure of inflation that the Democrats want to use for indexing the state minimum wage.

There WILL be a day when unions no longer control the California State Legislature and the Governor’s office. In the meantime, charter cities are exercising their own right to determine their economic destiny, and many of them don’t want to follow the direction of the State of California to inevitable bankruptcy.