Legislative Update by Richard Markuson, CAPHCC Lobbyist

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PLA Update

The Chula Vista Elementary School District “quietly approved the negotiation of a project labor agreement for future uses of $90 million in voter-approved bond money, as well as Mello-Roos funds, last Wednesday.” Voters approved a $90 million general obligation bond in November 2012 to provide funds for the school district’s oldest schools. The bond measure passed with support of the San Diego County Taxpayer’s Association, with the caveat that the school district would not employ a mandatory PLA for the awarding of those contracts. Mark Leslie of the group called the board’s actions Wednesday “an inappropriate overreach. It’s creating an uneven playing field that does not assure the best value for the dollar,” Leslie said. In 2010, 56 percent of Chula Vista voters approved a citywide ban on project labor agreements for public dollars. The approval passed 4-1 with trustee Marissa Bejarano opposed. More.

Want to support our PLA response teams and live in the wine country (the one in Napa/Solano etc)? Consider attending a PLA meeting at NCBE on April 30. More info here.

2015 Legislation

Surprising no one, the Democratic members of the Senate Labor committee defeated WECA’s one sentence SB 607 – buying the building trades’ line that the bill would either reduce the qualifications or workers on design- build projects or worse, “confuse contractors” by allowing electricians to use their state certification cards as evidence they were “skilled.”

AB 1017 prohibits an employer from posting a job advertisement unless the advertisement sets forth a minimum rate of pay for the position and states that an employer cannot pay below the advertised rate. To the extent that forcing employers to set forth a minimum wage rate in their advertisement does not provide any actual transparency or equity in pay, AB 1017 represents another mandate on employers that will subject them to potential litigation under the Labor Code Private Attorney General Act (PAGA), with statutory penalties and employee-only attorney’s fees.  Exposing employers to additional threats of litigation for failing to set forth a minimum rate of pay for a commission or piece rate, or that includes overtime, as well as credits for meal and lodging, is an unnecessary increase in doing business.

California’s minimum wage workers will receive a 62.5 percent raise over three years if Senate Bill 3 is approved by the Legislature and signed by Gov. Jerry Brown. The Senate Labor and Industrial Relations Committee recently passed the bill on a 4-1 party line vote. It was only a year and a half ago that Assembly Bill 10 was signed into law. It raised California’s minimum wage from $8 an hour to $9 in July 2014 with another increase to $10 scheduled to take effect in January 2016. SB 3 would supersede that bill, increasing the minimum wage from the current $9 to $11 in January 2016 with another $2 bump to $13 in July 2017. Thereafter the minimum wage would increase with inflation.

SB 854 made significant changes to laws that relate to public works projects and to the administration and enforcement of prevailing wage requirements by the Department of Industrial Relations (DIR). Contractors and subcontractors now must be registered with DIR in order to bid or be listed on a bid for a public works project; or to work on a public works project awarded on or after April 1, 2015.

The Assembly Labor Committee approved AB 219 by Tom Daly (D-Anaheim) that will make hauling and delivery of ready-mixed concrete or asphaltic concrete to a public works site prevailing wage – breaking the long tradition of exempting material suppliers from prevailing wage – and suggesting we’ll see future expansion. Daly was elected to office in 2012. In his race last year – his largest donor group was “general trade unions.”

The same committee passed AB 1308 by Henry Perea (D-Fresno) that makes it harder to offer new or expanded apprenticeship opportunities. Perea has received over $200,000 from general trade unions – his second largest contributor.

In the Assembly Education Committee the Democrat majority passed three bad school bills. The worst of the three was AB 1431 by Jimmy Gomez (D-Los Angeles). His bill permits school districts to use Job Order Contracting but mandates that any district that so chooses must adopt a PLA on ALL work performed by the district (not just the JOC) with a $25,000 threshold and the PLA has to last until 2021. Like Daly, Gomez was elected in 2012 and will be in office until 2024. His top two donor groups? General trade unions and public sector unions. The lone opponents to the bill were merit-shop associations – and some districts embraced the bill – one reason may be that Gomez is Chair of the Assembly Appropriations Committee and controls the purse strings for all state spending. Before being elected to the Assembly – Gomez was Political Director for United Nurses Association.

In the same hearing, the committee also approved AB 566 by Patrick O’Donnell (D-Long Beach) that requires school districts entering into specified school building lease contracts to use a skilled and trained workforce and comply with the requirement to prequalify and rate prospective bidders regardless of the source of funding. Contractors will be required to file monthly reports verifying they “skilled workforce” or they can show their commitment to hiring a skilled and trained workforce through a PLA. O’Donnell’s top two donor groups? Public sector unions and general trade unions.

The final bill in Education was AB 1358 by Matt Dababneh (D-Encino) that aligns the process for school districts awarding contracts through the design-build method with the process established for state and local agencies. Like AB 566, contractors will be required to file monthly reports verifying they “skilled workforce” or they can show their commitment to hiring a skilled and trained workforce through a PLA. The bill also exempts union contractors from a general requirement that contractors have an X-Mod of 1 or less. His top two donor groups? General trade unions and public sector unions.

According to Maplight construction unions were the top contributor group from Jan. 1, 2011 – Dec. 31, 2012 – donating over $4.0 million to legislators.