Project Labor Agreements…“Show Me the Money”
By Jim Ryan
AGCSD Executive Vice President 

As spring approaches each year, it seems there is a renewed effort to impose union only Project Labor Agreements on a public project or projects in the San Diego area.  This year is no exception!

AGC opposes Project Labor Agreements.  The union signatory contractors we represent oppose them because they object to an owner and the unions negotiating with each other and creating a collective bargaining agreement that undermines the decades of negotiations between the contractors and unions.  We find the recent trend of bringing in a consulting firm from the east coast to negotiate and “administer” the agreement especially objectionable.  These firms could care less about the history of labor relations between the industry and the unions….they are more interested in collecting a 2-4% fee for providing the service….which usually amounts to “negotiating” a boiler plate agreement and sitting in a trailer doing nothing while the project moves forward.

Our open shop contractors also oppose PLA’s.  Somehow, they find the opportunity to sign a collective bargaining agreement for one project not much of an “opportunity”….they would prefer to work on other projects!

During the past few months, an individual representing a management association that includes only union signatory subcontractors and the head of the San Diego Building and Construction Trades Council have been contacting administrators and Board members of a school district that successfully passed a bond measure in November that involves several hundred million dollars of renovation and new construction of district facilities.  They were giving the typical springtime PLA pitch…

They “guaranteed” no strikes and “labor peace” on the district projects…..they “guaranteed” a highly trained work force…..blah…blah ….blah…..basically a bunch of promises that really mean nothing…..I mean how many school construction projects in San Diego have  had “labor problems”?

Anyway, I hate to be skeptical…..but perhaps their real motivation to lobby for a PLA on these projects is pretty basic…..let’s…..“Follow the Money”….

The representative from the management association represents a select group of subcontractors that all have union agreements.  If the District adopts a union only PLA, this group of subcontractors will basically have an exclusive on their portion of the work! It is highly unlikely that non union firms in their specialty would be interested in the work, assuming the work involves establishing a relationship with the business agent for the craft.

The association benefits…..more dues; and the members benefit….limited competition on a bunch of work.

Hmmmm…..maybe we should create a PLA in which only AGC members can compete for the work…it would sure make selling memberships easier!!

The point is…there is a real financial benefit for the management association and their members to negotiate the PLA…”Follow the Money!”…I suspect they left this part of the consequence of a PLA out of the sales “pitch.”

Now let’s “Follow the Money” for the Building Trades.

Most building trades unions have an item under either VACATION or OTHER payments that is negotiated into their collective bargaining agreements and subsequently finds its way into the prevailing wage.  Let’s use my “good friends”, the Teamsters, as an example…but remember…a version of this exists in most prevailing wage decisions.

Under OTHER PAYMENTS in the most recent prevailing wage decision for Teamsters in San Diego County you will find $.50 per hour contribution.  OTHER PAYMENT is really union dues….money that goes directly to the Teamster’s union.  If a PLA is imposed on the district in question, this $.50 per hour will go to the Teamster’s union for all covered hours of Teamster’s work completed on the project…..yes, even if the individual earning the $.50 chooses not to join the Teamsters.

If there is no PLA the $.50 goes to the base wage of the individual or to the individual’s fringe benefits….not to the union, unless the individual works for a union signatory firm.

So…..this can amount to real money….for a Teamster that works full time on the District’s projects the Teamster’s union receives about $1000 per year.  Multiply this out by 16 or 17 crafts and hundreds of individuals and this is significant…..especially when most school work in the county is normally completed by contractors that are not signatory to union agreements. You do the math….multiply $1000-$1300 per year for each full time craft worker on a large school program….it’s real money!!!!

So school districts….when these two individuals come calling….listen to their pitch and then as them to…. “SHOW ME THE MONEY”…  

 

State and Local Leaders Vote for Road and Water/Wastewater Improvements

As we reported last week, road builders, and contractors who would like to bid on future water or sewer jobs in the City of San Diego had much at stake during meetings of the California Transportation Commission and the City of San Diego.  Investing in our infrastructure was the focus of each meeting, and in both instances the government bodies made the right decision.

California Transportation Commission Ups Bond Allocation for Transportation Projects to $4.5 Billion

The California Transportation Commission (CTC) heard it load and clear last Monday from eight regional transportation agencies, Governor Schwarzenegger, state and local officials, and business stakeholders (including AGC): “Give Us More Bond Money!”  That message paid off, as the CTC upped its proposed $2.8 billion allocation of Prop. 1B funds dedicated to corridor mobility improvements to $4.5 billion.

What does that mean to San Diego, you say?  Well, what was once San Diego’s $304 million share for various projects turned into $451.5 million.   Most of the funds will go to help fund two specific projects: 1) Retrofitting the existing eight-mile-long set of two express lanes on Interstate 15 between Highways 56 and 163 so they match the four new lanes being built to the north ($350 million); and 2) Extending the car-pool lanes on I-805 from Carroll Canyon Road to the I-5/805 merge ($82 million). One additional project, a mile-long auxiliary lane on southbound I-805, between E Street and Highway 54, received full funding of $19.5 million, but not from Prop 1B. 

Although the allocation for San Diego wasn’t the entire “wish list” from the San Diego Association of Governments (SANDAG had asked for nearly $1.7 billion), nor Caltrans’ recommendation of $515 million, it was about 10% of the statewide allocation, which is over the region’s fair share.  San Diego County’s population makes up about 8.24% of the state.

It is our intention to invite Gary Gallegos, SANDAG’s Executive Director, and Pedro Orso Delgado, Caltrans’ District 11 Director, to a meeting of the Engineering General Contractors’ Council, where they can provide more specific detail of CTC’s actions, discuss the current construction timeline for these projects, review upcoming projects, give a status report on TransNet, and discuss future funding needs.  

San Diego City Council Votes to Fix Deteriorating Water and Sewer System

By votes of 6-2 and 7-1, the San Diego City Council voted last Monday to increase water and sewer rates, respectively.  The increases, which are needed to improve the City’s aging infrastructure, will help fund $1.2 billion of improvements to the water and wastewater systems (specifically rehab/replacement of deteriorating water pipelines and improvements to wastewater pump stations and replacement of miles of pipelines).    

A special “Thank You” to those AGC members who contacted various City Council Members asking them to support the rate increases.  Brian Maienschein was the only council member to vote “no” to both increases, while Donna Frye joined him to oppose the water increase.  AGC staff attended the City Council meeting and encouraged council members to also support a proposed Independent Rates Oversight Committee and a Dedicated Reserve from Efficiencies and Savings.  Although not yet approved, these proposals allow the City to track expenditures and allow any savings to be put right back into capital projects.

The City Council’s action is good news for the construction industry, as contractors have been waiting nearly three years for funding to return to the City’s capital improvement program.  The costs for these improvements have been accumulating due to the City’s inability to access public finance markets.

AGC applauds the City Council for the commitment to fix the City’s ailing infrastructure, but we continue to be concerned about the delayed financial audits.  The revenue from the rate increases will not be enough to complete the approved infrastructure projects – public and/or private bond financing is also needed.  Until the audits are completed, the City will not be able to access the public bond market.  We understand that private bond financing could be a short term answer, but will enough funds be approved?  Stay tuned…

 

AGC 18^th Annual Spring Golf Tournament

The AGC Annual Spring Golf Tournament is scheduled for Monday, April 16, 2007 at the Country Club of Rancho Bernardo.  This is a beautiful, private course right next to the Rancho Bernardo Inn.  Registration will begin at 10:00 AM with the 2 player scramble, shot gun start at 12:30.

Most AGC members are aware of this, but please note that the Spring Golf is limited to the first 144 players and “always sells out” fast.  We suggest that you sign up early if you really want to play in this tournament.

Members can also help support the AGC by becoming a tournament sponsor.

Casper Company and Rossin Steel are once again sponsoring the golf shirts as the tee prize, and Marks Golia & Finch, LLP have agreed to sponsor the lunch again this year.

We still have hole sponsorships, beverage sponsorships, and contest sponsorships available.  Sponsors are vital to the success of AGC events, so please consider putting your company name on one of these marketing opportunities.

Donations for raffle prizes are greatly needed as well!  AGC material suppliers….do you have anything in stock that can be used for a raffle prize?  Your company name will be on the item and announced during the raffle.

For registration, sponsorship and raffle prize information, see the attached forms or contact Rae Krushensky at 858-731-8157.
Registration Form
Sponsorship Form

 

Web Link

Interested in having a web link on the AGC’s website? It is only $60 /year to have your company’s website linked directly on AGC’s website and listed under “Member Listings.”  Start off 2007 with an easy and simple way to get more “hits” on your website. – Click here for registration form: http://www.agcsd.org/members/membership.htm

 

“Meet Your Owner” – March 15^th

The AGC Specialty Contractor’s Council is proud to present a “Meet Your Owner” event on March 15 at the AGC featuring UCSD and Jim Gillie, Sr. Director of Construction Services, Facilities Design & Construction. 

Like past “Meet Your GC” events, the program will include a forum of representatives that will discuss topics such as:  How to find out about UCSD’s upcoming work; Project Delivery Methods; Pre-Qualification; Bidding – Addendums – Alternates; Basis of Awards; Labor Compliance Program; Construction RFI’s, and more….

Jaynes Corporation and Standard Drywall are the Major Sponsors for this event.  attend.  Please contact Rae Krushensky at 858-731-8157 with any questions.
Registration Form

 

AGC Committee Sign-ups

Members may still sign up to join any of the AGC committees (and the 2 new committees, Electronic Age and Foundation for Success). Please click on the following link, which will take you directly to the registration page on our website:  http://www.agcsd.org/aboutagc/committeevolunteer.php. 

If you have any questions or need additional information please contact Brad Barnum at 858-558-7444 (ext 103) or at bbarnum@agcsd.org.

 

“AGC Education & Training….Building a solid Foundation”

Register on Line
For Education classes click on the following link: http://www.agcsd.org/calendar/calendar.htm
For Safety Training classes click on the link: http://www.agcsd.org/calendar/safetytraining.htm

UPCOMING AGC CLASSES

Construction Education Training
March
CQM – March 13 & 14
Prevailing Wage in Riverside – Mar 21
WebCM – Mar 27
Deferred Compensation – Mar 28

April
Mechanic’s Lien Law – Apr 4
EM 385-1-1 – Apr 5 & 6
Construction Project Mgmt (Cert Course) – Apr 10 (Flyer Attached)
Project Engineering – Apr 10
Managing Construction Risks – Apr 10

SAVE THE DATE
Tax Favored Strategies – Apr 19

____________________________________________________________________________________

Safety Training
March
CPR/First Aid – Mar 21 (Flyer Attached)
Scaffolding CPT & Hazard Awareness Training – Mar 23 (Flyer Attached)
JUST ADDED -- Scaffolding & Safety Inspection Course 103 – Mar 27, 28 & 29 (Flyer Attached)

SAVE THE DATE
OSHA 10-Hour – Apr 16
Fall Protection – Apr 18

 

March  Meetings – Dates subject to change
March 7 - Safety Committee – 7 AM
March 9 - Builders’ Exchange Committee – 7 AM @ AGC
March 13 – Construction Education & Training – 11:30 AM
March 20- Human Resources Practices Committee– 11:00 AM
March 28 – Government Relations Meeting- 10 AM
March 30 – Electronic Age Committee – 7 AM @ AGC

 

UPCOMING EVENTS
March 13- Meet your Owner
March 20-22- AGC National Convention- San Antonio, Texas
April 16- AGC 18^th Annual Spring Golf Tournament