The Truth About Project Labor Agreements

On the afternoon of September 2 – the Friday before Labor Day weekend – the California State Building and Construction Trades Council finally revealed its plot to terminate local efforts throughout the state to guarantee the best quality construction at the best price for taxpayers. Bills in the California State Legislature were “gutted and amended” at the last minute to become new bills that promote Project Labor Agreements and nullify local Fair and Open Competition policies for bidding on publicly-funded construction projects.

With virtually no legislative review or public scrutiny, these bills will sail through the so-called legislative process in a few chaotic days and go to Governor Jerry Brown for quick action. Surely there were guffaws and snickers among top union officials at Labor Day picnics throughout the state as they gloated over their anti-democratic abuse of the California Kangaroo Court that operates nowadays at the state capitol.

What Are the Three Bills to Undermine Fair and Open Competition in California?

(1) Senate Bill 922 (a bill formerly about immunizations and tuberculosis screening) was gutted and amended on September 2 to become a bill that effectively terminates Fair and Open Competition laws and Project Labor Agreement bans enacted by local elected officials and local voters.

This heavy-handed, authoritarian bill shows how unions compel the state government to suppress the rights and powers of local governments and their hapless citizens. It will nullify Project Labor Agreement bans at most local governments and cut off state funding on projects for charter cities that ban Project Labor Agreements. This bill is authored by the top Democrats in the Assembly and Senate. The bill is here: SB 922 as amended 9/2.

(2) Assembly Bill 436 (a bill formerly defining private energy generation facilities as public works) was gutted and amended on August 30 to require certain local governments to pay Labor Compliance Program fees to the state, unless they require their contractors to sign Project Labor Agreements with unions. (Unions claim contractors under PLAs don’t violate laws, despite evidence to the contrary – see here for the City of Milpitas and here for the Los Angeles Unified School District.)

Soon California construction union officials will claim that Project Labor Agreements save money for taxpayers because local governments won’t have to pay labor compliance fees to the state – fees lobbied for by those same union officials! At the new bill’s first hearing on Thursday, the Democrat committee chairman reportedly said he didn’t understand why labor unions wanted less labor compliance, but “if the unions wanted it, he would vote for it.” The 76-page bill is here: AB 436 as amended 8/30.

(3) Senate Bill 790 had been a bill with bipartisan support about community choice electric load aggregation programs. Apparently the unions saw this popular bill as an excellent vehicle to hijack for their own nefarious purposes, because it now includes an obscure and unrelated amendment that authorizes payments in Project Labor Agreements covering utility infrastructure construction to mysterious union slush funds managed by top construction union officials. See Part 5, Section 11 of the bill on pages 27-28 here: SB 790 as amended 8/30. The most prominent of these trust funds, the California Construction Industry Labor-Management Cooperative Trust, had $3 million in the bank last year and mailed letters dated August 5 to elected officials throughout the state promoting Project Labor Agreements.

Here’s the scheme protected by Senate Bill 790: hold up the permit for a power plant by exploiting environmental laws until the developer or public utility surrenders and signs a Project Labor Agreement. Include a provision in the PLA requiring payments to a mysterious union slush fund. Use the slush fund to fund pet projects, contribute to election campaigns, and support other political activities. When the scheme is exposed, get the state legislature to declare it legal in the Public Utilities Code! For more details about this racket, go here.

Without the Support of the People, the Unions Revert to the California Legislature

The state legislature is the last refuge of scoundrels and special interests in California who want to change the world into their desired image at the expense of everyone else. This is where unions can circumvent the will of the people and local government decisions with ease.

The Assembly and the Senate are each almost two-thirds controlled by Democrats, almost all of whom won their primary elections (and thus their politically uncompetitive districts) through toadying up to unions and promising to vote for their latest political agenda. In addition, the strange operations of the state legislature allow bills to be completely changed at the last minute (a process called “gut-and-amend”) so that special interests can sling controversial and divisive proposals through the legislature before opposition effectively activates. In practice, the legislature also allows provisions that are not germane to be added to existing bills.

As a result, California union lobbyists and top officials will be crowing this week throughout the state and across the country about Senate Bill 922, Assembly Bill 436, and Senate Bill 790 and how these bills will preserve Project Labor Agreements, now their primary political means of cutting bid competition and raising construction costs by 15 percent for California taxpayers.