Misfeasance: Ohio IG Report on OSFC PLA Scheme Continues to Gain Traction; Calls for Murray to Resign Grow

0 August 9, 2010  School Construction, State & Local Construction, Uncategorized

The media attention over the August 5 release of the Ohio Inspector General’s review of Richard Murray’s tenure as head of the Ohio School Facilities Commission (OSFC) and his efforts to strong-arm local communities into wasteful and discriminatory project labor agreements (PLAs) continued to gain traction over the weekend.

Readers of TheTruthAboutPLAs.com know that Murray was accused of using his influence to bully local communities into using PLAs on school construction projects.  Sparked by complaints from several school districts, the Ohio Inspector General’s office started an investigation into Murray’s conduct this winter.

In a scathing report released on August 5th, the Inspector General’s office outlines efforts by Murray and his Big Labor cohorts to shakedown public officials and school boards for lucrative construction contracts.

More on the release of the report itself and early media attention is available on our earlier post.

The editorial boards from the Columbus Dispatch and Akron Beacon Journal have some thoughts on the Inspector General’s report and Murray’s conduct, but both editorial boards also correctly point out who is really to blame here: Gov. Ted Strickland (D).

First, here is an excerpt from the August 8 editorial by the Columbus Dispatch (“Misfeasance: Head of School-Building Agency Erred, but Governor to Blame,” 8/8/10), with our emphasis is added:

As executive director of the Ohio School Facilities Commission, Richard Murray was supposed to act as a good steward of the millions of dollars Ohio pours into new school buildings every day. Instead, a report by the Ohio inspector general shows, he has abused his position to push the interests of unions, including the one to which he belongs, at substantial cost to the state and local school districts.

His unprofessional behavior disqualifies him for this position.

Murray’s union advocacy comes as no surprise; his career before Gov. Ted Strickland appointed him included more than 12 years as Ohio director of the Laborers-Employers Cooperation and Education Trust, a union advocacy group. He is a member of Local 423 of the Laborers’ International Union of North America.

Strickland’s decision in September 2009 to summarily oust well-regarded former Executive Director Michael Shoemaker, a fellow Democrat, and replace him with Murray shows that the governor, too, is far more interested in doing favors for one of his primary constituencies — labor — than in working for Ohioans’ best interests. In fact, Murray says he was instructed by the Strickland administration to treat construction unions as “constituents” and to improve relations with them.

Shortly after taking office, Strickland began stacking the deck for unions by appointing union-friendly members to the Facilities Commission, which promptly lifted the policy that prohibited school districts from requiring contractors to pay the union-level “prevailing wage” on their projects.

[snip]

Under Gov. Bob Taft, school districts undertaking jointly financed school building and renovation projects with the School Facilities Commission were barred from requiring prevailing wage or using project-labor agreements, which in effect require any worker on a commission-financed project to join a union, if only temporarily. Such agreements haven’t proved to improve quality or safety but serve to fill union coffers with mandatory dues. The Taft policy ensured that more school-building money went into school buildings.

Reversing that policy was Strickland’s prerogative, and voters can render a judgment. But, according to the inspector general’s findings, instead of remaining impartial and leaving it to school districts to decide if they wanted to pay more for labor, Murray pushed and bullied some of them to do so.

He met frequently with union organizations, introducing himself as a member of Local 423 and asking the union supporters to be his “eyes and ears” on project sites to report problems with nonunion contractors — a clear indication of his bias.

That was bad enough, but Murray went much further to help twist school officials’ arms. When union representatives visited school officials to argue in favor of union labor, Murray — the keeper of the state purse for school construction — sometimes accompanied them, an implicit message to school officials that their best interest lay in acquiescing to union demands.

He bragged about having fired the commission’s legal counsel, who had tangled with organized labor. He disrupted several building projects in southern Ohio by yanking the commission-assigned project administrator because union officials had complained about her, and he did this without bothering to check out the administrator’s record or investigating the union’s complaints. In other cases, too, he interfered in building projects in response to complaints by unions without verifying the allegations.

Also, Murray stood by while union official Gary Coleman screamed profanities at officials of Clay Local School District in Scioto County during a meeting in which Coleman was pushing the reluctant school district to use a project-labor agreement. Coleman was upset because the district was using a nonunion contractor to do site preparation.

That Murray sat silently while Coleman abused the stunned school officials is shameful. Worst of all, Coleman’s tactic worked; the district eventually signed a project-labor agreement.

Not long after, when the New Boston Local School District declined to sign a project-labor agreement, Murray suddenly raised objections to the site chosen for the project; school officials say he told them that if they would accept a labor agreement, his objections could be worked out. Murray disputes the New Boston officials, but the accusation fits the pattern reported by the inspector general.

Most recently, renovation of the combined campuses of the state-administered Ohio State School for the Deaf and Ohio State School for the Blind gave Murray a chance to impose a project-labor agreement without having to pressure a school board into it. He did so, even though the agreement directly benefits the union he belongs to as well as his former employer, the labor trust.

As is typical, the agreement acted to discourage nonunion contractors from bidding, resulting in fewer and predictably higher bids, the lowest coming in $11 million above the state’s $28 million estimate. Now the project will be delayed because, under state law, it must be rebid.

[snip]

Murray’s actions were grossly unprofessional and unacceptable for the head of a state agency in charge of billions of dollars in public money. The governor faces a choice: Remove an administrator who has ill-served the public, or keep him and thereby choose to serve labor’s interests rather than those of Ohio students and taxpayers.

There is no comment necessary from us – the Columbus Dispatch‘s editorial speaks for itself.

Let’s check to see what the Akron Beacon Journal has to say in their August 8 editorial (“Hard Labor,” 8/8/10), with our emphasis added:

Hard labor

The inspector general has found a record of poor judgment at the school facilities commission. Now Richard Murray should resign

Richard Murray is a card-carrying union man. He makes no secret of it. And he shouldn’t. But Murray is also the executive director of the Ohio Schools Facilities Commission, which supervises the biggest school construction program the state ever has undertaken. In that capacity, he has an obligation to maintain a strict separation between his personal links to labor unions and his duty to ensure the program proceeds in a manner that is scrupulously fair and transparent, the results cost-effective.

Last week, the Ohio inspector general released a report on Murray’s dealings with regard to union and non-union contractors. The independent investigation stemmed from growing complaints that Murray was steering contracts to union contractors, cutting out nonunion contractors by aggressively pushing project labor agreements.

The report found no indication the executive director violated the law. The conclusions, nonetheless, are deeply disturbing and raise questions about Murray’s capacity to be sound in his judgment on contract awards. His actions have comprised his credibility to a degree that the integrity of his decisions — and ultimately of the commission and the project as a whole — almost surely will face constant suspicion, damaging his effectiveness in the office.

To protect public confidence in the fairness and integrity of the program, Murray should step down.

The report concluded Murray ”repeatedly failed in his responsibility to remain neutral on union matters” in ways large and small, thereby abusing his authority. It found the director engaged in intimidation and created the appearance of impropriety.

For instance, Murray participated in negotiations and later signed, a labor agreement to construct the schools for the deaf and the blind in Columbus that involved the Ohio Laborers-Employers Cooperation and Education Trust. Murray previously headed the organization, which helps union workers and contractors win construction contracts. He also belongs to a union, Local 423, that was part of the agreement. According to the report, both groups could collect dues of up to $145,000 from the agreement.

Ohio newspaper editorial boards are not the only ones to call for Murray’s resignation in the last week.  Here is an excerpt from Associated Builders and Contractors of Ohio’s August 5 press release:

The Inspector General’s (IG) August 5, 2010 report on the conduct of the Ohio School Facilities Commission (OSFC) executive director Richard Murray, sheds new light on possible criminal behavior and an ongoing pattern of abuse of office. “Based on these documented findings, Richard Murray should resign or be terminated so the OSFC can return to performing its important work in a fair and legal manner,” said ABC of Ohio government affairs director Bryan C. Williams.

ABC of Ohio applauds the Inspector General’s office for recognizing where there is smoke there is fire – where there is coercion, there is corruption.

Richard Murray decided to implement a union-only project labor agreement for the construction of the Ohio School for the Deaf. The IG’s report calculated this will result in a payday of at least $145,000 for Mr. Murray’s former union employer. It must be noted the Mr. Murray sought an ethics opinion several months earlier inquiring whether or not he could accept an above the table payment from his former union employer, the Laborers-Employers Cooperation and Education Trust (LECET), as a consultant while simultaneously serving as the OSFC executive director.

Surprisingly enough, the Columbus Dispatch reports that Gov. Strickland is standing by Murray as head of the OSFC. Gov. Strickland also claims that his dismissal of Murray’s predecessor as OSFC Director, Mike Shoemaker, was not motivated by Big Labor’s demands.

Here is an excerpt from the Columbus Dispatch article on Gov. Strickland’s response (“Governor Stands by Facilities Chief,” 8/7/10), with our emphasis added:

Gov. Ted Strickland yesterday defended embattled School Facilities Commission Director Richard Murray, rejecting the finding from a state investigation that Murray abused his position in an effort to benefit labor unions.

The governor also flatly denied any suggestion that he fired Mike Shoemaker, the previous director, and installed Murray, a former union official, last year to ensure continued union support and financial backing.

“Absolutely not,” Strickland said when asked about the allegation after an event at the Ohio State Fair.

But Shoemaker, an ex-state lawmaker and son of a former lieutenant governor, insisted that his firing was a result of union pressure on the Strickland administration.

Shoemaker said he thinks the governor’s office is using him as a scapegoat to deflect the inspector general’s report.

[snip]

Still, e-mails obtained by The Dispatch show that Strickland’s prepared remarks for a speech at the Construction Trades Education Conference in Columbus on April 28 included the comment, “we have made project-labor agreements and prevailing wages a priority.”

The report from Charles also suggests that Strickland replaced Shoemaker with Murray last year “in part, to improve relations with unions and ensure that unions were regarded as ‘constituents’ or ‘stakeholders’ at the (commission).”

In a transcript of Shoemaker’s March 22 interview with the inspector general’s office, Shoemaker goes a step further: He suggests that union groups wanted him replaced and threatened to withhold support for Strickland if he wasn’t.

“(M)y understanding is there was a meeting the week of July 20th (2009, a week before Shoemaker was fired) with some labor folks with the governor and they said Shoemaker has to go or we’re not going to give you the 400 grand,” the transcript says. “That was the price on my head.”

Shoemaker said yesterday that his information was “second-hand but from a good source.” He could provide no additional details.

One of the most under-reported but apparent trends of the 2010 gubernatorial races is embattled incumbent Democrats aggressively promoting PLAs in a transparent attempt to garner favor with Big Labor (See: Iowa and Illinois).  While the Inspector General’s report outlines the history of the OSFC promoting PLAs throughout the Strickland administration, it is clear that the intensity of this effort increased as the 2010 election approached.

The people of Ohio will have to choose whether they want four more years of Big Labor handouts on November 2.  In the meantime, it is clear that Richard Murray has lost all credibility and needs to step aside.

UPDATE: The Intelligencer/Wheeling News-Register in the Ohio Valley has also weighed in via a 8/10 editorial, “Stop Catering To Ohio Unions” available here:

For several years the Ohio School Facilities Commission’s philosophy was that taxpayers’ dollars should be stretched as far as possible. That changed not long after Gov. Ted Strickland took office. It became clear the governor intended to strengthen his friendship with labor unions that helped get him elected. [snip]

Obviously, Murray needs to be sent packing. The school facilities commission should have a new executive director – one more concerned with making tax dollars go as far as possible than with currying favor with labor unions.

The commission’s policy on prevailing wage contracts needs to change, too. Strickland is using taxpayers’ money to gain support from unions – and Ohio voters should not tolerate it.

The Cleveland Plain Dealer’s editorial, “Ohio school facilities director must go,” 8/10, gave this wise advice:

Murray, whether he believes it or not, has compromised the credibility of his office. Should he fail to resign, Strickland should give him a push. That might be politically expedient, but it’s also the right thing to do.

The Chillicothe Gazette editorial, “Richard Murray should quit or be shown door,” 8/12, said this:

Do the right thing, Governor.

If Murray doesn’t hand you a resignation letter, do him — and yourself — a favor and show him the door. And this time, find a school facilities head who really has students, teachers and Ohio’s families in mind.

The Toledo Blade editorial, “Union ties too tight,” 8/16, warns the charges in the Ohio IG’s report are too serious to ignore and calls Richard Murray a “union hack”:

…But these are serious charges that should not be dismissed cavalierly. As director of the commission, Mr. Murray oversees $2.8 million a day in school construction spending. He has great authority over every stage of school construction projects throughout the state. What he says, what he doesn’t say, whom he associates with – all these things matter and can influence decisions made by local school officials.

And the charges should matter as well to Mr. Strickland, whose strong ties to labor leave him open to accusations of pandering to big donors. If the report by the independent, nonpartisan inspector general’s office is accurate – and there is no reason to assume otherwise – Mr. Murray is a union hack who doesn’t deserve the governor’s support.

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