PD Editorial: Keep an even playing field on city contracts
Santa Rosa taxpayers should watch closely Tuesday when the City Council decides whether to limit competition for public works contracts. Millions of public dollars are at stake.
At issue is a proposal to require project labor agreements, also known as community workforce agreements, on capital improvement projects in Santa Rosa valued at $3 million or more.
When the city is spending taxpayer money, public officials should be focused on getting the biggest bang for the buck.
Project labor agreements, which are increasingly common at all levels of government, discourage open competition by imposing union-related costs on all bidders.
In Sonoma County, a majority of contractors and subcontractors are nonunion shops. Many of them choose not to bid on contracts that add overhead costs through pro-union rules.
Fewer bidders make for less competition, which can drive up costs. That means fewer miles of road get repaved and building and maintaining facilities costs more than necessary — or projects get scaled back to fit within fixed budgets.
Supporters contend that project labor agreements benefit residents by providing money for apprenticeship programs aimed at expanding and diversifying the local building trades workforce. Advocates also say these agreements can keep building projects on schedule and on budget by preventing labor disputes.
Opponents say the requirements often limit their ability to use their own employees and can require payments into union benefit funds on top of existing benefit costs for their employees.
Each side points to academic studies, but the conclusions are contradictory. Common sense tells us that limiting competition will inflate taxpayer costs.
Santa Rosa City Council members voted in 2021 to require project labor agreements for projects worth $5 million or more and directed city staff to return with a formal policy.
The framework going to the council on Tuesday lowers the threshold to $3 million, recommends an emphasis on construction work covered by existing collective bargaining agreements between local unions and union contractors, and proposes a 30% local hiring target. Sonoma, Napa, Marin, Lake and Mendocino counties are designated as the local hiring area. The policy would take effect Jan. 1, 2024, and last three years.
The 14-month window prior to the effective date gives the council time to reconsider — as the Sonoma Valley Unified School District board did last year. If nothing else, the three-year sunset will force the council to revisit this policy.
If council members insist on pushing ahead, they should conduct an empirical test before imposing a blanket policy.
Here’s how it might work: The city could ask for competing bids on a single project or a package of similar projects; allow contractors to offer their price with or without a project labor agreement.
With that information, the city could assess costs in advance or track the actual cost of work completed with and without project labor agreements. What’s there to lose?
Contractors hired for public works projects should be qualified for the job, treat employees fairly and pay prevailing wages as required by law. Beyond that, all contractors — union and nonunion — deserve an equal chance at public work. Project labor agreements tip the scales.
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