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Jon Fleischman

Dayton & Korenthal: Unions 1, Los Angeles County Taxpayers 0

[We are very pleased to offer this column from two longtime FR friends, Kevin Dayton and Kevin Korenthal, both affiliated with the Associated Builders and Contractors of California – Flash]

Kevin Dayton and Kevin Korenthal

Unions 1 – Los Angeles County Taxpayers 0
Los Angeles County Wastes $795,000 with More Waste to Come on Hospital Project

By Kevin Dayton and Kevin D. Korenthal

Seven months of debate at the Los Angeles County Board of Supervisors over requiring construction contractors to sign the county’s first Project Labor Agreement (renamed on the May 24 agenda as a “Community Workforce Agreement”) came to a regrettable end on Tuesday for county taxpayers, as well as businesses and their employees not affiliated with a labor union.

After a long series of public comments for and against the Project Labor Agreement, including many questionable “statistics” cited by union representatives, Los Angeles County Supervisor Mark Ridley-Thomas pushed for and won a 3-2 vote (the three Democrats in support; the two Republicans in opposition) to require contractors to sign a Project Labor Agreement with the Los Angeles/Orange County Building and Construction Trades Council for the Multi-Service Ambulatory Care Center Project, a part of the larger Martin Luther King, Jr. Medical Center Replacement Project.

Despite the objections of local Merit Shop contractors and their employees, the three Democrats on the Los Angeles County Board of Supervisors were apparently more impressed with the presence of hundreds of glaring union representatives in their union T-shirts. There was no acknowledgment that non-union companies that sign Project Labor Agreements are forced to commit their employees to pay union dues and fees, while the companies themselves are required to pay money into union pension funds, and other union benefit trust funds, that their employees will likely never be eligible to use. The supervisors also ignored how the Project Labor Agreement prohibits apprentices in state-approved Merit Shop apprenticeship programs from earning on-the-job experience on the project.

Nor was there consideration of the taxpayers. Studies and anecdotes concerning Project Labor Agreements indicate a 15 to 20 percent cost increase resulting from reduced bid competition. Additional costs come from internal negotiations and administration of the agreements: the county staff report for the agenda item repeated its statements from November that “the steps to implement the CWA could increase Project costs due to the cost of negotiating the CWA ($95,000), construction delays ($300,000), and management of the CWA over the two-year duration of construction ($400,000).” At a time when governments across California are cutting public services and laying off employees, a decision that wastes $795,000 of taxpayer money on lawyers and bureaucrats is foolish.

Not surprisingly, Project Labor Agreements are also consistently connected to waste, mismanagement and corruption. The Los Angeles Times recently published a six-part series, revealing extensive irregularities in the construction program of the Los Angeles Community College District. Union officials aren’t ashamed of this association: they are so confident in their political control of Los Angeles and so brazen in their intentions that one of them actually cited the Project Labor Agreement at the Los Angeles Community College District as a model for the county to adopt!

Although no one ever spoke specifically on behalf of the taxpayers during the seven-month struggle over the Project Labor Agreement, the citizens who will fund this project did have two advocates on the Board of Supervisors itself. Don Knabe expressed concerns about the cost of administering the Project Labor Agreement and the negative impact of the agreement on small, minority, and women-owned businesses. Knabe noted that although the agreement had been renamed, it was still a Project Labor Agreement. Mike Antonovich also stood up for taxpayers and asserted that the County staff did not fulfill conditions agreed to by the Board in December 2010 when the Board approved negotiations with the unions.

The county-approved, taxpayer-funded budget for the construction of this project is $95 million. The county will issue an addendum adding the government-mandated Project Labor Agreement to the bid specifications provided to the three prequalified construction companies (Clark Construction, Hensel Phelps Construction Company, and McCarthy Building Companies). The county had expected to award this project to one of these firms by March 29, 2011, and it appears that the political struggle over a Project Labor Agreement contributed to the delay.

Los Angeles County joins the City of Los Angeles, the Los Angeles Unified School District, the Los Angeles Community College District, the Port of Los Angeles, Los Angeles World Airports, and the Los Angeles Community Redevelopment Agency in requiring their construction contractors to sign a Project Labor Agreement with labor unions for at least some work. Other local governments in the Los Angeles region that have given unions a monopoly on taxpayer-funded construction include the City of Long Beach, the Port of Long Beach, the City of San Fernando, the San Gabriel Unified School District, the City of Carson, the Carson Unified School District, the Metropolitan Water District of Southern California, and various light rail construction authorities associated with the Metropolitan Transportation Authority of Los Angeles County. Unions are in control.

This is the first Project Labor Agreement approved for taxpayer-funded construction in the nation’s most populous county. Despite significant budget challenges, Los Angeles County chooses to ignore its fiscal responsibilities when powerful unions show up with their demands. Remember this vote the next time you hear Los Angeles County representatives wail that the county is underfunded and needs more tax money from you.

Kevin Dayton is State Government Affairs Director for the Associated Builders and Contractors of California. Kevin D. Korenthal is Executive Director of the Associated Builders and Contractors of California, Cooperation Committee and   These organizations support fair and open competition for public works projects to ensure quality and taxpayer accountability.