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Kevin Dayton

Pugnacious Defense of Economic Freedom in Orange County Can Inspire California’s Free-Market Activists

Huntington Beach Councilman Matt Harper speaks against the proposed Project Labor Agreement at the March 6, 2013 meeting of the Coast Community College District

Huntington Beach Councilman Matt Harper speaks against the proposed Project Labor Agreement at the March 6, 2013 meeting of the Coast Community College District

Californians who want fiscally responsible governments and freedom of choice for government contractors and their employees have another reason for dismay.

Construction union lobbyists are once again advancing their costly agenda for local governments beyond the corrupt and mismanaged urban centers of Los Angeles and the San Francisco Bay Area.

In their latest move, union officials and their elected sycophants are now pushing for monopoly control of almost $1 billion in planned construction at Coast Community College District in Orange County (California).

This is not the first infiltration of government-mandated Project Labor Agreements into Orange County. About a dozen years ago, union lobbyists managed to get control of the taxpayer-funded construction programs of three local governments: Orange County, Santa Ana Unified School District, and Rancho Santiago Community College District. In the case of Orange County, three Republican supervisors voted for it and a Republican state legislator defended it.

But California’s supporters of economic and personal freedom should not be discouraged! This new union challenge provides an opportunity to show how long-term commitment to civic involvement and political activism can stop or even reverse the costly agenda of union lobbyists. It has been done before and will be done again.

This is not a task for the timid or for the community leader always concerned about conforming to some sort of psuedo-aristocratic concept of neutralized dignity. As the Newport Beach/Costa Mesa Daily Pilot and Huntington Beach Independent reported in the March 8, 2012 article College District Caught in Labor Agreement Fight, “At the whiff of a controversial contract proposed for millions in bond money, opponents come out swinging against the already stalled item.”

Opponents know that an aggressive union move to grab a government-imposed monopoly requires an aggressive response. In fact, the same people now fighting for taxpayers and freedom of choice at the Coast Community College District managed to stop and even reverse the last construction union infiltration of Orange County in the early 2000s. They achieved their principled goals without worrying about reputation or reward. They won through a lot of unglamorous work, risk-taking, and defiance of conventional wisdom and the established order.

Read below and be inspired to make a difference.

1. Orange County

Orange County political leaders and residents were stunned in 2000 when the all-Republican Orange County Board of Supervisors voted 3-0-2 on January 11, 2000 to require the county’s construction contractors to sign a Project Labor Agreement with the Los Angeles-Orange County Building and Construction Trades Council as a condition of working on taxpayer-funded Orange County projects through 2005. In a January 13, 2000 press release, Supervisor Tom Wilson described the policy as hasty, premature, and unprecedented. Contractors even had to sign the union agreement for bird, weed, and dust control, as stated in Appendix B.

A majority of the Board of Supervisors saw the Project Labor Agreement as part of a strategy to encourage unions to fund campaign opposition to a March 2000 ballot measure (Measure F) that would have required a public vote to convert the El Toro Marine Corps base into a commercial airport. See a historical record of this shameful union Project Labor Agreement for Orange County.

In the end, 67% of voters approved Measure F and the airport did not happen, but unions enjoyed the real prize: control of county construction projects. Local, state, and even national news coverage depicted the union victory as a harbinger of fundamental political change in California.

The Orange County Republican Central Committee quickly condemned the decision in only its third resolution in 16 years. But party resolutions don’t have any power without activists backing them. Supporters of free markets and fiscal responsibility realized that weakened activism and relative apathy about local government affairs had created a political vacuum in Orange County that professional union officials had noticed and filled.

A few groups, including my former employer Associated Builders and Contractors (ABC), decided that the best response was to change votes through educating elected local officials and building relationships. Intransigent local elected officials who enjoyed their new union political friendships (and the campaign support that came with those friendships) would be accountable to the voters for their costly decisions.

Of the three votes in favor of the county union deal, Supervisor Chuck V. Smith decided not to run for re-election in 2004. Supervisor Jim Silva learned more about the issue after people became involved, and he was part of the 4-1 majority (Supervisor Smith in opposition) that voted on December 21, 2004 to terminate the Project Labor Agreement when its term expired. (A provision in the Project Labor Agreement allowed it to renew indefinitely unless the Board of Supervisors proactively chose to end it before the end of 2004.) Silva maintained a record in support of fair and open bid competition for construction projects throughout his service in the California State Legislature.

In addition, Project Labor Agreement opponents decided to defy the establishment and targeted unrepentant Supervisor Cynthia Coad for defeat. Despite being outspent 5-1, Chris Norby defeated Coad in a stunning upset – the first defeat of an incumbent on the Orange County Board of Supervisors since 1980. “Chris Norby’s stunning victory over incumbent Supervisor Cynthia P. Coad has left political scientists and pundits pondering why she lost and Norby won. On this they agree: Norby’s win was extremely unusual,” said the March 7, 2002 Los Angeles Times article “Untouchables” Go by Board.

In an act of final vindication on November 3, 2009, supporters of fiscal responsibility were gratified to see the Orange County Board of Supervisors – under the leadership of Supervisor John Moorlach – vote 5-0 for an ordinance prohibiting the county from requiring construction companies to sign Project Labor Agreements as a condition of work. (Regrettably, Governor Jerry Brown and the Democrats in the California State Legislature nullified this Fair and Open Competition ordinance (County Code Section 1-8-3) and many other local fair and open competition ordinances throughout the state with the enactment of Senate Bill 922 in 2011.)

Yes, you CAN reverse policies that restrict economic and personal freedom. It takes hard work and persistence – almost ten years in this case.

2. Santa Ana Unified School District

There was more work to be done. Two months after the vote at the Orange County Board of Supervisors, the board of the Santa Ana Unified School District voted 4-1 on March 14, 2000 to require its contractors to sign a Project Labor Agreement with the Los Angeles-Orange County Building and Construction Trades Council as a condition of working on construction projects funded by Measure C, which authorized the district to borrow $145 million for construction by selling bonds to investors. Measure C had been approved by 70% of district voters in 1999, without any indication in the official ballot information to voters that the district would require construction contractors to sign a union agreement. See a historical record of this shameful union Project Labor Agreement for Santa Ana Unified School District.

Under the direction of an elected board focused on controversies over bilingual education, this construction program became tangled up in irresponsible mismanagement decisions and other fundamental problems frequently reported in the news media. Staff for the school district had the courage to admit openly that the Project Labor Agreement was a costly mistake. Organizations opposed to the Project Labor Agreement were pleased to jump on board with a campaign to recall board member Nativo Lopez in a February 4, 2003 election – successful despite these union mailers defending Nativo Lopez and the Project Labor Agreement – and the Project Labor Agreement expired without mourning in 2005.

How do you know when you’re effective at making local elected officials accountable to the voters for their costly decisions on behalf of union special interests? Consider these paraphrased remarks made by recalled board member Nativo Lopez on Pacifica Radio in 2004 (they begin at 48:10):

Click to listen: The Morning Show – January 7, 2004 at 7:00am

Bacon (to Narro) – Now your funding is being cut by Arnold Schwarzenegger. Your group received the wrath of ABC, Associated Builders and Contractors, the group for non-union contractors that got the governor to pull that out from the budget.

Narro – They’ve been targeting us for a few years now. We face elimination this month and the closing of the Downtown Labor Center. We’re fighting like crazy to save the program with a foundation like the California Endowment. We do research strengthening the labor movement.

Bacon (to Lopez) – Nativo Lopez, I understand you also were a target of the ABC.

Lopez – Oh yes, “a very nice group.” I was on the school board in Santa Ana and shepherded a proposal to create a PLA, signed between the school district and the building trades, much to the chagrin of ABC. (Explains a PLA.) It was the only agreement of that character in California. I became a target of the wrath of the ABC with the Republicans in Orange County and Ron Unz. They tried to recall me, ABC was a big contributor. They were successful. I thank the ABC and Ron Unz, “because they really freed me up” to do organizing work for immigrants.

3. Rancho Santiago Community College District

On March 10, 2003, the elected board of the Rancho Santiago Community College District voted 5-2 to require its contractors to sign a Project Labor Agreement with the Los Angeles-Orange County Building and Construction Trades Council as a condition of working on projects funded by Measure E, which authorized the district to borrow $337 million for construction by selling bonds to investors. Measure E was approved in November 2002 by 64% of district voters, without any indication in the official ballot information to voters that the district would require construction contractors to sign a union agreement. See a historical record of this shameful union Project Labor Agreement for Rancho Santiago Community College District.

When the district went back to the voters in November 2006 pleading for $393 million more to finish their program with another bond measure (Measure O), voters rejected it with 53% approval (55% was needed). Activists made sure that voters knew about the union Project Labor Agreement, and the Orange County Register recommended a NO vote in part because of the Project Labor Agreement.

A group of apprentices in state-approved training programs not affiliated with unions filed a lawsuit in June 2004 against the college district pointing out that the Project Labor Agreement required them to quit their programs and join union training programs in order to benefit from on-the-job training at the college district. Regrettably, the Ninth Circuit U.S. Court of Appeals ruled on October 10, 2010 that the college district had the right to enter into a union agreement that required its construction companies to obtain apprentices exclusively from unions. By then, the Project Labor Agreement had terminated, and it was not renewed.

4. Ken Maddox – “It’s a badge of honor I’m proud to carry.”

 

Front of 2004 campaign mailer exposing Ken Maddox's support for the Orange County Project Labor Agreement.

Front of 2004 campaign mailer exposing Ken Maddox's support for the Orange County Project Labor Agreement.

Voters were informed about other Republican elected officials in Orange County who persisted in supporting Project Labor Agreements. In 2004, Assemblyman Ken Maddox decided to run in a Republican primary for a Senate seat. In 2000, Maddox had written a letter to the Orange County Board of Supervisors in support of the county’s Project Labor Agreement. He did not change his position; in fact, on February 28, 2004 Ken Maddox spoke about his support for the union political agenda at the annual conference of the State Building and Construction Trades Council of California.

Republican voters received a mailer exposing Ken Maddox’s support for the Project Labor Agreement. Apparently Republican voters were not impressed with the pro-union “badge of honor,” because Maddox lost the primary to John Campbell, 60% to 30%. (Maddox subsequently won election to the board of the Capristrano Unified School District in 2008, where he did not push for Project Labor Agreements but ended up being recalled in 2010 for other reasons. He is now Ken Lopez-Maddox and continues to express interest in running for public office.)

Back of 2004 campaign mailer exposing Ken Maddox’s support for the Orange County Project Labor Agreement.

Back of 2004 campaign mailer exposing Ken Maddox’s support for the Orange County Project Labor Agreement.

 

5. They’re Back! Union Target in 2013: the Coast Community College District.

The Coast Community College District quietly serves the people of Huntington Beach, Newport Beach, Costa Mesa, Seal Beach, Westminster, Garden Grove, and Fountain Valley. In November 2012, 57% of district voters approved Measure M, which authorized the Coast Community College District to borrow a whopping $698 million for construction by selling bonds to investors.

But every Orange County resident and every Californian should demand fair and open competition on bidding for this district’s construction program, because it will receive state matching grants. With matching grants and other funding sources, the total cost of the planned college construction program is almost $1 billion ($957 million). By the time the bonds are paid back with interest, it could cost taxpayers $1.5 billion to $2 billion or more.

That enormous amount of construction money pouring into an obscure local government attracts union officials, who are skilled at sniffing a political vacuum and filling it. Here’s information about the elected board of trustees for the Coast Community College District, who have been very sneaky about setting up this union deal:

BOARD MEMBER PARTY YEAR UP FOR RE-ELECTION
David Grant (D) 2014
Jim Moreno (D) 2014
Mary Hornbuckle (R) 2016
Jerry Patterson (D) 2016
Lorraine Prinsky (D) 2016

(Source: 2012 School Board Party Affiliation Post – November 16, 2012 by Chris Emami – www.OCPolitical.com.)

To show the lack of openness and transparency with this proposed Project Labor Agreement, here’s my March 5, 2013 email to the district:

From: Kevin Dayton
Sent: Tuesday, March 05, 2013 10:12 AM
Subject: Comments on Proposed Project Labor Agreement for $698 Million Measure M at Coast Community College District

Dear Board Secretary Julie Frazier-Mathews and the Coast Community College District Board of Trustees:

Below, I explain why the voters in your district are justified in being outraged at the governance of their community college, especially concerning the proposed requirement for construction contractors to sign a Project Labor Agreement with unions as a condition of working on your $698+ million taxpayer-funded Measure M construction program. (Total cost of program estimated at $957 million.)

1. No one expected a Project Labor Agreement to be considered because it was not referenced in the ballot statement for Measure M. Even in the staff presentation on January 16 during your Measure M study session, nothing about a Project Labor Agreement was included. Sneaky.

2. This issue was first placed on the college board agenda as a “Special Meeting” scheduled for 4:00 p.m. on January 24, 2013. Why so special? At least it was pulled from the agenda at the meeting.

3. The proposed public policy was disguised as a “Continuity of Work Agreement” rather than being called by its customary and traditional name, a Project Labor Agreement. Hiding it from the public?

4. There was not one reference to consideration of a Project Labor Agreement in the district president’s news briefs, a press release, or any other official material from the district. Was this an attempt to avoid public attention to a highly controversial proposal?

5. I could not find out what happened at the February 6 meeting until draft minutes were included in the March 6 agenda packet. What’s the big secret? Apparently staff isn’t even authorized to orally provide the public with the results of votes, let alone draft meeting minutes?

6. You’re considering a union monopoly on a $698 million construction program (not including state matching grants, interest on money borrowed through bond sales, and financial transaction fees). Your district is in a geographical region that cares about government fiscal responsibility and generally is not supportive of government-mandated union agreements for publicly-funded construction. (The Orange County Board of Supervisors voted 5-0 to ban them in 2009.) But no one bothered to inquire with any groups well-known for presenting an opposing view on Project Labor Agreements. Why? Didn’t you want to fully consider the pros and cons, such as the likely 10-15% cost increase in construction as shown in this report? Measuring the Cost of Project Labor Agreements on School Construction in California.

7. Your Vice Chancellor of Finance and Administration (Andy Dunn) is very familiar with Project Labor Agreements – he was immersed in fights over proposed Project Labor Agreements at the Foothill-De Anza Community College District (where a PLA was adopted in the end, 3-2 vote) and at the San Joaquin-Delta Community College District (where a PLA was never implemented in the end). Surely he was aware that this proposal was highly controversial.

The Orange County Taxpayers Association must feel a little sheepish, getting hoodwinked by the college district into endorsing Measure M even though the taxpayers’ group explicitly won’t endorse bond measures for which a Project Labor Agreement is planned. I bet Measure M would have failed without their endorsement – Measure M only passed with 57% of the vote.

Considering that one of the Coast Community College District board members is apparently running for Orange County Board of Supervisors and needs to get financial and organizational campaign support from the Los Angeles-Orange County Building and Construction Trades Council, I doubt the public uproar now being instigated about the proposed Project Labor Agreement will stop it. One of my axioms is “behind every push for a Project Labor Agreement is a politician with ambition for higher office.”

Nevertheless, the secrecy is over and the Coast Community College District is going to be in the news in Orange County as a local government eager to give unions a costly $698 million taxpayer-funded monopoly. In fact, this email will be the basis for a good op-ed. (“Sunshine Week” is next week, for which newspapers report on lack of transparency at local governments.)

No need to respond to me – I just happened to be the person who discovered the plot. You will be hearing from people who live, work, and pay property taxes in your district. You’re also going to hear from responsible and capable companies that worked on projects funded by your last bond measure but whose employees chose not to belong to a union.

Please make the wise decision to abandon this union deal.

And here’s a report from Eric Christen of the Coalition for Fair Employment in Construction  about what happened when opponents of the Project Labor Agreement finally entered the discussion at the March 6, 2013 board meeting:

[The sneaky plot for a Project Labor Agreement] compelled last night’s attendees to speak out and let it be known that Big Labor wasn’t the only voice out there on construction-related issues. Given five minutes each, the speakers included Eric Christen of the Coalition for Fair Employment in Construction, Dave Everett of the Southern California Chapter of Associated Builders and Contractors (ABC), Sergio Ortega of Associated General Contractors (AGC), and Matt Harper, Mayor Pro Tem of the City of Huntington Beach. Also at the meeting were local contractors showing their opposition to the Project Labor Agreement proposal.

Eric Christen led off the speakers by directly challenging the Trustees’ commitment to openness and honesty. He accused them of purposely keeping this backroom deal quiet and out of public view. How else, asked Christen, could eight union representatives just happen to show up and speak out in favor of a Project Labor Agreement while nobody was there to oppose at the February 6 meeting, when the board voted on it? A simple web search on such a drastic change in policy would reveal to any concerned Trustee that there was massive opposition to Project Labor Agreements. Christen went on to ask why staff would use the Los Angeles Community College District as a community college district to emulate: six front page stories in the Los Angeles Times reported on the corruption and shoddy workmanship of that college’s construction program. Christen ended his comments promising that the Trustees would soon learn just how big a can of worms they had just opened when their neighbors began receiving mailers informing them about their Big Labor giveaway.

Christen was followed by Dave Everett of Associated Builders and Contractors (ABC), who challenged the Trustees to respect all worker rights and to not discriminate against merit shop workers. Everett reminded the Trustees that Orange County banned Project Labor Agreements in 2009 and took its obligations to taxpayers seriously. He went on to discuss his organization’s commitment to training by highlighting its apprenticeship programs and mentioned capable and responsible local companies that planned to bid on Coast Community College District construction projects but would not if the district required them to sign a union agreement as a condition of work. He ended his comments by reading a letter from a local contractor that had worked on numerous Coast Community College District projects but would not bid if the district mandated a Project Labor Agreement.

Dave Everett was followed by Sergio Ortega, an apprenticeship coordinator for Associated General Contractors (AGC) in Orange County, who informed the Trustees that his organization represented both union and merit shop companies and also opposed government-mandated Project Labor Agreements. He highlighted the accomplishments of their apprenticeship programs and encouraged the Trustees to visit their training facilities.

Last up to speak was Matt Harper, Mayor Pro Tem of Huntington Beach. Harper was articulate and professional yet chided the Trustees for having this Project Labor Agreement come out of nowhere just to placate some union officials. He asked if they had incorporated the added cost of the Project Labor Agreement into their construction program cost estimates. If not, then the Trustees needed to kill the idea right then and there.

Speakers made these points during public comment because the Project Labor Agreement will not appear on the board’s agenda for final approval until the April 6 meeting. Board President Lorraine Prinsky said that “This issue was not decided and had in fact been turned over to a Task Force.” No advocates for fair and open bid competition are on the task force, so expect a recommendation at the April 6, 2013 meeting for the Coast Community College District to let the unions have the $957 million, courtesy of the taxpayers who were lured into funding it, with interest.

Want to know more by reading the original source documents? Here is a searchable, highlighted, complete official record of consideration of a Project Labor Agreement by the elected board of trustees for the Coast Community College District. It includes an agenda, staff report, draft Project Labor Agreement, and minutes of the January 24, 2013 “special” meeting and the agenda and minutes of the February 6, 2013 meeting: Complete Official Record: Project Labor Agreement Proposed for Coast Community College District – Measure M – 2013.

News Coverage as of March 11, 2013:

College District Caught in Labor Agreement Fight – Newport Beach/Costa Mesa Daily Pilot and Huntington Beach Independent – March 8, 2012


Kevin Dayton is the President and CEO of Labor Issues Solutions, LLC and is the author of frequent postings about generally unreported California state and local policy issues at www.laborissuessolutions.com. Follow him on Twitter at @DaytonPubPolicy.

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