FLASHREPORT

STATE SUPREME COURT STANDS UP FOR CHARTER CITIES, TAXPAYERS

Chairwoman of the Associated Builders and Contractors of California

Every once in a while, the taxpayers win! 

Nothing could illustrate that more than the decision released on July 2, 2012 by the California Supreme Court in the case State Building Trades Council of California vs. the City of Vista.  In a clear decision by the court, the justices ruled that local control as Constitutionally provided to California Charter Cities cannot be usurped.

In California, Charter Cities enjoy a unique protection in the State Constitution.  This protection allows Charter Cities to have autonomy from the state when it comes to “municipal affairs”.  This means that when local dollars are used, Charter Cities can exercise home rule. 

As illustrated in the incident between the City of Vista and the State Building Trades Council, the City of Vista exercised its rights as a Charter City to build a Fire Station without prevailing wage.  Since the City of Vista is a Charter City and used only local dollars it could legally do so.  Unfortunately, Vista was sued by the State Building Trades Council. 

Prevailing wages in the State of California can often raise costs on local projects.  Wage rates are determined by Bureaucrats with a Sacramento mindset.  This mindset uses collective bargaining agreements and expensive union wages as a determination of what constitutes a prevailing wage.  Unfortunately, these State mandated wages are inflated, and cost taxpayers more money.

With the economy putting stress on local governments this decision by the Supreme Court couldn’t have come at a better time.  Quite simply, when wage rates are set at the reasonable rates for the local market, there is more money for more jobs for more projects.  With Cities around the State facing financial shortages, relief is finally here.

In this decision the court said “Autonomy with regard to the expenditure of public funds lies at the heart of what it means to be an independent governmental entity.  We can think of nothing that is of greater municipal concern than how a city’s tax dollars will be spent; nor anything which could be of less interest to taxpayers of other jurisdictions.” 

Charter Cities now have a clear path to continue to operate as they see fit and the taxpayers will see the benefits with additional public works and infrastructure projects.

ABC is a "merit shop" construction business trade association that believes in doing business in which companies reward employees based on performance and encourage them to reach their highest level of achievement, and in which contracts are awarded based on safety, quality, and value, regardless of labor affiliation.  ABC has 74 chapters nationwide and more than 22,000 member companies.

Associated Builders and Contractors of California filed an amicus curie brief in support of the City of Vista and other public entities seeking to establish and clarify their power to make their own construction decisions. Robert Fried of Atkinson, Andelson, Loya, Ruud & Romo represented the amicus and participated in the litigation of the case from its inception, in the court(s) below and at oral argument, supporting Jim Lough and Darold Pieper who represented the City of Vista.  Robert had been counsel for amicii in previous California Supreme Court decisions concerning the development of California prevailing wage law. (Department of Industrial Relations v. Long Beach) He views the Court’s decision today as “a major step forward in clarifying the rights of municipal government that should play a pivotal role in revitalizing the struggling construction marketplace. He can be reached in the firm’s Pleasanton, California office at 925 251-8515 or at rfried@aalrr.com.