California State Legislature Picks a Fight with The United States Constitution

Kevin D. Korenthal
Former executive director of the Associated Builders & Contractors, California Cooperation Committee and principal in KORE Communications, LLC, a communications consulting firm specializing in corporate marketing and communications based in Santa Clarita, California.

Yet another new law confirms union control of the California State Capitol. Gov. Brown has signed Senate Bill 954, which restricts what kind of construction industry advancement programs are worthy of inclusion in state prevailing wage determinations.

As you might guess, Senate Bill 954 ensures that employer payments only qualify as industry advancement if they go to an organization affiliated with a union. In addition, the contractor can’t take credit for its payments that go to an industry advancement organization affiliated with a union unless that contractor is bound by a union collective bargaining agreement.

That means that the only sponsorship you’ll see for a high school football scoreboard is the International Brotherhood of Electrical Workers (IBEW). And you’ll see union sponsorship of community events but not sponsorship of events from other participants in the construction industry. Only unions can advance the industry in this way.

Senate Bill 976 is actually the second maneuver by the unions to obtain exclusive control over what can be defined as “industry advancement” under California prevailing wage law. In 2013, Gov. Brown signed Senate Bill 776, which restricts what kind of labor compliance investigations are worthy of inclusion in state prevailing wage determinations.

If you guessed that only union-affiliated programs now qualify as labor compliance programs, you would be correct. Senate Bill 776 essentially means that unions will examine the payroll records of non-union contractors for labor law violations, but no outside independent private organization will examine the payroll records of unionized contractors. Associated Builders & Contractors, California Cooperation Committee was the target of this bill. The ABC-CCC had successfully audited a dozen prevailing wage projects around California. ABC-CCC collected certified payrolls from prevailing wage contractors and compared them to what the law said each trade and experience level should pay. It also determined what if any apprenticeship education a worker should be enrolled in. Through the effort, ABC-CCC revealed that prevailing wage violations were rampant and not confined to non-union contractors as the unions had long claimed.

These activities were having a devastating impact on the union’s ability to convince municipal authorities to negotiate an even higher level of union control called a Project Labor Agreement or PLA. Readers of this blog are no stranger to posts about PLAs. They are the primary way that unions gain control of public works projects, reduce participation by non-union contractors and ensure that competition in the bidding process is kept to a minimum.

ABC-CCC, in an effort to uncover a primary claim about PLAs — that they raise the cost of public works construction — provided a small stipend to the National University System Institute for Policy Research to conduct a study to determine the impact of Project Labor Agreements on California school construction costs. “Measuring the Cost of Project Labor Agreements on School Construction in California” is a 2010 2011 analysis of construction costs of a large sample of California school construction projects. The results of that study were reviewed for statistical and procedural accuracy by the Keston Institute for Public Finance and Infrastructure of the University of Southern California. The study “shows that PLAs are associated with higher construction costs. [The authors] found that costs are 13 to 15 percent higher when school districts construct a school under a PLA”.

What group sponsored and led the 2013 lobbying campaign to enact Senate Bill 776? The State Building and Construction Trades Council of California – the same union umbrella group that sponsored and led the 2016 lobbying campaign to enact Senate Bill 954.

In both cases, the California legislature and Gov. Brown decided that certain labor compliance investigations and certain industry advancement activities were superior to others and therefore worthy of inclusion as prevailing wage payments. That determination was not based on performance or merit. It was based on union affiliation.

And what was the motivation for California construction unions to seek enactment of Senate Bill 776 and Senate Bill 954? Simply put, the unions don’t like competition in the arena of labor compliance investigations and they don’t like competition in the arena of speech.

The law that Senator Herzberg sponsored, the Democrat-held legislature passed and the Governor signed is the clearest case to date of legislative over-reach which violates the United States Constitution. It stands to reason that these violations of our founding document will not go unchallenged. There is simply too much at stake here not to try to right this terrible injustice inflicted on the public works construction community by an out-of-control legislature that is hell-bent on protecting the turf of its masters, organized labor.

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