As if the huge fiscal impacts of realignment (AB109-prisoner early release) weren’t tough enough for California’s cities to absorb, Sacramento is launching another assault on certain local government treasuries.
The latest attack is Senate Bill 7, sponsored by Senators Steinberg (D-Sacramento) and Cannella (R-Ceres). The bill seeks to punish charter cities-like Modesto- that use local taxpayer dollars in a fiscally responsible fashion on local building and infrastructure projects.
In California, there are over 120 charter cities. Charter cities have unique protections that allow cities to exercise more control over local affairs under the State Constitution. This protection is known as “home rule”. In short, this means when Modesto decides to use local tax dollars to pay on a local project, Sacramento can’t tell us how to spend our local dollars on the project.
Even the California Supreme Court recently weighed in on this issue and reaffirmed the rights of charter cities. In July of 2012, a ruling was issued in the case of the State building and Construction Trades Council vs. the City of Vista. That ruling stated the following:
“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.”
However, that very same union is the sponsor of SB 7—and in the Capitol urging union friendly legislators to give them what they could not get in court: a mandate to use state-set union wage rates on locally funded charter city projects.
Currently, when only local dollars are used, cities like Modesto can put projects out to bid and contractors are able to compete to provide the city with the lowest reasonable price possible. SB7 would require Modesto to pay state mandated prevailing wage rates on every project and prevent Modesto from realizing the minimum 15% savings the taxpayers currently see on local projects. If this bill were to pass, Modesto could not exercise its rights as guaranteed under the State Constitution.
We are very concerned that as drafted, the legislation will jeopardize the City’s ability to contract out basic maintenance services of its parks, municipal buildings and municipal facilities. These contracts include a multi-year maintenance agreement with a local non-profit organization that employs developmentally disabled workers.
Modesto, like many other cities, has been forced to utilize competitively bid contracts for maintenance of a number of city owned facilities for fiscal survival. Modesto currently has at least 14 competitively bid contracts worth over $4.7 million annually for maintenance of city owned facilities. These include but are not limited to contracts for maintenance of parks, janitorial services and golf course operations. The requirement to pay prevailing wages on these contracts will impact Modesto’s general fund and thus affect the level of service Modesto is able to provide to its citizens. This new requirement will also impact a number of maintenance contracts in our utility funds, increasing costs for our rate payers.
You would think that legislators like Senator Steinberg and Cannella would be trying to help Cities especially in this time of lean budgets. However, that appears not to be the case, as SB 7 will hurt rather than help cities like Modesto in these hard times.
This bill has already passed out of the Senate and will be heard in the State Assembly Local Government Committee on June 26. California’s cities need your help, Modesto needs your help, please call your Assembly representatives and tell them to oppose SB 7 (Steinberg/Cannella). Sacramento should not be allowed to take away local control from charter cities, or punish cities who choose to use this Constitutional right.