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A financial watchdog for the city of San Diego and the California state comptroller are warning that if the city's proposed ban on project labor agreements passes, it will be a financial disaster, as the city will lose, at a minimum, more than $158 million in state grants. The ban seems to be pointless, anyway, since San Diego has never required a PLA for any project.
For background, California passed a set of laws that ensure taxpayer protections in a PLA — a construction agreement for large-scale public works projects that outlines wage, safety, and diversity standards as well as local and veteran hiring goals — and prohibit cities from adopting blanket PLA bans. Charter cities lose state funds if they limit PLAs. Since the passing of the state law, public agencies have started backtracking on PLA bans. Escondido removed its proposed ban on PLAs by revising its draft charter proposal citing the potential loss of state funds. El Cajon followed, also removing the language banning PLAs from a proposed charter, and the Palmdale Water District Board voted unanimously to repeal its ban on PLAs. Other cities that have adopted PLA bans are also considering repealing them.
PLA bans at a local level started a few years ago in Southern California. With fiscal repercussions looming, they will likely end here as well.
Despite right-wing and corporate claims about PLAs, the evidence is quite clear that they are a benefit to workers, governments and taxpayers:
Saying PLAs are “only used in the public sector at the behest of union-allied politicians” is a blatant falsehood, and one this paper should immediately correct. PLAs have been used by public- and private-sector entities across the United States since the 1940s and are the method of choice for complex private-sector projects, where cost and quality are the overriding issues. The former head of construction for Toyota North America, Jeff Caldwell, wrote, “I have had numerous real-world experiences with PLAs, and I can say without any equivocation that they are a valuable tool for any entity seeking an economical and efficient construction process.”
In the public sector, and in projects right here in San Diego, PLAs have also proven invaluable. In a 2009 Cornell University study on “Why PLAs Are Good Public Policy,” the authors state plainly, “No one should be confused. When public entities enter the marketplace as owners, users, and/or purchasers of construction services, they have a responsibility to protect and promote the public interest by spending funds wisely, judiciously and efficiently. Project labor agreements are a vital instrument to fulfill that responsibility.”
At San Diego Unified School District, an independent study confirmed that PLAs the district entered into in 2009 had not raised cost, had exceeded its goals of employing local workers and was finishing work faster than non-PLA projects.
Perhaps most interesting to the U-T San Diego, far from “forcing” the district into union contracts, the PLA was found to have awarded bids on a level playing field between union and nonunion workers. Of the $51.5 million in Proposition S PLA projects awarded, $41.5 million went to nonunion contractors and $17.9 million went to union contractors. Some district officials openly question the value of the city of San Diego proactively preventing such agreements in the future. I don’t blame them
Learn more about Proposition A at Stop Prop A.