Court backs cities on prevailing wage

July 6, 2012

By Joseph Perkins

The California Supreme Court ruled this week that the state’s prevailing wage law does not apply to public works projects financed entirely by taxpayers residing in one of the state’s 121 chartered cities.

The decision is a huge win for chartered cities. It enables them to save millions of dollars in construction-related labor costs.

The case in question involved the city of Vista, where voters in 2006 approved a half-cent sales tax to fund several municipal projects. That included a seismic retrofit of an existing fire station, as well as construction of a new civic center, a new sports park and a new stage house for the city’s amphitheater.

In 2007, Vista’s city attorney submitted a report to its city council recommending that Vista, then a general law city, take steps to become a charter city.

That would give the San Diego County municipality the latitude, the report determined, not to pay state-mandated prevailing wages on its planned public works projects, which would result “in millions of dollars in savings over the next few years and beyond.”

Indeed, in a study of low-income housing construction in California, UC Berkeley researchers found that the state’s prevailing wage mandate drove up costs of such projects by an average 21 percent.

That’s because the state formula for calculating the prevailing wage for a given locality is based not on the average wage rate at actual construction sites, but on higher, union wage rates. 

That’s why Vista’s city council heeded the recommendation of its city attorney and placed a measure on the city ballot to convert to a charter city. And that’s why an overwhelming two-thirds of the city’s electorate approved the conversion.

Not long after officially becoming a charter city, Vista’s city council promptly amended an existing city ordinance to prohibit city contracts requiring payment of prevailing wages unless mandated under terms of a state or federal grant, specifically authorized by the city council or unrelated to a municipal affair.

Legal battle

Vista’s moves did not set well with the State Building and Construction Trades Council of California, an umbrella group for construction unions, which in 2007 filed suit in San Diego County Superior Court to compel the new charter city to compel with the state’s prevailing wage law.

The legal battle took five years to wend its way through the courts.

The union maintained that the matter of prevailing wages was a “statewide concern,” and, therefore, the state had authority over the city of Vista. Vista countered that the matter of wages paid to workers on construction projects financed by local revenues was a municipal affair and, therefore, governed by city ordinance.

“We agree with the city,” the state Supreme Court declared this week, in its 5-2 decision.

Vista Mayor Judy Ritter said the city’s legal victory was critical not only for her charter city, but for every other such city throughout the state that aims to control the cost of local public works projects.

Had the court sided with the union, she said, “it would have required the taxpayers of even the poorest charter city in the state to pay the highest possible wages to build their municipal facilities.”

That may not matter to the State Building and Construction Trades Council, which believes that unionized workers have an entitlement to artificially inflated wages on public works projects.

But it matters a great deal to cities like Vista that endeavor to be fiscally responsible; that do not want to find themselves in a similar position to the woebegone city of Stockton.

15 comments

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  1. Donkey
    Donkey 6 July, 2012, 08:25

    This is a battle between the RAGWUS Unions and the private Unions. The RAGWUS is looking to cut costs to maintain their high living standards and excessive pay, benefits, perks, and pensions at the expense of their private setor “brothers and sisters.”

    This is what happens in hte minds of many when the well runs dry, it should be no surprise that the RAGWUS has no loyalty outside its cult. 🙂

    Reply this comment
  2. Rex The Wonder Dog!
    Rex The Wonder Dog! 6 July, 2012, 08:55

    BAM!!!!!!!!!!!!!!!

    I redicted this win, making my predictions 9-0! After the sales tax is defetaed nov 6 it will be 10-0~~~~~!!!!!!

    Reply this comment
  3. Dyspeptic
    Dyspeptic 6 July, 2012, 09:48

    Another little faint beam of light and hope in the vast dark cavern of political stupidity that is Kalifornia. It’s always nice to see the big labor cartels get thumped though. 🙂

    Reply this comment
  4. BonnieGadsden
    BonnieGadsden 6 July, 2012, 10:06

    “unionized workers have an entitlement to artificially inflated wages”

    That sums it up right there. There is no way anyone could be ENTITLED to INFLATED wages.

    BG

    Reply this comment
  5. BonnieGadsden
    BonnieGadsden 6 July, 2012, 10:08

    And for those interested, here’s a link to a list of CA Charter Cities & Counties.

    http://www.ceres.ca.gov/planning/bol/1997/charter.html

    Reply this comment
  6. Kevin Dayton, Labor Issues Solutions
    Kevin Dayton, Labor Issues Solutions 6 July, 2012, 22:51

    Today I posted on my blog a “Memorandum to All California City Councilmembers Who Believe in Local Control, Fiscal Responsibility, and Providing Local Services in an Efficient, Cost-Effective Way.” It provides background to city councilmembers and city managers and city attorneys on how and why charter cities should establish their own policies for government-mandated wage rates for municipal construction contractors.

    There needs to be a movement – 24 California cities seeking approval from voters in November for robust, meaningful charters. Problem is, how to trigger it? This article and all the others help to spread the word, but it is nothing compared to the political clout of unions and their allies.

    Since California seems to lack an organized, capable operation on the Center-Right to encourage like-minded local government officials to free themselves from the costly, burdensome mandates of the California State Legislature, please take grassroots initiative and pass this information onto any city councilmembers your know who want to take action. This is a rare opportunity to bring relief to taxpayers and local governments. Here’s the post:

    http://laborissuessolutions.com/memo-to-all-fiscally-responsible-city-council-members-in-california-background-on-charter-cities-establishing-their-own-policies-for-government-mandated-wage-rates-for-municipal-construction-contract/

    Reply this comment
  7. Ted Steele, The Decider
    Ted Steele, The Decider 7 July, 2012, 08:48

    The Poodle— 0 for 9……soon to be 10 !

    Reply this comment
  8. Rex the Wonder Dog!
    Rex the Wonder Dog! 7 July, 2012, 21:39

    11-0 BABY!!!!!!!!!!!!!!!!!!!!!

    Reply this comment
  9. Rex the Wonder Dog!
    Rex the Wonder Dog! 7 July, 2012, 21:43

    This article and all the others help to spread the word, but it is nothing compared to the political clout of unions and their allies.

    Kevin, if words, merit, good intentions and honor were all that we needed for a responsible government we would never be in this mess.

    $$$$ makes the political world go round, and those who have it win and those who don’t have it lose.

    That is how it works and Citizens United cemented that corruption into place for many years to come……..

    Reply this comment
  10. Ted Steele, The Decider
    Ted Steele, The Decider 7 July, 2012, 22:42

    Poodle– I love how you try to back peddle off all your lost predictions! LMAO !!

    Reply this comment
  11. Ulysses Uhaul
    Ulysses Uhaul 8 July, 2012, 09:31

    Teddy calls em right!

    Reply this comment
  12. Rex the Wonder Dog!
    Rex the Wonder Dog! 8 July, 2012, 18:08

    11-0 BABY! 😉

    Reply this comment
  13. nowsane
    nowsane 10 July, 2012, 13:49

    Vista’s voters passing their charter city amendment by two thirds majority, is the same majority of voters that voted for pension reform here in San Diego.

    Reply this comment
  14. LGMike
    LGMike 10 July, 2012, 15:13

    With the California Supreme Courts action declaring “Charter Cites” don’t have to comply with “minimum wage” mandates, does this now make the vote by our legislature mandating pay this or else illegal because they can’t tell a Charter City what they can do?
    Interesting concept, wonder if anyone will take that up during this year.

    Brings out another possible fight. What about “living wage ordinances” forcing Companies that do business with a City to pay higher than other jobs that are not part of City contracts.

    Reply this comment
  15. Kevin Dayton, Labor Issues Solutions
    Kevin Dayton, Labor Issues Solutions 13 July, 2012, 08:25

    Living Wage – I would think that charter cities would have the right to establish “living wage” policies to impose their contractors for municipal services.

    But not every city in California with a living wage policy has a charter – SEVEN out of the 27 cities with living wage policies are general law cities. Here is the list of cities that have living wage policies, as compiled by the union propaganda think tank called the UC Berkeley Labor Center (affiliated with the University of California Miguel Contreras Labor Program):

    1.Albany

    2.Berkeley

    3.Davis [not a charter city]

    4.Emeryville [not a charter city]

    5.Hayward

    6.Fairfax [not a charter city]

    7.Irvine

    8.Los Angeles

    9.Oakland

    10. Pasadena

    11. Petaluma

    12. Port Hueneme

    13. Richmond

    14. Sacramento

    15. Santa Barbara

    16. Santa Cruz

    17. Santa Monica

    18. San Diego

    19. San Fernando [not a charter city]

    20. San Francisco

    21. San Jose

    22. San Leandro

    23. Sebastopol [not a charter city]

    24. Sonoma [not a charter city]

    25. Ventura

    26. Watsonville

    27. West Hollywood [not a charter city]

    Reply this comment

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