BILL ANALYSIS AB 2537 Page 1 Date of Hearing: May 7, 2008 ASSEMBLY COMMITTEE ON APPROPRIATIONS Mark Leno, Chair AB 2537 (Furutani) - As Introduced: February 21, 2008 Policy Committee: Labor and Employment Vote: 8-0 Urgency: No State Mandated Local Program: No Reimbursable: SUMMARY This bill extends, from January 1, 2009 to January 1, 2012, the prevailing wage exemption for work performed by a volunteer, volunteer coordinator, members of the California Conservation Corp, and certified Community Conservation Corps. FISCAL EFFECT The Department of Industrial Relations (DIR) indicates that extending the sunset will result in the avoidance of significant enforcement related cost increases that will occur if the present volunteer exemption expires. COMMENTS 1)Background . Existing law generally requires that prevailing wages be paid to all workers employed on public works. An exemption is provided, however, for volunteers and California Conservation Corps members working on projects used primarily for nonprofit, community organizations. Prior to 2004, this exemption was limited to work that was performed entirely by volunteer labor. Current law was created by AB 2690 (Hancock), Chapter 330, Statutes of 2004, in response to outcry from the public AB 2537 Page 2 following a DIR determination that a state-funded watershed restoration project had been in violation of prevailing wage law because it had used college students to complete parts of the project. The students earned course credit in classes in watershed restoration for performing various activities on the project, including planting seeds, clearing brush, and repairing colverts. After lengthy negotiations between the environmental community and representatives of organized labor, the Legislature enacted AB 2690 (Hancock), Chapter 330, Statutes of 2004. As amended by this bill, current law provides the prevailing wage exemption for work performed by a volunteer, volunteer coordinator, or by members of the California Conservation Corp and certified Community Conservation Corps - regardless of whether the work is performed exclusively by volunteers or by a mix of volunteers and employees. AB 2690 was enacted with a sunset date of January 1, 2009, after which California reverts back to the more restrictive pre-2004 law. 2)Rationale . Supporters of this bill argue that the ability to use volunteers is a cornerstone for many important land and water conservation projects, and that retaining this ability is particularly important at present given the state's large budget deficits. They also point out that since the revised volunteer exemption was enacted in 2004, there have been no reported complaints of abuse of the exemption reported to DIR. 3)Opponents (AFSCME) state that, although they laud the intent of the bill, the exemption countermands the state's need for economic stability and an individual's need for gainful employment. Opponents also raise concerns about liability, health, and safety issues related to use of volunteers on public works projects. 4)Related Legislation . SB 1345 (Ashburn) and AB 2364 (Walters) would eliminate the sunset date altogether, making the current volunteer exemption permanent. SB 1345 failed passage out of the Senate Committee on Labor and Industrial Relations when the author declined to take amendments which would have extended, instead of eliminated, the sunset date. AB 2364 failed passage but was granted reconsideration in the Assembly AB 2537 Page 3 Labor Committee Analysis Prepared by : Brad Williams / APPR. / (916) 319-2081