BILL ANALYSIS Ó
SB 829
Page 1
SENATE THIRD READING
SB 829 (Rubio)
As Amended March 14, 2012
Majority vote
SENATE VOTE :Vote not relevant
BUSINESS & PROFESSIONS 6-2 APPROPRIATIONS
11-4
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|Ayes:|Hayashi, Allen, Butler, |Ayes:|Fuentes, Blumenfield, |
| |Eng, Atkins, Ma | |Bradford, Charles |
| | | |Calderon, Campos, Davis, |
| | | |Gatto, Hill, Lara, |
| | | |Mitchell, Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Bill Berryhill, Hagman |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Wagner |
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SUMMARY : Prohibits the use of state funds for any charter city
construction projects if the charter city has banned the
consideration of the use of project labor agreements (PLAs).
Specifically, this bill:
1)Provides that, if a charter provision, initiative, or
ordinance of a charter city prohibits the governing board's
consideration of a PLA that includes current-law taxpayer
protection provisions for some or all of the construction
projects to be awarded by the city, then state funding or
financial assistance shall not be used to support any
construction projects awarded by the city.
2)Provides that the above provision shall not be applicable
until January 1, 2015, for charter cities in which a charter
provision, initiative, or ordinance in effect prior to
November 1, 2011, would disqualify a construction project from
receiving state funding or financial assistance.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, this bill could result in a reallocation of state
infrastructure funding, such as annual transportation funding
for local streets and roads, to the extent a charter city has an
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ordinance banning PLAs in general and thus is no longer eligible
for state funding after January 1, 2015.
Charter cities that ban PLAs, in order to remain eligible for
state funding after January 1, 2015, could incur costs to amend
their charters to overturn such bans. For PLA bans adopted by
ordinance, these costs would be minor. For PLA bans adopted by
charter amendment or initiative, a city seeking to overturn the
ban would incur the one-time costs of submitting the proposal to
the voters for approval. These costs would not be state
reimbursable.
COMMENTS : According to the author, "This bill is necessary
because anti-union groups/associations continue their campaign
to eliminate the option for local governments to utilize
PLAs...These are mainly political attacks because PLAs are
negotiated on a project-by-project or funding source (i.e.,
bond) basis and PLAs are not mandated under any state laws.
Anti-PLA/union lobbyists, mainly the Associated Builders and
Contractors, pushed bans in a few counties (Stanislaus, Orange,
San Diego) and Charter Cities (Chula Vista and Oceanside) based
on intense lobbying and campaigns waged by non-union contractor
organizations that voluntarily choose not to bid on projects
governed by a PLA.
"SB 922, which the California Legislature passed and the
Governor signed, effectively eliminated the PLA bans imposed by
general law cities, counties and special districts. SB 922 also
authorized all public entities to utilize a PLA if they meet the
criteria of Public Code Section 2500. SB 922 provided, in
Public Contract Code Section 2502, that charter cities that have
ordinances that prevent the city council from considering the
use of a PLA for a project cannot receive state funding for that
specific project. SB 829 would extend the law by providing that
charter cities that have ordinances that prevent the city
council from considering the use of PLAs cannot receive state
funding for any of their construction projects."
A PLA is a pre-hire agreement that establishes the terms and
conditions of employment for a specific construction project.
They are completed before any workers are hired to determine the
wage rates and benefits of all employees working on the project
and to agree to prevent any strikes, lockouts, or other work
stoppages for the length of the project. The terms of the
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agreement apply to all contractors and subcontractors who
successfully bid on the project, union or non-union, and
supersede any existing collective bargaining agreements.
PLAs are used on both public and private projects, and their
specific provisions are tailored by the contracting parties to
meet the needs of a particular project. By governing and
establishing work rules, pay rates, and dispute resolution
processes for every worker on the project, PLAs can maximize
project stability, efficiency and productivity. PLAs can also
help minimize the risks and inconvenience to the public that can
accompany public work projects, helping ensure that projects are
completed on time and on or under budget.
PLAs are not mandated under California law. However, if a state
or local agency chooses to use a PLA for a public construction
project, the PLA must include minimum taxpayer-protection
criteria. Governing boards of local agencies can choose by
majority vote whether or not to use a PLA that includes these
taxpayer-protection criteria. Governing boards of local
agencies can also decide by majority vote whether or not to fund
a project that includes such a PLA. Because of the home-rule
provision of the California Constitution, this provision does
not apply to charter cities. Local agencies, except charter
cities, are also prohibited from adopting blanket prohibitions
against using PLAs. Local governing boards have the authority
to decide on a case-by-case basis whether to use PLAs.
If a charter city has banned PLAs for a project to be awarded by
the city, state financial assistance must not be used for that
project. This provision becomes operable January 1, 2015, for
charter cities that had ordinances in effect before November 1,
2011, that would disqualify a project from receiving state
funding.
This bill further provides that, if a charter city has an
ordinance that prevents the city's governing body from
considering the use of PLAs, state funding cannot be used to
support any construction projects awarded by the city. This
provision has a delayed effective date of January 1, 2015, for
charter cities that had such bans in place before November 1,
2011.
SB 829
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Analysis Prepared by : Angela Mapp / B.,P. & C.P. / (916)
319-3301
FN: 0003204