BILL ANALYSIS Ó
SB 922
Page 1
( Without Reference to File )
SENATE THIRD READING
SB 922 (Steinberg)
As Amended September 8, 2011
Majority vote
SENATE VOTE : Vote not relevant
BUSINESS & PROFESSIONS 6-3
APPROPRIATIONS 10-5
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|Ayes:|Hayashi, Allen, Butler, |Ayes:|Fuentes, Blumenfield, |
| |Eng, Hill, Ma | |Bradford, Campos, Davis, |
| | | |Gatto, Hall, Hill, Lara, |
| | | |Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Bill Berryhill, Hagman, |Nays:|Harkey, Donnelly, |
| |Smyth | |Nielsen, Norby, Wagner |
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SUMMARY : Establishes parameters for the use of project labor
agreements (PLAs) for publicly-funded construction projects.
Specifically, this bill :
1)Authorizes public entities to use, enter into, or require
contractors to enter into a PLA for a construction project
only if the agreement includes all of the following taxpayer
protection provisions:
a) The agreement prohibits discrimination based on race,
national origin, religion, sex, sexual orientation,
political affiliation, or membership in a labor
organization in hiring and dispatching workers for the
project;
b) The agreement permits all qualified contractors and
subcontractors to bid for and be awarded work on the
project without regard to whether they are otherwise
parties to collective bargaining agreements;
c) The agreement contains an agreed-upon protocol
concerning drug testing for workers who will be employed on
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the project;
d) The agreement contains guarantees against work
stoppages, strikes, lockouts, and similar disruptions of
the project; and,
e) The agreement provides that disputes arising from the
agreement shall be resolved by a neutral arbitrator.
2)Provides that the members of the governing board of a local
public entity may choose by majority vote whether to use,
enter into, or require contractors to enter into a PLA as
specified above and whether to allocate funding to a project
covered by such an agreement.
3)Provides that a charter provision, initiative, or ordinance
shall not prevent the governing board of a local public
entity, other than a charter city, from exercising the
authority established by this bill on a project-specific
basis.
4)Provides that, if a charter provision, initiative, or
ordinance of a charter city prohibits the governing board's
consideration of a PLA as described above or from allocating
funds to a city-funded project covered by such an agreement,
then state funding or financial assistance shall not be used
to support that project. This provision is not 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 project from receiving
state funding or financial assistance.
5)Provides the following definitions:
a) "Project labor agreement" means a prehire collective
bargaining agreement that establishes terms and conditions
of employment for a specific construction project or
projects and is an agreement described in the United States
Code governing unfair labor practices and allowable labor
agreements in the building and construction industry; and,
b) "Public Entity" means a state, county, city, city and
county, district, public authority, public agency,
municipal corporation, or any other political subdivision
or public corporation in the state.
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FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Any state costs to incorporate the required provisions in PLAs
on state projects should be minor. Based on information
received at the time of this analysis, state agencies seldom
use PLAs.
2)Any costs for local governments would be non-reimbursable, as
the bill authorizes, but does not require, the use of PLAs.
Charter cities with PLA prohibitions adopted by charter
amendment or initiative, that seek to maintain eligibility for
state funding assistance on city projects after January 1, 2015,
would incur the costs of an election seeking voter approval to
repeal those prohibitions. Again, these costs would not be state
reimbursable.
COMMENTS : A PLA is a pre-hire collective bargaining agreement
with one or more labor organizations that establishes the terms
and conditions of employment for a specific construction
project.
Before any workers are hired on the project, construction unions
and contractors have bargaining rights to determine the wage
rates and benefits of all employees working on the particular
project and to agree to prevent any strikes, lockouts, or other
work stoppages for the length of the project. The terms of the
agreement apply to all contractors and subcontractors who
successfully bid on the project, 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. PLAs typically require
that the contractor hire all workers through union halls, that
nonunion workers pay dues for the length of the project and that
the contractor follow union rules on pensions, work conditions
and dispute resolution. Many PLAs also require that employees
hired for the project are referred by the union hiring halls,
though most of these allow for alternate hiring mechanisms,
including retention of a contractor's "core" or key employees.
On February 6, 2009, U.S. President Barack Obama issued an
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Executive Order requiring the use of PLAs on federal projects of
$25 million or more. According to the order, PLAs promote
efficient and timely completion of large-scale construction
projects and prevent many of the problems inherent in such
construction.
Analysis Prepared by : Angela Mapp / B.,P. & C.P. / (916)
319-3301
FN: 0002823