BILL ANALYSIS Ó ----------------------------------------------------------------- |SENATE RULES COMMITTEE | SB 54| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ----------------------------------------------------------------- UNFINISHED BUSINESS Bill No: SB 54 Author: Hancock (D) Amended: 9/3/13 Vote: 21 PRIOR VOTES NOT RELEVANT ASSEMBLY FLOOR : 51-24, 9/9/13 - See last page for vote SUBJECT : Hazardous materials: stationary sources: trained workforce SOURCE : State Building and Trades Council DIGEST : This bill enacts specified provisions related to construction and related work performed by contract at specified stationary sources. Assembly Amendments delete the Senate version of the bill which dealt with public employees and insert current language which addresses industrial safety, skilled and workforce training. ANALYSIS : Existing law establishes an accidental release prevention program implemented by the Office of Emergency Services and the appropriate administering agency, as defined, in each city or county. Under existing law, stationary sources subject to this accidental release prevention program are required to prepare a risk management plan (RMP) when required under certain federal regulations or if the administering agency determines there is a significant likelihood that the use of CONTINUED SB 54 Page 2 regulated substances by a stationary source may pose a regulated substances accident risk. Under existing law, the RMP is required to be submitted to the California Environmental Protection Agency and to the administering agency. Existing law imposes criminal penalties upon a stationary source that knowingly violates requirements of the accidental release prevention program. This bill enacts specified provisions related to construction and related work performed by contract at specified stationary sources. Specifically, this bill: 1. Requires an owner or operator of specified stationary sources (petroleum refineries and petrochemical manufacturing facilities), when contracting for the performance of construction, maintenance and related work, to require that its contractors and any subcontractors use a "skilled and trained workforce" to perform all onsite work within an apprenticeable occupation in the building and construction trades. 2. Defines a "skilled and trained workforce" to mean a workforce that meets the following criteria: A. All the workers are either registered apprentices or "skilled journeypersons." B. As of January 1, 2014, at least 30% of the "skilled journeypersons" are graduates of approved apprenticeship programs, as specified. C. As of January 1, 2015, at least 45%of the "skilled journeypersons" are graduates of approved apprenticeship programs, as specified. D. As of January 1, 2016, at least 60% of the "skilled journeypersons" are graduates of approved apprenticeship programs, as specified. 3. Defines a "skilled journeyperson" as a worker who meets all of the following criteria: A. The worker either graduated from an approved apprenticeship program or has at least as many hours of CONTINUED SB 54 Page 3 on-the-job experience that will be required to graduate from an approved apprenticeship program. B. The worker is being paid at least a rate equivalent to the prevailing hourly wage rate, as defined. C. For work performed on or after January 1, 2018, the worker has completed within the prior two calendar years at least 20 hours of approved advanced safety training for workers at high hazard facilities. 4. Provides that an approved apprenticeship program may enroll, with advanced standing, applicants with relevant prior work experience, as specified. 5. Specifies that these requirements shall apply to each individual contractor's and subcontractor's onsite workforce. 6. Provides that for purposes of existing law related to approval of new apprenticeship programs, a covered stationary source shall be considered in determining whether existing apprenticeship programs do not have the capacity, or have neglected or refused, to dispatch sufficient apprentices. 7. Provides that this bill does not make work subject to its requirements "public work" for specified purposes of the Labor Code. 8. Provides that the requirements of this bill shall not apply to oil and gas extraction operations. 9. Provides that the requirements of this bill shall not apply to contracts awarded before January 1, 2014, unless the contract is extended or renewed after this date. 10.Provides that the requirements of this bill shall not apply to the employees or the owner or operator of the stationary source or prevent the owner or operator from using its own employees to perform any work that has not been assigned to contractors while the employees of the contractor are present and working. 11.Provides that specified provisions of the bill related to the qualifications for skilled journeypersons shall not apply to CONTINUED SB 54 Page 4 either of the following: A. To the extent that the contractor has requested qualified workers from local hiring halls but is unable to obtain sufficient workers within 48 hours of the request. B. To the extent that compliance is impracticable because an emergency requires immediate action to prevent harm to public health or safety or to the environment. 12.Requires the Chief of the Division of Apprenticeship Standards to approve a curriculum of in-person classroom and laboratory instruction for approved advanced safety training for workers at high hazard facilities by January 1, 2016. 13.Makes related and conforming changes. 14.Makes related legislative findings and declarations. Comments According to the author's office, under existing law there are no requirements that employees of outside contractors working at chemical manufacturing and processing facilities, including refineries, have a minimum level of skills training, including safety training. This poses a risk to public health and safety as unskilled and untrained workers may be unfamiliar with the construction work associated with such facilities, general facility operations and emergency plans. Therefore, the author's office states that ensuring that outside contractors that work at chemical refineries have properly trained workers through approved apprenticeship programs will reduce public health and safety risks. The author's office states that outside contractors at these facilities should be using a qualified workforce, not unskilled, low-wage workers hired off the street or brought in from other states to save money. The bill defines a skilled and trained workforce to mean a workforce consisting of qualified journeypersons and apprentices registered in state-approved apprenticeship programs. Qualified CONTINUED SB 54 Page 5 journeypersons must be graduates of an apprenticeship program or have at least the same amount of experience as would be required to graduate from an apprenticeship program. They also must have completed at least 20 hours of advanced safety training in a curriculum approved by the Chief of the Division of Apprenticeship Standards. Contractors and subcontractors must pay their journeypersons at least the prevailing wage for the craft to ensure that there is no economic incentive to use less qualified workers for these high-hazard jobs. Beginning on January 1, 2014, at least 30% of a contractor's journeyperson workforce must consist of graduates of a state-approved apprenticeship program. That figure rises to 45% on January 1, 2015, and to 60% on January 1, 2016. The United Steelworkers opposes this measure, arguing that it jeopardizes the safety of the environment, communities, workers and families, and displaces 5,000 to 10,000 of their members. Similarly, the Western States Petroleum Association states that this bill may result in decreased safety, delayed maintenance, and extended shutdowns, adversely impacting local communities and the state's transportation and fuel supplies. Other opponents, including the California Chamber of Commerce, argue that the bill imposes a significant burden on private companies by requiring them to pay "prevailing wages" despite the fact that the project may not involve the use of public funds. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes According to the Assembly Appropriations Committee, this bill will result in annual, special fund costs, between $900,000 and $1.6 million, to the Department of Industrial Relations (DIR) to adequately enforce this measure. These costs are associated with additional training and staff. SUPPORT : (Verified 9/9/13) State Building and Trades Council (source) California Medical Association California Professional Firefighters California State Council of Laborers California State Pipe Trades Council California California Teamsters Public Affairs Council Construction Employees Association CONTINUED SB 54 Page 6 Environmental Labor Coalition of Contra Costa County International Association of Heat and Frost Insulators, Local 5 International Brotherhood of Boilermakers Legislative Conference of Plumbing, Heating, and Piping Industry National Electrical Contractors Association State Association of Electrical Workers State Building and Construction Trades Council (Sponsor) Western Steel Council OPPOSITION : (Verified 9/9/13) Asian Pacific Environmental Network Air Conditioning Trade Association Associated Builders and Contractors of California California Manufacturers and Technology Association Communities for a Better Environment Plumbing-Heating-Cooling Contractors United Steelworkers Western Electrical Contractors Association Western States Petroleum Association ASSEMBLY FLOOR : 51-24, 09/09/13 AYES: Alejo, Ammiano, Atkins, Bloom, Bocanegra, Bonilla, Bonta, Bradford, Buchanan, Ian Calderon, Campos, Chau, Chesbro, Cooley, Daly, Dickinson, Eggman, Fong, Fox, Frazier, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gray, Roger Hernández, Holden, Jones-Sawyer, Levine, Lowenthal, Medina, Mitchell, Mullin, Muratsuchi, Nazarian, Pan, Perea, V. Manuel Pérez, Quirk, Quirk-Silva, Rendon, Salas, Skinner, Stone, Ting, Weber, Wieckowski, Williams, Yamada, John A. Pérez NOES: Achadjian, Allen, Bigelow, Chávez, Conway, Dahle, Donnelly, Beth Gaines, Gorell, Grove, Hagman, Harkey, Jones, Linder, Logue, Maienschein, Mansoor, Melendez, Morrell, Olsen, Patterson, Wagner, Waldron, Wilk NO VOTE RECORDED: Brown, Hall, Nestande, Vacancy, Vacancy PQ:d 9/9/13 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END **** CONTINUED SB 54 Page 7 CONTINUED