BILL ANALYSIS Ó
AB 514
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ASSEMBLY THIRD READING
AB 514 (Roger Hernández)
As Amended April 27, 2011
Majority vote
LABOR & EMPLOYMENT 5-1 APPROPRIATIONS 12-5
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|Ayes:|Swanson, Alejo, Allen, |Ayes:|Fuentes, Blumenfield, |
| |Furutani, Yamada | |Bradford, Charles |
| | | |Calderon, Campos, Davis, |
| | | |Gatto, Hall, Hill, Lara, |
| | | |Mitchell, Solorio |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Morrell |Nays:|Harkey, Donnelly, |
| | | |Nielsen, Smyth, Wagner |
| | | | |
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SUMMARY : Clarifies the definition of "hauling of refuse" for
purposes of prevailing wage law. Specifically, this bill :
1)Provides that "hauling of refuse" includes the hauling of
materials other than bona fide commodities sold at fair market
value from a public works site.
2)Specifies that a "bona fide commodity" is a commodity for
which there exists a publicly-traded commodity market, such as
copper, steel or aluminum.
EXISTING LAW :
1) Requires the prevailing wage rate to be paid to all workers
on "public works" projects over $1,000.
2) Defines "public work" to include, among other things,
construction, alteration, demolition, installation or repair
work done under contract and paid for in whole or in part out
of public funds.
3) Defines "public works" to include the hauling of refuse from
a public works site to an outside disposal location, with
respect to contracts involving any state agency or any
political subdivision of the state.
AB 514
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FISCAL EFFECT : According to the Assembly Appropriations
Committee, minor, absorbable costs to the Department of
Industrial Relations.
COMMENTS : As discussed above, existing law defines '"public
works" as "Ýc]onstruction, alteration, demolition, installation,
or repair work done under contract and paid for in whole or in
part out of public funds . . . ." (Labor Code Section 1720).
Under Labor Code Section 1720.3, "public works also means the
hauling of refuse from a public works site to an outside
disposal-location, with respect to contracts involving any state
agency?or any political subdivision of the state."
This bill is jointly sponsored by the California State Building
and Construction Trades Council and the California Teamsters
Public Affairs Council. They state that current law guarantees
workers employed at public works sites are subject to a
prevailing wage for transporting refuse from the work site to an
offsite location. Although the statutory provision exists, the
sponsors contend that many workers do not receive the wages they
are due as a result of loopholes that circumvent this mandate.
They contend that some unscrupulous employers have rendered this
provision meaningless by selling refuse hauled from public works
sites for a nominal fee (an entire load for $1 for example) and
then refusing to pay the prevailing wage. Their rationale is
that since the material hauled away had "some value" it was no
longer refuse. Therefore, this bill would ensure that only bona
fide commodities sold at fair market value would be deemed not
to constitute "refuse."
Opponents contend that this bill would expand the prevailing
wage requirement for public contracts related to the hauling of
municipal solid waste. They argue that this bill could
substantially increase the cost of services provided to schools
and other public facilities that have not been factored into
contractual agreements and would increase the costs of services
to public agencies.
Analysis Prepared by : Ben Ebbink / L. & E. / (916) 319-2091
AB 514
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FN: 0000690