Sweeping Victories for Building Trades; Court Upholds SB 7, SB 922, SB 829

September 3, 2014 - The State Building and Construction Trades Council of California (SBCTC), and the 400,000 skilled construction workers it represents, earned a series of truly landmark legal victories in the last two weeks, when San Diego County Superior Court Judge Joel Wohlfeil issued a ruling upholding the validity of all of our most important recent legislative accomplishments.

As we have reported, the court rejected the challenge of six charter cities – Carlsbad, El Cajon, El Centro, Fresno, Oceanside, and Vista – to Senate Bill 7’s requirement, enacted in 2013, that charter cities pay the prevailing wage on local public works projects as a condition of receiving funding for construction from the State of California. In the same ruling, the court also upheld the validity of Senate Bill 922 (2011) and Senate Bill 829 (2012), which provide that local governments are not eligible for discretionary state construction funds if they have ordinances that prohibit entering Project Labor Agreements (PLAs). These Public Contract Code sections were enacted following the Legislature’s findings that PLAs “can provide significant benefits to taxpayers by insulating construction projects against uncertainties, promoting transparent competition, and ensuring a reliable supply of labor,” and that “taxpayers’ interests are best served” if local governments “are free to choose whether to adopt or not to adopt project labor agreements containing … taxpayer protection provisions.” The Superior Court concluded that – like SB 7, SB 922 and SB 829 simply provide a financial incentive to charter cities and, therefore, do not interfere with local home rule authority.

Together, these decisions validate our successful efforts of the past three years to ensure that all local governments remain free to enter into PLAs, and that charter cities have no financial incentive to try to circumvent prevailing wage. 

“Pursuing state policy objectives through financial incentives is generally constitutional,” Judge Wohlfeil ruled. The judge prominently referenced SBCTC’s argument citing other state programs – such as highway funding, peace officer training funds, and community development block grants – that require recipients to comply with specific conditions. He further cited SBCTC’s argument that likens the law to federal policies in which Congress requires states to meet certain requirements as a condition of receiving federal funds. In sum, SB 7 legitimately influences local government by attaching conditions on the receipt of discretionary state funding, and is not coercive, the Judge concluded.

SBCTC President Robbie Hunter commented: “A highly skilled, streamlined workforce, with decent wages, apprenticeship training, and well-built public works projects benefit all Californians. It is wise policy to direct discretionary state funding to the majority of charter cities that take the high road in their construction policies, pay workers the wage that prevails in the area that the projects are constructed, and get the highest quality of public works projects that will serve the California public for decades and beyond, as this state has done since the Golden Gate Bridge and Shasta Dam.”

The Court issued its tentative ruling on August 28, then heard attorneys for both sides argue its merits, then confirmed its ruling earlier this week, restating its conclusion that our opponents’ arguments “are simply not pertinent because of the finding that a conflict does not exist as between the state law and local ordinances.”

Following is a link to the court’s final order, followed by a link to its earlier tentative ruling explaining why SB 7, SB 922 and SB 829 are all valid laws.

http://www.smartcitiesprevail.org/wp-content/uploads/2014/09/SB7FinalRuling.pdf

http://www.smartcitiesprevail.org/wp-content/uploads/2014/08/El-Centro-TR-2014.08.27pdf.pdf

 

 

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