Homebuilders spending millions to defeat bill that would make sure workers don't get cheated

Aug. 29, 2017 - Some of California’s biggest home builders are spending millions to kill a bill that would hold them accountable if their subcontractors cheat workers out of their pay.

More than 50 of the major contractors and others have spent an estimated $3.6 million to defeat AB 1701. Their contributions have gone to a front group, the Coalition for Affordable, Reliable and Equitable Housing, that is waging the lobbying campaign to keep the unpaid workers from being able to go after the general contractors who employ these unscrupulous subcontractors.

Cheating workers is a hallmark of the underground economy that permeates the homebuilding business. According to a 2014 study by the Economic Roundtable, about 144,000 construction workers employed in the underground economy that year got cheated out of an estimated $1.2 billion in pay.

AB 1701 cracks down on this set-up, but it’s fair, too – general contractors would  get 30 days to make things right for their workers before any legal action could be taken against the employers.

“If you look at the people and the companies and the associations that are opposing this bill, they are the same people that oppose any effort to raise the minimum wage,” said Robbie Hunter, president of the State Building and Construction Trades Council, which represents more than 400,000 workers.

“They are some of the biggest players in the underground economy. They use subcontractors as a buffer between them and the criminal activity of the underground economy where workers comp isn’t paid, where Social Security and federal and state taxes aren’t paid. Those guys want companies that we can never compete with to be the norm, not the exception. This bill tamps down on the underground economy and the people who cheat workers. It takes away added profit for the people of the associations and the companies that are putting in millions of dollars against this bill.”

As for the big-money lobbying campaign, Hunter said, “They’re doing it because their preference is to have a contractor that doesn’t obey state law. They care nothing if the contractors are fully well aware in many cases that their subcontractors stiff workers and move on, close their doors, and move on, and open up again. They just don’t care. They’re abusing workers who don’t have documentation. They are abusing workers from out of state. They’re abusing workers from California that are desperate and can only find a job in this market. They are feeding the underground economy for their profits.

“It’s all done at the cost of the decent contractor that obeys the law,” Hunter said. “This market is growing, and the fair and decent contractor is getting driven out of business, because of this, and it’s all short term profit padding by these contractors.”

Here’s a partial list of contractors and others who have contributed to the lobbying campaign, according to the California Secretary of State’s web site:

B.L. Road Inc., $20,000
Brandywine Homes, $10,000
Bright Development, $10,000
Brookfield L.A. Builders, $114,376.07
Cabinets 2000, $10,000
CalAtlantic Group, $283,173.01
Caliber Interiors, $5,000
Canon Station Inc., $10,000
Cornerstone Communities Corp., $25,000
D. Horton Holding Co., $302,938.46
Denova Homes, $50,000
Doug Veerkamp General Engineering, $5,000
Emerald Site Services, $5,000
Family Real Property Partnership, $10,000
Fletcher Plumbing, $5,000
Foremost Communities, $10,000
Giacalone Design Services, $5,000
Greenbriar Project Owner, $100,000
Heritage Interests, $10,000
Highridge Costa Investors, $5,000
Hunsacker and Associates, $11,000
Jackson, Tidus Law, $10,000
John Mourier Construction, $50,000
KB Home, $366,847
KTGY Group, $7,500
Lennar Homes, $561,075.24
Lewis Pacific Partners, $77,565
McKay and Samps Civil Engineers, $5,000
Kenneth Meadows, $5,000
Meritage Homes, $132,823.82
Newland Real Estate Group, $25,000
Ponderosa Homes, $15,000
Pulte Group, $165,766.24
Raymus Homes, $10,000
Santa Ana Creek Development, $5,000
Shea Homes, $185,000
Silverwood Landscape Construction, $5,000
Stonefield Home $10,000
Taylor Morrison, $137,962.84
Thorpe Design, $5,000
Toll Bros. Inc., $124,785.87
Town Development, $15,000
Tracy Hills Project Owner, $100,000
TriPoint Group, $220,845.96
UCP LLC, $100,000
William Lyon Homes, $100,000
Woodside Group, $128,738.96
WP Development, $25,000

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