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Prevailing Wage Law Added in Anne Arundel County, Maryland

Posted by National Alliance for Fair Contracting on

July 1, 2022

Prevailing Wage Law

Beginning with contracts executed on July 1, 2022, the Prevailing Wage and Local Hiring Law applies and is patterned after the Federal Davis-Bacon and State of Maryland’s prevailing wage laws. See Anne Arundel County Bill 72-21. It requires the prevailing wage be paid to workers on County-financed construction contracts as required by Anne Arundel County’s Laws; and also adds local hiring requirements as applicable. The prevailing wage rate is the rate paid for comparable work in the private sector within the County. The County’s Wage Determinations are subject to the State of Maryland Wage Determination rates for Anne Arundel County for Highway Construction and/or Building Construction. Job classifications not listed, Vendors will be required to request a rate determination with the Request for Additional Wage Rates from the Maryland Division of Labor and Industry. In the event of a conflict between the County prevailing wage and local hiring statutes, the statute shall control.

It is the responsibility of each contractor and bidder submitting a quote or solicitation to Anne Arundel County to read, certify and attest to the County that they have read and agree to be bound by the prevailing wage and local hiring requirements of the County, including these guidelines, and agree to be bound to them. An affidavit must be provided attesting to the same in such form and substance as required by the County upon demand as an incorporated requirement to any contract or agreement.

In the event the state or federal prevailing wage law applies, the requirements of Maryland state law or federal law shall apply, provided however that local hiring requirements may still also concurrently apply. If the state prevailing wage applies, additional requirements as set forth in COMAR and state statute will be applicable including, but not limited to, notices to independent contractor and withholding of last payments for contracts until a certification and attestation is received by the County evidencing that all employees and contractors have been paid in accordance with state prevailing wage requirements.

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Anaheim considers ‘local hire’ agreement for about $260 million in projects (CA)

Posted by National Alliance for Fair Contracting on

By ALICIA ROBINSON
PUBLISHED: December 2, 2019

A proposed new agreement would push contractors who bid on city projects in Anaheim to hire more veterans, formerly homeless people and residents of the city or Orange County.

Called a community workforce agreement, the five-year contract – which the Anaheim City Council will consider Tuesday, Dec. 3 – is a first for the city but not unique in the region or the state. Santa Ana, Long Beach and Sacramento all have used such agreements, according to a report to the Anaheim council; the Anaheim Union High School District also adopted one as part of a 2014 school improvement bond measure.

Anaheim has not pursued “local hire” provisions so broadly before, but it has incorporated them into a few specific projects in recent years, including a new electrical substation and the latest expansion of the Anaheim Convention Center.

It’s unknown exactly how many projects the agreement would apply to, but city spokesman Mike Lyster wrote in an email that they’ll generally be large public works or utility jobs, typically costing at least $1 million, and the total for the term of the agreement is estimated at $260 million. A list attached to the city’s proposed agreement mentions new soccer fields at La Palma Park, a fire station and emergency operations center in the Platinum Triangle, roof replacement at the convention center, and large water, sewer and road projects.

The agreement, which was negotiated with the Los Angeles/Orange Counties Building and Construction Trades Council, sets an aspirational goal – not a mandate – that at least 35% of work hours on specified projects be done by people who are: Anaheim or Orange County residents; graduates of Anaheim high schools; veterans; or economically disadvantaged people (such as the formerly homeless).

“The goal of the agreement is to ensure that major publically funded projects are helping to meet city priorities,” including providing jobs to local residents and people in need, Lyster’s email said.

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Building better communities through construction workforce development

Posted by National Alliance for Fair Contracting on

PUBLISHED – Sept. 23, 2019

A Growing Workforce Trend

More and more often, public agencies are incorporating workforce hiring requirements into their construction contracts. For those who are unfamiliar, these stipulations typically require the contractors that are awarded contracts by the agency to employ a workforce that meets certain thresholds of demographic criteria. For example, one of the more common trends that local entities push for is an increased rate of local hires.

Typically, the contracting agency sets a benchmark on a project that the contractors must meet. In this example, contractors must maintain that a certain percentage of the workers on the project must reside within the city or county in which the project takes place (alternatively, the percentage of total hours worked on the project can be used as a measure). The primary motive of the agency here would be to ensure that the residents of the community are the ones benefiting most from public funds used on this project to maximize the return on taxpayer dollars. This discourages the outsourcing of skilled labor, a not-so-uncommon tactic that some contractors might try in order to cut recruiting and hiring costs. (Remember, the use of local labor is one of the reasons the Davis-Bacon Act was created in 1931.) The benefit that the public entity realizes from these hiring requirements is compounded. Not only are stable career opportunities created for local residents, but the workers’ disposable income may contribute to the local economies and provide additional tax revenue that would have otherwise been displaced along with the transplanted workers once the project was complete.

Another commonly tracked statistical measure that is vital to the longevity of the industry’s success is that of apprentices or on-the-job trainees (OJTs). These recruits are crucial because of the industry’s dependency on new labor entering the market. As many government professionals might already be aware, one of the most common obstacles contractors face daily is obtaining and retaining a sufficient quantity of skilled labor to complete their projects on time and on budget. It has been no secret that the industry has struggled to replenish voids left by retiring workers as socio-economic pressures have increasingly influenced youth to pursue college degrees and white-collar jobs over manual labor (even despite its enticing stability and benefits). This obstacle, among a plethora of others, has kept the industry in a constant battle searching for new skilled labor to keep up with the demand for construction projects.

A New Opportunity

This struggle, however, has positioned the industry in a unique situation. In fact, many feel that this challenge has presented a potential goldmine opportunity. It has left the door open to target new sources of untapped potential in traditionally under-utilized pockets of demographics, giving industry players a chance to fill the labor deficit while also providing career opportunities to individuals who need them the most.

Some localities have taken these hiring requirements to the next level to address these under-represented communities like minorities, the economically impoverished, or other disadvantaged groups. By working together with workforce training programs and supportive services that cater to these individuals, various entities across the country have successfully made a difference in lifting up the most deserving members in their communities with stable careers.

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Sacramento latest city to mandate local hiring (CA)

Posted by National Alliance for Fair Contracting on

By Kim Slowey
Aug. 23, 2018

Dive Brief:

  • The Sacramento City Council voted Tuesday to amend its city code and adopt the contentious, according to the Sacramento Bee, Local Hire and Community Workforce Training Program, which requires contractors to use a 50% local workforce on most city-funded projects of $1 million or more.
  • The program also requires that 20% of apprentices on covered projects be “priority apprentices,” who live in economically disadvantaged areas or are veterans, prior offenders, recipients of public assistance, foster youths, homeless or women. The new ordinance also requires that 50% of the budgets for two major city projects, including the renovation of the Sacramento Convention Center, be spent with local businesses in certain counties and that 15% of those businesses be small, regional enterprises.
  • In the sample agreement included on the city council’s agenda is “Contractor(s) performing construction work on the project described in the agreement shall, in filling craft job requirements, utilize and be bound by the registration facilities and referral systems established or authorized by the local unions,” a provision which some nonunion contractors argue will hinder their participation in city work. Proponents of the agreement, however, said that nonunion contractors perform around 60% of city work and that nonunion workers can simply register with the unions so that they can be included in the local hire program.

Dive Insight:

Unlike some other local hire mandates, Sacramento’s gives contractors an out of sorts by allowing them to hire from any source if unions cannot provide them with the necessary workers within 48 hours of a request. On the other end of the spectrum was the Detroit workforce requirement for contractors performing services during construction of the Little Caesars arena. The city fined construction companies that didn’t meet the 51% local hire requirements a total of $5.2 million. The Sacramento ordinance does not include such punitive measures for failing to meet the goals.

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Many DC projects don’t comply with local hiring mandate (DC)

Posted by National Alliance for Fair Contracting on

Kim Slowey
PUBLISHED July 2, 2018

Dive Brief:

  • An April audit of Washington, D.C.’s First Source mandate, which requires local workers be given employment preference for construction projects receiving taxpayer assistance, revealed that contractors and developers are not meeting the program guidelines and that the Department of Employment Services (DOES) is doing relatively little to make sure companies are in compliance, according to The Washington Times. Companies building qualifying projects of $300,000 to $5 million must hire 51% local residents, and those in charge of projects valued at more than $5 million must meet a higher percentage in several categories.
  • Lawrence Perry, deputy auditor for the Office of the D.C. Auditor, testified before the District council’s Committee on Labor and Workforce Development on June 21 and told the committee members that the agency in charge of enforcing the First Source program was insufficiently monitoring qualifying companies to make sure they entered into a First Source agreement; lacked written policies and procedures necessary to monitor and judge the success of First Source and did not have written guidelines for enforcement and imposition of fines, with only one financial penalty being issued in the history of the program. The auditor’s report also called attention to the fact that companies are allowed to self-report project data with little or no verification by the DOES.
  • Construction industry groups have said the program paperwork is too burdensome. They also said there is a shortage of skilled workers and that the lack of affordable housing is forcing the First Source-qualified employees that once lived in the District to the suburbs, shrinking the pool of craft workers even more. One council member said developers and contractors consider the possibility of a low fine just another cost of doing business.

Dive Insight:

Other local governments have no problem enforcing local hiring mandates and levying large fines against contractors that miss the mark.

Detroit fined contractors working on the $868 million Little Caesars Arena, now home to the NHL’s Red Wings hockey team and the NBA’s Detroit Pistons, a total of $5.2 million for not meeting the city’s 51% local-hire goals. The Michigan city said that, of the project’s three million man-hours, Detroit residents worked only 25%.

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Proposed Detroit ordinance could mandate 51% local hires for all city construction work (MI)

Posted by National Alliance for Fair Contracting on

By Kim Slowey
Sept. 20, 2018

Dive Brief:

  • At a Sept. 17 press conference, Detroit City Council President Pro Tem Mary Sheffield proposed a measure that would require all city-funded demolition and construction work to be performed by at least 51% city residents, the Detroit Free Press reported. The ordinance will be presented to the city council during the next few months as part of a package of “People’s Bills” aimed at helping Detroiters.
  • Sheffield told the Free Press that the push behind the construction-related measure was the revelation that local residents were not well represented in the city’s Land Bank demolition program, which funds the razing of blighted homes in Detroit. Of the $70 million spent on the initiative so far, more than 50% of the contracts have gone to suburban Detroit companies, 26% to minority firms and only 16% to African American-owned companies.
  • Detroit Mayor Mike Duggan instituted a similar program in 2014, but Sheffield’s proposal differs in that it would lower the current threshold of $3 million – at which hiring requirements kick in – to a lower, undetermined amount; include demolition projects; and impose expensive fines on companies that do not comply. The fines would go into a workforce training fund, though Sheffield maintains there are plenty of qualified Detroiters that simply have not been given work opportunities. Sheffield said her ordinance would pursue more rigorous enforcement and collection of fines, but Duggan’s office said they have been conscientious about going after violators.

Dive Insight:

Sheffield’s plan is similar to those instituted in other areas of the country, but at 51%, it’s higher than what is outlined in most other regulations, and many agencies forego fines and rely on contractors making their best efforts to comply.

The City of Sacramento is one of the latest municipalities to enact a local hiring law, the Local Hire and Community Workforce Training Program. The regulation, passed last month, requires that contractors use local workers when performing city-funded work valued at $1 million or more. The ordinance also requires that 20% of apprentices either live in an economically disadvantaged area or be a member of a special class – homeless, a woman, former offender, foster youth or recipient of public assistance.

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Local Impact of Prevailing Wage (MN)

Posted by National Alliance for Fair Contracting on

September 06, 2018 10:41 PM
(ABC 6 News)

When a construction worker goes to work on a project with a private contractor, the contractor decides what workers will be paid. However, when they work on a government-funded project, workers must be paid “prevailing wages.”

President of South Eastern Minnesota Building and Construction Trades Council Nate O’Reilly says for every construction project funded by the state, workers must be paid a minimum base rate called “prevailing wage.”

“When public dollars are being spent…it creates that level playing field to ensure the public expenditures reflect the local area standards for wages and benefits,” said Nate.

In the private construction industry, the lowest bidding contractor almost always gets the construction job. Executive Director of the Fair Contracting Foundation Mike Wilde says prevailing wage is intended to protect local workers and ensure they get paid fairly. This prevents the job from going automatically to whoever can do it the cheapest, which Mike says is often workers from out of the area.

…

“You want people that live in the area, perhaps reside in the housing, and support the economy. You want them to be your workforce, as opposed to people who might come in and do unskilled, unsafe, and insufficient work and perhaps take the wages out,” said Mike.

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Council approves rules to encourage local labor on city construction projects (IL)

Posted by National Alliance for Fair Contracting on

By Crystal Thomas – Staff Writer
Posted Sep 5, 2018 at 12:01 AM

Springfield City Council members unanimously voted Tuesday to strengthen an ordinance that encourages contractors to have city residents work on at least half of the hours needed for city construction projects worth more than $100,000.

With the changes, contractors who don’t make any effort to hire locally can be barred from bidding on city construction projects for up to three years, and those that do use a crew made up of more than 50 percent local workers will be awarded.

The changes were made to a local labor ordinance passed in 2016. It fined contractors who failed to utilize enough Springfield workers on city construction jobs. If a contractor used no local labor, it could be fined up to 2.5 percent of the total bid – a $25,000 penalty on a $1 million construction contract.

Now, contractors can be rewarded using the same formula. If all Springfield labor is used on a construction job, the company would receive an additional 2.5 percent of the total bid.

Ward 3 Ald. Doris Turner called the amended ordinance the “carrot and stick approach” to hiring local.

Turner and Ward 1 Ald. Chuck Redpath met with city officials last week to hammer out the changes council members wanted to see after Langfelder proposed his changes more than a month ago.

Turner said she saw the ordinance as way to promote work and careers for local residents. It establishes that a contractor would need to be affiliated with an apprenticeship program and use more minority workers.

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Columbus, OH, tests plan to increase apprenticeships, local hires

Posted by National Alliance for Fair Contracting on

By Kim Slowey
Nov. 2, 2017

Dive Brief:

  • The city of Columbus, OH, is testing a new construction apprenticeship and local hiring plan for public projects that it hopes will boost the local construction workforce, according to The Columbus Dispatch.
  • The agreement between the city and the Columbus Building & Construction Trades Council, AFL-CIO, requires the organization to host apprenticeship fairs, use 20% Columbus and 25% regional residents on the project, and collect five cents for every hour each member works to help fund an apprentice scholarship fund. City officials said non-union contractors will also be able to bid the project.
  • The first project to operate under the program is the construction of an $8 million firehouse. The local chapter of the Associated General Contractors of America expressed concern that the new workforce requirements would make it more difficult for contractors to bid on projects competitively.

Dive Insight:

It’s not uncommon for state and local governments to specify hiring requirements for publicly funded projects. Local activists often see it as a way to get a return on invested taxpayer money. However, while the goal of using as many locals as possible is not one with which many would disagree, the details of these initiatives are up for debate.

First, in some markets, contractors have difficulty finding enough workers to meet local mandates. For example, contractors working on the new Little Caesars Arena in Detroit were fined almost $3 million through March of this year for failing to meet the local hiring requirements laid out by the city. By all accounts, the contractors did their best to recruit local workers, but the skilled talent pool was just too thin.

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Trump Administration Drops Local Hire Program That Would Have Employed Hundreds of Thousands of Americans

Posted by National Alliance for Fair Contracting on

SOURCE: JOBS TO MOVE AMERICA
AUG 25, 2017

The U.S. Department of Transportation announced, that effective on August 25, it will no longer support local hire programs in cities that receive federal grants.

The DOT announced this week that it is withdrawing a proposed revision of a rule that – since 1988 – has prohibited the use of geographic preferences in the expenditure of federal grant funds. This change will go into effect on August 25.

The proposed rule and accompanying local hire pilot program, originally drafted by the Obama administration in 2015, has allowed cities receiving federal grant funds to apply local hire policies to federally funded construction projects, so long as that language did not violate federal law. With this week’s announcement, the Trump DOT is officially signalling that it will no longer pursue that rule change.

Madeline Janis, executive director of Jobs to Move America, said: “This administration’s withdrawal of support for local job creation directly contradicts President Trump’s stated commitment to creating good jobs for people in this country. Many Americans continue to suffer from poverty and inequality and desperately need the opportunities that are created by our federal infrastructure and transportation investments. Why not give local communities the opportunity to benefit from taxpayer investment?”

“Local hire has allowed municipalities to use their own money to help employ people directly from their communities. It has been strategic for our elected leaders to say that they’re not going to raise our tax dollars for investments in capital projects without ensuring that persons facing significant barriers to employment get expanded access to good jobs and training opportunities,” said Erik Miller, executive director of Playa Vista Job Opportunities and Business Services.

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