City Council approves prevailing wages proposal

A proposal to require contractors on many City of San
Diego public works and maintenance projects to pay prevailing wages to
employees was approved by the City Council on Tuesday.

The proposed ordinance passed on a party-line 5-4 vote, with Democrats
David Alvarez, Myrtle Cole, Marti Emerald, Todd Gloria and Sherri Lightner in
favor.

Currently, the city sets pay for contractors working on water and sewer
projects valued at more than $10 million or large city projects that are
partially funded with state or federal dollars.

The ordinance would govern public works and maintenance projects valued
over $25,000, in conformance with state labor law. It will take effect on Jan.
1 if it passes a second reading, according to Lightner.

Supporters of the proposal say the pay boost will help workers
economically in a city with a high cost of living while ensuring construction
quality, without dramatic increases in overall project costs.

“There is no more powerful or important strategy for developing the
economy of the San Diego region than to lift the wages of the people in our
primary industries,” said Richard Barrera, the CEO of the San Diego and
Imperial Counties Labor Council and a member of the San Diego Unified School
District Board of Education. “And, of course, construction is one of our key
industries.”

However, Felipe Monroig, the executive director of the San Diego County
Taxpayers Association, said costs on major city projects will rise.

“So when you go back to your constituents and talk about streets that
need repair, buildings that need to be fixed, including libraries and `rec'
centers, be prepared to explain to them why you're willing to accept an
additional charge and maybe reduce the number of projects that are able to be
completed as a result of this ordinance.”

Councilman David Alvarez noted competing data from the mayor's office,
which brought the ordinance to the council, and the city's independent budget
analyst and said he didn't know whether higher wages would raise project costs
or not.

“I think it's the right thing to do,” Alvarez said. “A lot of other
places have done it, and the world hasn't fallen apart. And it won't fall apart
here.”

Nelson Hernandez, the city's assistant chief operating officer, said in
a memo that the benefits of requiring prevailing wages include improving local
construction careers, ensuring that contractors compete on an even playing
field and building projects with a skilled labor force.

Prevailing wages are determined by collective bargaining between unions
and employers, he said, adding that the state Department of Industrial
Relations does an annual survey of pay rates.

The city's Independent Budget Analyst estimated in a report that total
project costs would rise 5-10 percent but said the mayor's office provided
little data that it could study.

As a charter city, San Diego is not required to specify prevailing wages
on municipal construction contracts. A bill being considered in the
Legislature, however, would end the exemption for charter cities.

Lawyers for the city have expressed the opinion that the state bill, if
passed, would ultimately be found unconstitutional.