Members of the Vermont House want to boost the wages of laborers working on many state-funded projects. But leaders in the Senate are worried about how the proposal would impact local construction firms. And supporters of the legislation are running out of time.
The bill could pump as much as $3 million into the wallets of construction workers, according to an analysis conducted by the legislative analysts. It would do so by requiring firms who bid on some state-funded capital projects to pay prevailing wages as determined by the federal government.
The bill sailed through the House last week on a party-line vote. Wardsboro Rep. John Moran, the Democratic vice-chairman of the House Committee on General, Housing and Military Affairs, said the measure will prevent contractors who pay good wages and benefits from being undercut by contractors who don’t.
“It is our hope to create a level bidding field on capital bill construction projects in Vermont, and to lead by example to put more money into the hands of hardworking Vermonters and into our economy,” Moran said during a floor debate.
The bill has the support of the Shumlin administration, which says unionized shops are having an especially difficult time competing with the bids of their non-union counterparts.
“So it really levels the playing field for responsible contractors and it levels the playing field for contractors who also engage with a union workforce,” says Annie Noonan, commissioner of the Vermont Department of Labor.
The measure isn’t without financial consequence. Additional money going into wages could force the state to reduce the number of projects funded by its annual $85 million capital bill, and exacerbate the long backlog of state and municipal projects in line for money. But Noonan says that the tradeoff is nonetheless a good one for taxpayers.
“When you look at economists who have examined prevailing wage issues into a local economy, they basically say the money that you’re paying out comes right back into the local economy, through the workers’ paychecks,” Noonan says.
Cathy Lamberton represents both the Associated General Contractors of Vermont and the Vermont Independent Electrical Contractors Association. She says that in a state where less than 2 percent of the construction workforce is unionized, it’s bad policy to pass legislation geared at that population.
Lamberton says the legislation will benefit out-of-state construction firms whose lower operating costs allow them to meet the federal prevailing wage and undercut the bids of Vermont-based contractors.
“So just because you try to level the playing field on who pays what for every individual doesn’t mean you’re leveling the playing field for Vermonters,” Lamberton says.
The House bill failed to meet a mid-session deadline known as crossover. And that means the bill will need a special vote from the Senate Committee on Rules to have a chance at passage this year. Rutland Sen. Kevin Mullin is the Republican chairman of the Senate Committee on Economic Development. And the rules committee will wait for his blessing before it allows the prevailing wage legislation to continue. But while Senate Majority Leader Philip Baruth says he’s hopeful the bill will at least get a hearing, Mullin at this point sounds more inclined to let it die.
“My feeling is we had a crossover deadline and I don’t want anything in committee that didn’t meet the crossover date,” Mullin said Wednesday.
The bill would apply to only state projects funded by the capital bill and administered by the Department of Buildings and General Services. Currently, contractors bidding on those projects are required to pay their workers the state prevailing wage, if the contract is over $100,000. The legislation would make the wage floor the federal prevailing wage, a figure determined by a formula set out in the Davis-Bacon Act.
Lamberton says the state prevailing wage is a far better indicator of what construction workers in Vermont are making. She says construction firms are still on the mend from a recession that saw the industry lose 25 percent of its jobs between 2006 and 2010.
The legislation has the support of unionized contractor shops around the state. The Senate rules committee will meet again Thursday to consider the fate of the bill.
