LCA contractors fined $2.9M over Detroit hires (MI)

Louis Aguilar, The Detroit News
Published 11:38 p.m. ET Aug. 23, 2017
Updated 8:29 a.m. ET Aug. 24, 2017

Dozens of the contractors building Little Caesars Arena have been fined a total of $2.9 million as of March for frequently not hiring at least 51 percent of Detroiters at the ongoing construction site, according to the latest data collected by the city.

And that total is expected to be even higher during the push to complete construction of the $862.9 million sports and entertainment complex by early September, based on the monthly data compiled by the city agency monitoring the workforce agreements on construction sites, said Portia Roberson, director of the city’s Office of Human Rights.

An average of 27 percent of total hours worked at the arena site were performed by Detroit residents from April 2015 to March 2017, the latest monthly data available. It’s been two years, August 2015, since at least 51 percent of hours worked at the site was done by Detroit residents, data shows. The percentage of hours worked is the measure the city uses to determine how many residents the individual contractors have working at the site.

In March alone, the city cited 53 of the contractors with fines ranging from $137,613 to a unit of Motor City Electric to 26 cents to John Papalas & Co. Motor City Electric is a large electrical contractor and the Papalas firm specializes in industrial painting and sheeting services. The other 32 contracting units on site were not fined, according to city records. Several large contractors, it should be noted, have multiple units working at the site.

Currently, crews are working three shifts each week day and Saturdays, with more than 1,100 workers on the site on weekdays, said a spokesman for Olympia Development of Michigan, the firm overseeing the construction.

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McHenry County Board approves prevailing wage, ending three years of protest votes

June 26, 2017

WOODSTOCK – The McHenry County Board approved the state prevailing wage rates, ending a three-year streak of casting a symbolic protest vote against them.

Board members voted, 19-3, to adopt the wage schedule, which requires local governments to pay workers hired for public construction projects a specific wage set by the Illinois Department of Labor.

Audience members, many of whom were union members and local residents who came to encourage a vote to approve, applauded when the final vote was tallied.

The County Board since 2014 had voted against prevailing wage, while being careful to instruct county staff to follow the law.

Board member Donna Kurtz, R-Crystal Lake, said voting against prevailing wage sends a negative message to the community, and disputed the notion that the wages are responsible for the county’s sky-high property taxes.

“I think in the end, the overall benefits well outweigh the negatives that some may perceive regarding prevailing wage. It’s the right thing to do – we know it’s the law. It’s the right thing to do,” Kurtz said.

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Prevailing wage repeal: Hurting blue-collar wages or saving tax dollars?

Apr 25, 2017

Critics of a proposal to fully repeal the state’s prevailing wage laws decried it Monday as an assault on the wages of blue-collar workers, while proponents framed the move as frugal stewardship of public funds.

A state Senate panel gave the proposal its first legislative hearing Monday.

If enacted, it would mark another crushing defeat for Wisconsin labor unions. They, along with legislative Democrats, are among the staunchest backers of a prevailing wage, a minimum wage requirement for workers on public construction projects.

The bill would eliminate all state-imposed prevailing wage requirements for projects funded by the state. That includes state office buildings, University of Wisconsin System buildings and state highway projects.

Two who testified against the bill were Leroy Miller, a heavy equipment operator from New Berlin, and Luke Burnaman, a crane operator from Portage. Both are union members and U.S. military veterans.

Both men said they’re concerned about how prevailing wage repeal could affect veterans, who they and others who spoke Monday said are disproportionately represented in the building trades.

Burnaman said he and his family moved to Wisconsin from his native Louisiana last year, lured by the prospect of higher wages and better schools for his children.

He questioned why senators would mull prevailing wage changes after recently having increased their own expense reimbursements. State Senate leaders earlier this year approved a 31 percent increase in their daily per diem amount – up to $115 per day, compared to $88 per day last year, the Appleton Post-Crescent reported.

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What good is affordable housing if the people who build aren’t paid decently?

July 27, 2016
Kevin Duncan, Pueblo, Colo.
The writer is a professor of economics at Colorado State University-Pueblo.

To the editor: Like climate change, construction prevailing wage standards have been studied and an academic consensus exists, but myths persist. (“Affordable housing at an impasse,” editorial, July 22)

Peer-reviewed economists have found that prevailing wages produce more local, middle-class job opportunities and less spending on fuels, materials and public assistance for blue-collar construction workers. They do not significantly raise total development budgets.

In California, labor makes up just 20% of total construction project costs. Any savings from exploitative working conditions are offset by lower productivity on the job site.

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Prevailing Wage States Have Fewer Job Separations in Construction

Feb 29
Posted by Frank Manzo IV

Labor economists have explained that lower job turnover is one of the reasons why raising the minimum wage has very little impact on employment, contrary to classical economic theory. … They found that separations, new hires, and turnover rates declined significantly after a minimum wage hike.

Prevailing wage is essentially a minimum wage for public construction. Prevailing wages reflect local labor standards and require that contractors pay workers at least the rate established in the private marketplace through competitive practices. …

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