Chowdhury: Repeal of prevailing wage would hurt Wisconsin economy

Abdur Chowdhury
10:17 a.m. CT June 6, 2017

Out-of-state companies received $32 million in contracts for municipal projects in Wisconsin between January and April of this year, up from about $21 million during the same period in 2016. That represents a 53% increase.

Contracts that should be going to Wisconsin companies are now being given away to out-of-state companies from Florida, Kentucky and Missouri. The difference? No prevailing wage protection on municipal projects.

In 2015, the Wisconsin Legislature voted to end prevailing wage in local projects – a provision that took effect this January. Republicans in the Legislature are now considering a full repeal of the state’s prevailing wage law.

This law requires that construction workers on state construction projects be paid the wages and benefits prevailing for similar work in or near the locality in which the construction project is to be performed. The concept arises from the concern that unbridled competition among employers to pay low wages in low-bid public construction environment would lead to a less-skilled and less-productive workforce and to shoddy construction practices and unsafe public buildings and infrastructure.

While the Legislature was debating this issue in 2015, many of us had expressed concern that eliminating the law would cut wages and invite so-called “gypsy contractors” from out of state to bid on Wisconsin projects. Research conducted by Frank Manzo and his co-authors indicated that the amount of construction work that would be leaked to neighboring states would cost Wisconsin 6,700 jobs and $40 million in tax revenue, and reduce economic activity in the state by $1.1 billion. For every dollar of construction value that is completed by an out-of-state contractor, economic activity would decrease by $2.26 in Wisconsin.

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Video: Indiana GOP Leader Admits Repealing Prevailing Wage ‘Hasn’t Saved a Penny’

With Senate Committee Set to Vote on Repeal Bill, April 24 Video Debunks Prevailing Wage Supporters’ Claims about Savings
PRESS RELEASE · MAY 2, 2017
MEDIA CONTACT | MIKE BROWNE
DEPUTY DIRECTOR

MADISON, Wis. – With the Republican-controlled Senate Labor Regulatory Reform Committee poised Wednesday morning to vote for a misguided repeal of prevailing wage laws for public works projects, video has surfaced from a forum April 24 in Milwaukee where Republican Indiana House Assistant Majority Leader Ed Soliday angrily reveals that similar legislation passed in Indiana which went into effect in 2015 “hasn’t saved a penny.”

“We got rid of prevailing wage and so far it hasn’t saved a penny,” Soliday says during the question and answer session last week hosted by the Wisconsin Transportation Development Association in Milwaukee. “Probably the people most upset with us repealing [prevailing] wage were the locals. Because the locals, quite frankly, like to pay local contractors and they like local contractors to go to the dentist in their own town.”

One comprehensive analysis showed repealing Wisconsin’s prevailing wage laws will result in a projected $500 million in construction value being completed by out-of-state contractors on an annual basis and a yearly total of over $1.2 billion being lost due to reduced economic activity. A second analysis revealed 885 public construction jobs left Indiana after repeal of prevailing wage and 770 jobs popped up across the border in Kentucky.

One Wisconsin Now Executive Director Scot Ross said he “wasn’t surprised the Wisconsin Republicans are using lies and deception to level yet another attack on Wisconsin workers.” Ross said the list of Republican co-authors on the bill was “a who’s who of Wisconsin’s anti-worker extremists.”

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(See a Copy of Video Here)

Rep. Pocan: Repealing Wisconsin’s Prevailing Wage Laws Will Take Money Out of People’s Pockets

State Senate proposal will do little to improve Wisconsin roads and could undercut wages throughout the state

Apr 25, 2017 – Press Release

MADISON – U.S. Rep. Mark Pocan (WI-02) released the following statement after the Wisconsin state senate heard arguments on a bill to repeal the state’s prevailing wage laws.

“Once again, Governor Scott Walker and Wisconsin Republicans are putting corporate cash and the 1% ahead of working families. This bill to eliminate prevailing wage requirements for public projects will literally take money out of people’s pockets and could allow companies to bring low-wage workers from out of state, undercutting wages throughout our state.

“We also know this legislation will do little to improve Wisconsin’s roads, which are ranked as one of the worst in the country. I hope my former colleagues in the Wisconsin legislature see this for what it is, another boost for big business that winds up costing working Wisconsin families, and reject it.”

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

MARK SOMMERHAUSER
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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Total netted from state’s misclassification fight exceeds $1.1 million

By: Dan Shaw, dan.shaw@dailyreporter.com
March 15, 2017 4:54 pm

State officials’ efforts to crack down on companies that misclassify direct employees as independent contractors has generated more than $1 million for the state’s unemployment-benefits system over the past few years.

The state began stepping up its enforcement of misclassification laws several years ago. Since then, those efforts have recovered nearly $1.13 million worth of in unpaid unemployment-insurance taxes, penalties and interest, according to a report on the state’s unemployment fund released by the Wisconsin Department of Workforce Development on Wednesday.

Worker misclassification is believed to be particularly rampant in the construction industry, where frequent seasonal layoffs can blur the line between a permanent employee and someone hired for a particular job. Industry officials say deliberate misclassification not only deprives the state of unemployment taxes and other resources; it also gives dishonest companies an advantage by enabling them to avoid the sort of costs that their more scrupulous rivals often end up rolling into bid prices.

The state reported Wednesday that auditors found 8,613 misclassified workers at Wisconsin companies last year. The same year saw tipsters use a state-run website to report 59 instances of suspected misclassification.

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Time to be honest about prevailing wages

Robb Kahl
January 27, 2017 1:08 pm

What troubles me the most about certain far-right-leaning legislators’ recent efforts to further erode prevailing-wage laws is the false propaganda used in an effort to justify their mission.

It’s time to be honest.

They are on a clear mission to lower the family incomes of middle-class construction workers.

Prevailing-wage laws ensure that public, taxpayer-funded bidding practices do not undercut local construction wages and benefits. Using local wage data from private construction, the government sets rates for public construction projects that allow contractors to pay wages, health care and retirement benefits that retain skilled workers.

This is good public policy. Why? The laws reduce the likelihood that construction workers will need to rely on public assistance by ensuring they are paid family sustaining wages. The laws also spur local economic development by increasing the likelihood that local contractors and employees are building local public-works projects. In other words, taxpayer money spent by state and local governments stays in Wisconsin rather than being exported.

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Repealing prevailing wage laws hurt veterans (WI)

Paul Gehl, Community columnist
8:12 a.m. CT Jan. 21, 2017

We have to do a better job of supporting our returning military veterans in Wisconsin – whether it is improving their health care, job opportunities, pay scale or all of the above.

I read recently with great irony that the Wisconsin executive director of Americans For Prosperity (Eric Bott) believes that wage protections – specifically Wisconsin’s prevailing wage laws – should be repealed so veterans can actually enjoy more job opportunities and better wages. That is not a misprint. A guy from a group promoting “prosperity” is suggesting less is more for our honorable veterans. No sir, more is more for our veterans.

I am a veteran, a longtime American Legion member and the former president of Lunda Construction. While president of Lunda I was proud to employ many veterans who were extremely interested in continuing their service to country building critical infrastructure like highways, schools and bridges that helped keep our communities safe for our families.

A 2016 study by the Midwest Economic Policy Institute found recent changes to Wisconsin’s prevailing wage laws implemented by the Wisconsin legislature “will have a disproportionate impact on veteran(s)” because veterans are more likely to work in the construction trades than non-veterans and these law changes will result in lower wages for construction workers. Specifically, the study estimates that the changes going into effect this month will result in the loss of more than 2,000 jobs and $13 million in lost wages for veterans. Mr. Bott throws out various red herrings to misdirect and obfuscate but in the end he cannot refute the study’s core findings – veterans work in construction at higher rates than non-veterans so by definition a repeal of prevailing wage disproportionately hurts veterans.

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Veterans Urge Walker, GOP To Abandon Prevailing Wage Repeal

Wisconsin American Legion Argues Repeal Would Cost Veterans Jobs

Wednesday, February 22, 2017, 1:45pm
By Laurel White

Veterans are calling on Gov. Scott Walker and GOP lawmakers to abandon their proposals to repeal prevailing wage laws in Wisconsin.

Wisconsin American Legion representatives said Wednesday veteran jobs could be lost if state lawmakers move ahead with repealing the prevailing wage. The group says a large number of veterans work in construction after returning from service.

During the last legislative session, lawmakers removed prevailing wage, which sets minimum salaries for workers, on local construction projects. Now they want to end the prevailing wage for state projects.

“Why is it that always the budget is balanced on the backs of veterans,” said Daniel Seehafer, department commander with the Wisconsin American Legion.

Seehafer and his colleagues cited a 2016 Midwest Economic Policy Institute study that contends 2,000 veteran jobs would be lost if the wage repeal becomes law.

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Gary Wetzel: Repealing Wisconsin’s prevailing wage law would hurt veterans

February 21, 2017

 

SOUTH MILWAUKEE – I am a proud military veteran, Medal of Honor recipient, American Legion member and retired operating engineer. Though retired, I am an active advocate for veterans, their medical care, job opportunities and family sustaining wages.

Specifically, I am concerned about a repeal of Wisconsin’s prevailing wage law and the negative impact it would have on veterans.

This is not a union versus non-union issue. All workers in the construction industry benefit from prevailing wage laws. Prevailing wage laws simply ensure workers building our vital infrastructure receive a fair wage. If you cut construction worker wages by repealing prevailing wage laws – which everyone agrees will happen if prevailing wage laws are eliminated – veterans will be harder hit because veterans are more likely to work in the construction industry.

We are veterans who want our voices heard and have a deep desire to continue proudly serving this great state and country by building safer roads, schools and communities for our families. Let us send a loud message to our legislative leaders – protect job opportunities and wages for our veterans.

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Mortenson Construction enters into PLA for $524M Milwaukee Bucks arena project

by Kim Slowey
July 26, 2016

 

Dive Brief:

  • General contractor Mortenson Construction has entered into a project labor agreement (PLA) with local trade unions and workers on the new $524 million Milwaukee Bucks arena, according to the Milwaukee Business Journal.
  • The agreement establishes a prevailing wage guarantee, sets up a dispute resolution process prohibiting any activity – strikes or lockouts – that could hold up construction and requires a veteran employment program through the organization Helmets to Hardhats.

 

Dive Insight:

Bucks President Peter Feigen praised the deal and said the team was proud to “enlist local labor” in the safe and efficient construction of the arena. Local trade union representatives also hailed Mortenson’s willingness to use union labor and its understanding of “the role of the PLA from the quality, productivity and the safety it provides.”

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