County governments challenge prevailing wage
By PAT FRIDGEN Echo Pilot

Franklin County Commissioner Bob Thomas, Antrim Township Municipal Manager Ben Thomas Jr. and Bruce Hanson, a representative from the state legislature Labor Relations Committee, discuss the impact of prevailing wage on local construction projects at an Aug. 20 Council of Governments meeting.

Officials from Franklin County boroughs, townships and school districts met Aug. 20 to strategize on overturning Pennsylvania's prevailing wage law. The assembly heard a report from a special Council of Governments committee on its findings and recommendations for grassroots action.

Chairperson Robert Thomas, county commissioner, introduced the subject.

"Prevailing wages increase costs of construction and are basically union-driven. An educated public will rise up and turn this thing over."

Prevailing wage was enacted in the state in 1961, and required that any public works projects bid over $25,000 pay laborers the same rates across the state, as determined by the Department of Labor and Industry. Through the years the payscales have increased, but not the $25,000 threshold. The effect on rural communities is that they pay the same in labor costs as urban communities, though the cost of living may vary greatly.

"Is it fair and just to citizens in all 67 counties?" asked Ben Thomas Jr., Manager of Antrim Township. He said in today's economy only projects over $172,000 should have to pay prevailing wage and money would be saved by the taxpayer-funded entities.

Mike Christopher, Manager of Washington Township, noted that any effort to modify or eliminate the prevailing wage law would be a precedent. He had seen that workers paid the rates common in cities such as Harrisburg, Pittsburgh and Philadelphia tended to slow down to extend the number of hours they worked. Franklin County wages were normally $10 to $15 lower per hour than in the larger cities.

"The law serves no useful purpose in our area," he concluded.

A June 4 ruling by the Pennsylvania Supreme Court determined that some maintenance projects fell under the law. Because of that, Greene Township had to rebid a recently awarded street paving project, which tacked another 15 percent onto the bill, passed along to the taxpayers.

Some local companies therefore do not bid on local projects because of the hassle of dealing with the paperwork, disgruntled employees and lack of subcontractors who will bid for them, said Joan Warner, president of the Cumberland Valley Chapter of the Association of Builders and Contractors.

The effect on employees is discontent when some get sent to a job that pays prevailing wage while the others go to a smaller construction project. One roofer could be earning $50 an hour and the other $20. Maryland companies will not work in Pennsylvania for the same reason, she said.

In addition, employers pay for four years of training towards journeyman licensure, so it hurts the bottom line when the certified workers then leave Pennsylvania to work in other states.

"This is not a contractor issue, it's a taxpayer issue," Warren declared.

She said some firms bid in Maryland, with a $500,000 threshold, and Virginia, with no prevailing wage because it is a right-towork state.

Frank Traver from Eagle Construction refuses to bid for area projects because he can't compete with the big companies. As Christopher had stated, larger companies had an edge in purchasing greater quantities of materials to "squeeze out the little guy."

Supervisor Fred Young III said the issue was brought to light when a municipal government complex was considered in 2007 in Antrim Township.

"The public has got to get mad," Robert Thomas said, "because it's not right."

On a state level

Bruce Hanson, Executive Director of the Pennsylvania House of Representatives Labor Relations Committee, clarified his identity before a group primarily in favor of reform.

"I'm not with the Department of Labor and Industry. I'm on your side."

He said the law was unclear on how to set prevailing wage and left it up to the governor and the Dept. of L&I. Gov. Edward Rendell uses prevailing union wage, but most employees are not union members. House Bill 1515 is attempting to exempt milling and curbing of roads from the requirement. Senate Bill 333 seeks to amend the act to raise the threshold to $175,000. Both are sitting in committee.

Rep. Todd Rock supported change to the law, stating prevailing wages added 30 percent to the labor costs of the Waynesboro High School addition. "This is not easy. I don't think we'll eliminate prevailing wage tomorrow."

The voting members of the COG approved a measure to educate citizens about inflated costs for government projects due to prevailing wage, to team up with other private and public organizations to push for making the system market-based county by county, to inform the public on the financial impact on taxpayers, to encourage municipal leaders to explain the impact of the law on roads, parks, schools, water and sewer plants and other construction projects, and to appoint a committee of elected officials to visit Harrisburg.

"We believe this is up to the citizens. It is not a Republican or Democrat issue," Ben Thomas said. "We can agree or disagree, but we're all taxpayers. As an appointed municipal manager, I am deeply concerned. I see what is on the horizon."

He wanted local funding to support local projects, including emergency services, rather than being spent on inflated labor.

Other participants at the meeting were Greencastle Borough Manager Kenneth Womack, Council Member Michele Emmett, School Superintendent C. Gregory Hoover and citizen Daniel Jordan. Supervisor Curtis Myers came is as the meeting was winding down.