Contractors working with the city of San Diego on construction projects will soon be held to the pay rate standards of the state’s prevailing wage law.
By a party-line vote of 5-4, the City Council passed on Tuesday an ordinance that will require contractors on city projects to pay their workers the prevailing wage, as determined by the state Department of Industrial Relations.
As a charter city, San Diego is not required to do so. General-law cities within the state are required, as is the state when it enters into construction contracts.
“A lot of other places have done it,” said Councilman David Alvarez, who voted in support of the change, referring to other charter cities, such as Los Angeles, that have adopted such ordinances. “And the world is not falling apart.”
In a May 8 memo to the City Council, Mayor Bob Filner requested the council adopt such an ordinance, citing benefits he believed could come of it, including more local hiring, a “stimulation of marketplace competition and “ensuring that contractors compete on an even playing field."
Filner released a statement after the vote.
"This decision to pay a fair, livable wage to the hardworking men and women in the construction business is long overdue," Filner said. "I applaud the City Councilmembers who stood up to do the right thing and voted in favor of the Prevailing Wage Ordinance."
The city’s Independent Budget Analyst issued a report on the proposal, concluding that a switch to prevailing wage would increase the city’s costs on construction projects by an average of 5 percent.
Staff for the city’s chief operating officer rebuffed those claims in a separate report, saying the IBA did not fully take into account certain cost savings that could result, such as increased efficiencies resulting from a more skilled and competent work force.
The council’s decision to join many other charter cities in the state requiring prevailing wage on city construction jobs comes as the California Legislature is already considering a bill that would back charter cities into a decision on the matter.
State Senate Bill 7, originally proposed by State Sen. Darrell Steinberg, D-Sacramento, has passed the state Senate already and has received one reading in the Assembly.
If adopted, it would prohibit charter cities from receiving state funding for public works projects if those cities authorize a contractor to not comply with prevailing wage provisions on any public works contract after Jan. 1, 2014.
Assemblywoman Lorena Gonzalez was the first to speak before the council Tuesday afternoon, as the item went to public comment. She was followed by a many speakers on both sides of the proposal.
“We know that this is coming down as a state mandate,” Gonzalez said in reference to the potential passage of the bill still working its way through the Assembly. “It’s nice to see San Diego … doing what’s right before it’s told.”
Bill Baber, government affairs director for the Associated Builders and Contractors, spoke against the proposal.
“It takes the authority of the city of San Diego and transfers it to the state,” Baber said. “There are very, very, very few things that the state does well.”
In a statement from Council President Todd Gloria, he said the action would "result in higher-quality work and more middle-class jobs for our region."
Councilman Scott Sherman, along with members Kevin Faulconer, Mark Kersey and Lorie Zapf, voted against adopting the ordinance.
Sherman said he disagrees with the government telling private companies what they should be paying their workers.
“It should be what the market is able to do,” Sherman said before the vote.
Wes May, executive director of the Engineering Contractors Association, lauded the council’s decision in a statement released late Tuesday afternoon.
“When hard-working people earn a fair wage, they can support their families,” May said. “This builds the middle class and strengthens the economy — all while we make much-needed expansions and improvements to local infrastructure."