Back for a return engagement: repeal of prevailing wage

LANSING - It's baaack.

The annual effort to repeal Michigan's Prevailing Wage Act of 1966 has returned to our state's capital, where repeal proponents are making the usual argument that the law is "burdensome" and costs taxpayers money.

Legislation similar to this comes up just about every year - but even with Republicans in control of both houses of state government and the governor's seat over the last several years, the GOP hasn't been able to obtain sufficient support among its own people to repeal prevailing wage.

This year may or may not be different. Republican state Rep. Wayne Kuipers, in an Oct. 12 letter to school board members across the state, stated, "we are close to building a majority to repeal this law and save money for our schools." He called prevailing wage "a wasteful special interest law."

On the other hand, Todd Tennis of Capitol Services Inc., a lobbyist for the IBEW, said he doesn't take the threat lightly, "but the fact that they're coming after us now is a little surprising to me." Both Republicans and Democrats, he said, are concerned about the effects of redistricting and term limits in the coming months - and don't appear to be in the mood to rock the boat with organized labor.

"Nothing is for certain, but in many ways we haven't been as strong with prevailing wage as we are now," Tennis said.

In 2001, the repeal measure comes in the form of House Bills 4329 and 4383, which have been introduced by GOP Rep. Robert Gosselin, who chairs the House Employment Relations Committee. He held the first public hearing on the matter on Oct. 16. The legislation would repeal prevailing wage standards for public school construction and highway and bridge construction.

Usually proponents of repeal will throw out a number that represents how much prevailing wage will save the state's taxpayers: this time, it's $150 million per year in lower construction costs. The usual argument is that contractors will submit lower bids because their labor costs will be lower.

The reality is that study after study - including one that examined the court-ordered repeal of Michigan's law in 1994-96 - has shown that setting aside statewide prevailing wage laws has little effect on the cost of construction.

Moreover, large nonunion contractors have agonized in recent months over making "poor people" out of nonunion workers because of low pay in the industry. It is becoming increasingly difficult to retain and attract workers, especially in the nonunion sector, because of poor pay and lousy working conditions. A prevailing wage law is one of the few ways governments can uphold pay standards in the construction industry.