Michigan Legislature poised to repeal prevailing wage law
LANSING, Mich. (AP) — A 53-year-old Michigan law that guarantees higher “prevailing” wages for construction workers on state-financed projects could soon be nullified.
The Republican-controlled Legislature this week is poised to repeal the statute, which would make Michigan the fifth state to annul its prevailing wage law since 2015. Though GOP Gov. Rick Snyder opposes the bill, it is veto-proof because it was initiated through a ballot drive by nonunion contractors.
“It’s about providing relief for taxpayers, because when they buy a building it makes no sense for them to pay extra just because of prevailing wage when other folks can build the same building to the same standard for less cost to the taxpayer,” said Senate Majority Leader Arlan Meekof, a West Olive Republican who has long pushed to nix the law, which is modeled after a U.S. law applying to federal projects.
On the other side are union contractors, organized labor, Democrats and others who say the 1965 statute ensures that workers are paid fairly and quality work is done on schools, fire stations and other public works projects. A repeal, they contend, would also squeeze training programs provided by unions.
Opponents of the legislation are pressing Republicans to let it proceed to the November ballot, especially in the House — where the GOP’s 63-46 majority is slimmer than its 27-11 edge in the Senate.
“It’s a big surprise to me that any Republican wants to be on public record that we should be gutting the wages of the skilled trades when we have a (worker) shortage at this point,” said House Minority Leader Sam Singh, an East Lansing Democrat.
Michigan’s law requires paying the local wage and benefit rate — usually union scale — on government construction projects.
Twenty-two states do not have prevailing wage laws, according to the U.S. Department of Labor. Republican-led Arkansas and Kentucky repealed theirs in 2017, West Virginia in 2016 — when GOP lawmakers overrode a veto — and Indiana in 2015.
Protecting Michigan Taxpayers, a committee of nonunion contractors, launched the Michigan ballot drive last year. The initiative, which the state elections board certified Friday after a court fight, is a way to bypass a veto threat from Snyder.
“I don’t agree with it. I’ve been pretty clear about that,” Snyder told The Associated Press last week at a policy conference on Mackinac Island. “I don’t think it’s an appropriate thing to do at this point in time. ... I have built good partnerships with the professional trades. These are great well-paying careers. Shouldn’t we be encouraging more people to go into them?”
The ballot drive was funded primarily by the nonunion Associated Builders and Contractors of Michigan, which spent $1.3 million to collect voter signatures. It says the prevailing wage mandate is a “red tape nightmare” that inflates costs and makes it harder for nonunion contractors to compete by making lower bids.
“For decades, the notions of fair, open competition and fiscal responsibility in public construction have been ignored due to this costly government mandate,” said Jeff Wiggins, president of the ballot committee and associated builders’ state director.
Others in the business community and organized labor, however, are rallying against the repeal bill.
Mike Jackson, executive secretary-treasurer of the Michigan Regional Council of Carpenters, said the law helps fund training that is important from a business perspective and for worker safety. Mike Nystrom, executive vice president of the Michigan Infrastructure & Transportation Association, a construction trade association, wrote to lawmakers that better-trained workers may leave Michigan for neighboring states if out-of-state, “fly-by-night” contractors can “unfairly undercut proven companies and workers based here.”