Milwaukee’s new hiring rules might force sewer and water contractors to lay off workers and replace them with city residents.
The city on Friday will replace its longstanding Residents Preference Program with a new system requiring Milwaukeeans work 40 percent of the hours on Milwaukee public works projects. The old program set a 25 percent requirement. To be eligible, workers had to be unemployed before joining the program and living in certain low-income areas of the city.
Workers whose hours count toward the new program’s 40 percent requirement must have worked fewer than 1,200 hours in the 12 months prior to joining the program and must have an income level below federal poverty guidelines.
The dearth of work in the region means contractors cannot simply add new staff to meet the 40 percent requirement.
“It’s really not going to be doing what they think it’s going to be doing by adding workers to the work force,” said Dennis Biondich, president and treasurer of American Sewer Services Inc., Rubicon. “It’s going to be replacing workers with other workers.”
Biondich said about a quarter of his employees qualified for the old program, and more than 40 percent of the people on his staff are Milwaukee residents. Yet the new income and hours-worked rules mean one Milwaukee resident might have to sit out a project to make room for another, he said.
The city’s new rule is designed to get more city residents on public works projects, and it is a good policy, said Pam Fendt, coordinator of the Good Jobs and Livable Neighborhoods Project, which helped guide the new contracting rules through city approvals last year.
“I don’t want to not make good policies because we are in an economic downturn,” she said. “Then you are just in a race to the bottom.”
While it’s possible some Milwaukeeans might take a back seat to others, the program will still achieve the goal of getting Milwaukee people on projects, Fendt said.
“We may have to trade out a Racine worker to put in a Milwaukee worker,” she said, “and I think Milwaukee policymakers are pretty comfortable with that.”
More workers are eligible under the new rule because it is open to residents living in any area of the city, Fendt said. The previous rules created problems for contractors by requiring that certified workers live in certain areas of Milwaukee.
The economic downturn also means there are more out-of-work people who satisfy the hiring program’s income limit, Fendt said.
Contractors would be happy to hire more workers from Milwaukee to satisfy the new rule, said Richard Wanta, executive director of the Wisconsin Underground Contractors Association. Builders can keep workers on staff and train them on Milwaukee jobs as long as the projects are there, he said.
Super Excavators Inc. probably will add another worker to each construction crew to satisfy the 40 percent rule, said Jeff Weakly, president of the Menomonee Falls-based company.
“Our construction industry in the last 25 years has suffered through myriads of government socialization on all levels of government,” he said. “And this is just one more constraint. That’s all. It just increases the cost of construction.”
It’s hard to say what task the additional worker would do on each job, Weakly said.
“Who knows? Sweep the streets?” he said. “It’s a good question. This is all new.”