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Michigan Legislature poised to repeal prevailing wages

A crew with RBV Contracting Inc., a subcontractor of Cimco Refrigeration Inc., begin excavation work on Jan. 2 for the ice system at Little Caesars Arena, home of the Detroit Red Wings hockey team and Detroit Pistons basketball team. A 53-year-old Michigan law guaranteeing "prevailing" wages for construction workers on state-financed projects could soon be nullified. (AP Photo/Carlos Osorio, File)

A crew with RBV Contracting Inc., a subcontractor of Cimco Refrigeration Inc., begin excavation work on Jan. 2 for the ice system at Little Caesars Arena, home of the Detroit Red Wings hockey team and Detroit Pistons basketball team. A 53-year-old Michigan law guaranteeing “prevailing” wages for construction workers on state-financed projects could soon be nullified. (AP Photo/Carlos Osorio, File)

By DAVID EGGERT
Associated Press

LANSING, Mich. (AP) — Michigan lawmakers are moving to repeal their state’s 53-year-old law guaranteeing construction workers be paid “prevailing” wages on state-financed projects.

If the Republicans who control Michigan’s Legislature vote to repeal prevailing wages, their state will be among a handful that have taken that step since since 2015. Wisconsin lawmakers voted to repeal their state’s prevailing-wage laws for local projects in 2015 and for state projects in 2017.

In Michigan, Gov. Rick Snyder, a Republican, has expressed opposition to the repeal of prevailing wages. But the proposal now moving through the state Legislature 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 Republican who has long pushed to nix the law.

On the other side of the debate are union contractors, organized labor, Democrats and others who say prevailing wages ensure that workers are paid fairly and quality work is done on schools, fire stations and other public-works projects. Repeal, they contend, would also squeeze training programs provided by unions.

“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, a Democrat.

Michigan’s law requires paying the local wage and benefit rate — usually union scale — on government construction projects.

Twenty-two states have no prevailing wage laws, according to the U.S. Department of Labor. Outside Wisconsin, Arkansas and Kentucky repealed theirs in 2017, West Virginia in 2016 and Indiana in 2015.

Protecting Michigan Taxpayers, a committee of nonunion contractors, started the Michigan ballot drive last year. The initiative, which the state elections board certified Friday after a court fight, allows lawmakers to pass legislation that can’t be vetoed by the governor.

“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 paid for 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 pay for 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.”

Copyright 2019 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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