INDIANAPOLIS
(AP) - Indiana lawmakers proposed changes Tuesday to a GOP-backed bill
that would repeal the law that sets wages for public construction
projects, though opponents say those efforts aren’t enough to offset
potential damage to the state’s construction industry.
Members of the
Senate Tax and Fiscal Policy Committee are considering a measure to
eliminate the decades-old Common Construction Wage Law, along with the
local boards that set construction wages for state or local projects
that cost more than $350,000.
Supporters of
the repeal say these set wages are artificially high and hinder the
competitive market from lowering bid prices, which would save taxpayers
money on public projects.
Glenna Jehl, a
Fort Wayne Community Schools board member, says local board members
favor union workers and often come to meetings already knowing the vote
outcome.
“I was kind of
stunned when I went to the hearings and they turned around and voted for
artificially higher wages, which when you have a limited pot, means that
you’re not going to get as much work done,” Jehl said.
Opponents argue
the change would hurt many Indiana-based companies by opening the door
for low-paying, out-of-state contractors to underbid on projects.
“I think we run
the risk of taking away a level playing field,” said William Mott,
corporate vice president of labor relations at Hunt Construction Group
in Indianapolis.
Mott said
Indiana contractors will struggle to be competitive under an unregulated
market, while also trying to pay workers proper salaries and maintain
the high level of workforce training.
Committee
Chairman Brandt Hershman, R-Lafayette, proposed an amendment Tuesday
that he said helps to address concerns about potential out-of-state
competition.
Changes would
include establishing a mandatory E-Verify program to ensure that all
workers are legally allowed to work within the country and requiring
contractors with at least 10 employees to have an employee training
program.
“We want to
ensure that we have a well-trained workforce,” Hershman said. “It leads
to greater worker safety and we think that’s important.”
The amendment
would also prohibit businesses from paying workers in cash, and require
general contractors to perform at least 20 percent of the work on a
project with their own employees, services or materials. This would
prevent businesses from subcontracting entire projects out to a
potentially cheaper workforce.
Contractors who
violate these rules could face criminal charges or be temporarily
suspended from bidding on future government projects.
Opponents said
the changes were a step in the right direction but questioned why
lawmakers were making rushed proposals on such a major issue that has a
big impact on the construction industry.
Labor Committee
Chairman Phil Boots, R-Crawfordsville, who would normally lead
discussion on this type of measure, has said he wasn’t in favor of
taking up the proposal this session and believed a special committee
should review the construction wages law.
But Republican
Senate President Pro Tem David Long, who supports the measure, decided
to assign it to the Tax and Fiscal Policy committee.
“This repeal
could have severe unintended consequences,” Mott said. “I don’t think
it’s broke so I don’t think we should fix it.”