A state housing proposal aimed at making it easier to build townhomes has opened a sharp divide between two of California’s most influential construction labor groups, putting Democratic lawmakers in a politically difficult position as they try to address the state’s housing shortage.
Assembly Bill 1751, carried by Assemblymember Sharon Quirk-Silva, a Fullerton Democrat whose district includes parts of Orange and Los Angeles counties, would remove certain regulatory barriers for townhouse construction. The measure is intended to speed approval of tightly built, multistory homes, a housing type often seen as a middle ground between single-family houses and large apartment projects.
In exchange for that streamlined approval, developers would have to pay construction workers at least $28 an hour. That is well above California’s current statewide minimum wage of $16.90.
But the proposed wage floor has drawn fierce opposition from the State Building and Construction Trades Council, which represents skilled trades such as electricians, plumbers and sheet metal workers. The council argues the bill could weaken higher wage standards already in place for many union workers on public or publicly supported projects.
At the center of the dispute is the concept of “prevailing wage,” a government-set pay rate that applies to many publicly funded construction projects, including a number of affordable housing developments. Prevailing wages are calculated through surveys of what workers in specific trades earn in different regions. Because union contracts often cover large numbers of workers, union pay scales can help establish those prevailing rates.
Quirk-Silva has insisted that her bill would not alter those standards.
“It does not replace prevailing wage,” she said during a tense Assembly floor debate earlier this month. “It does not undercut prevailing wage. This bill leaves prevailing wage exactly where it stands in current law.”
The building trades remain unconvinced. Their concern is partly technical: while the bill says California regulators could not use the new $28 wage standard when calculating state prevailing wages, federal officials conduct their own surveys and set their own rates for federally supported projects. Union leaders worry that if enough townhouse construction jobs are paid at $28 an hour, that lower rate could influence federal prevailing wage calculations.
Their broader objection is about precedent. For years, the building trades have pushed back against housing bills that ease development rules unless they include strong labor protections, such as prevailing wage requirements or “skilled and trained” workforce mandates that favor graduates of apprenticeship programs, most of whom are union members.
AB 1751 offers a different model: a required minimum wage that is far lower than what many skilled union tradespeople already earn.
Chris Hannan, president of the State Building and Construction Trades Council, said that approach could become the new standard in future housing legislation. If lawmakers begin treating a construction minimum wage as the labor concession needed to win support for development streamlining, he said, “that becomes the new go-to.”
On the other side of the fight are California’s unionized carpenters, who support the proposed wage standard. The rivalry between the carpenters and the building trades has become a recurring feature of housing debates in Sacramento.
The two labor groups clashed over a similar proposal last year, when Assemblymember Buffy Wicks, an Oakland Democrat and longtime ally of the carpenters, sought to include a residential construction wage floor of $28 to $40 an hour in a budget bill near the end of the fiscal year. The carpenters argued then, as now, that most workers building housing in California are not represented by unions, except on high-rise projects that require more specialized labor. A higher minimum wage, they said, would improve standards for those nonunion workers.
The building trades reacted strongly to that proposal. Union members packed a budget hearing to denounce the idea, saying it would mark a retreat from California’s traditional labor standards. One representative compared the measure to “Jim Crow” laws. The proposal was ultimately dropped after several labor-friendly Democrats expressed concern.
This year’s version has gone through a more public legislative process, though opponents still argue it has moved too quickly. When AB 1751 was introduced in February, it dealt only with townhouse regulations. The wage language was added in late April before the bill’s second committee hearing.
Quirk-Silva’s staff declined to make her available for an interview, citing personal family matters. On the Assembly floor, she said the timing was partly affected by serious health issues involving staff and family members.
Since the wage language was added, debate over the bill has centered almost entirely on labor. That is notable because the measure would also exempt townhouse projects from environmental review and remove local elected city councils and planning boards from parts of the approval process. In past years, that kind of land-use shift would likely have triggered a major Capitol battle on its own.
But California’s housing politics have changed rapidly. Last year, Gov. Gavin Newsom signed a law exempting most urban infill housing developments from environmental litigation, reducing some of the political shock around proposals that limit local review.
During an Assembly floor vote last month, Assemblymember Chris Ward, a San Diego Democrat, called the wage issue the “900-pound gorilla.” Like several Democrats, Ward said he generally supported the housing goals of the bill but remained concerned about unanswered questions over how the $28 rate might interact with existing labor standards.
The bill needed 41 votes in the 80-member Assembly to advance to the Senate. It passed with 47.
Quirk-Silva’s office attempted to address the prevailing wage concern by writing into the bill that the California Department of Industrial Relations could not use the $28 townhouse wage when calculating state prevailing wage rates. Those rates are based on the most common pay for each type of work in each region.
The building trades say that does not solve the federal issue. For example, the current federal prevailing wage for a residential roofer in Sacramento is $46.73 an hour, plus benefits. Federal officials base those numbers on the most common wage paid in an area, or on the regional average if no single rate covers at least 30% of surveyed workers.
Scott Wetch, a lobbyist for unions affiliated with the building trades, warned at an April hearing that federal officials would not be bound by the California bill’s language.
“The federal government won’t give a rat’s ass about what this bill says,” Wetch said. “And they will set the prevailing wage rate for all the crafts at $28.”
Kevin Duncan, an economist at Colorado State University Pueblo who has studied how prevailing wage rules affect construction costs, said the trades’ concern is not baseless. In a smaller market with limited union presence, he said, a large number of contractors paying workers exactly $28 an hour could potentially influence a wage survey.
“That would be the prevailing rate — and with zero benefits,” Duncan said.
Supporters of AB 1751 say that scenario is unlikely. They argue the bill applies to a specific category of townhouse construction and would not generate enough federally relevant wage data to substantially change prevailing wage rates. They also contend that few residential roofers work on federal public works projects in Sacramento or elsewhere in California.
Most roofers on privately funded residential projects are nonunion and many earn less than $28 an hour, said Danny Curtin, director of the California Council of Carpenters. Raising the floor for those workers, he argued, should not be portrayed as a threat to higher-paid union trades.
The claim that a $28 minimum wage would pull other workers’ pay down “defies comprehension,” Curtin said.
Original source: CalMatters
