Legislature Wants to Borrow More, Natch Politicians plan to borrow $10 billion from Wall Street for school construction and make taxpayers pay it back plus 80 percent in total interest costs. Several years ago, Gov. Gavin Newsom bragged about having a $97.5 billion surplus to expand health care, social equity, and educational programs. But facing mid-term elections in November 2022, Newsom and the State Legislature hatched a plan to give more than $9 billion of this money back to low—and moderate-income California residents. And for some reason, Newsom signed a contract with an out-of-state company instead of issuing checks to send this money as prepaid debit cards. According to recent reports, over half the cards issued still had unspent funds as of April. Some 624,000 cards had not even been activated. Hundreds of millions of dollars are being held by the state’s contractor, Money Network, benefiting no one in California. Worse, the state auditor released a report recently saying Money Network failed to answer half of the calls from residents who wanted to speak with an agent about the program or problems with their cards. Because of that, the auditor said it’s impossible to track how much fraud occurred, even though, per its $25 million contract with the state, Money Network was supposed to limit the fraud rate to 1 percent. And the state just signed another $32 million contract with Money Network to handle more benefits.

If that wasn’t bad enough, the legislation to place the bond on the ballot (AB 247) includes a “sweetener” for the State Building and Construction Trades Council. In an attempt to address concerns that poor school districts have little access to the state matching fund, because these small, primarily rural districts can’t raise the match, the state plans to increase state funding for certain districts on a sliding scale. The bill creates a sliding scale system where lower-wealth school districts will receive a higher state funding share for projects. The state grant amount for new construction would increase from 50 percent to 55 percent, and for modernization from 60 percent to 65 percent, based on the district's ability to generate local funds, the percentages of low-income, foster care, and English learner students, whether the district has fewer than 200 students, and whether the district’s project has a project labor agreement. We all know the 18 percent cost increase for a PLA will certainly help these poorer districts build new, or repair existing facilities.
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If You Are Planning on Social Security, Bob, Yeah, Well, Don’t Social Security has been known as “the third rail of American politics” since the early 1980s. Touching the program can prove deadly to a politician’s career, the thinking goes. The program is on solid footing, but the latest projections point to benefit cuts in the next decade. On the campaign trail, the presidential candidates are promising to preserve the program and protect seniors. Still, snappy lines at campaign rallies can mask the issue's complexities. “I think there's a real difficulty in talking about Social Security because there's been so much storytelling,” said Romina Boccia, director of budget and entitlement policy at the Cato Institute. “And there's so many myths out there about how the program works.” For years, the system has been paying out more in benefits than it brings in in payroll taxes, partly due to the combination of lower birth rates and an aging population. Another reason is growing income inequality. There’s a cap on the income taxed for Social Security, so the Americans who earn the most — and their employers — only pay Social Security taxes on the first $168,600 of income. Stephen Goss, the chief actuary of the Social Security Administration, explained the issue to members of Congress in testimony before the House Budget Committee earlier this month. More
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Utah To Finally Get Its Own Passport Office, After Romney Push Salt Lake City will get a permanent passport office, Secretary of State Antony Blinken announced Tuesday. The closest passport office to Salt Lake is currently 500 miles away in Denver. Still, after a concerted effort by Sen. Mitt Romney and other members of Utah's congressional delegation, an office will soon be open in Utah. Romney released a statement after the announcement saying he and his team had worked for more than three years to bring a passport agency to Utah: "Utah is experiencing rapid population growth as it becomes a center for global commerce and tourism - as well as a home base to thousands of Latter-day Saints who embark on worldwide religious missions each year," Romney said. "A passport agency in Salt Lake now means that Utahns will not have to travel such long distances to obtain in-person consular services. I could not be more thrilled with today's announcement." In a statement released alongside the announcement, Blinken said six new agencies will open, including the one in Salt Lake, and that the department is issuing more passports “than ever before.” Story
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Flash: Indoor Heat Rule Done For the second time in three months, the Cal/OSHA Standards Board has adopted a rule to protect indoor workers from heat illness. In contrast to the controversial and ultimately rejected March version, this one will likely pass muster with the Office of Administrative Law. It could become effective as soon as August. The new standard is General Industry Safety Orders §3396, and it closely follows the current outdoor heat regulation in many instances. Employers must provide a quart of water per hour, access to “cool-down” areas, emergency response and acclimation procedures, and training. The basic provisions trigger when the indoor temperature reaches 82ºF. More detailed requirements kick in when the temperature is 87ºF, the heat index equals 87ºF, employees wear clothing that restricts heat removal, and the temperature is at least 82ºF, or they work in a high-radiant heat area and the temperature is 82º. In those cases, employers must measure the temperature and heat index and evaluate environmental risk factors. Employees must have “active involvement” in planning and conducting these tasks. Employers then must use engineering and administrative controls and, in some cases, personal heat-protective equipment to protect employees from the heat. Prisons, local detention facilities, and juvenile facilities are exempted from the regulation and will be subject to separate rulemaking. With the standard newly adopted, the Board is requesting OAL expedite its effective date. If that happens, the standard will be in force by early August. If not, the rule will take effect on October 1st.
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Labor Commissioner Audit: At a recent hearing, state labor officials discussed an audit of the Labor Commissioner’s Office that said severe understaffing is the primary cause of backlogs in the unit handling wage theft claims. Lawmakers were skeptical that approving more positions — which they have done the past few years — would completely solve the problem. Labor Commissioner Lilia Garcia-Brower said some of her initiatives, such as assigning staff more efficiently, are promising. New positions have helped the office shave the average wait time for a wage claim hearing and decision from 1,000 days to 800 over the past two years. That’s an improvement from the 890 found in the audit, but still a far cry from the 135 required by state law — which the office has failed to reach for decades. As part of a business-union deal reached over PAGA last week, the state will soon hand the department emergency hiring authority to try to address the staffing crisis.
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Making Voting Easier... Or Harder?: Nearly a decade ago, California revamped its voter registration program to allow eligible people to register to vote when they visit the Department of Motor Vehicles. But with 4.7 million eligible Californians still not registered to vote — more than the combined population of half of the states in the U.S. — advocates are pushing a proposal to further streamline the automatic registration process. SB 299, by Sen. Monique Limón (D-Santa Barbara), would implement a “back-end” process, automatically registering people to vote if the DMV or other state agencies receive information verifying eligibility, allowing them to opt out later. Limón told POLITICO that while the bill doesn’t address voter turnout, removing the step for people to opt-in to voting allows organizations to focus on informing voters on the issues. But the bill’s opponents—the ACLU, League of Women Voters and Naleo Education Fund—argue the risks of implementing a new voter registration system outweigh the potential benefits. In an opposition letter, the groups said that while they share the goal of increasing voter registration, they believe the proposal “has significant potential to increase voter confusion, incorrectly deny eligible voters registration opportunities, create erroneous registrations and strip important voter preference information from registration records.”
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A new decision by an NLRB Regional Director may help clarify the issue. A question that has confounded many in the labor relations community for years is whether or not worker centers are, in fact, labor organizations. However, a new National Labor Relations Board (NLRB) Regional Director (RD) decision may shed some light on the subject.
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EV Charging Desert  A new study led by Harvard University shows that some rural counties across the U.S. have become EV “charging deserts.” According to the study, 34 counties that once had public charging stations no longer do, and three dozen other counties have lost most of theirs. The study shows that the U.S. charging network’s reliability is at 78 percent, well below the Biden administration’s 97 percent goal. The charging network is “uneven,” according to Omar Asensio, a Georgia Institute of Technology professor doing a fellowship at Harvard’s Institute for Business in Global Society and one of the study's authors. Loren McDonald, the founder of the EV-charging data hub EVAdoption, said multiple factors could contribute to the trend. “They didn’t get a lot of use, and they got old and stopped working,” he said. “There was no motive, either by the charging network or the host, to keep them going.” Story
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Newsom Warns Of ‘Forces of Darkness’ Ahead of Presidential Debate Gov. Gavin Newsom struck a somber tone in his annual remarks to Californians last Tuesday. He warned that the state’s democratic values are at stake while castigating Republican opponents for rolling back reproductive rights and failing to pass meaningful immigration reform. He then announced he was immediately returning to Marin, which is, apparently, immune.
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Register for the July 10 virtual meeting for ADOT’s Electric Vehicle 2024 Plan Update The Arizona Department of Transportation (ADOT) will host a virtual public meeting on July 10 for the 2024 Electric Vehicle (EV) Charging Infrastructure Deployment Plan Update. The update will include information about the additional highways being added as EV corridors, proposed station locations, and the status of implementing stations identified in the 2022 and 2023 plans.

The virtual meeting will be held:

• Wednesday, July 10 at 6 p.m.
• Visit AZDOT.gov/EVPlan to register for the meeting and receive your link to attend.

The public can provide feedback on the EV Plan update through July 17 in the following ways:

• Complete an online survey: azdot.gov/EVcomments
• Email: AZEVPlan@azdot.gov
• Call: (800) 915-4301
• Mail: ADOT EV Plan, 1655 W. Jackson, MD 126F, Phoenix, AZ 85007
• Attend the virtual public meeting

For more information about the EV plan, visit AZDOT.gov/EVPlan.
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House Appropriators Lop Off a Fifth of DOL's Budget, a Third of NLRB's House Republican appropriators are again seeking steep cuts to the Department of Labor’s budget as part of funding legislation released last week. The GOP proposed allocating $10.5 billion for DOL, a 23 percent cut from the $13.5 billion set aside for the department in the fiscal year that runs through the end of September. In March, President Joe Biden requested an additional $318 million in discretionary funding for DOL above FY24 levels. House appropriators attempted to slash DOL’s budget by about 30 percent last year, only to see their efforts dashed by their Senate counterparts amid White House pushback to such heavy cutbacks. GOP appropriators want to slice $75 million from DOL’s two main worker-protection arms, the Wage and Hour Division and the Occupational Safety and Health Administration, a combined 12 percent cut to their budgets. The funding bill would bring the WHD budget down to $235 million and provide nearly $557.8 million for OSHA. In contrast, the Biden administration requested a $121 million boost for the two branches in its FY25 request. Separately, Republicans revived their bid to strip the National Labor Relations Board of a third of its funding, bringing its budget down to $200 million. Earlier in Biden’s term, the NLRB received its first increase in years, staving off impending furloughs. The White House had requested that the independent agency be brought up to $320 million, a 6.9 percent increase for FY25.
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Arizona State Legislature Refers 11 Measures to The General Election Ballot, Most Since 1984 The Arizona State Legislature adjourned earlier this month, referring 11 measures to the ballot—five state statutes and six constitutional amendments. This is the most legislatively referred measures on the ballot since 1984, when 13 measures were on the ballot. This is also the third-highest year on record in the state. Some measures did not make the ballot—an additional 15 amendments and five statutes passed one chamber but not the other. Arizona has a divided government. Gov. Katie Hobbs (D) was elected in 2022. This is the first time since 2008 that Arizona had a Democratic governor. Meanwhile, the Republican Party has controlled both chambers of the Legislature since 2003. In April, Hobbs set the record for the most vetoes of any governor in Arizona history, vetoing 185 bills since taking office in January 2023. In Arizona, legislatively referred measures do not require gubernatorial approval to go on a statewide ballot for a popular vote of the people, so they provide a different approach for the legislature to enact policy potentially. Story
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Court Rejects Phoenix and Tucson Prevailing Wage Ordinances A Maricopa County Superior Court judge on Monday ruled that attempts by Phoenix and Tucson to establish prevailing wage ordinances for public works projects violated state law. Attorneys from the Goldwater Institute successfully argued on behalf of the Associated General Contractors (AZAGC), the Arizona Builders Alliance (ABA), and the Associated Minority Contractors of Arizona (AMCA). Story
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Does Arizona Have Enough Water? Phoenix-Area Cities Are Spending Big To Make Sure It Does The Biden Administration has poured money … allocating $4 billion from the Inflation Reduction Act for Colorado River projects. … The Biden administration framed the spending effort as “water conservation,” but Arizona’s municipal water leaders aren’t using it to make changes traditionally considered conservation. Instead of paying for small tweaks to water use – like encouraging residents to install low-flow showerheads or rip out their thirsty lawns – many are thinking bigger, putting their multimillion-dollar checks towards billion-dollar infrastructure projects to keep taps flowing for decades. Cities like Peoria are planning to engineer their way out of the problem. Story

PAGA Deal California’s crowded November ballot will have one fewer question after business and employee groups resolved a dispute over a law workers commonly use to sue their employers. Newsom’s office announced Tuesday's agreement to rework the Private Attorneys General Act or PAGA, which lets workers sue employers on the state’s behalf. The California Chamber of Commerce has argued that the law leads to frivolous and expensive lawsuits, while the California Labor Federation counters that it’s an important tool for maintaining respect for workers’ rights. The agreement makes changes intended to reduce the number and scope of suits brought under the law, gives employers more chances to fix problems outside court, and caps some penalties. At the same time, it increases penalties for the worst offenders and awards a greater share of the payout to wronged employees — 35 percent of the total instead of 25 percent. The deal comes after weeks of behind-the-scenes conversations involving Newsom’s team and Democratic lawmakers. They are expected to pass legislation codifying the deal before next week’s deadline to remove qualified measures from the ballot.
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Biden Rule Weaponizes IRS to Steer Clean Energy Construction Projects to Union Donors Associated Builders and Contractors issued a statement regarding the Internal Revenue Service’s final rule released for public inspection on June 18, which requires private developers to follow onerous project labor agreement, prevailing wage and apprenticeship policies when building clean energy projects funded by more than $270 billion in tax credits via the ABC-opposed Inflation Reduction Act. According to the final rule, developers must certify that their contractors pay all construction workers prevailing wages and benefits determined by the U.S. Department of Labor following the federal Davis-Bacon Act. Developers must also ensure that contractors utilize apprentices enrolled in government-registered apprenticeship programs for 15% of all construction labor hours performed on a project, among other requirements. Project developers that satisfy these new provisions are eligible for a 500% increase in various clean energy construction project tax credits compared to baseline tax credits offered to developers under prior regulations widely used by industry. In addition, developers that require contractors to execute PLAs with labor unions are immune from new monetary penalties if the developer and its contractors fail to meet cumbersome prevailing wage and apprenticeship rules. Story
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Workplace Safety Reshuffle The Occupational Safety and Health Standards Board bucked the Newsom administration in March, criticizing how it handled long-delayed indoor heat rules. Now, the administration is pushing back. Four months ago, the Board was expected to approve the rules for employers to protect workers from extreme indoor heat. The night before the meeting, the Newsom administration withdrew its support, citing cost concerns. Two board members who were among the most outspoken critics of the administration’s move have been reshuffled. Chairperson Dave Thomas has been demoted (replaced by antitrust attorney Joseph Alioto). Laura Stock has been removed, which she said she learned in a phone call last Friday. Stock has served on the board since 2012 and is a researcher and director of the UC Berkeley Labor and Occupational Health Program. In March, she called the administration’s action “completely outrageous.”
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Pension Bailout In its third pension bailout, the Pension Benefit Guaranty Corporation (PBGC) announced recently that it had approved $10.6 million in taxpayer funds for the Arizona Bricklayers' Pension Trust Fund. The fund, based in Phoenix, Arizona, covers 666 participants in the construction industry and was expected to run out of money in 2041. Thursday's announcement follows two other recent bailout announcements by the PBGC. The PBGC announced it approved approximately $545.6 million in special financial assistance (SFA) to the CWA/ITU Negotiated Pension Plan (CWA/ITU Plan), based in Mount Laurel, New Jersey. The plan, which covers 24,288 participants in the printing industry, was projected to become insolvent and run out of money in 2029. The PBGC also announced Tuesday that it approved special financial assistance for another failing Teamsters pension plan. The Teamsters Local 102 Plan, based in Cherry Hill, New Jersey, and covering 508 transportation industry participants, will receive approximately $12.4 million. "As of June 13, 2024, PBGC has announced approval of about $54.6 billion in SFA to plans that cover about 818,000 workers, retirees, and beneficiaries," the PBGC noted. "Special financial assistance for financially troubled multiemployer plans is financed by general taxpayer monies." Just this week, the PBGC announced it would be providing $568.6 million in taxpayer money to only three underfunded union pension plans. Go here for prior posts about the PBGC's taxpayer-funded pension bailouts.
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EEOC Releases Anti-Harassment Guide for Contractors The Equal Employment Opportunity Commission released a guide to help construction leaders prevent and address harassment on the job. “Promising Practices for Preventing Harassment in the Construction Industry” is part of the EEOC’s ongoing focus to address bias within the building sector. More
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Lawmaker Spent $75K In Campaign Cash On 49ers, Giants, Warriors Tix Assemblyman Matt Haney had one hell of a weekend in late January. The state assemblymember and avid sports fan partied Saturday evening at Cavana, a beautiful rooftop bar in Mission Bay specializing in Colombian cuisine and fruity cocktails. Haney dropped a few hundred bucks on food and drinks and watched LeBron James and Steph Curry duel it out at Chase Center in a double-overtime thriller. The next morning, Haney got $158 of booze at Tenderloin Liquor and headed down to Santa Clara to watch the San Francisco 49ers battle the Detroit Lions for a trip to the Super Bowl. He pregamed at a tailgate party outside of Levi’s Stadium, smoking a stogie as he took a picture with Supervisor Shamann Walton. Story
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Labor Board May Impose Union on Mercedes Workers Despite Employee Vote against UAW On May 17, workers at the Mercedes Benz plant in Vance, Alabama, voted against joining the United Auto Workers, with 56% of the voters choosing not to unionize and 90% voter turnout. Despite this decisive vote, the UAW may still be forced on the Mercedes workers. Story
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Legislature Wraps Session, Closes Budget Gap, Continues ACA The second regular session of the Arizona 56th Legislature ended on Saturday night, finally adjourning sine die. Here’s the session and the business community’s perspective on the last six months. Story
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Mistake No. 4 of the Top 10 Horrible, No-Good Mistakes Construction Lawyers Make: Not Knowing When to Fold ‘Em The following is mistake No. 4 of the top 10 mistakes lawyers make in construction disputes. Story
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A Battle Looms Over Fair Funding for School Construction In the coming days, Gov. Gavin Newsom is expected to confirm his commitment to place a state school construction bond on the November ballot. He hasn’t committed to anything yet, but he must decide in the next ten days whether to reform a method of sharing state-matching money that has long favored property-rich districts over their property-poor neighbors. Story
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Thirty seats are up for grabs in the Arizona Senate in 2024. Here's what to know about the incumbents and who's running ahead of the July 30 primary.
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Utah Climate Skeptic Lee Closes in On Top Senate Energy Role Politico reports that “Congressional Republicans who have sought to soften their party’s opposition to climate change action in recent years may be poised to elevate one of their most outspoken skeptics to lead a prominent Senate panel. Sen. Mike Lee (R-Utah) has been a fierce conservative and perennial thorn in the side of leadership of both parties since arriving in the Senate in 2011. And despite some prominent GOP members’ efforts to craft a Republican-style policy on climate change, Lee looks likely to lead the party on the powerful Energy and Natural Resources Committee — and wield the gavel if Republicans win control of the chamber in November’s election.”
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Legislation

AB 107 (Gabriel) Budget bill was approved by the Legislature on 6/15. Included two “pork barrel” projects with PLAs. WECA Position: Oppose

AB 1957 (Wilson - D) Authorizes any county of the state to use the “best value” method for construction projects over $1 million and job order contracts up to $3 million until January 1, 2030. Devoid of State Building and Construction Trades Council language. Approved by Legislature on 6/13 WECA Position: Support

AB 1976 (Haney - D) Requires, on or before July 1, 2027, the Occupational Safety and Health Standards Board to draft and adopt a rulemaking proposal to revise a standard on first aid materials to require all workplace first aid materials to include naloxone hydrochloride or another opioid antagonist, as specified, to reverse opioid overdose with instructions for using the opioid antagonist. Passed by Senate Labor on 6/12. WECA Position: Oppose Unless Amended

AB 2135 (Schiavo - D) Extends the statute of limitations on complaints submitted to the Labor Commissioner from 18 to 24 months. Allows the Labor Commissioner to continue ongoing investigations beyond the statute of limitation for good cause. Prohibits an open investigation from being closed solely due to the statute of limitations being reached. Passed by Senate Labor on 6/12. WECA Position: Oppose

AB 2179 (Davies - R) Requires a school district, county office of education, or charter school to, at the beginning of the first semester or quarter of each school year, provide information on local apprenticeship programs to pupils in grades 11 and 12. Passed by Legislature on 6/13. WECA Position: Support

AB 2182 (Haney - D) Allows the prevailing wage applicable to a public works project to be adjusted when an updated wage rate is determined by the Department of Industrial Relations (DIR) director, recasts the method for annualizing benefit computations, and repeals any previously issued determinations. Passed by Senate Labor on 6/12. WECA Position: Oppose

AB 2499 (Schiavo - D) Entitles an employee with a family member who is a victim of crime to job-protected leave to attend to the family member’s needs and ensure their safety. Additionally, it permits both the employee victim and the employee who has a family member who is a victim to use sick leave for time off to obtain victim services. AB 2499 creates new, uncapped leave for scenarios already covered under existing law. And it applies to small businesses with just five employees. Passed by Senate Judiciary on 6/18. WECA Position: Oppose

AB 2696 (Rendon - D) Authorizes a joint labor-management cooperation committee (JLMCC), as specified, to bring an action in court against a direct contractor or subcontractor at any tier for any unpaid wage, fringe or other benefit payment or contribution, penalties or liquidated damages, and interest owed to a wage claimant by the direct contractor for the performance of private work. This proposed expansion of Section 218.8 is unnecessary from an enforcement perspective. Employees of general contractors know the identity of their direct employer. They can file wage claims with the Labor Commissioner, mechanics liens on the property, stop notices with the funding entity, civil lawsuits for non-payment of wages, and claims against payment bonds. AB 2696 encourages needless lawsuits that serve no legitimate enforcement purpose. Passed by Senate Labor on 6/19. WECA Position: Oppose

AB 2705 (Ortega - D) Provides that, for a violation of public works law, the statute of limitations (SOL) for the Labor Commissioner (LC) to sue a bonding company shall be the same as the 18-month SOL for the LC to issue a civil wage and penalty assessment to the contractor or subcontractor on that project or both. Passed by Senate Labor on 6/12. WECA Position: Oppose

AB 3265 (Bryan - D) Establishes procedures for an environmental leadership media campus in the County of Los Angeles. The project must pay prevailing wages unless covered by a PLA.  Passed by Senate EQ on 6/19. WECA Position: Oppose

SB 739 (Ashby - D) If the City of Elk Grove council approves, this new bill would expand this authorization to the City to use CMaR. It requires using a Skilled and Trained Workforce unless covered by a PLA. Passed by Assembly Local Gov on 6/5. WECA Position: Oppose Unless Amended

SB 984 (Wahab - D) Requires the courts and CSU to identify and select at least three major construction projects by January 1, 2027, governed by a project labor agreement (PLA). DTSC was removed after they reported that "utilizing a PLA for a project increased the cost of the cleanup by approximately 25 percent." Passed by Assembly Labor on 6/19. WECA Position: Oppose

SB 1022 (Skinner - D) Significantly expands existing statute limitations for any complaint brought by the Civil Rights Department or its “authorized representative” to ten years. It also gives a court discretion to extend that statute of limitations even further if it is “reasonable” to do so. Passed by Assembly Judiciary on 6/11. WECA Position: Oppose

SB 1162 (Cortese - D) Expands existing law, which requires contractors and bidders on public projects to use a skilled and trained workforce, by also requiring them to report the date of birth of each worker every month. Passed by Assembly Labor on 6/19. WECA Position: Support If Amended

SB 1321 (Wahab - D) Changes standards on ETP grants. A coalition of opponents states, “This bill poses a significant threat to the vital interests of manufacturers and small, diverse businesses throughout California. SB 1321 proposes fundamental changes to the Employment Training Panel (ETP) that would render the very businesses that fund the program ineligible to participate. Such a change would undermine the essence of the ETP, jeopardizing the development and sustainability of California's workforce." Passed by Assembly Labor on 6/19. WECA Position: Oppose