Labor showdown brewing between Branstad, Cedar Rapids

Gov. Terry Branstad is gearing up for a confrontation with the City of Cedar Rapids over the use of a project labor agreement for the the city’s $75.6-million Convention Complex project, with both sides appearing unwilling to back down.

Last week, the city council — led by former Republican Iowa House Speaker and now Mayor Ron Corbett – voted 5-4 to push ahead and seek bids on a first contract related to the project with a labor agreement in place. This, however, flies in the face of one of Branstad’s first acts as governor: An executive order that prohibits state funds to go to construction projects which come with project labor agreements.

The primary purpose of PLAs is to ensure smooth completion of projects by getting the participants — project manager, the contractors and workers — to agree to certain ground rules, thus expediting the project with minimal disruptions. Provisions within a PLA standardize and stabilize wages and benefits, starting and ending times for employees and requires workers to agree not to disrupt the project if labor disputes arise, but rather submit disputes to fast and binding arbitration so the project can move forward.

Corbett has argued that since the planning of the project predates Branstad’s executive order, the city is not in violation of it. The point of the PLA, he said, is to ensure that many of the workers on the project are local union workers. Branstad, however, said the state will withhold $15 million in state funding if a PLA is used. Because the project is also using federal funding, the city will pay union-scale wages with or without the PLA.

On Friday, The Cedar Rapids/Iowa City Building & Construction Trades Council asked state Sen. Rob Hogg (D-Cedar Rapids) to seek an opinion from Attorney General Tom Miller on the matter. In his letter the group points out that the Iowa Supreme Court ruled in 2002 that PLAs do not violate Iowa’s competitive bidding law or Iowa’s right-to-work statute.

The nonpartisan think tank Iowa Policy Project analyzed the role of PLAs in public construction and released a report in October 2004. Using the 2002 Iowa Events Center PLA as a test case, the group concluded that a PLA would inevitably cost less.

“…The county’s [Polk] construction manager estimated that both with and without the PLA, the percentage of union workers on the project would be about 90 percent to 95 percent of the workforce. However, with the PLA, the 5 percent to 10 percent of the workforce that would be nonunion in either case would probably be somewhat better paid. Its overall conclusion, however, was that the gross dollar savings from using the PLA was going to be greater than that wage differential, and the PLA would produce a worthwhile positive net benefit.”

Opponents have argued the opposite, that PLAs will drive up costs and prevent many contractors from bidding on projects.

Cedar Rapids Gazette columnist Todd Dorman said it was ironic that Branstad, who “ran on reducing the ‘size and scope’ of state government is now seeking to dictate the terms of every public works project in Iowa.” On Iowa Public Television’s “Iowa Press,” House Speaker Kraig Paulsen (R-Hiawatha) said PLAs add to the cost of projects and cause them to take longer, but eventually he declined to interject himself into the debate without talking to local officials first.