To: Sonoma County Board of Supervisors
Department or Agency Name(s): County Administrator’s Office
Staff Name and Phone Number: Yvonne Shu 565-1739, Christel Querijero 565-7071
Vote Requirement: Majority
Supervisorial District(s): Countywide
Title:
Title
Project Labor Agreement Policy
End
Recommended Action:
Recommended action
A) Consider potential updates to the Project Labor Agreement Policy:
i. Whether to lower the project cost threshold;
ii. Whether to include the Sonoma County Water Agency and the Sonoma County Fairgrounds under the Project Labor Agreement Policy; and
iii. Whether to include an emergency response exemption.
B) Provide direction to staff on potential updates
end
Executive Summary:
The County adopted a Policy and Template Agreement in 2014 for the use of Project Labor Agreements (PLA) for County construction projects estimated at or above $10 million in total construction costs. Since the adoption of the policy, the County has not completed any projects that require compliance with the Board’s PLA policy. In anticipation of the proposed County Government Center project, the PLA Ad Hoc Committee, comprised of Supervisors Hopkins and Rabbitt, revisited the policy in 2022 to understand policy update opportunities. A racial equity analysis is attached for this item.
Discussion:
Background
Project Labor Agreements are collective bargaining agreements negotiated for construction projects, typically between the County as the project owner and the local building trade unions.
A PLA is a form of a pre-hire agreement that sets the terms of employment for construction workers engaged construction projects that contractors and subcontractors must adhere to during the entire construction project, and the Project Labor Agreement becomes part of the bid specifications. Winning contractors are required to execute an agreement to be bound by the terms of the PLA. A PLA remains effective for the duration of the project.
In general, elements of a PLA include no-strike, no-lockout clauses; grievance/arbitration procedures; specifying the wages and fringe benefits for all workers on a project; and generally, requiring contractors to hire workers for the project through a union hiring hall that is responsible for supplying skilled labor. PLAs may also include clauses outlining goals for hiring local community members on projects; incorporating equity plans; detailing strategic recruitment policies for workers from underserved communities; and requiring participation of small businesses.
Mitigating labor disruptions is often cited as a key benefit of having a PLA. Notably the County has only experienced one construction work stoppage, which occurred when the County workforce itself was striking. Attachment 1 contains an overview of arguments for and against PLAs, as summarized from two existing analyses on PLAs.
Feedback received from external stakeholders in 2022 when the PLA was first revisited is compiled in (Attachment 2). More recently, staff confirmed with the North Bay Building & Construction Trades Council (NBBCTC) that the information that the City of Santa Rosa included in their July 2022 staff report is still representative of their members and apprentice program (Attachment 3).
Policy Areas Requiring Board Consideration and Direction
The PLA Ad Hoc Committee considered potential policy updates based on the following goals: increasing local job creation; supporting training and internship opportunities in the building trades; avoiding costly labor disruptions or work stoppages; ensuring adequate health, welfare, and retirement benefits for workers; ensuring that the use of a PLA does not significantly increase County project costs; and supporting the County’s commitment to achieving racial equity. The PLA Ad Hoc directed staff to bring forward for the Board’s consideration the following PLA policy areas:
1 - Whether to lower the PLA project cost threshold
The current PLA policy and template, adopted in 2014, has a project threshold of $10 million (Attachment 4). The County has yet to complete any projects that would require the use of a PLA. However, the Behavioral Health Housing Unit and the Morgue and Public Health Lab projects, should they move forward, would both have construction costs that would exceed the current $10 million threshold for development of a PLA.
Lowering the threshold amount would increase the number of future projects required to use a Project Labor Agreement, depending on how low the threshold might move. In addition to the previously mentioned Behavioral Health Housing Unit and Morgue and Public Health Lab, the County, (excluding the Water Agency and Public Infrastructure’s Airport division), has completed one project each in the $5.0 to $9.9 million tier and the $3.0 to $4.9 million tier since adoption of the PLA template in 2014 (Attachment 5). There are a variety of PLA thresholds for other jurisdictions, with examples in Attachment 6:
• Alameda County <https://www.acgov.org/board/bos_calendar/documents/DocsAgendaReg_10_06_20/GENERAL%20ADMINISTRATION/Regular%20Calendar/GSA_301589.pdf>: $1 million
• City & County of San Francisco <https://sf.gov/information/understanding-citywide-project-labor-agreement>: $1 million
• Santa Clara County <https://boardclerk.sccgov.org/sites/g/files/exjcpb656/files/BOSPolicyCHAP5.pdf> (see section 5.7.5.4): $2 million
• City of Santa Rosa: $500,000
• Santa Rosa Junior College: project-specific
The nature of a PLA is such that it is negotiated before a project is put out to bid. Any lowering of the PLA threshold would necessarily mean that staff workload would increase. Previous attempts at PLAs required 2-3 months of negotiations and weekly meetings with labor advocates involving County Counsel, outside counsel and the project lead. A master agreement that would be applicable for all qualifying projects would front-load the negotiations that would be applicable for future projects, eliminating the need to negotiate a PLA with each project.
2 - Whether to include the Sonoma County Fair and Sonoma Water in the PLA policy
Construction projects for the Sonoma County Water Agency (“Sonoma Water”) AND Sonoma County Fair are currently not subject to the County’s PLA policy. Similar to lowering the project cost threshold, including these entities could increase the number of projects that could potentially expand employment opportunities locally, but there may be limitations on applying PLAs to projects that include federal funding.
From 2014-2022, Sonoma Water had one project over $10 million and five projects in the $5.0 to $9.9 million range.
Sonoma Water estimates that about 90% of their projects already use organized labor. The most recent and relevant project at the Fair, the construction of the Saralee and Richards Barn, was under the PLA threshold amount and was funded with donations.
3 - Whether to include an emergency response exemption
The current PLA template does not exempt emergency responses. This proposal would remove the requirement of a PLA for construction projects related to the County's disaster and emergency response work, pursuant to the Public Contract Code. This provision would allow the County to move quickly to protect life, public health, and property when disaster strikes.
Anticipated Next Steps
With Board majority direction on these policy areas, staff anticipates returning with an updated PLA template in September 2023.
Strategic Plan:
N/A
Racial Equity:
Was this item identified as an opportunity to apply the Racial Equity Toolkit?
Yes
Staff used the Government Alliance on Race and Equity’s (GARE) Equity Toolkit to provide a general equity analysis (Attachment 7) of a PLA policy.
Prior Board Actions:
§ January 28, 2014: Adopted a Policy and Template Agreement for the use of Project Labor Agreements on future County construction projects over $10 million
Fiscal Summary
Narrative Explanation of Fiscal Impacts:
There is a potential for overall project costs to be higher with a PLA than without a PLA.
For County staff, estimated internal and external counsel time in 2022 for discussions for the County Government Center, was 80 hours, in addition to commensurate staff time from Public Infrastructure’s project lead. Note that this is estimate is based only on an incomplete discussion/negotiation for a revised PLA template, since the County Government Center project has since been postponed.
Narrative Explanation of Staffing Impacts (If Required):
N/A
Attachments:
Attachment 1 - Summary of arguments for/against PLA’s
Attachment 2- 2022 written comments
Attachment 3 - NBBCTC demographics
Attachment 4 - County PLA template
Attachment 5 - Capital projects
Attachment 6 - County Working PLA Comparison Matrix
Attachment 7 - Racial Equity Analysis
Related Items “On File” with the Clerk of the Board:
N/A