Dilapidated schools in Kentucky may get funds for repair and new construction from the Special Session, now that the House has passed H.B. 2, which would provide $1.3 billion for education facilities.
The Kentucky Opportunity Coalition is correct to demand that school construction be exempted from the prevailing wage. Whatever amount of money is ultimately appropriated to school facilities, repeal of the prevailing wage will allow that amount to go ten percent further.
In a press release today, the Coalition chair Kristin Webb Hill noted
The Kentucky Legislative Research Commission (LRC) has reported that the wage portion of prevailing wage projects is more than 20% higher than if area market-based wages were utilized. That translates into an estimated 10% of total project costs that are underutilized due to the prevailing wage requirement.
"If we are going to make the commitment, let's maximize our investment dollar," Hill added. "Instead of potentially directing nearly $130 million toward artificially inflated wages, let's invest that money in the next generation of Kentucky's minds.
I don't see an extra $130 million laying around for politicians in Frankfort to squander. Let's do right by those Kentucky children who are forced to attend schools so run down that they should be condemned and repeal the prevailing wage. That will ensure that whatever money Frankfort can dedicate to school construction does not get wasted.
Showing posts with label prevailing wage. Show all posts
Showing posts with label prevailing wage. Show all posts
Monday, June 22, 2009
Thursday, June 11, 2009
Thayer Asks Beshear to Add Prevailing Wage to Special Session Call
Sen. Damon Thayer (R-Georgetown) has requested Gov. Steve Beshear to add repeal of the prevailing wage (as applied to schools) to the list of topics called for in the upcoming Special Session.
Thayer's press release notes that as a first priority, we must "dedicate ourselves to maximizing every dollar we invest in Kentucky’s future." The prevailing wage, according to Thayer, is one area in which Kentuckians are not getting the maximum possible return on their taxes spent:
According to a report by the Legislative Research Commission, Kentucky’s prevailing wage laws artificially inflate school construction labor costs by 21 percent. That means that 21 cents of those dollars are directed at inflated wages as opposed to going toward investments in larger schools, enhanced technology, more energy efficient facilities and an overall better environment for Kentucky’s children to learn in.
In 2004, KDE estimated that between 1999 and 2004, the prevailing wage law artificially increased the cost of school construction by more than $480 million. To put this in perspective, the total resource requirements in 2005 to meet the reported “needs assessment” of Category 4 and 5 schools, schools in the worst physical shape, was just under $500 million. Had the dollars that were directed toward inflated prevailing wages during that period been invested in our schools –nearly every child in Kentucky would have been attending an adequate school.
This is why I filed legislation to repeal “prevailing wage” during the 2009 Session and it is my intent to do so again.
Kentucky has too many children attending schools that are no more than hovels. There is no extra money to give to education this year, so at the very least, let's make sure that what little we can spend goes as far as possible.
Thayer is to be congratulated for this sensible requesst to stop padding the cost of school construction. Again, this is not a proposal to spend more -- just to spend more wisely. Beshear should add it to the Special Session call.
Thayer's press release notes that as a first priority, we must "dedicate ourselves to maximizing every dollar we invest in Kentucky’s future." The prevailing wage, according to Thayer, is one area in which Kentuckians are not getting the maximum possible return on their taxes spent:
According to a report by the Legislative Research Commission, Kentucky’s prevailing wage laws artificially inflate school construction labor costs by 21 percent. That means that 21 cents of those dollars are directed at inflated wages as opposed to going toward investments in larger schools, enhanced technology, more energy efficient facilities and an overall better environment for Kentucky’s children to learn in.
In 2004, KDE estimated that between 1999 and 2004, the prevailing wage law artificially increased the cost of school construction by more than $480 million. To put this in perspective, the total resource requirements in 2005 to meet the reported “needs assessment” of Category 4 and 5 schools, schools in the worst physical shape, was just under $500 million. Had the dollars that were directed toward inflated prevailing wages during that period been invested in our schools –nearly every child in Kentucky would have been attending an adequate school.
This is why I filed legislation to repeal “prevailing wage” during the 2009 Session and it is my intent to do so again.
Kentucky has too many children attending schools that are no more than hovels. There is no extra money to give to education this year, so at the very least, let's make sure that what little we can spend goes as far as possible.
Thayer is to be congratulated for this sensible requesst to stop padding the cost of school construction. Again, this is not a proposal to spend more -- just to spend more wisely. Beshear should add it to the Special Session call.
Friday, May 15, 2009
Metro Council Votes to Waste More $
The Metro Counsel voted at 1:30 this morning to require that contractors on its projects that cost more than $500,000 pay the prevailing wage. This was a Democratic initiative, and the Republicans argued strenuously against it but did not have enough votes.
The Courier-Journal has done a good job covering the issue. The prevailing wage,
is defined by state statutes as the “predominant” wage paid to trades in a locality, in this case Jefferson County. It is calculated by taking the average of wages paid on all public projects, similar private projects and union wages.
The problem with it is that by forcing the city to pay union wages, it distorts the market -- it artificially inflates the cost of public construction by preventing anyone from undercutting the unions (and thereby saving taxpayers money).
Earlier this week, the C-J noted that the Chamber of Commerce and Greater Louisville, Inc. fear that the prevailing wage ordinance could put Louisville at a disadvantage when recruiting new businesses to move here. Why? Because the ordinance will apply even if the city is involved a small percent of a project that is primarily paid for with private dollars.
Billy Parson, president and CEO of the Associated Builders & Contractors of Kentuckiana, Inc., said the big difference between union and non-union wages is the amount paid for benefits.
Parson said union carpenters can expect to earn just over $32 an hour, including about $11 in benefits. Nonunion carpenters earn more like $23 an hour, with about $5 an hour going to benefits, he said.
"This is just government interference in the free market and will add unnecessary costs to projects," Parson said, adding that under prevailing wage, a carpenter with one year of experience could earn the same as a carpenter with 20 years of experience.
Those who support the bill say that it somehow levels the playing field.
Democratic council members Jim King (10th District) and Rick Blackwell (12th) are sponsoring the ordinance, saying it's necessary to ensure that local workers see a proper return on city tax dollars invested in big projects.
"It's important to make sure, as much as we can, that jobs produced by local tax dollars keep our local people working," Blackwell said. "For me, it's about local jobs for local workers."
But the ordinance discriminates against anyone -- including local workers -- who would underbid the going rate that the union charges. So this is not just about "local jobs for local workers" but rather government-subsidized jobs for local union workers.
The Kentucky Opportunity Coalition has been all over the prevailing wage issue as it relates to artificially inflating the cost of school construction. Check out their blog as this issue heats up.
Now that our federal government is the majority shareholder in GM ("Government Motors"), it seems our Metro government has decided to enter the construction business -- unless Mayor Jerry understands that this is not the time to inflate the cost of anything the city does and vetoes this ordinance.
The Courier-Journal has done a good job covering the issue. The prevailing wage,
is defined by state statutes as the “predominant” wage paid to trades in a locality, in this case Jefferson County. It is calculated by taking the average of wages paid on all public projects, similar private projects and union wages.
The problem with it is that by forcing the city to pay union wages, it distorts the market -- it artificially inflates the cost of public construction by preventing anyone from undercutting the unions (and thereby saving taxpayers money).
Earlier this week, the C-J noted that the Chamber of Commerce and Greater Louisville, Inc. fear that the prevailing wage ordinance could put Louisville at a disadvantage when recruiting new businesses to move here. Why? Because the ordinance will apply even if the city is involved a small percent of a project that is primarily paid for with private dollars.
Billy Parson, president and CEO of the Associated Builders & Contractors of Kentuckiana, Inc., said the big difference between union and non-union wages is the amount paid for benefits.
Parson said union carpenters can expect to earn just over $32 an hour, including about $11 in benefits. Nonunion carpenters earn more like $23 an hour, with about $5 an hour going to benefits, he said.
"This is just government interference in the free market and will add unnecessary costs to projects," Parson said, adding that under prevailing wage, a carpenter with one year of experience could earn the same as a carpenter with 20 years of experience.
Those who support the bill say that it somehow levels the playing field.
Democratic council members Jim King (10th District) and Rick Blackwell (12th) are sponsoring the ordinance, saying it's necessary to ensure that local workers see a proper return on city tax dollars invested in big projects.
"It's important to make sure, as much as we can, that jobs produced by local tax dollars keep our local people working," Blackwell said. "For me, it's about local jobs for local workers."
But the ordinance discriminates against anyone -- including local workers -- who would underbid the going rate that the union charges. So this is not just about "local jobs for local workers" but rather government-subsidized jobs for local union workers.
The Kentucky Opportunity Coalition has been all over the prevailing wage issue as it relates to artificially inflating the cost of school construction. Check out their blog as this issue heats up.
Now that our federal government is the majority shareholder in GM ("Government Motors"), it seems our Metro government has decided to enter the construction business -- unless Mayor Jerry understands that this is not the time to inflate the cost of anything the city does and vetoes this ordinance.
Tuesday, March 3, 2009
A Chance for Fiscal Sanity in Frankfort
Given Kentucky's budget crisis -- and how desperately our schools need upgrading -- one piece of legislation is like a breath of fresh air in Frankfort. It's SB 145, an Act Relating to School Construction, filed by Senator Damon Thayer. This legislation would exempt school's from the prevailing wage requirement of KRS 337.010.
That exemption would save schools approximately 21 percent on the labor costs of construction, which means that more schools could be built, repaired or upgraded for the same amount of money, according to the Kentucky Opportunity Coalition.
The Kentucky Department of Education Facilities Management Division found in 2004 that subjecting Kentucky schools to the prevailing wage requirement inflated construction costs by more than $480 million. That money could have done alot of good for our children, had it not been wasted.
Kentucky does not have that kind of money to squander -- particularly given that 90,000 of our children attend sub-par schools. For some districts, the problem is overcrowding. Other schools are in such bad shape that they should be condemned. Few schools offer the state of the art technology (like "smart classrooms") that can best help teachers teach and children learn.
So it is very refreshing to see someone introduce legislation that reflects good stewardship of our tax dollars and a practical way to help our schools. SB 145 deserves quick enactment. Tell your elected officials that Kentucky cannot afford to artificially inflate the cost of school construction by 21 percent.
That exemption would save schools approximately 21 percent on the labor costs of construction, which means that more schools could be built, repaired or upgraded for the same amount of money, according to the Kentucky Opportunity Coalition.
The Kentucky Department of Education Facilities Management Division found in 2004 that subjecting Kentucky schools to the prevailing wage requirement inflated construction costs by more than $480 million. That money could have done alot of good for our children, had it not been wasted.
Kentucky does not have that kind of money to squander -- particularly given that 90,000 of our children attend sub-par schools. For some districts, the problem is overcrowding. Other schools are in such bad shape that they should be condemned. Few schools offer the state of the art technology (like "smart classrooms") that can best help teachers teach and children learn.
So it is very refreshing to see someone introduce legislation that reflects good stewardship of our tax dollars and a practical way to help our schools. SB 145 deserves quick enactment. Tell your elected officials that Kentucky cannot afford to artificially inflate the cost of school construction by 21 percent.
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