The California Legislature is set to break new ground and taxpayers should be very concerned.
For the first time in state history, the Legislature is posed to require a local government entity to mandate a project labor agreement (PLA) on a local construction project.
If Assembly Bill 155, sponsored by Assemblyman Luis Alejo (D), is passed by the California Senate, the Monterey County Water Resources Agency would have to require contractors working on the proposed $25 million Interlake Tunnel project to enter into a wasteful and discriminatory PLA as a condition of performing work if the project is built using the design-build construction delivery method.
Union lobbyists try to be discreet when they influence the California State Legislature to gain advantages in public contracting. That secrecy is now crumbling in the case of a new "urgency" bill that authorizes a Monterey County water agency to use an alternative bidding procedure to build a pipeline project.
Can unions whip this bill through the legislature before new revelations about backroom deals undermine local support for it? It depends on how many Republicans in the Assembly and Senate see construction union support as useful to their political futures.
A Mundane Objective: Awarding a Contract for a Water Storage Project
Assembly Bill 155, a bill about payroll records quickly moving through the Legislature, was gutted and amended on June 9 to suddenly become a bill requiringa Project Labor Agreement (PLA) on all construction work done on the proposed $25 million Interlake Tunnel Project to connect Lake Nacimiento and Lake San Antonio by an underground tunnel or pipeline.
This is the first time a PLA mandate has come from the state level. Historically, PLAs have always been debated in public at the local government level. Even Gov. Jerry Brown agrees that key, contested issues like this one need to be debated on all sides (and stated so in SB 922's signing message).So the question becomes, why hasn't there been a debate or mention of the PLA on Monterey County Water Resources Agency agendas? In addition, AB 155 has not gone through the proper channels of the Monterey County Legislative Committee, whose role is to review and make recommendations to the Board of Supervisors positions on legislative issues impacting Monterey County.
PLAs end open, fair and competitive bidding on public work projects, discouraging the vast majority of contractors (over 80 percent) the opportunity to bid on work. Studies indicate that projects cost an additional 13-15 percent when built under a PLA. That could increase the Interlake Tunnel Project by an additional $3.75 million.
SACRAMENTO, CALIF. — A San Rafael-based group that opposes California's high-speed rail project filed a lawsuit Monday contesting the state's plan to fund it with money from a greenhouse gas emissions program, arguing that building the $68 billion bullet train would create more pollution than it would reduce for at least a decade.
The Transportation Solutions Defense and Education Fund filed the lawsuit in Fresno County Superior Court against the California Air Resources Board, the state agency responsible for ensuring California meets the emissions reduction targets in its landmark global warming law, AB32.
The suit alleges the board downplayed the harmful effects on the environment and exaggerated the potential environmental benefits of high-speed rail in its scoping plan, allowing the state to claim the bullet train will help the state meet its greenhouse gas reduction targets.
As our economy continues to struggle to maintain momentum and consistently create jobs, the construction industry remains a source of untapped potential.
For generations, the construction industry has provided excellent career opportunities for millions of American workers. Unlike other industries, construction cannot offshore or outsource its jobs, and the Bureau of Labor Statistics projects that the construction industry's need for workers will grow twice as fast as the average for all industries. This growth, combined with an aging workforce, is projected to create a shortage of 1.6 million workers by 2022. To put this into perspective, the 1.6 million jobs projected to be available in the construction industry alone is nearly double the number of jobs created across all industries so far in 2014.
Construction provides career opportunities for Americans from all walks of life, including high school graduates, those searching for a career change and veterans transitioning into the civilian workforce. However, to qualify for these jobs, workers need high-quality and flexible skills training. Effective, targeted and accessible workforce training programs are essential to preparing new workers while also providing career development opportunities for current craft professionals.
The ongoing tug-of-war between rail backers and opponents to the project has led to delays in California's plan to build a high speed rail. Since its voter-back initiative, Proposition 1A, was passed back in 2008, the California High Speed Rail project has encountered numerous bumps in the road. The latest was the appeal denied by the Third District Court of Appeals regarding pending lawsuits between CHSRA and Kings County farmers. Now, the courts continue to delay the project because CHSRA is implementing a plan much different than the one voters approved back in 2008. Issues have a risen regarding CHSRA's financial plan, lengthened travel times and higher operating subsidies. Courts have already held that the current financial plan is not in accordance with the terms of Prop 1A.
Senator Andy Vidak, R-Hanford, argues that a majority of California voters are now opposed to the high speed rail. Senator Vidak attempted to get 4 bills passed in hopes of derailing the project. This first bill, SB 901, was an attempt to get a referendum on the November 2014 ballot to prohibit sales of additional bonds to fund the project. SB 902 would have required CHSRA to disclose its funding sources before the use of eminent domain to acquire property and required a higher compensation for any properties taken through eminent domain. In Fresno, the CHSRA has already begun the eminent domain process for property needed for new train stations; however, it is unclear whether CHSRA has enough funds to complete its initial operating segment. SB 903 would have required CHSRA to reimburse counties for lost tax revenue because of the acquisition of private properties. Finally, SB 904 would have required officials and contractors of the project to identify themselves to property owners prior to pre-condemnation entry for eminent domain purposes.
All 4 bills were rejected by the Senate Transportation and Housing committee. Legislators have been reluctant to allow California voters to re-vote on the high speed rail project. The Senate committee stated "while voters today may not approve...Californians will be thankful the state continued to pursue it." Unfortunately, these Legislators seem to have forgotten that they are in office to represent the will of the people they serve- not to dictate to the people what their will should be.
The estimated cost of building a key Central Valley segment of the California bullet train has increased by nearly $1 billion from the original estimate, based on figures in an environmental impact statement approved by the rail agency Wednesday.
The estimate, prepared for the state by a team led by San Francisco-based engineering firm URS Corp., includes higher costs for tracks, structures, land purchases, signals and electrical systems in a segment that would run from Fresno to Bakersfield.
The lowest cost estimate for the 114-mile segment in a 2011 environmental report was $6.19 billion. The comparable figure increased 15% to $7.13 billion in the new report.
An artist's rendering of a completed bullet train station. Gov. Jerry Brown wants to use cap-and-trade money to support construction for years to come. (California High-Speed Rail Authority)
The California High Speed Rail Authority said in a statement that it believes the cost will be lower than URS is projecting. In a March report to the Legislature, the authority's budget showed smaller increases totaling $222 million for the section, although that estimate included a different set of assumptions.
The authority still forecasts that the entire Los Angeles-to-San Francisco line can be built for about $68 billion. Some critics and experts noted that the prospect of higher costs is arising before construction has begun.
"A $1-billion cost increase at this point in the project is concerning, to put it mildly," said William Ibbs, a UC Berkeley civil engineer who has consulted on high-speed-rail projects around the world.
The environmental impact report approved Wednesday marks a key milestone in the effort to issue contracts and build the high-speed train through the Central Valley. The section is part of a 130-mile initial construction package that would be completed by about 2018. Construction on the first 29-mile segment through Fresno is supposed to start by July.
Rail authority Chairman Dan Richard said the approval of the environmental document was a culmination of extensive discussions with community representatives and elected officials to ensure that impacts of the project are mitigated and that it "benefits Central Valley residents now and into the future."
A $1-billion cost increase at this point in the project is concerning, to put it mildly.- William Ibbs, a UC Berkeley civil engineer
Cost estimates for the Fresno-to-Bakersfield segment have been the subject a dispute between URS and state officials, records show. In a March progress report to the rail authority, the consulting firm complained that it had been "instructed" by the authority to hold cost estimates for the project's business plan at a "baseline" that was set in 2012. URS wrote that "in its professional opinion" the authority was incorrectly assigning projected cost increases to a contingency account.
URS appeared to be taking a strong stand. Under the state's code of conduct for licensed professionals, engineers can "only express professional opinions that have a basis in fact or experience or accepted engineering principles."
In response to Times inquiries about the URS assertions, the rail authority provided a copy of a letter written to the firm April 30 saying its statements were "misleading and not accurate." The authority also wrote that estimated cost increases were not shifted to a contingency account but reflected in the environmental impact statement. The letter instructed the firm to correct its report.
URS declined to comment and it wasn't clear Wednesday if the company had revised the report.
The Legislature currently is weighing a plan to allocate new funding to the bullet train project from fees imposed on firms generating greenhouse gases.
Elizabeth Alexis, a critic and co-founder of a Bay Area group that closely monitors the project, said she believes that the authority is facing cost pressures that are not being fully shared with the public and lawmakers.
"The $1 billion is a significant increase on the one segment that has gotten closer scrutiny than the rest of the project," she said. "If the authority re-prices all of the segments with the same scrutiny, what would be the real cost?"
It is noteworthy that over the life of a project ... there will be several estimates. A change in one estimate does not necessarily result in a change to our budget.- Rail authority
The rail authority's statement said the URS cost figure is an engineering "estimate" and subject to change.
The ultimate cost of the Central Valley segment will be determined by many factors not yet known, the statement said, which may explain why URS produced a higher estimate.
"It is noteworthy that over the life of a project, as design progresses, there will be several estimates," the authority said. "A change in one estimate does not necessarily result in a change to our budget."
Several capital staffers and officials who review the project said they were not aware of URS' $1-billion estimated cost increase, including state Sen. Mark DeSaulnier (D-Concord), chairman of the Senate Transportation Committee. "I don't know how anyone could trust their numbers," he said.
In its March report to the state, URS also said that it had not been paid some $19 million owed by the authority since 2013, causing subcontractors to threaten to stop working.
A rail authority spokeswoman said the agency had internal accounting problems last year that resulted in a number of contractors not getting promptly paid for work. In addition, the Federal Railroad Administration was slow in processing grant payments to the state, which held up the flow of money. The state lost access to $9 billion in state bond funding last year after a judge ruled that it had failed comply with provisions of state law, forcing the rail project to depend largely on federal grant payments.
The spokeswoman said the problems with delayed payments to URS have been fixed and the company has been paid about $25 million, leaving $6 million still in process and $3.6 million still in dispute.
Regularly scheduled service on California's bullet train system will not meet anticipated trip times of two hours and 40 minutes between Los Angeles and San Francisco, and are likely to take nearly a half-hour longer, a state Senate committee was told Thursday.
The faster trips were held out to voters in 2008 when they approved $9 billion in borrowing to help pay for the project. Since then, a series of political compromises and planning changes designed to keep the $68-billion line moving ahead have created slower track zones in urban areas.
But Louis Thompson, chairman of the High-Speed Rail Peer Review Group, a state-sanctioned panel of outside experts, testified that "real world engineering issues" will cause schedules for regular service to exceed the target of two hours and 40 minutes. The state might be able to demonstrate a train that could make the trip that fast, but not on scheduled service, he told lawmakers. If public demand for the service supports additional investments, travel times could be improved after the currently planned system is built, he said.
Union activists in San Francisco recently filed suit to block Google's commuter buses from stopping at City bus stations– a privilege for which Google pays the City handsomely. Why might activists use an environmental regulation to block buses that eliminate at least 45 million vehicle miles and 761,000 tons of greenhouse gas emissions a year and also includes a $6.8 million giftto support transit for low and moderate income youths? It's impossible to know about the Service Employees Union's real motives but its leadership suggests the suit is not about green— unless you mean greenbacks. SEIU is concerned that Google Bus could lead to less reliance on the publicly subsidized transportation system—in effect reducing the union's choke-hold on bay area transportation and perhaps threatening their high-paying jobs.
Unfortunately, using California's Environmental Quality Act (CEQA) for non-environmental motives is a common problem. In large part because California is one of only three states that subject private projects to this scrutiny, competing groups use the threat of CEQA litigation to obtain special benefits that have nothing to do with the environment. In fact, CEQA abuse often harms the environment by delaying renewable-energy projects, infills, public transit, and other "green" projects.
Unions often use CEQA to delay projects until developers capitulate to project labor agreements that exclude non-union labor. In fact, large scale projects are rarely completed without a project labor agreement. In San Diego, for example, officials used private emails to secretly negotiate guaranteed project labor agreements in exchange for dropping a CEQA lawsuit.
The California High-Speed Rail Authority plans to appeal a court ruling that would send the agency to trial on whether its planned bullet train can live up to performance requirements required under state law.
Sacramento Superior Court Judge Michael Kenny this week denied the rail agency's motion to dismiss part of a lawsuit filed by Kings County and two of its residents, farmer John Tos and homeowner Aaron Fukuda. Kenny's ruling Tuesday set the stage for a potential trial later this spring.
On Thursday, the rail authority said it will ask the Third District Court of Appeal for a writ to overturn Kenny's ruling. "We disagree with the March 4 Sacramento Superior Court ruling and are preparing to seek a review by the Court of Appeal," said Lisa Marie Alley, a spokeswoman for the agency.