Responsible Contractor Ordinance – City of Portland
Overview: Labor unions are pushing what they call a “responsible contractor ordinance” (RCO) for the City of Portland. Adoption of this language will prevent 95% of area construction employees from working on public construction projects. The sole purpose of this ordinance is to ensure that only union contractors are permitted to work on public construction projects in Portland.
While portions of the RCO may seem reasonable – like having valid licenses, meeting bonding requirements and following existing state law – the portion dealing with apprenticeship training in Sec. 3 (b)(11) precludes virtually all open-shop contractors from workingon public construction projects.
Other elements of the proposed RCO, like requiring a particular type of safety training (the one unions use) and forcing workers into outdated and restrictive union trade classifications, are onerous and unnecessary – again, designed to prevent open-shop contractors from getting the work.
This RCO would also require city contractors to fix wages for workers – making it the first city in Maine to force employers to set wages and benefits by union-based trade classifications, rather than the worker’s merit and skill.
Associated Builders and Contractors of Maine strongly opposes this Responsible Contractor Ordinance. We believe it is discriminatory and will drive up the cost of public construction by limiting competition. ABC also believes that every employee has a right to join a union if they so desire, but all public construction work should be awarded to the lowest responsible bidder without regard to union affiliation.
Who is promoting this discriminatory RCO?
The AFL-CIO’s building trades unions crafted the sample ordinance language and they are pushing it all over the country. Union leaders tried and failed to get a very similar ordinance passed in Portland in 2002. They have also tried and failed to get elements of this RCO passed at the Legislature.
Why are labor unions promoting the RCO?
It's all about market share - union's can't compete on a level playing field, so they want to change the rules to slant them in their favor. On the surface, RCOs seem like a reasonable effort to protect local communities from contractors and subcontractors who do not perform up to their standards. Once you examine the details of the ordinance, however, it becomes apparent that the real purpose is to ensure that only union contractors can meet the criteria drafted by the unions because only they run the type of apprenticeship programs that meet the criteria of these ordinances.
Is this RCO necessary to protect Portland taxpayers?
No. Contractors who bid on public work must secure bonding as a prerequisite to performing work on a public construction project. In order to secure bonding, a contractor must demonstrate that they are financially sound, operate safely and have a proven track record of performing construction work. A good procurement policy would maintain a level playing field while protecting the public from inferior contractors by asking for and obtaining relevant information about their qualifications. It would not, as this one does, arbitrarily exclude qualified contractors based on union membership.
Will this RCO result in increased construction costs?
Yes, for a variety of reasons. Discriminating against the vast majority of contractors in Maine will reduce the number of bidders: reduced competition on public construction projects equals increased construction costs – that’s Economics 101. Extra administrative costs will be incurred by both the contractors and the City of Portland for monitoring RCO compliance – that will get passed on to the taxpayers. In the construction industry, time is money, so if contractor selection could be delayed by as much as 51 days will carry the risk in their bids. Additionally, applying fixed wage requirements to projects not normally subject to Maine’s prevailing wage laws will increase labor costs.
Are union apprenticeship programs the only training available?
Today there are many alternative avenues that provide quality construction education. Maine’s technical high schools, community colleges and universities offer outstanding craft education. ABC partners with many of these programs and helps raise money to pay for equipment and their curriculum – the National Center for Construction Education and Research’s CONTREN® - through our Downeast Construction Education Foundation. It is recognized nationally for its excellence and provides a modular, portable craft education that is as good – if not better than – the outdated union apprenticeship model.
Most construction companies in Maine have outcome-based training programs that allow employees to learn at their own rate, based on their ability rather than an arbitrary union timeline. These highly specialized in-house safety and training programs produce the skilled workforce contractors need.