Union Watch Highlights

Project labor agreements: Mass. taxpayers lose again
Editorial, July 24, 2012, Boston Globe
Although it lacks any compelling reasons for doing so, the Patrick administration is continuing to impose project labor agreements on some major state projects. Those agreements restrict work to contractors who agree to use union labor and abide by union work rules, effectively excluding the state’s nonunion firms and nonunion workers, and raising costs at a time when the state’s transportation coffers are already running dry. In March, the administration put a PLA on the $260 million reconstruction of the Longfellow Bridge. In June, it slapped one on a $265 million project to rebuild the Whittier Memorial Bridge, which carries Interstate 95 traffic over the Merrimack River between Amesbury and Newburyport. The administration has also previously used a project labor agreement to restrict $750 million in renovation and reconstruction work at the University of Massachusetts at Boston to union labor. Now, several studies have indicated that these agreements push the price of construction projects up significantly. When the Beacon Hill Institute, Suffolk University’s market-oriented think tank, looked at school-construction projects in Massachusetts, Connecticut, and New York, it found that PLAs had added at least 12 percent to construction costs. Other studies have suggested that limiting bidders boosts prices even more. (read article)

California’s Proposition 32 opponents blast measure as flawed, unfair
By Jon Ortiz, July 23, 2012, Sacramento Bee
Leaders and activists representing good government advocates and labor organizations today officially lauched their fight against a campaign finance reform measure on the November ballot, depicting it as unfair and fatally flawed. The measure, Proposition 32, eliminates payroll-deducted monies from use for political purposes by unions and corporations. It also bans campaign contributions by either interest group, although both could continue spending unlimited sums on independent expenditure efforts. Union representatives at a downtown Sacramento press conference said the measure would devastate organized labor, however, because unions depend on payroll deductions for their political funding. Corporations play in politics with money donated by company executives and from corporate treasuries. The measure’s backers have said that Prop. 32 is an even-handed reform that would limit influence over California politics by both labor and business. “If Propostion 32 passes, it will silence our voice,” said Emily Lo, a member of Davis Professional Firefighters Association Local 3494. Trudy Shafer of the League of Women Voters and Derek Cressman of Common Cause both blasted the measure as misleading. Cressman said that the initiative wouldn’t affect businesses that aren’t structured as corporations, such as limited liability companies, and does nothing to keep executives from writing big checks to politicians. Jake Suski, spokesman for the union-backed Yes on 32 campaign, said that the measure doesn’t restrict workers’ free speech at all and is written to mirror federal campaign contribution law. (read article)

Walters: Prop. 32 will put California voters to the test
By Dan Walters, July 23, 2012, The Sacramento Bee
Warring factions will spend untold millions of dollars on political propaganda to sway California voters on Proposition 32 this year, and while each denounces the other as a pack of scoundrels, neither likes the media’s capsule description, “paycheck protection.” Twice before, in 1998 and 2005, voters rejected measures that would restrict unions from collecting political funds via payroll deductions, so backers came up with a new wrinkle in 2012. They expanded it into a ban on direct contributions to political candidates from both unions and corporations, while continuing to prohibit payroll deductions without specific permission from union members or corporate employees. That means, its sponsors say, that it’s an even-handed restriction on both labor and management, so the term “paycheck protection” no longer applies. But opponents contend that the corporate restrictions have loopholes so the real effect is still to curb union political power. And they prefer the term “special protections act.” (read article)

Some investors worry Fresno might be California’s next bankrupt city
By Kurtis Alexander and George Hostetter, July 23, 2012, Fresno Bee
The recent bankruptcy filings of three California cities have U.S. investors worried that Fresno could be next to go down this road, according to a major Wall Street financial house. Vikram Rai, strategist with Citigroup Inc., said bond investors are increasingly asking about the financial health of Fresno out of concern that the city will seek court protection from its debt obligations and that millions of investment dollars will be lost. Stockton, San Bernardino and Mammoth Lakes have filed for bankruptcy protection this summer. “Investors worry about contagion,” Rai told the Bee. “Many California cities are in a tough situation.” Fears about Fresno in the trading world were reported in Citigroup’s investment strategy report, which this month said that “the harsh spotlight (of potential bankruptcy) has shifted to Fresno.” The comments were seized by a handful of nationally syndicated news outlets, which fueled further speculation of Fresno’s impending march to Chapter 9, the public version of Chapter 11. Many news reports suggested that bankruptcy has become an increasingly convenient — and less vilified — path for cash-strapped cities. (read article)

Chicago Teachers Union vs. Reality
Editorial, July 23, 2012, Chicago Sun-Times
It is time rage met reality. Buried in an independent fact-finder’s report last week that sought to resolve the bitter contract dispute between the Chicago Teachers Union and the school system, arbitrator Edwin Benn spoke of the union’s “rage.” That rage, which Benn describes as “understandable,” is fueled by a decision by CPS last fall to cancel a 4 percent raise for teachers, coupled with a move to a longer school day and year without a major bump in pay. Understandable, yes. Yet CPS’ decisions are deeply and correctly rooted in an undeniable fiscal reality. The board prudently canceled the 4 percent raise not because it fails to appreciate teachers, or the rage they feel about poor working conditions, poor learning conditions and the injustice of a poorly funded school system. The raise was canceled last fall for the same reason CPS can’t offer a major pay increase today: It doesn’t have the money. Plus, as Benn noted, between 2007 and 2012, teachers benefitted from an “extremely lucrative contract,” under which they earned raises ranging from 19 to 46 percent. This coincided, of course, with the Great Recession, when raises of any kind were scarce. (read article)

Union says contract with TSA is near
By Joe Davidson, July 23, 2012, Washington Post
The union representing about 45,000 transportation security officers (TSO) says it is on the verge of finalizing a contract with the Transportation Security Administration (TSA). “Following marathon negotiations, AFGE and TSA are close to a historic labor contract,” John Gage, president of the American Federation of Government Employees, said Sunday. “We have partial agreement, but we ran out of time at about 3 a.m. Saturday before we could complete the entire agreement. Both parties remain committed to reaching an agreement and will go forward from here to bring the negotiations process to a successful conclusion.” This would be the first labor agreement for the officers who screen passengers and baggage at the nation’s airports. They choose AFGE as their bargaining agent 13 months ago, after more than a decade of pushing for collective bargaining rights. (read article)

California student assistants get the ax as part of union pay-cut deal
By Jon Ortiz, July 23, 2012, Sacramento Bee
California’s ongoing state budget crisis has claimed another victim: student state workers. In a few weeks the state will ax hundreds of their jobs – just as the school year gets under way. Meanwhile, the state’s university systems have hiked tuition and will probably do it again if voters reject Gov. Jerry Brown’s tax proposal on November’s ballot. And with job prospects for young adults more scarce than for other age groups, students such as Sacramento State junior Amber Amey aren’t sure what they’ll do. “I don’t really have a plan yet, because we were just informed about this,” Amey said last week during a break from her job in California State Teachers’ Retirement System’s call center. “It stinks.” Amey’s post and those of about 1,600 state student assistants will soon be the collateral damage of a labor deal struck last month to help close a $15.7 billion budget deficit. Brown and the state’s largest public employees union, Service Employees International Union Local 1000, agreed the 95,000 state workers it represents would take 12 unpaid days off through next June 30 in exchange for, among other things, purging the state payroll of student assistants as of Sept. 1. (read article)

Union Money Floods New York City’s 2013 Election
By Michael Howard Saul, July 23, 2012, Wall Street Journal
Unions have significantly stepped up campaign contributions to New York City candidates compared with four years ago, a sign that organized labor intends to exert more influence in the 2013 race for City Hall. The Retail, Wholesale and Department Store Union has already contributed more than $31,000 to candidates seeking public office in 2013, double what the union had spent at this point four years ago, according to records filed with the city’s Campaign Finance Board. The union has already successfully lobbied the City Council to adopt a living-wage bill. (read article – subscription required)

California’s public employee unions oppose Prop. 32
By Nannette Miranda, July 23, 2012, News 10 Sacramento
Government groups are joining forces with powerful public employee unions to oppose Proposition 32, which aims to curtail big money influence at the state Capitol. The alliance calls the November ballot measure deceptive and does little to stop unlimited spending by independent groups called Super PACs. “Proposition 32 is not at all what it seems,” League of Women Voters spokesperson Trudy Schafer said. “It promises political reform, but it’s really designed by its special interests to help themselves and harm their opponents.” This is the third attempt by Orange County Republicans to go after the influence of labor groups, but this time, they’ve broadened the restrictions to include corporate money. (read article)

We need to compare public compensation with private industry
By Ward Fredericks, July 21, 2012, The Desert Sun
There has been much discussion about transparency and the cost of local government in the Coachella Valley. The facts about employee salary levels, perks, holidays and pensions have started to come out from the nine cities. The Desert Sun is providing information never available before. The level of public compensation in this valley appears to be well above prevailing wages, and the further inclusion of health care, pension donation support, paid holidays and banking of sick days and personal days is unlike anything I’ve seen elsewhere after 40 years in the private sector. Growing pension liabilities and the underfunding and poor performance of the California Public Employee Retirement System investment management suggests we have large and unknown liabilities for every city that are on no balance sheet or disclosure document. Basing pensions on inflated final rather than average earnings further balloons the liability of the public. Even the new and improved renegotiated deals are unsustainable in the real world. (read article)

Labor Unions Are Hurting Philadelphia
By Joel Mathis, July 20, 2012, Philadelphia Post
Unions built Philadelphia. Hell, they built America. But today, Philadelphia’s public unions are leading the city into permanent decline. That’s a painful conclusion if, like me, you’re a liberal who believes deeply in the right of workers to advocate for better pay, benefits and workplace conditions. Look around the city, though, and this is what the evidence shows: Public unions drain the city’s resources. There are roughly 35,000 public-sector pensioners in Philadelphia, consuming up to 18 percent of the city’s budget—money not used to do things like keep libraries open. (read article)

Union Woes Can Be Good News for Gov. Jerry Brown
By John Wildermuth, July 20, 2012, Fox & Hounds
Paying attention to July polls for November ballot propositions is a bit like betting on pre-season NFL games: just because you can doesn’t mean you should. Having said that, though, an online poll by the California Business Roundtable and Pepperdine University School of Public Policy has some mighty welcome news for Gov. Jerry Brown. Sure, it’s good that his Prop. 30 tax initiative has a 56 percent to 39 percent lead in an admittedly self-selecting poll. And Team Brown likely is relieved to see that Molly Munger’s rival tax measure has its numbers almost reversed, with 35 percent in favor and 54 percent opposed. But the most exciting news for the governor, not that you’d ever get him or his supporters to admit it, involves Prop. 32, which would bar unions from using payroll deductions to collect money for their political contributions. According to the polling, the anti-union measure is way popular with voters right now, with 60 percent looking to stick it to labor and only about 29 percent looking to keep that campaign cash flowing. (read article)

Sacramento’s SEIU Local 1000 gives $500,000 to fight Proposition 32
By Jon Ortiz, July 20, 2012, Sacramento Bee
SEIU Local 1000 has contributed $500,000 more to fight Proposition 32, the campaign-funding initiative, according to records filed Thursday with the state. Local 1000’s latest donation nearly doubled the $503,000 it previously donated to the cause, pushing its total contribution so far to just over $1 million. Unions so far have given nearly $9 million to defeat the measure, which would ban money obtained via payroll deductions from being used for political purposes. The ban would extend to both unions and corporations, but it would clearly hurt labor interests more, since they receive nearly all of their political operating money from payroll deductions of their members’ dues. Corporations, on the other hand, draw most of their political funds from executive donations and company resources. Those kinds of business sources have donated a little over $4 million to support the measure, which goes before voters on Nov. 6. (read article)

Labor unions spend four times as much as previously thought on politics
By Isaac Gorodetski, July 20, 2012, Manhattan Institute
The Supreme Court’s 2010 decision in Citizens United v. Federal Election Commission, which prevented the government from restricting political expenditures by corporations, caused much Sturm und Drang among some politicos who predicted the decision would allow corporations to disproportionately influence the outcomes of elections. Lost in the resulting firestorm was analysis of labor union’s electoral influence through their political activity and spending, which was also uncapped as a result of the Citizens United decision. Labor unions have long been required to disclose their expenditures on federal elections to the FEC; data disclosing union spending on local elections, however, is not required by the FEC. To unearth local union political expenditures, the Wall Street Journal analyzed data from the Labor Department that includes information on unions’ participation in local elections. The result is that total labor union spending on politics is four times as high as previously estimated: The usual measure of unions’ clout encompasses chiefly what they spend supporting federal candidates through their political-action committees, which are funded with voluntary contributions, and lobbying Washington, which is a cost borne by the unions’ own coffers. These kinds of spending, which unions report to the Federal Election Commission and to Congress, totaled $1.1 billion from 2005 through 2011, according to the nonpartisan Center for Responsive Politics. The unions’ reports to the Labor Department capture an additional $3.3 billion that unions spent over the same period on political activity. (read article)

Another reason to be angry at the Modesto Irrigation District — its new contract with the IBEW
Editorial, July 19, 2012, Modesto Bee
Why are many people angry at the Modesto Irrigation District? Well, let’s see, repeat electrical rate increases, a $1 million-plus legal settlement for ineptly handling the environmental review process for a biomass project and, of course, the proposed sale of water to San Francisco. Citizens are watching the actions of the MID like never before — and many aren’t satisfied. So what do they see now? A tentative agreement that would give MID cost-of-living raises that could total 12 percent over the next 2½ years. In addition, 55 percent of the district’s 400 employees would get so-called market adjustments — raises — of between 3 and 34 percent based on salary comparisons with 14 other utilities and public employers in Northern California. If the new contract with the International Brotherhood of Electrical Workers is approved by the board Aug. 14, the cost-of- living and the salary survey raises will total almost $4 million for 2012. The increases for 2013 and 2014 — and therefore the total cost for those years — will depend on the Consumer Price Index. (read article)

Unions Gain Under Citizens United Decision They Seek to Overturn
By William McQuillen, July 18, 2012, Bloomberg
U.S. labor-union leaders are taking advantage of a Supreme Court ruling they are fighting to overturn in their drive to elect Democrats this year. The AFL-CIO, the largest U.S. labor federation, will send more than 400,000 volunteers to campaign for President Barack Obama, aided by a decision known as Citizens United that removed limits on independent spending by corporations and unions. Before the 2010 ruling, labor unions were able to make donations only through regulated political action committees, which collect voluntary donations from employees and have reporting requirements and limits on disbursements. The decision lets unions spend from their treasuries, taking restrictions off using member dues in political campaigns. “This will make us far more efficient and it is going to make the electorate more and more informed,” AFL-CIO President Richard Trumka said at a Washington news conference July 12. The ruling means labor groups are now able to pay members to campaign in neighborhoods among all residents — not just union homes — get people to the polls and push their message. Limits remain on donating to candidates and parties. (read article)

Judge rules in favor of picketing Teamsters in Riverside, California
By Jack Katzanek, July 18, 2012, Press-Enterprise
A Riverside County Superior Court commissioner has denied Anheuser-Busch’s request for an injunction that would have limited the time that striking Teamsters workers could block vehicles leaving and entering the company’s Riverside distribution center. In a decision released late Wednesday afternoon, July 18, Court Commissioner Paulette Durand Barkley ruled that Anheuser-Busch did not prove that an injunction was warranted. Striking members of Teamsters Local 166 have been picketing at the Hunter Park facility for three weeks. Riverside police had instituted a two-minute limit for pickets who are slowing up delivery trucks and other vehicles. George Pappy, the attorney for the Bloomington-based Teamsters local, said Commissioner Barkley apparently did not believe the Police Department’s decision to ask both sides to abide by the two-minute rule was causing a problem, either for the company or other motorists on the street. (read article)

San Bernardino officials debate role of union money in decision-making
By Ryan Hagen, July 17, 2012, San Bernardino Sun
As the public battle rages over how the city developed a $45 million deficit, much of the attention has focused on union contracts – and the blame for those contracts has included some explicit claims. “There are some members of this council who are bought by the unions,” Mayor Pat Morris has said several times, using a phrase that has also been used by other City Council members. They point to campaign contributions by the San Bernardino Police Officers Association and San Bernardino Professional Firefighters that in some cases paid for nearly all of a successful campaign, saying it’s impossible to expect independent decisions from elected officials who depend on unions for their election. But there’s nothing inappropriate about accepting money from people who share your values – that’s how campaigns are always funded, said Councilman Robert Jenkins. “I received union support because I strongly believe the role of government is to provide protection for its residents,” Jenkins said. (read article)

Bid to curb California’s union spending gets big Democratic backer
By Michael J. Mishak, July 17, 2012, Los Angeles Times
Proposition 32 just got a big Democratic voice. Former state Sen. Gloria Romero, a Los Angeles Democrat, announced her support this week for the November ballot measure that would ban the practice of political contribution by payroll deduction, the primary method labor unions use to raise political cash. “As someone who has been on the political front lines in Sacramento, I’ve seen first hand how special interests control the political process,” Romero said in a statement. “Through their vast resources, special interests are able to hold lawmakers hostage to their agenda. This isn’t a partisan or ideological issue — all Californians deserve elected officials who will work for them, rather than special interests.” In some ways, Romero’s support is not surprising. Throughout her tenure in Sacramento she battled publicly with some of the state’s most powerful unions, namely the California Teachers Assn. and the California Correctional Peace Officers Assn. In her statement, she cited education legislation that died in the Legislature because of union opposition. (read article)

About the author: Jack Dean is editor of PensionTsunami.org, formed to monitor developments in all three pension spheres nationwide — public employees, corporations and social security. PensionTsunami, like UnionWatch, is a project of the California Public Policy Center. Dean is a former newspaper editor and a past executive director of the Reason Foundation. He has been active in politics for more than three decades and currently serves as president of the Fullerton Association of Concerned Taxpayers.

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