How a Basketball Arena Would Expand the Unionized Workforce in Sacramento: Part 1

Proponents of a proposed $447 million new “entertainment and sports center” in downtown Sacramento for the Kings professional basketball team claim the arena itself would generate over 4,000 full-time jobs, including employees hired temporarily for construction, employees for operations of the arena, and other outside service jobs related to arena events and activities. Proponents also claim that 11,700 total jobs would be created through construction and permanent employment at ancillary downtown development around the arena.

Unions want to represent every one of those workers who are not legitimately classified as management. Their plan is not to attain control of these jobs through merit or through selling the benefits of unionism to workers, but through backroom deals. These deals include an already-implemented Project Labor Agreement, a proposed Community Benefit Agreement, and other side agreements for employee retention and employer neutrality in organizing campaigns.

This is Part One, explaining the background of how construction trade unions have already obtained a monopoly on the construction workforce for the arena itself. Part Two will explain the union plot to monopolize the service jobs at the arena. Part Three will address the construction and permanent jobs at the ancillary development around the arena.

Kings Arena

Construction of the Arena

Project Labor Agreement Long Expected

As far back as October 2003, Sacramento construction trade union officials were alluding to their desire for a Project Labor Agreement on a possible new Kings basketball arena. Groups such as the Coalition for Fair Employment in Construction, Associated Builders and Contractors, and the Western Electrical Contractors Association began efforts to try to preserve fair and open competition.

For union leaders, it would be a matter of pride to declare this high-profile project as built exclusively by union workers. In addition, the sheer size of the project would pour large amounts of money into union political operations via dues and employer payments to labor-management cooperation committees. It would help all unions in the region to accelerate the political conversion of Sacramento’s suburbs from Republican federal, state, and local representation to union-backed Democrat representation.

For more detail on this early stage of the fight for fair and open competition on a new Sacramento Kings arena, see The Union Quest for a Project Labor Agreement on a New Sacramento Kings Basketball Arena: Part One – 2006

An Attempt to Prohibit Project Labor Agreements in the City of Sacramento Fails

In 2011, a coalition of construction associations, taxpayer groups, and other business interests collected signatures on petitions for ballot measures to prohibit the County of Sacramento and the City of Sacramento from entering into contracts that required construction companies to sign Project Labor Agreements as a condition of work. Local governments throughout the state were adopting these “Fair and Open Competition” policies through voter initiatives or elected boards.

Unions responded with a massive radio advertising campaign to scare people into not signing petitions, along with relentless in-person harassment of signature gatherers and other antics to interfere with the campaign. Then they shoved a last-minute gut-and-amend bill through the California legislature (Senate Bill 922) that nullified all Fair and Open Competition charter provisions and ordinances for counties and general law cities. It also cut off state funding to charter cities that had such policies. Because Sacramento was a charter city, the Fair and Open Competition – Sacramento campaign continued to collect signatures for the city ordinance. It submitted petitions with a total number of signatures well over the amount needed, but the measure failed to qualify in January 2012 because an astonishing number of the signatures were not valid. Union leaders gloated.

The Way Is Clear for a Project Labor Agreement

With voters no longer a threat to the union goal to impose a Project Labor Agreement, plots could proceed. A March 2012 resolution for an arena deal with potential team owners (which subsequently derailed) had an unannounced and unexpected provision for a Project Labor Agreement and Community Benefit Agreement tacked on the end through a city councilmember’s amendment, with no opportunity for public comment. See Out of Nowhere: Project Labor Agreement and Community Benefit Agreement Tacked on End of Motion for New Sacramento Kings Basketball Arena.

A “Request For Proposal For Lead Contractor” issued on June 21, 2013 by a new set of team owners informed prospective respondents that “The Contractor shall also meet and negotiate with local labor regarding a possible Project Labor Agreement for the ESC,” that is, the “entertainment and sports center.” In addition, respondents are asked to “Please describe your experience, if any, with labor on construction projects in northern California including, without limitation, negotiations with labor and the results, the size of the project, and project labor agreements.”

Announcement of a Backroom Union Deal

The public relations firm told us to celebrate the Project Labor Agreement.

The public relations firm told us to celebrate the Project Labor Agreement.

On September 4, 2013, a public relations firm hired by the Sacramento Kings (Mercury Public Affairs) informed local news media with only a few hours notice about a press conference to announce a special deal with the Sacramento-Sierra’s Building and Construction Trades Council. This deal was the long-anticipated Project Labor Agreement.The press conference featured Sacramento Mayor Kevin Johnson, top union officials, and top Kings team officials. Their consultants were even successful in “working on getting a few women there.” But also in attendance at the press conference were uninvited protesters from local non-union construction companies.

These opponents of the backroom union deal spoiled the visual impact by holding signs and banners on the balconies overlooking the atrium where the press conference was held. At the end of the official press conference, protesters then held their own impromptu press conference (using their opponents’ unsecured audio equipment) to condemn the Project Labor Agreement and call for the arena to be built instead in the suburbs, away from union influence and backroom deals. This high-profile celebration of union political power turned into a debacle.

Protest of Sacramento Kings Arena Project Labor Agreement - September 4, 2013

Following the press conference, non-union contractors circulated a memo entitled “Eight Steps to Possibly Alleviate Taxpayer and Contractor Outrage about the Backroom Deal for a Project Labor Agreement on Construction of the Sacramento Kings Arena.” Neither the Kings nor the City of Sacramento responded.

Motivation for the Backroom Union Deal

Although no one directly involved in the proposal, negotiation, or execution of the Project Labor Agreement has explicitly admitted it in public, most informed observers claim the union deal was mainly intended to neutralize the threat of construction unions exploiting the California Environmental Quality Act (CEQA) to delay permitting for the arena through comments, appeals, and lawsuits. Political and business leaders recognized that construction trade unions in Sacramento routinely engage in “greenmail” to hold up projects until the developer provides economic concessions (usually a Project Labor Agreement). Some recent examples within the City of Sacramento included the Railyards project and the Greenbriar and Delta Shores developments.

Once unions had control of the arena construction work, their lobbyists at the state capitol had no objections when State Senate leader Darrell Steinberg (who represents downtown Sacramento) pushed through a bill (Senate Bill 743) in the last days of the 2013 California legislative session. This bill provided special breaks under CEQA to the Kings arena to hinder the efforts of other interest groups to hold up the project with environmental objections.

Perhaps this scheme satisfied construction unions, but it did not discourage Unite Here Local No. 49 from submitting objections to the Draft Environmental Impact Report (DEIR) for the Kings Arena. Nor did SB 743 discourage community organizations from submitting objections to the DEIR with the open intent of seeking a Community Benefit Agreement for the ancillary development around the arena.

Other parties even asserted in their DEIR comments that SB 743 was unconstitutional and that the arena did not actually qualify as a project under the criteria set in SB 743. If a court later agrees with these claims, a new environmental impact report will need to be drafted, and SB 743 will ironically end up jeopardizing the project altogether.

No Public Accountability or Transparency Allowed

To this day, the Sacramento City Council has never discussed or voted on the Project Labor Agreement. Even more offensive, the Project Labor Agreement has never been released for the public to review, despite Mayor Johnson citing the agreement in his State of the City address on February 12. Tweets from the State of the City event indicated that some people misheard Mayor Johnson claim that arena construction would employ “sex-offenders,” although the Project Labor Agreement apparently includes a provision to employ “ex-offenders.”

Rumors get started when backroom deals remain a secret even as they are promoted as policy accomplishments. Why is it so important to withhold this celebrated deal on a public works project from the people who will be paying for a majority of it, plus the interest on the money borrowed through the city’s sale of revenue bonds?

In addition to being an accomplishment of the city’s chief elected executive, the mysterious Project Labor Agreement has also become relevant for litigation in the state courts involving the city. The Sacramento-Sierra’s Building and Construction Trades Council cited the Project Labor Agreement as the basis for justifying its February 14, 2014 amicus brief in defense of the city’s decision not to qualify a ballot measure requiring voter approval of public subsidies for the arena.

A request to the City of Sacramento for the Project Labor Agreement under the authority of the California Public Records Act failed to produce it.

Cost Impact Is Likely But Not Acknowledged to Date

A non-binding term-sheet between the Kings and the City of Sacramento dated March 26, 2013 provides for a $258 million subsidy for the Entertainment and Sports Center. Under state law, this subsidy means that the arena is a public works project, and contractors would be required to pay prevailing wage rates based on union labor agreements.

The Project Labor Agreement will go beyond this wage requirement to cut bid competition and raise costs even further. As an additional contractual obligation, the Project Labor Agreement will require contractors to obtain workers from unions and pay fringe benefits and other payments into union trust funds.

Various studies, anecdotes, and common sense have suggested that Project Labor Agreements raise the cost of construction projects by about 15%. The March 26, 2013 non-binding term sheet for the arena stated a total cost of $447 million. Did that amount account for the reduction in bid competition resulting from a Project Labor Agreement mandate?

An Aggressive Response from Supporters of Fair and Open Competition

In Sacramento, non-union contractors dominate electrical work on public works and commercial construction. Knowing that public opinion in the City of Sacramento is strongly against providing $258 million in public funding to billionaire team owners and professional basketball players, a group of large Sacramento-based non-union contractors provided essential funding to a new organization (Voters for a Fair Arena Deal) created to finish collecting signatures on petitions to put a measure on the June ballot to require a citizen vote to authorize any public subsidies for entertainment and sports facilities.  Residents of the City of Sacramento await a judge’s ruling on whether they will get to vote in June on this ballot measure. (See “Voter Approval for Public Funding of Professional Sports Arena Act”)

On February 26, 2014, a Sacramento County Superior Court judge agreed with the City of Sacramento and ruled that petitions for a vote on public subsidies contained too many inconsistencies and interfered with the city’s charter authority. Citizens will not have a chance to vote on the public subsidy, whether it is $258 million or some other amount in the end. See the decision in Camacho v. Concolino.

Meanwhile, the Coalition for Fair Employment in Construction is demanding that the Sacramento Kings ownership and the Sacramento-Sierra’s Building and Construction Trades Council immediately release to the public a copy of the alleged Project Labor Agreement for the proposed Kings Arena. It threatens to file a lawsuit against the City of Sacramento to get it.

Such a lawsuit could expose some embarrassing background about how and why unions obtained a monopoly on arena construction. In 2013, the Coalition for Fair Employment in Construction sued the City of San Diego to obtain the San Diego Convention Center Phase 3 Expansion Project Labor Agreement, another Project Labor Agreement negotiated and executed in a secret backroom deal. In the process, the coalition obtained the actual union deal and the complete list of political payoffs to unions from the San Diego Mayor’s office.


Measuring the Cost of Project Labor Agreements on School Construction in California – study by National University System Institute for Policy Research in San Diego – July 2011

Proposed, Non-Binding Terms of a Potential Transaction – term sheet between the City of Sacramento and an investor group in order to retain the Sacramento Kings NBA basketball franchise and to develop a new Entertainment and Sports Center (ESC) in downtown Sacramento.

The Renaissance Report economic analysis of the impact of the new entertainment and sports center and related downtown development to Sacramento.

Mayor Kevin Johnson Announces Project Labor Agreement at September 4, 2013 Press Conference, Opposition Has One Too

Senate Bill 743 (2013)

Senate Bill 922 (2011)

Regional Sports and Entertainment Facilities in the Urban Core Attract Costly Political Meddling: Sacramento Kings as a Case Study – – December 16, 2013

September 4, 2013 Sacramento Kings Arena Project Labor Agreement Final Press Kit – “Great…let’s circulate to key folks.”

September 3, 2013 Sacramento Kings Arena Project Labor Agreement Press Conference – “working on getting a few women there” Re Labor Presser Check-In 

September 4, 2013 – Press Conference Announcing Project Labor Agreement for New Sacramento Kings Arena – Final Press Kit

Coalition for Fair Employment in Construction Calls for Public Access to Backroom Union Deal Imposed on Proposed Sacramento Kings Arena – Press Release – February 19, 2014

February 14, 2014 – Sacramento-Sierra Building and Construction Trades Council – Amicus Curiae – Kings Arena Vote

January 31, 2014 Unite Here Local 49 CEQA Comments – Sacramento Kings Arena Draft Environmental Impact Report

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.


Unions “Using Political Leverage to Punish Those Exercising Rights” in California Constitution

On October 13, 2013, California Governor Jerry Brown signed Senate Bill 7, which cuts off state funds designated for construction to any California city that exercises its right under the California Constitution to establish its own policies concerning government-mandated wage rates (so-called “prevailing wages”) on contracts. This was a major victory for the State Building and Construction Trades Council of California, the construction union umbrella lobbying organization that sponsored the bill.

There are 121 California cities that govern their own municipal affairs through a charter, a mini-constitution authorized in Article XI of the California Constitution. In its letter unsuccessfully requesting for a gubernatorial veto, the League of California Cities declared that “using political leverage to punish those exercising rights provided by the Constitution is unjust” and a veto was needed to “protect the integrity of our Constitution and the communities operating in lawful compliance with it.” (Coming from the professional association of California city officials, these statements cannot be easily brushed off by California Democrats and their union allies as irrelevant “Tea Party” rhetoric.)

In California, the “Progressive” movement is determined not to let the structural protections of constitutional government impede the quest for democratic socialism and societal justice. Passing Senate Bill 7 through the state legislature and getting it signed is the type of government activism that earns praise from the national news media, as it compares the State of California favorably against the “gridlock” in Washington, D.C.

Senate Bill 7 has a practical fiscal impact as well as a constitutional significance. Out of California’s 121 cities governed under a charter, 43 do not require construction companies to pay state-mandated prevailing wages on any city contracts, and 10 do not require construction companies to pay state-mandated prevailing wages on some kinds of city contracts. The cities of El Cajon, Bakersfield, and Newport Beach are the most recent cities to establish their own prevailing wage policies. Meanwhile, unions have successfully lobbied the city councils in San Diego and Mountain View in recent months to abandon their own wage rate policies and submit to state prevailing wage law.

A couple dozen “general law” cities have recently proposed charters to voters or plan to propose charters to voters. Evading the costly state prevailing wage mandate for construction contracts has been a primary motivation for these cities, and construction unions have been aggressive in lobbying and campaigning to undermine these local efforts. In 2012, voters in the cities of Auburn, Costa Mesa, Escondido, and Grover Beach rejected proposed charters.

It’s likely that a charter city or group of charter cities will file a lawsuit in 2014 to strike down Senate Bill 7, along with two similar laws implemented by Senate Bill 922 in 2011 and Senate Bill 829 in 2012. These two laws, also sponsored by the State Building and Construction Trades Council of California, cut off state construction funds to charter cities that adopt Fair and Open Competition policies prohibiting the cities from entering into contracts requiring construction companies to sign a Project Labor Agreement with unions.


Article XI of the California Constitution

Senate Bill 7 (2013) – to be California Labor Code Section 1782

League of California Cities – SB 7 (Steinberg) Undermining Constitutional Exercise of Municipal Affairs – Request for Veto

Information on Charters from League of California Cities (includes list of 121 charter cities)

State Building and Construction Trades Council of California, AFL-CIO v. City of Vista et al. – California Supreme Court decision of July 2, 2012 upholding constitutional right of charter cities to establish their own policies concerning government-mandated wage rates for municipal construction contracts.

Are Charter Cities Taking Advantage of State-Mandated Construction Wage Rate (“Prevailing Wage”) Exemptions? (3rd edition – Summer 2012) – the most comprehensive report ever published on California prevailing wage and charter city policies and an inspiration for advocates of fiscal responsibility and local control. (A 4th edition is in the works.)

Senate Bill 922 (2011) and Senate Bill 829 (2012) – punishing charter cities with prohibitions on city contracts that mandate Project Labor Agreements.

State-mandated prevailing wages for construction trades in all geographic regions of California

State Building & Construction Trades Council of California

News and Opinion Leading Up to and Following Gov. Brown Signing Senate Bill 7

SB 7: Cities Stand to Lose Home Rule over Municipal Affairs – – September 9, 2013

Three Bad Bills that Gov. Jerry Brown Should Veto – editorial – Sacramento Bee – September 9, 2013

Legislative Sampler: 2 to Sign, 2 to Veto – editorial – Riverside Press-Enterprise – September 18, 2013

Has Labor Leader Overreached? – columnist Dan Morain – Sacramento Bee – October 9, 2013 (The answer is “no.”)

Prevailing Wage Bill Deserves a Veto – editorial – UT San Diego – October 4, 2013

Governor Should Veto Wage Bill – editorial – Modesto Bee – October 11, 2013

If Gov. Brown Doesn’t Like Intrusion, He Should Veto SB 7 – editorial – Sacramento Bee – October 12, 2013

Jerry Brown Signs Prevailing Wage Bill for Charter Cities – Sacramento Bee – October 13, 2013

Governor Brown Signs Union-Backed Senate Bill 7 and Continues Erosion of Constitutional Checks and Balances – – October 13, 2013

Brown Signs Prevailing Wage Bill – Capitol Weekly – October 14, 2013

Brown Signs Prevailing Wage Bill for Cities – Central Valley Business Journal – October 14, 2013

Governor Signs Prevailing wage Bill for Charter Cities – Sacramento Business Journal – October 14, 2013

Gov. Brown Signs SB 7 to Neuter Charter Cities – – October 14, 2013

Prevailing Wage Law Could Raise Costs – UT San Diego – October 14, 2013

Unions Smile, Cities Frown at Prevailing Wage Law – Bakersfield Californian – October 14, 2013

Modesto Fears Harm from New Prevailing Wage Law – Modesto Bee – October 14, 2013

California Construction Unions Get Two Big Wins – columnist Dan Walters – Sacramento Bee – October 15, 2013

Charter Could Cost City Funding – Newport Beach/Costa Mesa Daily Pilot – October 16, 2013

Wage Law Costs Cities More Than Money – op-ed by El Cajon Acting Mayor Bill Wells – UT San Diego – October 25, 2013

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.


Are Unions Behind California Assembly Bill 76 to Hinder Public Records Access?

What special interest group would have such disregard for the tenor of the times that it would now push for a law to hinder the public’s ability to obtain records from local governments?

And what special interest group would have the chutzpah to get that law enacted through a supplemental trailer to an annual budget, thus avoiding public hearings or an opportunity for the public to comment on it?

Until June 12, 2013, California Assembly Bill 76 had been an empty shell for a “budget trailer bill” to be passed as a supplement to the 2013-2014 California state budget. Then it was filled with technical changes and union-backed statutory provisions and whipped through the legislature and to Governor Jerry Brown on June 14. It now waits for the governor’s signature.

At one time, the legislature could claim that it while it was “mindful of the right of individuals to privacy,” it found and declared that “access to information concerning the conduct of the people’s business is a fundamental and necessary right of every person in this state.” But now there are suspicions that it is more concerned with protecting a special interest group or an individual or individuals  from damaging revelations.

Among the provisions of AB 76 is language that gives local agencies “discretion” to comply with certain provisions of the state’s longstanding Public Records Act. Certain requirements would transform into optional “best practices.” Local governments would no longer need to explain why they couldn’t provide requested records within 10 days; for that matter, local governments would no longer need to explain why they couldn’t provide records at all. Local agencies would no longer need to provide records (such as financial data) in a useful and appropriate electronic format or cooperate with the public to ensure satisfactory fulfillment of records requests.

Special language in Section 4 of the bill seems to indicate that the public records access provision would take effect in law immediately, rather than on July 1, 2013 as explicitly stated (in Section 119 of the bill) for many other sections. Starting in 2014, but not before then, a local government would have to announce orally at a scheduled public meeting that it would not be complying with the relevant public records laws for the next year. It’s hard to believe, but it seems the law was written to allow a local government to avoid compliance with public records access laws for the remainder of 2013 without making a public announcement of the policy.

AB 76 justifies this change with a cynical provision (Section 118 of the bill) claiming the legislature has a “strong interest…in allowing, to the extent possible, local agencies to control the manner in which they perform their public duties, including, but not limited to, the manner in which they comply with the spirit and purpose of the California Public Records Act.” This statement is laughable.

As readers of know from articles such as With Senate Bill 7, California Unions Advance Plot to Neuter City Charters, the California state legislature recently enacted two union-backed bills (Senate Bill 922 and Senate Bill 829) that nullify local Fair and Open Competition policies that prohibit Project Labor Agreements in counties and general law cities and cut off state funding for charter cities that enact Fair and Open Competition policies. The union-backed Senate Bill 7 is now moving through the legislature to cut off state funding for charter cities that establish their own policies concerning government-mandated construction wage rates (so-called “prevailing wage”).

Local control is not the consistent principle in the affairs of the California state legislature – union control is the consistent principle. Knowing this, and recognizing that almost no one in Governor Brown’s office or in the state legislature is publicly defending this attack on government records access with a thoughtful argument, there’s justification to speculate that this provision in Assembly Bill 76 has something to do with a union concern.

Really, does anyone believe Governor Jerry Brown one day decided that the public had excessive access to information about their local governments? Of course not. It’s more likely that a special interest group or a person or persons with significant political clout asked for this. Here are some reasons to suspect unions.

1. Union fingerprints are all over Assembly Bill 76. Many of the substantive policy changes in the bill are related to union objectives. These proposals have not been considered in public hearings and are too obscure and complicated to recognize unless you are already familiar with the related labor issues. Here are examples:

  • There’s a set of amendments to the California Labor Code that allows the California Department of Industrial Relations to charge unlimited fees to school districts for labor compliance and enforcement on construction funded by bond measures that receive state matching grants from the State Allocation Board, while limiting the amount that a school district can reimburse the state using proceeds from those state matching grants. In other words, the operations of the California Department of Industrial Relations will be subsidized by money borrowed by school districts through bond sales authorized by local voters.
  • Money is shifted and loaned among various funds overseen by the California Department of Industrial Relations.
  • The Displaced Janitor Opportunity Act of 2002 is expanded to include contractors that provide food and beverage services at a publicly owned entertainment venue. In other words, the new Sacramento Kings owners, with their planned new arena, will not be able to save money by ending the old union arrangements.
  • New opportunities will be created for unions to impose apprenticeship requirements on industrial construction and maintenance contractors through training and process standards developed through the Occupational Safety and Health Standards Board and the Division of Occupational Health and Safety (OSHA).
  • The threshold for state agencies to avoid competitive bidding for contracts under certain conditions is increased from $75,000 to $150,000.

2. Newly-elected Assemblywoman Lorena Gonzalez, who was head of the San Diego-Imperial Counties Labor Council before taking office on May 28, 2013, is one of the few legislators publically defending the proposal. Here’s an excerpt from an article Advocates Press Brown on Records Law in the June 17, 2013 UT San Diego newspaper:

Other Democrats including Assemblywoman Lorena Gonzalez, D-San Diego, said they appreciated the concerns of the public and the press but couldn’t bring themselves to oppose a bill that included funding for a host of other general government programs, including victims of crime for property losses, a commission on the status of women and to strengthen job safety and wage enforcement for workers.

“This wasn’t a bill situation where I could say ‘Yeah, it’s very easy to vote against this. I don’t agree with this portion,’” Gonzalez said. “What I would like to see is the onus on local governments, where they will continue to provide the information. If not, give me the concrete stories about that not happening because of the change and I’ll be happy to work with that.”

The absence of a credible policy rationale for hindering public records access (other than challenging the credibility of opponents’ arguments) is stunning.

3. Anyone looking for a conspiracy theory might want to research where there are currently active efforts to obtain public records from a local government that are potentially damaging to politicians and special interest groups. One case of note is a lawsuit filed by the Coalition for Fair Employment in Construction in San Diego County Superior Court on April 22, 2013 to get public records from the City of San Diego regarding the development and implementation of a Project Labor Agreement on the San Diego Convention Center Phase III Expansion. (See Coalition for Fair Employment in Construction v. City of San Diego, Case No. 37-2013-00045254-CU-WM-CTL.)

As readers know, this saga has been reported in the articles Unions Threaten Environmental Litigation to Block San Diego Convention Center and Persistent Pressure Compels San Diego to Spit Out Project Labor Agreement. The Coalition for Fair Employment in Construction has persevered for eight months to get records, and some have been obtained, including a set unexpected provided by the city on June 3, 2013 that contains jaw-dropping information in emails. This was described as “the tip of the iceberg” by an informed source. The Coalition for Fair Employment in Construction has not released that set of information to the public yet, for reasons that will one day become obvious, but it continues to seek and pry out additional government documents. See for more information.

In the meantime, groups such as the California Newspaper Publishers Association, the American Civil Liberties Union, the Electronic Freedom Foundation, the California First Amendment Coalition, Californians Aware, and California Common Cause are asking Governor Brown to veto this language. Readers of have good reason to support the efforts of this coalition to preserve open and transparent government.

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.

Persistent Pressure Compels San Diego to Spit Out Project Labor Agreement

For five months, the City of San Diego refused to give the public a Project Labor Agreement negotiated for its planned $520 million convention center expansion. This union agreement was reportedly the result of a backroom deal involving top union leaders, but multiple requests for it under the authority of the California Public Records Act failed to dislodge it.

But today (April 23, 2013), the city provided the labor agreement to the public, less than 24 hours after a construction organization filed a lawsuit to get it. 

Here are some of the twists and turns of this saga, which serves as an excellent case study in how unions manipulate public policy at the state and local level in California.

In May 2012, the San Diego County Building and Construction Trades Council submitted a massive objection under the California Environmental Quality Act (CEQA) against the draft Environmental Impact Report for the proposed San Diego Convention Center Phase 3 Expansion. Four months later, the San Diego County Building and Construction Trades Council submitted another massive CEQA objection against the revised and final Environmental Impact Report, this time choosing the drama of presenting it during a packed meeting at which San Diego port commissioners were scheduled to approve the project. (Attorneys for unions routinely engage in last-minute CEQA “document dumps” at California public meetings in order to intimidate public officials and developers into surrendering to union economic demands.)

In November 2012, a few days after union-backed Congressman Bob Filner was elected as the next mayor, San Diego Mayor Jerry Sanders and Lorena Gonzalez – head of the San Diego-Imperial Counties Central Labor Council – held a press conference to announce a settlement concerning the union CEQA complaints and also a settlement concerning a union-backed lawsuit challenging the financing method for the project. The settlements resolved very few of the environmental concerns indicated in the union CEQA complaints – not even the subsequently high-profile concern of protecting the project from sea level rise caused by global warming.

However, the San Diego County Building and Construction Trades Council now had a Project Labor Agreement for construction of the Convention Center expansion, as proclaimed in a press release. And UNITE-HERE Local No. 30 “extended their Memorandum of Understanding (MOU), ensuring a unionized operation of the Convention Center once expanded,” according to Lorena Gonzalez.

If the apparent union “greenmail” of the project using CEQA as leverage to get labor agreements wasn’t controversial enough, the Project Labor Agreement also appeared to violate a ballot measure (Proposition A) approved by 58% of San Diego voters in June 2012. That ballot measure established a “Fair and Open Competition” ordinance prohibiting the city from entering into contracts that require construction companies to sign Project Labor Agreements with unions as a condition of work. It was put on the ballot in part to protect the convention center from ongoing union lobbying efforts at the city council to win monopoly control of  its construction.

Up to that time, voters and elected boards of local governments throughout the state had been defying union officials and approving Fair and Open Competition policies, starting in October 2009 with Orange County. In response, the California State Legislature passed and Governor Jerry Brown signed into law two bills (Senate Bill 922 and Senate Bill 829) pushed by then-State Senator Michael Rubio to nullify all Fair and Open Competition policies in counties and general law cities and cut off state funding for charter cities (such as San Diego) that enacted or failed to repeal such policies.

Union leaders in San Diego, particularly Lorena Gonzalez, repeatedly warned that the state would cut off money to the City of San Diego if voters didn’t repeal the Fair and Open Competition ordinance they had approved in June 2012. But for now this dramatic threat has proven to be empty, and Proposition A remains in the City of San Diego Municipal Code.

An unexpected political development occurred a few weeks after the mayor and top county union leader announced the settlement agreements for the convention center: Lorena Gonzalez announced her candidacy for the 80th Assembly District seat that would soon become vacant. Like the Eye of Sauron, union political focus in San Diego County shifted from government-mandated unionization to the task of getting her elected.

Meanwhile, a group called the Coalition for Fair Employment in Construction sought to obtain the Project Labor Agreement as the preliminary step to a planned lawsuit contending that the union deal violated the Proposition A ordinance. None of the many parties involved – including the City of San Diego – would provide the document, and finally the Coalition for Fair Employment in Construction filed a lawsuit against the city to get it.

A press release dated April 18, 2013 stated the following:

“We’re going to get that union Project Labor Agreement, expose it to the public, and make every schemer involved with this union sweetheart deal accountable for breaking the law,” said Eric Christen, executive director of the Coalition for Fair Employment in Construction.

Perhaps a schemer somewhere was getting nervous. The city promptly handed over the Project Labor Agreement today, April 23, 2013.

Note that the aggressive actions of the Coalition for Fair Employment in Construction repulse many civic leaders in San Diego. It disrupts the cozy relationship of politicians, unions, and business interests giving each other special favors to get the convention center expanded. It creates additional controversy for a project already under scrutiny for the bizarre tax scheme involving hotel room fee assessments that will be used to pay back the borrowed money (and interest) obtained through bond sales to pay for construction. At a more basic level, many impartial observers believe the expansion is unnecessary and foolish.

Exposing the shenanigans of unions and their cohorts in California wins few friends among the powerful, but it does disgust the ordinary voter who ends up paying for it, one way or another.


Project Labor Agreement for the San Diego Convention Center Phase 3 Expansion

Lawsuit to Obtain Copy of Union Project Labor Agreement on San Diego Convention Center Phase 3 Expansion

Letter claiming the Project Labor Agreement for this public project is a “Trade Secret”

Settlement Agreement – Building Trades Unions – San Diego Convention Center – 2012

Settlement Agreement – Various Construction Trade Unions – San Diego Convention Center – 2012

May 2012 Union CEQA Objections to the Draft Environmental Impact Report on the San Diego Convention Center Phase 3 Expansion

September 2012 Union CEQA Objections to the Final Environmental Impact Report on the San Diego convention center Phase 3 Expansion

Background on Proposition A, the Fair and Open Competition ordinance approved by 58% of San Diego voters in June 2012

For more detailed information, see these web sites:

“San Diego Convention Center” articles in

Kevin Dayton is the President & CEO of Labor Issues Solutions, LLC, and is the author of frequent postings about generally unreported California state and local policy issues at Follow him on Twitter at @DaytonPubPolicy.

With Senate Bill 7, California Unions Advance Plot to Neuter City Charters

More than 30 California cities are likely to defy top union officials by asking their citizens in 2014 to vote on enacting a “home rule” charter for local control.

Cities want to free their purely municipal affairs from costly union-backed state mandates, for reasons revealed in these recent articles:

Unions Rise to Defense of “Prevailing Wage” Rates Jeopardizing Hotel Project in Redding – – February 15, 2013 and Redding Needs a Charter to End Nonsense Definition of Private Hotel as a “Public Works” Project – – January 31, 2013.

Stanford Professor Warns Costa Mesa about Pension DebtOrange County Register – February 27, 2013 and City’s Pension Outlook Called ‘Stark’ – Newport Beach/Costa Mesa Daily Pilot – February 27, 2013. (With the failure of the Measure V charter in November 2012, Costa Mesa is now in the union paradigm with a proposed solution to raise taxes.)

A Former Mayor of a Southern California City Provides an Intellectual Argument for City Charters and Local Government Authority – – February 19, 2013 (a commentary on Reasons to Consider Becoming a Charter City – San Diego Union-Tribune – February 19, 2013).

For a powerful example of how charter cities are saving money and being more cost-effective in their city operations and services, see Are Charter Cities Taking Advantage of State-Mandated Construction Wage Rate (“Prevailing Wage”) Exemptions? Cities recognize that exercising the power of a charter can free their municipal affairs from the grip of the state legislature and the special interest groups entrenched at the capitol. A staff report about city charters to the Murrieta City Council for its October 2, 2012 meeting was blunt about the need for cities to enact charters:

…a knowledgeable, involved electorate should both propel and constrain the direction of its own city. Local control has always been a paramount matter of residents, businesses and the Murrieta City Council. Yet state legislators and previous gubernatorial administrations continue to impose far greater mandates, while at the same time hindering the ability of local governments to operate successfully. With little ability to protest, local governments have watched as the state government continues to balance its budget deficits on the backs of fiscally responsible local jurisdictions…The voice of cities in Sacramento has become mute due to a combination of special interest groups, influential political campaign contributions and tone-deaf lawmakers passing unfunded mandates. This process has left cities with little ability to petition the state government…

A city charter is a unique document that acts like a constitution for a city adopting it. Overall, this puts more control into the hands of the residents instead of state legislators and gives a community greater independence to determine its own destiny. Cities typically enter the process to become a charter city to become more autonomous. A charter city has more flexibility and has ultimate authority over municipal affairs. The charter city provision of the state Constitution, commonly referred to as the “home-rule” provision, is based on the principle that a city, rather than the state, is in the best position to know what it needs and how to satisfy those needs. The home-rule provision allows charter cities to conduct their own business and control their own affairs. Therefore, a charter maximizes local control. Such benefits of a charter city are greater flexibility on public works contracts and other changes in the procurement process, more control over economic development practices, and less reliance on the state.

Right now there are 121 charter cities in California, up from 107 in 2007. But there are aggressive opponents who regard cities’ exercise of their charter authority (as cited above from the Murrieta staff report) to be an attack on their hegemony. In 2011 and 2012, unions spent jaw-dropping amounts per voter on campaigns to convince voters to reject reasonable proposed charters.

Charters were defeated in Rancho Palos Verdes, Auburn, Costa Mesa, Escondido, and Grover Beach, to the dismay of civic leaders whose local grassroots efforts were rolled over by well-funded union-backed professional campaign operations. Unions are now ready to crush California’s federalist rebellion once and for all in 2013 and 2014.

As one strategy, they are infiltrating and trying to neutralize the League of California Cities as an organization that provides information to cities looking at charters. A union-affiliated group called is trying to influence the League of California Cities through sponsorship, partnership, and participation in the League’s Transportation, Communication & Public Works Committee.

Unions are aggressively opposing charters when proposed on the local level and are trying to derail proposals through charter review commissions (a strategy that worked for unions in Elk Grove, Redding, and other cities). See the newspaper articles listed below for evidence.

Union lobbyists also have a bill now in the California State Legislature (Senate Bill 7) introduced by Senate leader Darrell Steinberg and a Republican State Senator, Anthony Cannella. It will cut off state funding for cities that use their constitutional charter authority to establish their own policies concerning state-mandated construction wage rates. (See Bill Introduced in State Senate to Suppress Authority of California’s Charter Cities to Establish Their Own Policies on Government-Mandated Construction Wage Rates – – February 20, 2013.)

This bill adopts the same concept of crushing charter city authority as did the union-backed Senate Bill 922 in 2011 and Senate Bill 829 in 2012 (two bills pushed by Senator Michael Rubio, who just resigned to take a lobbying position with Chevron). These two laws cut off state money to charter cities that adopt policies prohibiting those cities from requiring construction contractors to sign a Project Labor Agreement with unions as a condition of work.

Threatening to withhold money as a tactic to force a government to submit to centralized authority may remind you of warnings in the dissent in the U.S. Supreme Court decision in June 2012 concerning the constitutionality of Obamacare:

Structural protections – notably, the restraints imposed by federalism and separation of powers – are less romantic and have less obvious a connection to personal freedom…The fragmentation of power produced by the structure of our Government is central to liberty, and when we destroy it, we place liberty at peril…[The] practice of attaching conditions to federal funds greatly increases federal power…This formidable power, if not checked in any way, would present a grave threat to the system of federalism created by our Constitution…Coercing States to accept conditions risks the destruction of the “unique role of the States in our system.”

While the same principles would seemingly apply to the relationship of state and local governments, forces at the state capitol seem to prefer an overbearing centralized government that can solve problems with broad strokes of alleged social justice.

With bills such as SB 922, SB 829, and SB 7 deemed as acceptable modes of governance by the legislative supermajority and the governor, I anticipate a union-backed effort in the future to repeal outright the section of the California Constitution (Article XI, Section 3) that allows cities to govern their own municipal affairs under a charter. It would be an effective way to eliminate another one of the diminishing number of checks and balances that interfere with utopian schemes planned under the benevolent and enlightened one-party state.

Then there is the strange case of Republican Senator Anthony Cannella, who is so proud of undermining local control and raising costs for taxpayers that he used the Senate Republican Caucus communications operation to proclaim his legislative achievement to a gullible press. Here’s a Tweet:

It didn’t go unanswered. I responded with this Tweet:

Senator Cannella may not realize (or may not care) that he represents two cities – Modesto and Merced – that use their charter authority to set their own policies concerning government-mandated construction wage rates (so-called “prevailing wages”). Here is the Modesto policy, set by a 1995 resolution: Modesto Prevailing Wage Policy and Staff Report. Here is the Merced practice: Merced Exempts Rental Housing Preparation from State-Mandated Government Wage Rates (Prevailing Wage). Oh well, sometimes the union lobbyists in Sacramento are a more important constituency than the people back home in the Central Valley.

With the help of Senators Steinberg and Cannella, union lobbyists intend to direct their legislative puppets from Los Angeles and San Francisco to suppress the small and medium-sized cities trying to determine their own financial destinies. To protect union power, these cities must submit to centralized power exercised by the state legislature and Governor Jerry Brown.

In the meantime, the local federalist rebellion continues. In addition to the cities of Temecula and Murrieta, the following California cities are now publicly moving forward on asking their citizens to approve a charter in 2014 (with several more soon to begin public discussion):

Costa Mesa

Outsourcing Back in for Costa MesaOrange County Register (editorial) – February 6, 2013

…passage of Measure V would have made the privatization task easier. But the union outspent Measure V proponents by more than seven-to-one. However, Mr. [Councilman Jim] Righeimer said he hopes a new charter measure will be put on the June 2014 ballot…Within 60 days the council will hold a study session on how to set up the independent committee for the new charter measure.


Escondido Mayor Touts Urban Renewal, Embracing DiversitySan Diego Union-Tribune – February 20, 2013

Delivering his annual State of the City address to nearly 300 residents and business leaders gathered at the city’s arts center… [Mayor Sam] Abed said he also wants the city to take another shot at becoming a charter city, which would increase Escondido’s independence from Sacramento and reduce the cost of some city construction projects.

Moreno Valley

Moreno Valley: City to Explore Becoming Charter City – Riverside Press-Enterprise – February 26, 2013

The Moreno Valley City Council on Tuesday, Feb. 26, unanimously approved establishing a subcommittee that would explore becoming a charter city and appointing two council members to it.

Moreno Valley: Charter City Committee Could Be Created  – Riverside Press-Enterprise – February 25, 2013

The Moreno Valley City Council on Tuesday, Feb. 26, is to follow through on plans to determine whether to become a charter city. The council is set to vote on whether to establish a charter exploratory subcommittee and appoint two council members to it.


Buellton Continues “Home Rule’ Talk – Santa Ynez Valley News – February 7, 2013

The idea of changing Buellton to a “home-rule” city is on hold again after City Council members decided to set up a workshop for more discussion about a draft plan…City Manager John Kunkel said the committee wants voters to be comfortable with the measure and, if the council wants to have a dialogue with unions, there is no rush.

Charting Best Path to Buellton’s Future – Santa Ynez Valley News (editorial) – February 7, 2013

…being a charter city does mean that local elected officials and voters can make more of their own decisions, and are therefore better able to tailor policy to fit specific local needs…Being a charter city also lets local government off the hook for paying a prevailing wage. Labor unions don’t like that possibility…

Arroyo Grande
Arroyo Grande Considering City Charter – – January 28, 2013

The Arroyo Grande City Council has created a committee to explore the idea of becoming a charter city in order to cut costs…Many union members oppose city charters because they allow exemptions from state-mandated prevailing wage agreements. City staff says adopting a charter could save Arroyo Grande $50,000 to $300,000 annually.

Study Under Way to Find Out if Arroyo Grande Should Try to Become a Charter CitySan Luis Obispo Tribune – January 27, 2013

A committee has been convened to study whether Arroyo Grande should try to become a charter city, a move that officials say could save money and give it more local control. The idea, however, faces stiff opposition from local union members…

California cities have two choices about their financial futures: enact a charter as an way to become more cost-efficient, or raise taxes. Guess which choice the unions want?

Kevin Dayton is the President and CEO of Labor Issues Solutions, LLC and is the author of frequent postings about generally unreported California state and local policy issues at