VOL. 8 | NO. 42 | Saturday, October 10, 2015
View From the Hill
Metro Nashville’s Local-Hire Rule Gets Battered On Many Fronts
SAM STOCKARD | Nashville Correspondent
The ink wasn’t dry on standards for Metro Nashville’s local-hire charter amendment when new Mayor Megan Barry put the measure on hold – despite sizable support in the August election.
Whether Barry is faltering in the face of legislative or business opposition or making a prudent decision is hard to tell. She talks as if she merely wants more time to develop better training for Metro residents to make sure they can take construction jobs on the city’s taxpayer-funded projects.
But considering Barry stood fully behind Amendment Three during her campaign, the reversal just two days after she took office seems a little wishy-washy.
Either way, she will face stiff objections in the Legislature next session as Republicans try to nullify the local decision whether it’s on hold or not.
State Attorney General Herb Slatery presents another stumbling block in the form of an opinion stating the amendment is invalid because it violates state law.
The measure, which requires Davidson County residents to work at least 40 percent of the hours on Metro construction jobs costing $100,000 or more, was passed by voters 58 to 42 percent. Efforts also must be made to ensure 10 percent of the construction work is done by low-income residents of Davidson County.
With that type of support, it appeared to be sailing toward implementation until Barry sent a letter Sept. 30 to Vice Mayor David Briley and Metro Council members notifying them she and the Metro Legal Department asked Metro’s Procurement Division for the delay based on requests from organized labor and the business community.
Metro guidelines were to take effect Oct. 1.
Barry’s letter notes the new procedures could hurt Nashville’s ability to start construction projects and be “counterproductive” in putting more local people to work.
“Like the majority of voters in the August 6 election, I supported Amendment Three because I believe strongly in workforce development and expanding access to good-paying jobs,” she writes.
“My commitment to these principles has not wavered and I believe that we can find a path forward that satisfies our desire to promote economic prosperity for working families while also being fiscally responsible and continuing to move forward with important Metro projects.”
Delaying the measure, she notes, will give Metro a chance to see how other cities handle similar initiatives and for her office and the Council to work with the labor and business on guidelines for training and hiring.
Her decision stems largely from the request of a labor group that helped her win election.
The same day she took the oath of office, Glenn Farner, business manager of the Laborers’ International Union of North America, sent Metro’s Department of Finance a letter requesting the local-hire measure be delayed until March 31, 2016.
“While our organization affirmatively advocated on behalf of the passage of the Amendment #3 charter referendum, we agree with all interested parties on the need for a more expansive and better trained local workforce,” Farner writes.
“In addition, we want to insure that all parties have an opportunity to work together to better understand the planned procurement practices and opportunities for improvement and common ground going forward.”
Ethan Link, program director with LiUNA, explains Metro’s main gap lies with concrete finishing, carpentry work and welding, skills requiring only a two-year apprenticeship. But training programs put in place so far have been “ad hoc and project-specific and haven’t created a lasting workforce,” he says.
Contractors often depend on groups of workers with concrete and carpentry skills who travel the country and hold no community ties, Link adds.
“Those are actually the jobs that would be easiest to train people to do, because it wouldn’t require a five-year apprenticeship.”
State Sen. Jack Johnson (R-Franklin) is bringing legislation in 2016 to turn back the amendment and outlaw similar moves across Tennessee. He says out-of-state contractors wouldn’t be subject to the requirements and could benefit while others are handcuffed.
“It will take the local control away, but we have complete, absolute constitutional authority to do it,” says Johnson, who chairs the Senate Commerce and Labor Committee.
Johnson says the “stupid” charter amendment would hurt commerce in Tennessee, including companies headquartered in his district who do business with Metro and could be ineligible to bid on Davidson County projects because of the people they hire.
“And that is wrong,” he says. “So their charter amendment is not a local issue. It’s a statewide issue. It will impact certainly the other Middle Tennessee counties. But it’ll affect counties all over the state. There are companies in Memphis that do business with Metro.”
Johnson says he believes Mayor Barry decided to put the local-hire move on hold “because it’s such a disaster.”
In the September mayoral run-off, Johnson also supported David Fox, who opposed the charter amendment, saying it was “unrealistic.’’
While some people want to let the amendment take effect and “collapse of its own weight,” Johnson is determined to forge ahead with his bill, even with Barry’s decision to delay.
“I’m hopeful that they realize it’s such a bad idea that they come to us and ask us to nullify it. I don’t know that that will happen,” he adds.
“It will prevent any municipality from implementing any type of protectionism or discriminatory hiring practices in any municipality in the state.”
As is typical, Nashville’s Democratic legislators find themselves at odds with Republicans from surrounding counties.
House Minority Leader Mike Stewart calls this “another example of the Republican majority choosing to tell local governments what to do.”
Stewart, who supported the local-hire amendment, says most Republicans he talks to feel local government should be making decisions because they’re closer to the people.
“I’m not saying Sen. Johnson doesn’t have the right to file this bill,” Stewart says. “I just can’t imagine why anyone would think it was a good idea to tell the citizens of Davidson County how to run their affairs. It’s a classic local issue that localities should be able to decide for themselves.”
Metro voters see “great prosperity” in the county, and they say they believe the local-hire amendment will be a way to spread it across Davidson, Stewart adds. Several business people tell him complying with the measure is “no big deal,” he adds.
Benny Overton, vice chair of Nashville Organized for Action & Hope and United Auto Workers Local 737 president, calls Johnson’s legislation “an overreach of state power and authority” after Metro voters expressed their will.
“I mean, they’re trying to address the problem of unemployment and of under-employment here in Nashville. I just think it’s unfortunate (Johnson) would seek to interfere with that,” Overton says.
The amendment is based on success shown in other cities, and Overton says he believes it should be used to target minority employment, which he says is typically twice that of the general population. It also could address situations in which people are working two or three part-time jobs and still can’t support their families, he says.
He says he believes it will have “minimal effect” on workers and companies just outside Davidson County because 60 percent of the hours for construction projects could be worked by anybody, regardless of where they live.
“But then you’ve got to think about it. The money that’s used for these projects is the public money of Davidson County residents,” Overton adds. “So certainly they should get some type of consideration to ensure that the people of Davidson County at least have an opportunity for employment.”
LiUNA’s Link agrees, pointing out the issue boils down to “local control.”
A letter from Lee Company
Richard Perko, president of Franklin-based Lee Company, sent a letter Sept. 21 to Metro’s purchasing division opposing the amendment and arguing it would favor contractors outside. It points out the requirements and time frame for the local-hire amendment would be “unachievable” for his company.
“Forced with trying to meet an unachievable standard and compete with out-of-state contractors on an uneven playing field, we and other great construction companies in this region will use our resources elsewhere,” Perko writes. “Business sense will drive these companies who currently highly value working for Metro government to cease working on these construction projects altogether. This is not a threat, it’s simply the reality of the business climate that this amendment will produce.”
Lee Company is a Metro corporate taxpayer with substantial investments in Davidson County, including offices, a fabrication facility and training center and is one of the largest construction employers in the region with more than 900 employees residing in 40 counties. But because of the “diverse nature” of its business and the areas it serves, only 12 percent of its workforce lives in Metro, and only 6 percent of those are the commercial construction workers who would be affected by the new rules, he writes.
Perko points out the charter amendment may sound good to voters but it oversimplifies the situation. Construction projects require highly-skilled workers such as welders and metal fabricators who must go through several years of training, and the region is running into a shortage of qualified workers, he notes.
Finding people with basic life skills is one of Lee Company’s biggest problems. If it can find candidates who can pass a drug test, come to work and show a basic work ethic, it can help them develop into skilled workers, he writes.
“Nashville’s greatness was strengthened through regionalism,” he writes, adding Metro’s formation illustrates how city and county leaders foresaw combining government would strengthen Nashville.
That “regionalism” extends two counties in every direction outside Nashville, driving growth and participating in the Nashville “boom,” he states.
“Regionalism is under attack by this amendment. Isolationist policy such as this amendment will not strengthen Nashville, it will weaken it. And a failure to support a regional vision will put a halt on this city and region’s aspirations,” Perko writes.
Lee Company further encourages the Barry administration to review the amendment and either abolish or revise it to meet the “intended” goals, Perko writes, noting Lee Company is interested in working with the Metro government and other stakeholders to move forward “without this job killing mandate.”
Slatery’s opinion says the amendment violates the Contractors Licensing Act of 1994 prohibiting counties and cities from enacting extra requirements and discriminating against contractors.
The opinion points out the charter amendment specifies Tennessee-licensed companies would have to abide by the local-hire rule, thus exempting out-of-state contractors from having to meet the hiring guidelines.
Stewart, an attorney by trade, says he hasn’t dug into the AG’s opinion yet but has spoken with several local lawyers who have a different interpretation of the amendment than Slatery.
In light of the opinion, which will give Republicans stronger standing at the State Capitol, Barry says her office asked the Metro Department of Law to review Slatery’s legal view. Still, she plans to “bring together” council members, business and labor leaders and other groups to figure out how to make the local-hire charter amendment work.
“We are going to solve the problem Nashville voters asked us to solve,” she explains.
A good start for all those involved, regardless of what happens in the General Assembly, would be to put a nail gun and concrete finisher into people’s hands and teach them how to run them.
Of course, they have to want to do the work first, and these jobs aren’t easy, no easier than it will be to reach a conclusion on this local-hire measure.
Sam Stockard can be reached at email@example.com.