A Better San Diego Forum Attacks Props A, B
A Better San Diego held the latest installment in its monthly series of community forums Friday morning. The organization, backed largely by labor groups, invited Tom Lemmon, business manager of the San Diego County Building and Construction Trades council, and Michael Zucchet, general manager of the San Diego Municipal Employees Association, to speak against city Propositions A and B.
Zucchet took the podium first to argue against Prop B, which has been widely been touted as a means to save the city money by enacting a five-year pay freeze on pensionable salaries for existing employees and by directing most new city hires into 401(k)-style savings plans instead of defined benefit pensions. Proponents have argued that the measure could save the city nearly $1 billion, a claim countered by opponents by pointing out that all of the savings come from the pay freeze, and that the 401(k) plans would actually be more costly than the existing pension plan.
But the pay freeze itself is not guaranteed, it simply dictates a starting point for the city to open negotiations with its union employees. Zucchet and others believe that such a mandate may even be illegal, and challenges to the measure are already being prepared.
“There’s litigation that’s already been initiated, and there’s a relative mountain of litigation that will be initiated if it passes at the polls, because the way this was done violates state law in a number of ways, particularly as it relates to bargaining laws in California,” says Zucchet, who believes that opening negotiations with a predetermined mandate constitutes a failure to bargain “in good faith.”
An article published in CityBeat last September contains statements from a spokesperson for mayor Jerry Sanders that suggest the initiative was intentionally structured to avoid otherwise required discussions with the unions, something Zucchet suggests might be evidence of bad faith on the part of city officials.
Speaking on the city’s budget woes that Prop B aims to ease, Zucchet cited a Center on Policy Initiatives study that allegedly found revenues were artificially low due to the city having the lowest effective tax rate in the state.
“If you were to take the average tax structure of the ten largest cities in California and apply those rates to San Diego for hotel taxes, business license fees, and everything else, San Diego would immediately generate another $200-300 million in tax revenue per year,” says Zucchet, alleging that reduced taxes caused the need to intentionally underfund the pension system that created the current shortfalls.
Zucchet further attempted to debunk the common perception that large numbers of union employees were retiring with six-figure pensions, something that independent mayoral candidate Nathan Fletcher called “immoral” at a debate last month while running as a Republican. Zucchet said that Prop B proponents had used pension payments of non-union management employees not subject to the collective bargaining agreement in question to skew the public’s perception of typical pension benefits. Specifically cited were the positions of deputy city attorneys and city managers.
“The average employee we represent earns $53,000 annually, and the average pension of a non-public safety worker after working 30 years for the city is $31,000 annually with no Social Security,” said Zucchet. City workers gave up their Social Security during bargaining in 1982. “Reasonable people may agree or disagree whether those levels of compensation and retirement benefits are good or bad, but those are the facts.”
Ultimately, Zucchet acknowledges that supporters of the measure have had much more success in getting their message out and enjoy a considerable advantage in public opinion. A poll published in U-T San Diego in late March showed Prop B garnering support from 56 percent of voters, with only 30 percent opposed.
“From a political standpoint, it’s pretty likely that this is going to pass in June. And when I say pretty likely, I mean we’re [expletive].”
Lemmon spoke against Prop A, which seeks to ban the use of project labor agreements in the city — similar measures have already passed in the county and in cities such as Chula Vista and Oceanside.
Such agreements are typically entered into on large construction projects and are frequently used on both government and private projects. They dictate the terms of work, including timelines, budgets, and employee compensation, with the party contracting for the work receiving the benefit of a firm budget and a guarantee of no work stoppages. The downside, detractors say, is that such agreements require workers to receive union-level pay, even if the contractor bidding on the work does not typically use union labor or pay workers at the usually higher rate of compensation.
“Who’s really putting the initiative together? It’s a group of contractors, the Associated Builders and Contractors, who only represent four tenths of one percent of the contractors in California. Yet they’re responsible for 24 percent of all the state-law violations that occurred in 2010,” charges Lemmon. “So they don’t like to play by the rules, and project labor agreements make them play by the rules.”
Lemmon points out that enacting such a ban could cost the city a large amount of money, even though without the ban in place no projects are currently being pursued under the use of a project labor agreement.
Senate Bill 922, signed into law last year, prohibits local municipalities that have blanked project labor agreement bans in place from receiving state funding for construction projects, though there is no requirement that cities actually entertain the notion of entering into such an agreement. Last year San Diego received $158 million in state construction funding.