Delaware to start Community Workforce Agreement pilot

Delaware will identify six construction projects to bid out under a Community Workforce Agreement, including a multi-million rebuild of the Hodgson Vo-Tech High School. | DBT PHOTO BY KATIE TABELING

DOVER – Gov. John Carney signed an amendment to the state bond and capital improvement spending bill into law, but the legislation included a controversial Community Workforce Agreement pilot program for six state construction projects.

Community Workforce Agreements, also called Project Labor Agreements, are pre-hire agreements between contractors and subcontractors and local labor organizations for specific construction projects. Under the signed Senate Bill 35, the Office of Management and Budget (OMB) and the Department of Transportation can designate a total of six public works projects for these agreements.

Even if bids for these select projects were awarded to non-union companies, those companies would be required to contract or subcontract work or retain a percentage from local unions. That percentage would be determined by the state agencies.

“That language helps us be able to see what percentage of the project the union occupies, and whether they could make sure the folks they hire are indeed local Delawareans, as well as their demographics indeed match the state,” OMB Director Cerron Cade explained during a Jan. 19 Joint Finance Committee hearing. 

“We just want to make sure the worksites are reflective of the state, and that includes both union and non-union participation and workers from the neighborhood,” he added.

Last year, MGT Consulting Group released a study that examined disparities in state contracts for construction. Using data from the OMB, Department of Health and Social Services and Department of Corrections, it was determined that less than 3% of state contracts between 2015 and 2020 were awarded to women-owned firms, while firms owned by Latino or Hispanic people were awarded 3%.

Black-owned businesses were awarded around 2% of contracts in that time frame, or $685,000 in total construction dollars.

Last year, Rep. Larry Lambert (D-Claymont) filed a bill that would require all contractors on public projects that cost more than $3 million to have Community Workforce Agreements. That bill never made it to a floor vote in either the Senate or the Floor.

The OMB has designated four projects for these agreements, while DelDOT will designate the remaining two. One identified project includes the $134 million replacement of Hodgson Vo-Tech High School. 

Other potential projects highlighted by Cade include an OMB warehouse, the state food distribution center in Smyrna, the new Department of Natural Resources and Environmental Control lab and the new hospital for the chronically ill in Smyrna. These projects were chosen because of the variety of contracting work needed to be done, although Hodgson would include a cooperative agreement to get vo-tech students some hands-on experience.

The pilot program also includes Disadvantaged Business Enterprise, which is defined as a business that has a majority ownership and is managed by people who are “socially or economically disadvantaged.” Contracts included in the pilot will be evaluated based on best value, schedule and requirements set out in the pilot project

SB 35, dubbed a “mini-bond bill,” was introduced last week as a housekeeping measure to amend the state’s bond bill – no new money is spent, but it redirects funds already allocated and sometimes unspent in the Fiscal Year 2023 program.

For the past two weeks, many Republican lawmakers criticized the inclusion of the labor agreement provisions on the mini-bond bill instead of a bill that would require committee hearings. 

Instead, SB 35 was discussed in the Joint Finance Committee on Jan. 19, and was then moved for floor votes. The bill passed along party lines in both the House and the Senate, with the Senate holding an hour of discussion Thursday evening before the final vote.

Rep. Ruth Briggs King (R-Georgetown) noted that 20% of her district is Latino and 13% is Black. Many constituents reached out to her and her office in the days leading up to the vote, commenting that the Community Workforce Agreement would be hurtful to their business. 

Many Hispanic construction workers and contracting business owners came to Dover to protest the provisions all week, arguing that little to none of the workers in their community were in unions.

“They’re trying to seek opportunities to grow their business and their community, and to let the community see what they’ve done,” Briggs King said during Thursday’s floor vote. “I’m a little disappointed that they didn’t have a voice in this process. They came up here, and this is the first time they’ve ever been engaged in the political process, and for them to be discounted. There’s been a process for this kind of thing in the legislative process not to be rushed.”

Republicans in the Senate attempted to amend the bill to remove the community workforce agreement and to increase Disadvantaged Business Enterprise pilot projects through the OMB. That amendment failed, with 15 votes in opposition.

Many Hispanic construction workers and contracting business owners came to Dover to protest the provisions all week, arguing that little to none of the workers in their community were in unions.

Javier Torrijos, founder and owner of TORREngineering, testified on Jan. 24 that many of the Latino American community members he spoke to were opposed to the inclusion of project labor agreement language because it “discriminated against a very large minority group” that represents the construction workforce. 

He was one of roughly 50 people from the Hispanic community in Legislative Hall that day to protest the pilot program provision in SB 35.

“In the free marketplace, you’re placing a restriction, and our communities are already facing many barriers through language regulations,” Torrijos said. “Right now, we have a lot of folks that do drywall, framing,  vertical construction as well as horizontal construction.We don’t have a union workforce. This would impose on our workforce a union requirement to be able to bid on projects.”

Cade explained that the targeted four projects are coming up for bid relatively quickly, so it necessitated action before another budget process. 

The Hodgson Vo-Tech replacement project comes up for bid in June and the OMB warehouse is set to be bid out in April. DelDOT has one project earmarked for this pilot set to go to bid this summer.

Defenders of the provision like State Sen. Darius Brown (D-Wilmington) argued that the intention of the pilot program would serve as a starting point to collect data to address inequity issues that have frequently come up in the General Assembly since the Disparity Study was funded in the 2021 Bond Bill.

“I really believe this legislation is about how we provide for families up and down this state,” Brown said during the Jan. 24 floor vote. “Even though there may be some difference of opinion today on how we move forward, let me say there are not enough African Americans working union or non-union construction jobs. This will allow us to collect the data and really look at who’s doing better for the state – whether it’s union, non-union or a combination of both.”

Editor’s Note: The article has been revised to give better context around the history of the Disparity Study and when it was first funded.