CONNstruction - Summer 2011 - (Page 9)

newsandviews How Hiring Preference Laws Could Impair Quality Craftsmanship By Matthew Hallisey Limiting public works projects to state residents is an admirable goal, but one that is not so easy to accomplish. In the current economy, while the industry struggles to recover from a severe recession, most officials and taxpayers naturally want to employ a local workforce. Connecticut employs the best craftsmen, the thinking goes, who perform quality work on public projects. Workers employed by state contractors are skilled, experienced, well-trained, and safety-conscious. However, requiring contracts to be performed solely with a local workforce is fraught with potential problems and could invite legal challenges. During the 2011 legislative session, the General Assembly considered several bills that would have given state residents preference over nonresidents for employment on state construction projects. Some lawmakers believed that, in light of the severe economic recession, it was unfair to award work to out-of-state contractors when instate contractors employ a quality workforce, are subject to state laws and regulations and licensing requirements, and pay taxes and spend money here. Why send limited work to nonresident contractors, lawmakers reasoned, when many Connecticut workers are unemployed and it is difficult to evaluate out-of-state contractors’ workmanship? State and local governments would prefer to keep local contractors and employees busy rather than permit scarce public funds to exit the state. Nonresident contractors are more likely to take tax revenue with them, and a workforce outside the state does not spend most of its discretionary income here, which in turn does not CCIA Director of Government Relations and Legislative Counsel stimulate the local economy. Additionally, local contractors, and workers, have a greater stake in the project. While there has been a law on the books in Connecticut for at least 60 years requiring a hiring preference for state citizens in construction of public buildings, Conn. Gen. Stat. §31-52, it could present enforcement challenges for the state Department of Labor. If challenged on constitutional grounds, the state may need to articulate a compelling reason why non-resident contractors should be excluded from construction work, or show that the state statute is narrowly tailored to achieve this goal. While it ultimately would be up to the courts to decide, whether any such preference law survives a constitutional challenge may depend on whether the law has a preference for state citizenship, as opposed to residence; whether the construction work is exclusively funded by the state or local government; or whether the General Assembly established findings to justify the preference for state residents. During the 2011 legislative session, the General Assembly considered several bills that would have given state residents preference over nonresidents for employment on state construction projects. Other potential problems could arise from preferences. Under such laws, it may not be easy to define or identify resident contractors; contractors headquartered outside the state but with a significant and historical presence in the state and who employ many local workers could be disadvantaged; costs could be added to public works projects; and bid protests could increase, resulting in project delays and additional costs. So, while it may be good public policy to develop a quality local workforce, hiring preferences on state projects could have the unintended consequence of providing fewer opportunities for such workers. No matter what the outcome, state and local governments need to be careful in adopting and enforcing such laws so as not to impair work opportunities for those they are trying to help while also affecting the quality of workmanship and cost of public works projects. CONNstruction / Summer 2011 / 9

Table of Contents for the Digital Edition of CONNstruction - Summer 2011

CONNstruction - Summer 2011
Restoring Craftsmanship
How Hiring Preference Laws Could Impair Quality Craftsmanship
The Disappointing Performance of the NLRB
Specialty Contractors Benefi t from AGC and Vice Versa
New Life for Old Buildings
Maintaining the Tradition
Developing the FutureDeveloping the Future
New Perils for Contractors in the ‘Greening’ of Connecticut
The Associated General Contractors of Connecticut Annual Meeting – February 2011
Senator Richard Blumenthal at CCIA
CONNDOT Paving Conference
Index to Advertisers

CONNstruction - Summer 2011