If we didn’t have enough heat this winter in Indianapolis, our Legislature is rushing toward repeal of the Common Construction Wage Law.
A fixture for 80 years, the law sets wage levels for government projects such as school construction and sewer lines. It also marks the front line of a political battleground.
Republicans say the law creates artificially high wages that inflate the cost of public projects. They say the free market should set construction wages, the way it does for privately funded projects.
Democratic supporters of the law say it prevents out-of-state contractors from using low-paid labor to take Hoosier tax money for shoddy work. That was the problem that led to the law’s passage in 1935, they contend.
The law affects all government projects with price tags above $350,000.
In each county, a five-member committee sets wage levels for a variety of job categories. The committee includes union and contractors’ representatives, a taxpayer and an industry representative appointed by the agency paying for the project, and finally a taxpayer appointed by the county council.
As the balance works out, the taxpayer chosen by the county council usually holds the swing vote, and results reflect the political leaning of that county.
Wages do not vary significantly between local counties. Counting fringe benefits, a heavy equipment operator makes between $27 and $29 in northeast Indiana. Pipe workers and electricians are paid in the same range. Roofers command slightly less, and skilled laborers make $19-$20.
Supporters of the law and advocates of repeal both claim they’re looking out for taxpayers.
“It is about making sure the hard-earned dollars of Hoosier taxpayers are going as far as they can. I think this also would lessen the burden on cash-strapped local schools and local governments,” said Gov. Mike Pence, who has pledged to sign a repeal bill if it passes.
“The common construction wage law often sets wages/benefits at rates above where the free market would. It is unfair to the taxpayers to pay more than is needed,” Fort Wayne City Councilman John Crawford said in an article for a Fort Wayne newspaper. He predicts savings of 10 percent on public projects if the law is repealed.
John Gregg, Democratic candidate for governor in 2012, warns against repeal, saying, “by shortchanging workers’ wages and allowing contractors to low-ball public works projects by hiring unskilled, low-wage workers, there is a very real risk of building unsafe roads, bridges, schools and other public facilities.”
Not all contractors are pushing for repeal, with some fearing it might cause skilled workers to leave Indiana. A newspaper article quoted a major Terre Haute contractor as saying repeal “would be a far more complicated issue than anyone realizes.”
That may be why Sen. Phil Boots, R-Crawfordsville, is calling for everyone to take a deep breath and study the pros and cons over the summer.
Boots chairs the committee that would handle the repeal bill — under normal circumstances. Reports say his eager colleagues might buck procedure and take a detour around Boots’ committee.
But a year from now, Republicans still will hold all the cards in Indianapolis. No one would be able to block repeal if it still looks appealing. After 80 years, it might be worth listening to Boots and taking our time to make a careful choice about construction wages.