In Allentown, controversial law requiring contractor apprenticeships on city projects hits snag

Allentown Mayor Matt Tuerk, who supports the ordinance, has sent it back for fine-tuning

By: - Sunday March 6, 2022 6:30 am

In Allentown, controversial law requiring contractor apprenticeships on city projects hits snag

Allentown Mayor Matt Tuerk, who supports the ordinance, has sent it back for fine-tuning

By: - 6:30 am

(c) skarie – Stock.Adobe.com

(c) skarie – Stock.Adobe.com

ALLENTOWN — An ordinance requiring contractors on large city projects in Allentown to be part of apprenticeship programs has hit a roadblock, forcing revisions to address concerns over the value of the projects that fall under the bill and past history in training programs.

The apprenticeship provision for construction projects worth more than $100,000 is contained in a Responsible Contractor Ordinance (RCO) that council passed 4-3 during a Feb. 16 meeting where a spill-over crowd of contractors on both sides showed up to weigh in.  

But Mayor Matt Tuerk, though supportive, sent the ordinance back for revisions that make it clear that it only covers contracts entered into with the city — not city-related authorities.

Meanwhile, council Vice President Ed Zucal, who is a co-sponsor, said even more revisions are under consideration. One change would be raising the value of jobs falling under the RCO to $250,000.

Another would involve lowering the timeframe for past apprenticeship participation from five to possibly three years, Zucal said.  

“I think it will be more favorable,” Zucal told The Pennsylvania Capital-Star.

Class A apprenticeships

If Allentown’s proposed ordinance survives a second vote, the city would join Bucks, Lehigh and Northampton counties in adopting the measures in recent years, with Northampton’s withstanding a legal challenge

Such ordinances typically cover bonding, background checks on lawsuits and criminal records and other standard compliance matters. 

But many add participation in Class A apprenticeship programs or the equivalent to win work on larger projects – those valued at or above $100,000 (Lehigh and Northampton) or at or above $250,000 (Bucks).   

Proponents say apprenticeships provide better trained workers, who, in turn, improve the chances of a project being completed on time, within budget, and without costly mistakes and accidents.

That’s because Class A apprentices must be fully employed by a company, given on-the-job, classroom and lab training, and have mentorships. At the end of the program, they are credentialed at the journey-person status.

Pennsylvania has 587 federally registered apprenticeship programs in the building trades, according to Tara Loew, director of the state Department of Labor and Industry’s Apprenticeship and Training Office. She could not provide a breakdown on the number of union and non-union programs.

“You’re really improving the quality of work,” said Allentown council member Joshua Siegel, who co-sponsored the bill with Zucal.

By passing the ordinance, critics say the city is favoring union contractors and shutting out companies that worked for years for the city without issue. 

“You are just picking winners and losers,” Terry Crouthamel Jr., of the non-union Asphalt Maintenance Solutions, told council on Feb. 16.

Past history provisions

David Sload is president and CEO of Keystone chapter of Associated Builders and Contractors, a trade group that represents mostly non-union contractors, and is involved in apprenticeship programs.

Sload told the Capital-Star that his group strongly favors apprenticeship programs. But he said RCOs can tilt in favor of union shops if they contain provisions like Allentown’s that require a history of participation. Not all of them do.

Sload said apprenticeships are typically offered by jointly operated labor-management committees that involve unions or trade associations such as ABC. https://www.pacareerlink.pa.gov/jponline/JobSeeker/ManageServices/SearchTrainings.aspx

With Allentown’s five-year requirement, Sload said, non-union companies would have to enroll in a program and wait the required period before being eligible to bid on jobs.

Non-union companies also would be responsible for directly paying for oversight and classroom learning, which runs about $3,000 a year at his organization, Sload said.

Companies with union employees pay a cents-per-hour fee for each employee to cover apprenticeships and continuing education for journey level employees. For electrical contractors, for example, that amounts to $1,200 per employee a year. Apprentices are then assigned to companies as they need them. 

Brian Wanamaker, vice president of Diefenderfer Electrical, a union shop located in Allentown,  praised apprenticeships, saying they supply a steady supply of trained workers that he can count on. He told the Capital-Star that he typically has 10-15 apprentices a year.

However, Wanamaker said the five-year requirement doesn’t strike him as fair.

“As long as you are signed up with a program and doing some type of training, to me that would be acceptable,” Wannamaker said. 

 Bud Bauer, owner of Baseline Contracting, said he can’t meet the Class A requirements even if he wanted to do so.

“There is no apparent program that meets our needs,” said Bauer, whose open shop company won three city contracts in the last five years.

That doesn’t mean he doesn’t believe in training. Bauer told council members that he spends about $2,000 a year on specialized equipment training. 

Zucal said these concerns are why the ordinance is under review. He said raising the RCO value to $250,000 would help smaller companies. He also said there is a waiver that does away with the apprenticeship requirement should no one bid on a job.

Money saver or bigger expense for taxpayers?

Supporters of Allentown’s RCOs point to Northampton County’s new forensic center as Exhibit A on why RCOs work.   

The facility, which was built with union and non-union labor, was budgeted for $12 million but ended up costing $10.6 million.

“We, in part, credit the fact that we had the RCO for it being completed on time and under budget,” Northampton County Executive Lamont McClure said.

Northampton has awarded 11 contracts since the RCO passed in 2018 – all without issue, McClure added.

Allentown council member Candida Affa said the ordinance would cost the city more money, citing a city analysis that shows that two dozen companies would not have been eligible to bid on 17 recent construction projects.

They include a $470,975 contract awarded to Baseline Contracting for ramp work in 2019.

“Is council willing to increase taxes to accommodate change?” said Affa, who voted no along with council President Cynthia Mota and member Dave Hendricks.

Frank Manzo IV, executive director of the Illinois Economic Policy Institute, said such analyses cannot accurately predict future bids.

Manzo said his institute looked at 1,200 public projects in Illinois and northern Indiana that ranged from road work to school construction. Of those, about 300 involved such ordinances. https://illinoisepi.files.wordpress.com/2022/01/ilepi-impact-of-new-rbos-in-illinois-and-indiana-final.pdf

The results showed projects with RCOs are no more costly than those without, he said. 

The reason, he said, is that RCOs end up attracting more bids from companies with apprenticeships because they are on a more level playing field.

A stronger local economy  

Allentown’s ordinance is being debated at a time when the federal government says more than eight in 10 contractors in Pennsylvania are having trouble finding workers.

One of the bill’s stated purposes is to help build a supply of highly trained workers for future city projects.

Siegel, the bill’s co-sponsor, said he thinks it’s appropriate for municipalities like Allentown to help steer training through law. 

“I tend to think that municipal governments need to be more expansive in their role,” he said. “We should be rewarding contractors that value their employees’ skills.”

Whether that will happen in Allentown remains to be seen. The next chance for the ordinance to be introduced again is March 16.  

Correspondent Katherine Reinhard covers Allentown and Lehigh Valley for the Pennsylvania Capital-Star. Readers may follow her on Twitter @KMReinhard.

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