The Morning Report
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When San Diego Unified School District officials adopted a project labor agreement for its bond program seven years ago, officials made big promises to hire local workers.
San Diego County residents – not out-of-towners – would build all of the large bond projects, and at least 70 percent of workers would live within the boundaries of the school district. Among them, 35 percent would come from poor, local neighborhoods.
District and union officials argued the pact would boost the local economy, stabilize the contractor work force and limit costly disruptions to the district’s multibillion-dollar bond program by eliminating the possibility of a strike, they said.
But those local hiring targets have remained out of reach.
Just 38 percent of the 6,020 workers who built bond projects costing over $1 million to date have been residents of the school district, according to the latest figures released to the citizen’s bond oversight committee this month. That’s far short of the 70 percent pledged.
The district has come close to reaching its goal that 100 percent of workers on the sites be from San Diego County – so far, it’s reached 96 percent. But it is still short as well on its goal of hiring people from specific, poor neighborhoods. That stands at 27 percent, compared with the goal of 35 percent.
Workers who show up for one day are counted the same as a worker who spends 100 days on the job.
The shortcomings have not been a major point of concern for the elected school board or their 11 appointees to the citizen watchdog group that received the report on local hiring.
That group is charged with independently looking after San Diego Unified’s $4.9 billion bond program. In fact, two members of it work for the unions contracted with the district to supply the workforce in the labor deal.
The arrangement may pose legal problems since state law bars district contractors from serving on the bond committee.
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The state-mandated advisory bond group exists to provide accountability for the bond program and either confirms things are on track, or sounds the alarm if things go awry. The contractor prohibition is supposed to prevent members from having dueling loyalties.
Under the labor deal, local construction unions are contractually required to supply the work force building San Diego Unified’s large bond projects. The unions must have a job referral program, apprentice program and work with the district toward meeting the goals set for local hires and small local businesses.
The labor pact – signed in 2009 after months of closed-door school board negotiations – was a huge win for the Southwestern Regional Council of Carpenters, the San Diego Building & Construction Trades Council and more than 20 other unions that signed on, from painters to asbestos workers to plumbers.
In one swoop, it drastically narrowed the competition, ensuring billions of dollars of school construction and modernization work would go primarily to union shops by mandating that all contractors working on bond projects over $1 million source their labor through union halls or pay union fees and benefits.
The initial agreement was signed in July 2009. Three years later, the district expanded the deal to cover future bonds. A couple months after that, in 2012, voters approved a new $2.8 billion bond, bringing the district’s total bond program to $4.9 billion.
Mike Magallanes, business representative of the Southwest Regional Council of Carpenters, signed San Diego Unified’s project labor agreement on behalf of the union group in 2009. He was appointed to the oversight committee in 2012 and his term doesn’t expire until 2017.
Matt Kriz, trustee of the San Diego Building & Construction Trades Council – another major party to the PLA – joined the oversight committee in 2013. His oversight term also doesn’t expire until 2017, according to the district’s website.
While contractor lobbyists serving on bond oversight committees have raised ethical questions about how they can police workers they are paid to advocate for, such lobbyists aren’t normally contracted with the public agency they oversee.
In the case of Magallanes and Kriz, a contract does exist between their unions and the school district.
Kriz pointed to the section of the oversight committee bylaws added by the school board in 2013 requiring a representative from his union, and wrote in an email, “Other than that you’ll need to talk to SDUSD. I’m not an attorney, just a volunteer.” He said he is not aware of any legal opinion on the issue.
Magallanes did not respond to several requests for comment over the last month, and San Diego Unified spokeswoman Linda Zintz said the district would need to see a specific court opinion or regulation forbidding the arrangement – beyond the state law banning contractors from serving on bond oversight committees – before commenting.
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Having a contractor on the independent board is not allowed, but public agencies are interpreting the word “contractor” as they see fit.
San Diego attorney Kevin Carlin is troubled by the pattern.
“How can the public trust the bond oversight committee as impartial and looking out for their best interest when it’s populated by representatives of unions or contractors?” Carlin said. “That’s the fox guarding the henhouse.”
Tom Duffy, legislative advocate for California’s Coalition for Adequate School Housing, said he’s not convinced the union chiefs should be disqualified from the oversight group.
“It’s not a contract for construction services like a contractor would provide, or other services like an architect would provide,” said Duffy, who also lobbies for school district clients in Sacramento. He said the law is meant to forbid “simply those who have some sort of monetary gain out of this.”
If that’s the standard, Michael Turnipseed, president of the nonprofit California League of Bond Oversight Committees, sees a financial connection.
“If they have a contract with the district, they are a contractor. If they are providing services to the district … the payoff is using their workers. Workers that they provide pay dues to the union,” he said. “There is a conflict across the board with that. I am not a lawyer, but with a smell test, it doesn’t smell good.”
Turnipseed also said local hiring goals “should be part of the (bond’s) performance audit. If they are not performing up to the standards they set out, that should be noted.”
Duffy said the local hire goals may be outside the group’s purview. He has advised districts that the oversight job is to simply answer the question: “Did we spend the money the way we told the voters? … That’s the very narrow role of the bond oversight committee.”
The differing views illustrate how mixed the advice can be from advocacy groups. Who districts choose to listen to may determine the extent of the oversight provided.
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San Diego Unified isn’t the only agency appointing contracted union chiefs to its bond oversight committee despite the contractor prohibition – which applies to public school districts and community colleges.
Ron Miller, chief executive of the Los Angeles/Orange Counties Building and Construction Trades Council, signed Los Angeles Unified’s PLA on behalf of the union and has served on the school district’s oversight committee since the 2012-13 school year.
Miller’s committee bio boasts he “leads the negotiations for billions of dollars’ worth of Project Labor Agreements with public and private entities, such as the Los Angeles Unified School District.”
Miller did not respond to multiple requests for comment about his dual roles. Staff for both Los Angeles Unified and the district’s oversight committee declined to comment.
Closer to home, in Chula Vista, Southwestern College officials appointed Kriz – with the trades council – and Nick Segura, an officer with the local electrical workers’ union, to the college bond committee in recent years, even though both unions signed the college’s project labor agreement in December 2013. Segura did not respond to a request for comment.
College spokeswoman Lillian Leopold said there is no conflict because the unions “are not vendors, contractors or consultants to the district in connection to any bond-funded project.”
The ban, she said, applies when a contractor “agrees to provide a specific service or product which the contractor is paid for from bond proceeds.” Since the college never paid the unions bond money for their PLA services, the law wasn’t broken, Leopold said.
Southwestern officials also go a step further.
Leopold claims Baker Electric foreman Dennis Gittens can legally serve on the college’s bond oversight committee, even though Baker Electric was awarded a $2.2 million contract by the college earlier this year. The reason: Gittens was not in a position to influence contracting at work.
Gittens, who currently serves on the committee, offered the same reasoning and said he is “proud and committed to my service on the bond oversight committee.”
“I am far removed from all management decisions of Baker Electric and I do not participate in, or consult on, bids and contracts offered or executed by Baker Electric – hence there is no conflict of interest,” Gittens said in an email. “I seek to help the district build state-of-the-art facilities that enhance student education and achievement, put local residents to work and connect to training and apprenticeship programs.”
Baker Electric will help construct a building at the college’s National City higher education center this year. It is unclear if Gittens will be part of the construction team.