Home Contributors Westchester Op Ed: New York must put the brakes on prevailing wage legislation

Op Ed: New York must put the brakes on prevailing wage legislation

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With the shock of Amazon’s decision to abandon its plan for opening a second headquarters in New York still fresh, New York state now is facing another decision with the potential to be even more damaging to the state’s increasingly fragile economy. It’s called Prevailing Wage legislation and it is a construction project killer.

prevailing wage
Gordon

Both the Assembly and the Senate have included Prevailing Wage language in the new state budget scheduled for adoption by April 1. If passed, this legislation, that is strongly backed by the construction labor unions, would require that any development project receiving state funding assistance would be required to pay prevailing wages for all construction labor. The requirement, which would apply to private development projects as well as projects built by not-for-profits including hospitals and colleges, would increase labor costs by 30 percent or more.

What would this mean? However well-intentioned, instead of helping construction workers, it’s a job killer. In simplest terms, any project receiving financial assistance would pay union wages for all work. While laudable on the surface, the consequences are far-reaching and would bring a large percentage of the major construction projects planned in communities across the state to a standstill. The most severe impact would be on urban downtowns such as in Yonkers, New Rochelle and White Plains that are on the cusp of unprecedented revivals after decades of little or no new investment.

prevailing wage
Ravitz

Why? Without state subsidies, the vast majority of projects being planned in urban downtown locations will simply not be built. State and municipal subsidies provide the financial cushion to make these costly construction projects financially viable. The vast majority of the affected projects are residential, meaning much needed new housing at all levels, including affordable housing built by non-profit groups, could not move forward.

The significantly increased labor costs resulting from the proposed legislation would be particularly harmful in Westchester where residential rents are considerably lower than in New York City.   

In Westchester, more than 30 prominent development company leaders have joined with the Business Council in forming the Westchester Coalition for Smart Development to present the facts about the unintended consequences of the proposed legislation. We have met with the entire Westchester legislative delegation, as well as other leaders in Albany to promote an open public dialogue before passage of this far-reaching legislation. We have also joined with the Business Council of New York State in this effort.

We need look no farther than Yonkers to see the consequences of requiring Prevailing Wages. For 18 months the City’s Industrial Development Agency (IDA) imposed the requirement for any project it funded. What happened? The additional labor expense was far greater than the IDA benefits would have been. The net result? Not a single major proposal came before the IDA during that period.

We have no opposition to union labor. In fact, most major projects employ some union labor. But requiring all construction projects receiving public financing of any kind to pay union wages will effectively assure that most of the projects won’t move forward. That is certainly not an outcome that anyone wants.

We strongly urge that the Prevailing Wage legislation proposals be put on hold until a thorough and thoughtful discussion of all consequences takes place. New York State cannot afford to do otherwise.

Marsha Gordon is the president and CEO of The Business Council of Westchester. John Ravitz is executive vice president and COO of The Business council of Westchester.

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6 COMMENTS

  1. Why should New York put the breaks on making better paying jobs? Wouldn’t it be logical that it would boost New York’s economy? The more money being spread out means the more money being circulated back into the economy. Working class people deserve a fair wage. Most people in New York can’t even afford to live here with inflation and tax hikes. Study’s show people are moving out of this state faster than ever before. Maybe you should put the breaks on this article!

  2. This is nothing more than a scare tactic by those that want to keep the working class wages as low as possible to maximize they’re profit margins on our backs. This law would gaurantee fair wages to both union and nonunion labor employed on these projects. It is heavily backed by union labor because we support working people. Check your history books that’s what we do.

  3. I guess Ms Gordon only wants equal pay for the people in her profession. I guess she doesnt want equal pay for women in construction. Why should women and minorities have a good paying union job that can give them a better life. Ms Gordon wants our tax money to go to projects that pay less to its workers so the developer can make more profit.
    Do union construction workers not pay taxes, we pay far more taxes than a worker on a non union job. Come to think of it what does a non union off the books worker pay in taxes. Why should a taxpayer funded project help one group when with prevailing wage it can help many.
    Stop the scare tactics. Developement is cyclical, someone is going to start a project too late and lose and that will have nothing to do with prevailing wzge being passed.

  4. If you guys and the developers are so worried about finances, why don’t you take a 50% cut in pay and salary and benefits? Do you think that would be then worth your while to do your job at such a significant cut in pay?do you think when your boss is not paying you a pension that you’ll be able to live with dignity when you are older and not able to work anymore? Answer these questions mrs. Gordon and miss the rabbits remember New York State does not and will not take advantage of immigrant workers and that’s just what the developers do. Without Union protecting the rights they are vulnerable to this type of abuseand that means they have not ever gotten a prevailing wage Nor are most of them on the books.

  5. This bill continues to be swept under the rug as developers continue the race to the bottom. Good wages,equal pay and safe jobs are vital for our economy and our local communities. It is a bold lie and yes, a scare tactic that this bill would add any increase to the projects, the studies have already been done. Let’s think about this for a moment, when local Men and Women are working on these projects making a good wage they are spending local, supporting local businesses.Stopping at the mom and pop delis and pizza shops, getting their cars repaired at local garages and body shops, supporting local day care for their children, good paying skilled workforce will Always be the driving factor for a good economy. The Westchester &Putnam Building&Contstruction Trades have tried negotiating with some of these developers to find common ground but the sad reality is the bottom line. When you have luxury High Rise Developement going up in All of your major cities being done mainly by out of state workers, that money certainly is not being spent here, keeping small business thriving, it’s going back to other municipalities.Pass this bill immediately and let’s continue to support the local Labor Force that truly keeps this Local economy moving in the right direction.

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