State Supreme Court Accepts Prevailing Wage Case

The state Supreme Court will review an appellate court ruling that California's prevailing wage law does not apply to a charter city's public works projects that are funded exclusively with city revenues.
 
In April, the Fourth District Court of Appeal ruled that the law did not "outweigh the power of charter cities over their municipal affairs." The appellate panel vote was 2-1 with Justice Joan Irion dissenting (see CP&DR Legal Digest, June 2009). She wrote that the court was deciding on the advisability of the prevailing wage law rather than its reach under the state constitution.
 
The litigation was brought by a collection of labor unions against the San Diego suburb of Vista, one of 83 charter cities in the state. In the past three years, Vista has launched $100 million worth of public works projects financed by a voter-approved half-cent sales tax. The projects, which are either complete or well underway, include two fire stations, a civic center, a sport park and an amphitheater stage house. Shortly after approving the sales tax, voters backed a proposed city charter based in part on the argument that a charter would allow the city to save money by exempting it from prevailing wage and other public contracting statutes that apply to general law cities.
 
The prevailing wage law requires contractors on public works projects to pay workers at rates set by the state director of industrial relations. Typically, the rates are equivalent to union wages in major urban areas. Cities and counties, especially in rural areas, often complain that the prevailing wage law unnecessarily drives up expenses. Supporters say that the law ensures that contractors who use union labor can compete for public works projects, and that it generates funding for apprentice training programs.
 
All seven justices on the state Supreme Court voted to review the Fourth District's decision. The case is State Building and Construction Trades Council v. City of Vista, No. S173586.