Gov. John Hickenlooper on May 24 signed into law a state-contracting reform bill that aims to reduce the outsourcing of public works projects and penalizes employers who do not hire local workers or who buy foreign-produced materials.
But it’s a bill that earned little legislative support from Republicans, who panned the legislation as another example of Democrats protecting unions over businesses.
House Bill 1292, which Democrats dubbed the “Keep Jobs in Colorado Act,” reforms the bidding process for state work projects, such as highway construction. Bill sponsors say the legislation helps to ensure that Colorado taxpayer dollars are being spent on local workers.
“This really was my number one priority coming into this legislative session,” said state Sen. Andy Kerr, D-Lakewood. “We need to do everything we can to keep and create jobs in Colorado, and make sure our taxpayer dollars are being used as wisely as possible.”
Under the bill, state agencies would not only weigh bid costs from contractors, but also would take into consideration “best value” bids, which include factors such as the contractor’s employment practices, such as worker wages and benefits.
The teeth in the act is in the enforcement of a law that’s been on the books for 80 years.
Before the bill was introduced, there was a requirement that state-funded construction projects have a workforce that is made up of 80 percent of Colorado workers. For years, the requirement was rarely, if ever enforced, primarily because the penalty for employers who violated the law was jail time.
Now, the bill creates a series of civil penalties that could eventually lead to contractor disbarment whenever that 80 percent threshold is not met.
State agencies can waive the 80 percent rule if contractors can show there is not sufficient Colorado labor available for a project.
The bill also requires many contractors to provide proof of the country of origin for materials used in projects, such as iron and steel.
The two state entities that will oversee enforcement of the bill’s provisions will be the Departments of Labor and Employment, and Personnel and Administration.
Some contractors who testified during the legislative process raised concern their costs of doing business with the state would rise and that the bill’s reporting requirements would increase overhead. In fact, the General Assembly’s Legislative Council’s staff report on the bill states that “the new reporting required by the bill may increase contractor costs.”
Republicans have criticized the bill as something that could actually reduce the number of contracting jobs and blasted it as having been spearheaded by unions. The AFL-CIO was a major driver of the legislation.
“Whatever happened to the simple, ‘Hey, low bid? Qualified bidder? Sold?’” said Sen. Kevin Grantham, R-Canon City, during a Senate debate earlier this month. “That’s good for the taxpayer.”
But bill supporters believe there should be more to the process than just low bids.
“A low bid may cost less, but at the end of the day, it may not be the best value for the taxpayer,” Kerr said.
And bill sponsors disagree that this bill is all about making unions happy.
“I wasn’t trying to protect one kind of worker over the other,” said Sen. Jeanne Nicholson, D-Black Hawk. “I think the important thing is that local taxpayers are protected and that jobs stay here, at the end of the day.”