In a victory for taxpayers and merit shop contractors, the Illinois House of Representatives failed to reach the three-fifths majority required to override Gov. Bruce Rauner’s (R-Ill.) veto of S.B. 2964. The bill would have tied prevailing wage rates for public projects to local union rates.
Under current Illinois law, collective bargaining agreements are typically among the factors used to determine the local prevailing wage.
“By tying prevailing wage rates exclusively to collective bargaining agreements, as long as the agreements covered at least 30 percent of workers performing similar work in the area, S.B. 2964 would have essentially given labor organizations the authority to set prevailing wage rates,” said ABC Illinois Chapter President Alicia Martin. “This is despite the fact that more than 60 percent of the private construction workforce in Illinois chooses not to belong to a union or be covered by collective bargaining agreements. Additionally, the bill would have removed the authority to set wages from local governments that are accountable to taxpayers and given it to labor organizations, whose members would be bidding on the very projects they were setting wages for.”
ABC’s Illinois chapter conducted an extensive grassroots operation to engage its members to oppose the bill, which would have put merit shop contractors at a disadvantage in bidding on public work and driven up the cost of public construction projects.
Illinois ranked as the least friendly place for merit shop contractors to do business according to 2016 rankings
from ABC’s Merit Shop Scorecard
, in part because of its prevailing wage requirements on all public projects.
ABC opposes prevailing laws because they tilt the playing field towards unionized contractors by requiring contractors to pay local union wages and often require contractors to use outdated and rigid union job restrictions.
Eliminating prevailing wage laws lowers state and local government’s cost of doing business creating opportunities for more schools, roads, bridges, low-income housing, hospitals and prisons. A study commissioned in 2014 by the nonpartisan Anderson Economic Group found that from 2002 through 2011, the state of Illinois and local governments could have saved an estimated $1.6 billion on school construction costs with the exemption of prevailing wage.