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Right-to-Work, Prevailing Wage Repeal Bills OK'd by State House Panels

The General Assembly is in session for a few days and the Republican-dominated legislature is getting right to work on Right to Work and prevailing wage issues which were frequently killed when the Democrats ran the show. 

Boone County Superintendent Randy Poe spoke in support of a prevailing wage repeal. Rep. Adam Koenig (R-Erlanger) is a co-sponsor of the bill which was given the green light by a House panel on Wednesday.

A House panel also passed right-to-work legislation that would prohibit Kentuckians from being required to join labor unions as a condition of employment.

House Bill 1 would prohibit mandatory membership in or payment of dues to labor organizations with few exceptions involving federal law and agreements entered into before HB 1 would take effect. Violators would be subject to prosecution.

The legislation passed the House Economic Development and Workforce Investment Committee favorably after an hour-long discussion that began with comments from Governor Matt Bevin. “Jobs come from private sector employers and they’re incentivized by the kinds of things you’re going to hear in coming days,” said Bevin. “This is a zero-sum game.”

Right-to-work bills have been filed several times in past legislative sessions said Speaker Jeff Hoover (R-Jamestown), who told the committee that HB 1 will give employees the ability to negotiate benefits and wages directly with their employer without being part of a union.

“I personally have no problem with an individual opting to be part of a labor union,” said Hoover. “… But government shouldn’t stand in the way of someone who opts not to join a union.” He said HB 1 would make Kentucky the 27th Right to Work state in the country, putting it on par with most Southern states as well as Indiana and labor-heavy Michigan.

Hoover said private sector employment in right-to-work states increased over 17 percent between 2001 and 2013 compared to around an 8 percent increase in non-right-to-work states like Kentucky.

Those opposing the bill included Rep. Gerald Watkins (D-Paducah) who told the committee that  tax code changes and the paring-down of regulatory burdens could do more for Kentuckians than right-to-work legislation. “I don’t believe personally a right-to-work law is (a) silver bullet,” he said.

Also speaking against the bill was Kentucky Center for Economic Policy analyst Anna Baumann who said Kentucky’s manufacturing sector is strong without right-to-work—Kentucky has the fifth-highest manufacturing employment as a share of total employment nationally, she said. But Hoover, backed by officials from the Kentucky Chamber of Commerce as he gave his testimony, said data shows the economy is stronger in right-to-work states. 

“Economic development is not only my primary, but my sole motivation in proposing this legislation,” said Hoover.

HB 1 would also prohibit public employees in Kentucky from engaging in work strikes. The bill now goes to the full House for consideration.

A bill that would repeal a state law requiring payment of an hourly base wage—or prevailing wage—to workers on public works construction projects has passed a House committee.

House Bill 3, sponsored by Speaker Hoover, R-Jamestown and Rep. Koenig (R-Erlanger), would apply to projects for which bids have not yet been awarded at the time the bill, should it pass, takes effect. An emergency clause included in HB 3 would ensure the bill takes effect immediately upon being signed into law by the governor.

Koenig, who presented HB 3 to the House Economic Development and Workforce Investment Committee before the committee approved the bill today, said prevailing wage laws are “unlikely to yield rates that are representative of market wages.” They are also a financial strain on local governments and school districts, Koenig said, emphasizing that saving money was the motivation for filing HB 3.

The bill has the support of Boone County Schools Superintendent Dr. Randy Poe who testified alongside Koenig. Poe told the committee that higher construction fees on prevailing wage projects have cost his school district as much as $50 million over the last 19 years.

“The higher fees we pay through prevailing wage keeps us from improving upon traditional space versus portable space (for) our students,” said Poe. “This is about creating more space for our students.”

Speaking against the bill was Bill Finn, the state director of the Kentucky State Building and Construction Trades Council. Finn said that nine out of 11 economic studies since 2001 have showed no increase in overall construction costs due to prevailing wage. “Twenty three percent is the entire pie that prevailing wage affects,” said Finn.

HB 3 now goes to the full House for its consideration.

From the Legislative Research Commission with light editing by The River City News