If Akron can’t find contractors to meet the local hiring
goals for its billion-dollar sewer project, the city has another solution:
starting its own construction company.
Mayor Don Plusquellic is exploring this idea as his
latest solution for ensuring that Akron residents, who are paying for the bulk
of the sewer project through higher rates, get a big chunk of the work.
“I’m tired of hearing, ‘I can’t find city residents to do
these jobs,’ ” he said. “We’re going to prove they can.”
Plusquellic mentioned his new brainstorm for the first
time publicly last Monday during an update to Akron City Council members on the
city’s mammoth sewer project. Though he admitted many details remain to be
worked out, he then expanded on his concept in an interview with the Beacon
Journal.
One thing is clear: What Akron plans to do hasn’t been
tried before in Ohio, despite how numerous other medium and large cities also
are overhauling their sewer systems because of environmental concerns with
sewage runoff into waterways.
“No other municipality has a construction company as part
of their operation,” said Kent Scarrett, a spokesman for the Ohio Municipal
League. “I think Akron is probably the first community to have the financial
wherewithal and that has that need for an upcoming project.”
Akron’s fledgling idea is so far garnering a mixed
reaction, with champions and critics.
“I would argue the competitive-bid process gives the
citizens of Ohio a better deal on true construction projects,” said Chris
Runyan, president of the Columbus-based Ohio Contractors Association, which
sued the city over its sewer hiring goals but later dropped the lawsuit.
Still, even Runyan tipped his hat to the city for
experimenting and “trying to be efficient.”
Hiring history
Plusquellic admits to being fueled in his quest for local
hiring by experiences from the past.
He hasn’t been satisfied with the low amount of local
hiring on the Akron school district’s construction project, which is being
funded with a 0.25 percent city income tax. He also wasn’t pleased when a
federally funded stimulus project to refurbish the All-America Bridge, also
known as the Y-bridge, went to a Michigan contractor, rather than a local
company, because the bid was slightly lower. The city sought, but was denied,
permission to still hire the local company.
With the city about to begin the first job under its
sewer overhaul last spring, Plusquellic announced ambitious hiring goals that
any contractor getting sewer work would have to accept. Contractors last year
were required to hire 30 percent of their employees from within Akron, with the
number ramping up 5 percent a year until 2018, when it will reach 50 percent.
The Ohio Contractors Association, a not-for-profit group
that represents contractors across the state, sued in May, seeking to have the
hiring requirements ruled unconstitutional and to stop the city from awarding
bids on the Rack 15 storage basin project. The group dropped its challenge a
month later.
After the legal challenge, though, Plusquellic announced
that the city would serve as its own contractor on the Rack 15 project. The
city, the mayor points out, is under no obligation to hire private contractors.
The city has been using a “construction manager at risk”
for its first sewer projects, which involves a construction manager who
oversees a project and pledges to deliver it for a certain price. The
construction manager then hires subcontractors to do the various tasks.
Akron has been taking steps to try to increase the pool
of Akron residents who are prepared to do the sewer work, including starting a
Commercial Driver’s License training program, with the city hiring some of the
graduates. Akron also kicked off a pre-apprenticeship program last week in
which 50 Akron residents are being trained to enter apprenticeship programs
with local trade unions.
Plusquellic, though, has decided these steps don’t go far
enough and that Akron should actually start its own construction company as an
offshoot of the Akron Development Corp., an entity that has been around since
before Plusquellic became mayor. This private company, he said, could require
its employees to be Akron residents, which the city isn’t able to do because of
a residency requirement that was shot down by the Ohio Supreme Court.
New venture
Many details of this new venture remain to be worked out,
including the name.
One idea is that it be called Akron CCC (City
Construction Company), though this hasn’t been set in stone.
Plusquellic has decided whom he wants to head up the new
venture: Mark Moore, a city engineer with a law degree who has been in charge
of crafting the city’s capital budget for the past several years.
Moore attended the World of Concrete trade show in Las
Vegas earlier this month to price concrete trucks and see how quickly they
would be available for purchase.
Concrete, interestingly, is one of the main reasons Akron
is pondering its own construction company. Already in the sewer project, Plusquellic
and Moore said there have been several times when the city has had trouble
getting concrete because of conflicts with providers. This could be a problem
with a project that Moore said will require “hundreds of thousands of cubic
yards” of concrete.
“I believe we have to do it,” Plusquellic said. “We have
to take control of price and timing.”
Plusquellic has spoken to local trades unions, including
the Teamsters, about an agreement that will allow the city’s new company to
hire their members when additional employees are needed for jobs.
The mayor said he realizes that Akron residents likely
won’t be available for certain specialty jobs, like operating the machine that
will drill a 27-foot-diameter tunnel through downtown.
“We can’t have 100 percent,” he admitted.
Moore said the company will start small and build its
capacity, the same as any other business. He said the company’s employees will
be able to handle such tasks as excavating, hauling dirt and concrete and
digging ditches.
Plusquellic said he isn’t yet sure if the company will be
set up as a for-profit or non-profit, though he said the intent will be for it
not to make a profit. He said the city will continue to use a construction
manager at risk, with the new company acting as one of the subcontractors hired
by the construction manager.
“We would reinvest any profits into the public purpose —
expanding the company, providing training opportunities,” Moore said.
Mixed reaction
When Plusquellic mentioned his idea for a new company
during a council committee meeting last Monday, he gave a shout out to Willie
Smith, a local resident who has been pushing for the city to provide sewer jobs
to Akron residents.
Smith, a frequent speaker and attendee at council
meetings, was thrilled to hear about the mayor’s idea.
“I was surprised,” Smith said. “I didn’t think he would
understand that we can become the general contractor. By law, you can hire who
you want to work on your project. This is no government subsidy. We are the
residents paying for this.”
George Johnson, the president of the Akron chapter of the
American Federation of State, County and Municipal Employees (AFSCME), also
liked what he initially heard about the concept. AFSCME represents about 425
Akron employees, including the recently trained CDL holders hired by the city.
“For us, it’s about a strong economy with people with
decent paying jobs,” he said. “I don’t care whose union they are in. I just
care that folks have jobs. If the jobs are not unionized, that’s fine too. As
long as they are paying them well and treating them well.”
Johnson said the bottom line is: “Let’s create some jobs
and money for the Akron economy. That helps everybody.”
Runyan, though, of the contractors association, isn’t
sold on the concept. If the city starts this venture, he said it won’t be a
true “construction company” because it won’t have to worry about making a
profit, winning bids or justifying a purchase.
“It’s basically a public entity that has whatever it
wants to buy,” he said.
Runyan thinks the company could run into legal problems
with requiring employees to live in Akron, just as the city did with its
residency requirement. He said there also may be legal questions about where
the line is drawn between the city and the company.
“Who’s going to inspect their work?” he asked. “Who’s
going to keep the fox out of their hen house?”
“I guess they can try anything,” Runyan continued.
“That’s their right.”
Source: Ohio.com
No comments:
Post a Comment