Union organizers from Carpenters Local 107 in Worcester
regularly check local construction sites for illegal activity. They look for
workers who don't have U.S. citizenship, companies that are not paying overtime
to their workers, and for unsafe conditions, among other things. The job sites
they watch and report on usually employ non-union labor and, in some cases,
out-of-state workers and companies.
In June, a union organizer found that two companies
working on a $55 million apartment complex renovation on Williamsburg Drive in
Worcester were not providing workers' compensation insurance to their workers.
The union reported the violations to the state Department of Industrial
Accidents.
The DIA found that the companies, AAPCO Southeast Inc.,
of Concord, North Carolina, and J.R. Complete Construction, Inc. of
Philadelphia, were in violation of the state law mandating that workers be
covered by workers' compensation insurance. The DIA issued stop-work orders to
both companies on June 14. The companies paid fines of $200 and $700, and
obtained the required insurance.
As part of the stop-work order, the two companies are now
barred for three years from working on any job funded by public dollars in
Massachusetts.
Yet the companies were allowed to return to work on the
Williamsburg Drive project just a week later, on July 20.
Why? Because although MassDevelopment, a quasi-state
agency, is involved in a significant portion of the project's funding, the $28
million in funding that MassDevelopment arranged for the project is not public
money. It's private investment, buoyed by federal tax credits.
Kelsey Abbruzzese, spokeswoman for MassDevelopment,
explained that the agency acts as a conduit between investors, lending
institutions like banks, and development projects. MassDevelopment issues
tax-exempt debt on behalf of eligible agencies, she said, or arranges for
tax-exempt bonds to be purchased by private investors. Either way, the
investments represent private dollars.
In the case of the Washington Heights development,
MassDevelopment "issued a $28 million tax-exempt bond on behalf of
Washington Heights Preservation Limited Partnership, a Worcester project
sponsored by Related Companies. The organization is using bond proceeds to buy
and renovate a 404-unit multi-family housing apartment complex known as
Washington Heights," according to a May 17 MassDevelopment news release.
"Planned renovations include bathrooms, kitchens, fire alarm, and
electrical upgrades; new air conditioning units, HVAC equipment, and security
system; and common area painting. Other upgrades include new vinyl siding,
roofs, and gutters; balcony and parking lot repairs; and improved outdoor
community areas. Washington Heights has 366 units affordable to households
earning no more than 60 percent of the area median income, 36 units affordable
to households earning no more than 95 percent of the area median income, and
two market rate units. The 21-acre property is comprised of 34 three-story garden-style
buildings with 196 one-bedroom units, 180 two-bedroom units, 18 three-bedroom
units, and 10 four-bedroom units.
"This project will preserve Washington Heights as
affordable housing for 30 years. MassDevelopment also assisted the Department
of Housing and Community Development with the approval of federal low-income
housing tax credits, which will generate about $16.2 million in equity for the
project," the release said.
In the end, the state apparently considered the
violations minor, considering the small fines. Barring the two construction
companies from publicly funded construction projects in Massachusetts might
harm them in the future, but it only delayed them a week on the Washington
Heights project.
The union continues to have a problem with the project,
despite the state's intervention.
“This is exactly the situation we hate to see, local
taxpayers being hurt by an out-of-state developer whose project is being built
by contractors that include these two that brought in low-pay, uninsured
workers from well beyond Massachusetts’ borders,” Jack Donahue, business agent
for Carpenters Local 107, said in a news release.
Fred Taylor an organizer with Carpenters Local 107 in
Worcester, said, “I couldn’t believe what I saw up at Washington Heights. As a
longtime resident of Worcester I just kept muttering to myself, ‘Why is the
state and city helping this New York City developer so much and then he’s
turning around and having his project built by companies including these two
that were brought in from North Carolina and Pennsylvania that are working here
illegally. Something is terribly wrong with this picture.'”
The union would rather that such projects be staffed by
local construction companies using union workers. But that can be expensive,
and developers are always looking for ways to cut costs.
What was accomplished here? The union brought some
attention to a business practice it considers repugnant; the construction
companies suffered a one-week delay and paid some small fines.
I'm not sure either side can claim victory.
Source: Telegram.com
Worcester, MA
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