“Prevailing Wage”: Profiteering at Schoolchildren’s Expense

By NY Ed Reform guest blogger Peter Murphy

It’s that time of year again on the legislative calendar when the labor unions try and get the state legislature to mandate higher costs on building projects by mandating so-called “prevailing” wages be paid by more public and private entities. The AFL-CIO and building trade unions already by law get “prevailing” or higher union wage rates on most publicly-financed projects, which is one reason taxes and the cost of living are so high in New York compared to most other locations.

The New York Post today contains an article yet another “prevailing wage” bill to impose these higher construction costs on charter schools. This bill, being pushed by several unions, already passed the Senate Labor Committee this week. I pointed out several obvious objections, primarily the fact that charter schools do not get public funding for construction and facilities costs, unlike school districts which do. In addition, charter schools already have their operating funding frozen at 2008-09 school year levels, leaving even less money to operate the school or finance capital expenses.

In the absence of a state mandate for prevailing wage, what happens? Does the laborer get cheated and ripped off and denied a living wage? In a word – no. In fact, any and every construction project not subject to prevailing wage, including those by charter schools, is paid based on a mutually agreed upon contract by both parties – the charter school and the company or companies doing the work. It’s called negotiation in the marketplace. Imagine that.

Racist Roots of Prevailing Wage Laws
New York is one of at least 41 states that impose prevailing wage laws on most publicly-financed projects, along with the federal government (the “Davis-Bacon” law). Prevailing wage laws, in fact, have an racist history to them as they were used to steer projects to white-dominated unions at the expense of minority workers that were not members of unions. This ugly history has been documented by George Mason University Law Professor David Bernstein and others. Prof. Bernstein also wrote specifically on New York’s dubious prevailing wage law, which was published in a 1997 article in the Civil Rights Law Journal.

Diverting Charter Funding from the Classroom
The bottom line is this: a state imposed higher cost from “prevailing wage” has to come from somewhere. In the case of charter schools, it would come from scare operating funds that would be diverted from regular educational expenses; or, with higher costs, the planned facilities project may not get done at all and no one would benefit no one, including the unions pushing this bill.

Even the teacher unions are pushing prevailing wage mandates on charter schools, notwithstanding that it would mean less money for the classroom and teachers in particular. Such misplaced priorities from NYSUT and the UFT only demonstrate that union corporate (oops, I mean “solidarity”) matters more even if it means less funding for the very individuals they purport to care about.

With cutbacks in state education funding and continued lack of facilities funding for charters, it is the worst possible time for the state legislature to advance a bill that would substantially raise costs in order to appease the labor unions. The difficult fiscal climate faced by charter and all public schools unfortunately hasn’t given the unions any pause from trying to profiteer no matter how much it harms the ability of charter schools to educate students.

Peter Murphy is Policy Director of the New York Charter Schools Association

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