In a 2-1 vote on Tuesday, Centre County’s Board of Commissioners approved a controversial ordinance that establishes new requirements for contractors to be eligible for large county government construction projects.
Board Chair Mark Higgins and Vice Chair Amber Concepcion, both Democrats, voted yes on the Responsible Contractor Ordinance (RCO), while Republican commissioner Steve Dershem voted no. The vote came after a two-hour public hearing during which 30 people spoke — 16 in favor and 14 against or wanting commissioners to table it for further discussion — as well as two previous work sessions that stirred debate.
The ordinance applies only to county government-owned construction projects of $250,000 or more and will go into effect on July 27.
The county is required to accept the lowest responsible bidder on any given project, but state law and the existing county code offer no guidance on how “responsible” should be defined. County Administrator John Franek said in an overview at the start of the meeting that the intent of the RCO is to ensure a safe work environment, quality, timely construction at the lowest possible cost, risk limitation for the county and taxpayers and promotion of skilled workforce development.
Concepcion said it will “protect taxpayers’ investments in public facilities…”
“As officials in a position of fiduciary trust for the county, we have a responsibility to do what we can to ensure that taxpayers are getting what they are paying for and that our workplaces are safe,” Concepcion said.
The ordinance will require that 70% of the craft labor workforce on projects over $250,000 be journeypersons, workers who have completed a state- or federally-approved apprenticeship training or those currently enrolled in such an apprenticeship program. All craft labor on a project must have completed the OSHA 10-hour training course for safety and at least one person must have OSHA 30 training.
It also prohibits bids from being awarded to contractors who in the past three years have been convicted of a crime, had a contracting license or certificate revoked, defaulted on any project or been found in violation of any law applicable to their contracting businesses.
The ordinance, as well as prevailing wage requirements, further extend to off-site custom fabrication for non-standard goods and materials for a project.
Bidders will self-certify with a notarized form that they are in compliance with the provisions of the project.
Requirements of the ordinance can be waived if no bids or only one bid above budget are received.
Opponents of the ordinance uniformly said they did not oppose efforts to ensure safety or to weed out bad-faith contractors. But they argued that otherwise qualified local, nonunion contractors with workers who have years of experience and non-apprenticeship training would be disqualified from bidding on large county government projects and alleged it favors unions (which do not appear in the language of the ordinance). Unions offer apprenticeship programs, while non-union shops typically would need to seek them out from organizations like the Associated Builders & Contractors (ABC).
Several speakers suggested there are more effective methods for ensuring worker safety, including a company’s Experience Modification Rate, which measures safety incidents and workers’ compensation claims and which was included as an option in an earlier draft of the ordinance.
Dershem called it the “Restrictive Contractor Ordinance” and said it will shut out many local contractors who do not meet the apprenticeship criteria.
“I want you to understand I would be vehemently opposed to this even if the tide were turned and it favored nonunion folks against the trade unions,” Dershem said. “I want the fairest, straightest line we can between getting a project started and its completion at an economical rate. I want everyone to be able to bid, to be able to think about ‘how can we be part of something going on in Centre County that will be positive for our community?’”
He said he believes the ordinance was “rushed” and seemed to change based on whims.
“This is a flawed ordinance,” Dershem said. “I agree with the folks that say we need to go back and look at things that we actually can do and will do better to make sure that the workers are safe, that everybody is taken care of and that we have responsible contractors. This is so broad and so nebulous that there’s very little doubt in my mind that this is going to show a lot of flaws in the future.”
Members of the public speaking against the ordinance included a representative for state Sen. Cris Dush, R-Pine Creek Township, members of Centre County GOP leadership and several business owners.
Greg Scott, president and CEO of the Chamber of Business and Industry of Centre County, said his organization’s board and membership opposed the ordinance.
“If the RCO is adopted, this ordinance will effectively exclude many of our local contractors and business, potentially in favor of out-of-county entities, from participating in county projects exceeding $250,000, limiting their ability to contribute to the growth and development of our region,” Scott said. “While the Chamber supports the county’s aim to ensure accountability, this ordinance imposes excessive restrictions that will negatively impact our local contractors and ancillary businesses.”
Some also raised concerns about the requirements for fabrication of materials. Jim Willshier, director of government affairs for the ABC Keystone chapter, said questions have gone unanswered and it was unclear how the fabrication requirements would be enforced.
“Six lines does not really cover a lot of a monumental change to how you’re going to be doing procurement in Centre County,” he said.
Proponents of the ordinance who spoke on Tuesday included local Democratic elected officials and committee members and union members and leaders. Many cited the five worker deaths that have occurred at Centre County construction sites since 2018, and some argued that apprenticeships provide the best standard for having a well-trained workforce.
“At the end of the day this measure is about safety,” Brian Pomeroy, secretary-treasurer of the Central Pennsylvania Building and Construction Trades Council, said. “Every worker on every job site has the right to be safe, properly trained, respected and have the opportunity to go home at the end of the day to their family. You don’t have to be union; you just have to properly train your workforce. We all should want things done responsibly in Centre County and beyond.”
Connor Lewis, a State College resident and president of Seven Mountains AFL-CIO, said the ordinance also promotes fairness for workers.
“We want decent treatment from our employers and we want to be paid a fair wage for a hard day’s work,” Lewis said. “We want to know that when we pay our taxes, those dollars are responsibly invested by our government in quality goods and services that strengthen the entire community.”
The integrity provisions of the ordinance, Higgins said, will “weed out unscrupulous bidders who lowball bids and then create multiple change orders to improve their profit,” to the disadvantage of honest contractors. He also argued that it will keep more construction projects among Pennsylvania workers.
“Due to the requirement for Pennsylvania [Department of Labor and Industry]-certified training it levels the playing field for in-state, smaller bidders because it makes it more difficult for large contractors to bring in out-of-state contractors and workers, therefore supporting local workers’ wages and benefits,” Higgins said.
RCOs are not new and have been established in a number of Pennsylvania counties, cities and school districts. Northampton County’s ordinance was upheld as constitutional by a federal district court after ABC filed a lawsuit over it in 2018.
“There is nothing unique here,” Concepcion said. “The Pennsylvania courts and federal district courts have upheld RCOs as serving a legitimate state interest. The arguments being used against this RCO are also not unique and have been used by opponents of RCOs in many other communities as well.”
She cited studies of RCOs in other states that found no increase the cost of construction bids while yielding positive results.
“Studies from across the country show that RCOs help promote higher quality service, increase competition among responsible contractors, reduce turnover rates among workers on projects, reduce costs related to mistakes and reduce delays in project completion,” she said.
Higgins noted that the ordinance ultimately only applies to a small percentage of overall construction in Centre County, since it does not govern private or other local government construction, or even projects that are county-endorsed or -sponsored but not county-owned.
“Centre County Government skilled labor construction projects over $250,000 are a tiny fraction of skilled labor projects in Centre County,” Higgins said. “There are a total of nearly $1 billion of construction projects announced just by Penn State and Mount Nittany hospital over the last couple months, not covered by a Centre County Government Responsible Contractor Ordinance for county government projects over $250,000.”
