Item 51 - Approve Proposed Community Workforce Agreement

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Approve Community Workforce Agreement June 6, 2023 Page 2 3 4 9 5 of each agency’s CWA are different, the thresholds applied generally correlate with the size of the agency and the scale of projects it delivers. For example, a small city like Palmdale, CA has a CWA threshold of $250,000, while a large agency like the City of Portland, OR (Portland Metro) has a CWA threshold of $5 million. Locally, Orange County cities like Anaheim and Costa Mesa have project-based CWAs that list specific projects where their CWA applies, rather than a dollar threshold. In an effort to balance between the support for trained and skilled union workforce, disadvantaged business enterprises (DBEs), and small scale local vendors, staff recommends setting a CWA applicability threshold commensurate with the scale of our city and the public works construction projects it delivers. The proposed CWA (Exhibit 1) would apply to City multi-trade public works construction contracts that exceed $2,500,000 and specialty contracts that exceed $1,000,000—the professional staff-recommended thresholds. Specialty contracts are contracts with a single specialty contractor which is either limited to a particular, single trade, or craft limited to a singular scope. Given the unpredictable nature of inflationary forces experienced in the past year and the corresponding increased cost to deliver construction projects, staff recommends including an annual threshold escalator tied to the California Construction Cost Index (CCCI), especially given the 10-year term of the proposed CWA. The City currently has over 50 active public works construction projects totaling over $157 million, with an additional $37 million in projects planned for next fiscal year. Based on the City’s current and projected Capital Improvement Program (CIP), it is estimated that 80% of all dollars spent on CIP projects will be on projects covered by the CWA. In accordance with State Law, all public works contracts, regardless of CWA, are subject to competitive bidding and the requirement to pay prevailing wage. The City is required to award public works construction contracts to the lowest responsive and responsible bidder. Key provisions of the CWA The proposed CWA sets baseline thresholds, annually adjusted for inflation, for the cost of public works construction project that will be covered by the CWA. The cost of a project directly correlates to the size, scope, and duration of a project. Based on the City’s current and projected Capital Improvement Program (CIP), it is estimated that 80% of all dollars spent on CIP projects will be on projects covered by the CWA. The proposed CWA will be in effect for 10 years, providing stability in requirements and expectations in project delivery for both employers bidding on projects and employees hired to build the projects.