HomeMy WebLinkAboutRESO 9472Resolution No. 9472
Resolution of The Council Of The City Of Palo Alto Suspending City
Policy against Requiring Prevailing Wage,
Unless and Until SB 7 is Enjoined or Invalidated
RECITALS
A. Palo Alto is a Charter City protected from State legislative interference in its
municipal affairs by the California Constitution, Article XI, Sec. S{a).
B. In State Building and Construction Trades Council of California, AFL-CIO v. Vista
(2012) 54 Cal.4th 547, the California Supreme Court determined that the subject of prevailing
wage rates for locally funded public works projects is a municipal affair, and that Charter cities
are not subject to the state law requirement to pay prevailing wages.
C. The Palo Alto City Council has determined that it is in the City's best interest to
obtain the lowest responsible bid for locally funded public projects. In December 1981, the
Council adopted Resolution No. 5981, providing that payment of prevailing wage not be
required on locally funded projects.
D. In 2013,the California Legislature adopted and the Governor signed Senate Bill 7
(SB 7), adding Section 1782 to the California Labor Code to prohibit a charter city from receiving
state funding for any construction project ifthat city has awarded within the prior two years a
public works contract without requiring the contractor to pay prevailing wage rates. SB 7 goes
into effect January 1, 2015.
E. In City of El Centro et al v. Lanier (Cal. Court of Appeal, Fourth District, Case No.
D-066755), a group of charter cities filed suit to invalidate SB 7 on the grounds that it violates
the Constitutional prohibition on interference in the municipal affairs of charter cities.
F. The Lanier case is pending before the Court of Appeal, and no injunction has
been issued staying the effect of SB 7.
G. The City of Palo Alto desires to maintain its policy of non-payment of prevailing
wages on locally funded projects, but is constrained by the prospect of losing state funds on all
construction projects, a significant financial impact that could make it infeasible for the City to
undertake certain critical infrastructure maintenance and improvement projects on which local
residents depend.
NOW, THEREFORE, the Council of the City of Palo Alto RESOLVES as follows:
SECTION 1. Effective January 1, 2015, this Resolution No. 9472 shall supersede
Resolution/Ordinance No. 5981.
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SECTION 2. Resolution No. 5981 shall be suspended and be of no force and effect,
to the extent that it applies to public works contracts as defined in Labor Code section
1782(d}(1). Beginning January 1, 2015, all public works projects as defined in Labor Code
section 1782(d)(1) shall be advertised for bid and awarded in conformance with the Public
Contracting Code requirements regarding payment of prevailing wages.
SECTION 3. This Resolution No. 9472 shall expire and be of no further force or
. effect immediately on the issuance of a preliminary or permanent injunction enjoining the state
from enforcing SB 7, or the entry of any other court order that invalidates or suspends the
operation of SB 7.
SECTION 4. The Council finds that the adoption of this resolution does not meet
the definition of a project under Public Resources Code Section 21065, thus, no environmental
assessment under the California Environmental Quality Act is required.
INTRODUCED AND PASSED: December 1, 2014
AVES: BERMAN, BURT, HOLMAN, KLEIN, KNISS, PRICE, SCHARFF, SCHMID, SHEPHERD
NOES:
ABSENT:
ABSTENTIONS:
ATTEST: ~
~~
~ityClerk
~ City Attorney ·
APPROVED:
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