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AGC Fundraiser for Kevin Faulconer for Supervisor February 27

By Dustin Steiner, Vice President Government & Industry Relations

Please join AGC San Diego and event co-hosts Doug Barnhart, Thomas L. Brown, Randy Finch, and Mike Furby on February 27 for a fundraising reception in support of former San Diego Mayor Kevin Faulconer as he seeks a seat on the County Board of Supervisors. This is the biggest race in town this cycle, so don’t miss your chance to meet and hear Kevin’s vision for our County. 

In accepting AGC's endorsement last year, Faulconer said, “It is a privilege to receive the endorsement of the Associated General Contractors of San Diego. As Mayor, I worked with our local communities and small businesses to tear down red tape and overregulation that made it impossible for our local businesses to flourish. As Supervisor, you can count on me to continue championing reforms that make our small businesses easier, not harder, to operate. Small businesses keep our economy moving and we will do whatever possible to help them, not hinder them.”

Please view the invitation here. As a reminder, County law permits only personal donations and limits contributions to $1000 per individual, per election.

If you cannot attend the reception, please make an online donation here. If you have any questions or would like to get more involved with AGC San Diego’s Political Action Committee (PAC), please e-mail Dustin here.

Hope to see you there!

A Solution in Search of a Problem

By Mike McManus, Director of Engineering Construction & Industry Relations

We have heard for years that “wage theft” is a big problem in the construction industry. It is a narrative that has been peddled by a few elected officials in this region as a justification for making certain policy choices, such as requiring prevailing wages to be paid for traffic control on San Diego city streets on private developer projects. A report just issued by the City of San Diego Office of Labor Standards Enforcement (OLSE) does not support the rampant "wage theft" narrative.

The Prevailing Wage Ordinance was passed by the San Diego City Council in 2013 and requires all City awarded contracts to comply with State prevailing wage laws for work performed on roads, buildings, and parks. The Ordinance applies to public works projects, specifically construction work over $25,000 and any alternation, demolition, repair, or maintenance work over $15,000. The OLSE monitors and enforces prevailing wage labor compliance requirements on all City-awarded public works projects under the Ordinance. 

The recently issued report by OLSE covered construction projects underway in the fiscal year ending last July. The findings are surprising given the consistent narrative of “wage theft” on the public record at multiple agencies with no factual basis ever given. Just rumors. Here are the facts.

The report notes that 90 construction projects worth about $800 million were underway in the 2023 fiscal year. All contractors and subcontractors performing work on public works projects are required to submit certified payroll records (CPRs) to the city. OLSE reviews these reports to ensure proper payments are made to workers based on the appropriate wage determination(s) and the work being performed. OLSE issues delinquency notices to contractors who are late in providing CPRs to the City. Any discrepancies found are addressed in a formal notice to the contractor or subcontractor. Prevailing wage violations not corrected or disputed by a contractor are reported to the Department of Industrial Relations (DIR).

So, how many contractors were given a fine by DIR after all this investigation and review by OLSE? An effort that cost millions of dollars in staff time at the city and by contractors and hundreds of millions of dollars in pay and benefits paid to construction workers? One Orange County contractor was penalized by the DIR with a civil wage and penalty assessment to the tune of $21,000.

OLSE said in the report that they also identified $330,928 in prevailing wage underpayments and inconsistencies in CPRs submitted to the city. Staff recovered $54,669 in worker back wages through voluntary compliance by contractors and verification of payments to workers. Contractor entry errors accounted for $121,466 of the assessed wage violations. The staff verified that the correct prevailing wage rates were given to workers through the review of source documentation, such as itemized wage statements, training fund contribution payments, and fringe benefit statements.

Based on staff compliance monitoring, 28 violation notifications were issued to the DIR, including $78,313 in prevailing wage underpayments that contractors failed to remedy after receiving notifications from OLSE. It is important to note that the 28 violation notifications that were reported to the DIR were done so because the contractor disputed the city’s interpretation of prevailing wage laws. Those “violations” are unresolved disputes between the city staff and contractors. 

In summary, most of the “violations” are either unresolved disputes, entry errors by contractors determined to comply, or were paid eventually voluntarily by contractors after correcting a paperwork error. It seems like OLSE is mostly a solution in search of a problem.

However, OLSE does provide some safeguards that we support. They continue to enforce prevailing wage requirements on all City-awarded public works projects. This helps to create a fair and level playing field among contractors bidding on City projects by ensuring consistency in the application of State and federal labor laws. They also provide publicly released facts about the extremely high level of compliance with prevailing wage laws by contractors that should eventually blunt the narrative of rampant "wage theft."

SDSU Student Teams Compete in ASC Region 6 & 7 Competition

Students on 233 teams from 55 schools descended upon Reno, Nevada, for the largest student construction competition in the nation this past weekend, and in the crowd were 39 students from San Diego State University. The competition included 18 schools from California alone!

Let me set the scene: A buzz of excitement was in the air as a crowd of over 1,700 college students waited to enter the kick-off student dinner of the ASC Region 6 & 7 Competition. While excitement might have turned to stress during the competition, the camaraderie between teams and schools was one of support throughout. This two-day competition puts students in teams of six and provides them with a real-world construction problem to solve based on each competition category. San Diego State University (SDSU) sent teams in Commercial, Heavy Civil, Preconstruction, Visual Design and Construction (VDC), and Electrical.

The SDSU students prepared for months with the help of AGC San Diego Construction Leadership Council (CLC), team sponsors, SDSU faculty advisors, and industry coaches. Thank you to our team sponsors!

• Electrical - Bergelectric Corporation
• Commercial - Clark Construction
• Heavy Civil - Filanc
• Preconstruction - Swinerton
• Visual Design and Construction (VDC) – Balfour Beatty

For some teams, the competition started the week prior, when they had to complete pre-competition tasks, but the real work started in Reno early Thursday morning. The students got to work in their “work rooms,” with each student focused as they completed needed tasks for their team and competition problem. The teams were challenged throughout the day with updates to the problem including “change orders” or notification of supply chain issues all to see how the students would adapt to real-world scenarios.

What comes next? The deadline to turn in their proposals. Witnesses were engrossed by the students as they made the mad dash, running the halls to make it in time to turn in their proposals and experience the relief that Day 1 was done. Day 2 was the presentation to the problem sponsor, so some teams continued to practice and perfect their presentations.

It was time to watch the SDSU teams! First up was the Commercial team, followed by the open competition camp, and ending with the Heavy Civil Team in the Region 7 competition. The open competition teams were in the categories of VDC, Preconstruction, and Electrical. The SDSU teams had a mixture of new and returning members this year and learned a lot during the competition. Returning members were eager to take what they learned this year and apply it to next year’s teams.

A big shoutout to SDSU Faculty Advisors Thais Alves, Nensi Lakrori, and Reza Akhavian for attending and supporting the student teams. The SDSU AGC Student Chapter, along with AGC’s support, organized the teams and coordinated the preparations for the competition. This year’s Student Chapter Reno Lead, Diego Mendoza, had a big hand in collaborating with all teams and coordinating with AGC for a successful student experience.

Finally, give yourself a pat on the back: If you are reading this, you may have been a team coach or a "Mock Problem" spectator this year who challenged and provided feedback to the teams to prepare them for the competition. Thank you for your involvement and for helping prepare the students who compete in this competition. They will surely graduate from this program and from SDSU to take their place as excellent future leaders in the construction industry.

2024

March 19-22, 2024 - AGC Convention - San Diego - Marriott Marquis Marina

March 21, 2024 - Reception Honoring Thomas L. Brown (as part of Convention) - Marriott Marquis Marina

April 11, 2024 - AGC Seaside Mixer - Tom Ham's Lighthouse

May TBD - Specialty Contractors Council event- AGC HQ Lakeside

June 6, 2024 - Baseball Bash - Padres vs. Diamondbacks - Petco Park

May 16, 2024 - Boy Scouts Lunch-O-Ree honoring Mike Furby - Paradise Point Resort

June 24, 2024 - AGC/EGCC Spring Golf - Steele Canyon

July 8-12, 2024 - AGC Blood Drive - Member Hosts

July 26, 2024 - Day at the Races - Del Mar Racetrack

August 9, 2024 - Affiliate Day Golf - Singing Hills Golf Resort - Sycuan

September TBD - Public Agency Showcase - San Diego Yacht Club

October 7, 2024 - AGC Fall Golf - Country Club of Rancho Bernardo

October 17, 2024 - CLC Car Show & Mixer - AGC HQ Lakeside

December 14, 2024 - Holiday Dinner Dance - Hotel Del Coronado

FEBRUARY MEETINGS

February 15 - Specialty Contractors Council @ 11:30 a.m. - Lakeside

February 21 - Build & Serve Committee @ 7:30 a.m. - Virtual

February 29 - HR Practices Committee @ 11:30 a.m. - Lakeside

About Monday Morning Quarterback

AGC San Diego Chapter's Monday Morning Quarterback is a "hot off the press" and to the point Monday morning briefing on the important issues facing San Diego's construction industry. It is prepared by AGC Chief Executive Officer, Eddie Sprecco, and Vice President Government & Industry Relations, Dustin Steiner.

Please contact Eddie Sprecco or Dustin Steiner with your comments, or with information that should be conveyed to the industry through this service. Well over 3,000 individuals employed by AGC member firms are part of this system.

AGC San Diego Chapter, Inc.

The VOICE of Construction

(858) 558-7444

agcsd.org

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