Local workers protest construction outsourcing

BY IAN STEWART | JULY 28, 2011 7:20 AM

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Behind an emblazoned banner and under an upside-down Iowa flag — a signal of distress — demonstrators yelled, "Iowa workers on Iowa jobs."

More than 100 people, many from local unions, gathered Wednesday morning at the construction site of the University of Iowa's future Pappajohn Biomedical Discovery Building.

"We're protesting the fact that the UI has a construction project, and most of the workers are from Texas and Colorado and out of state," said Bill Gerhard, a member of a local union building-trades council. "They should hire local contractors, who should hire local people."

Gerhard and others at the demonstration said frustrations emerged after Chicago-based Walsh Construction, the general contractor for the project, subcontracted the majority of positions to out-of-state workers.

Randy Rayner, who helped organize the event, said many local workers felt betrayed after dealing with the company in July 2010.

"We met with [Walsh Construction] shortly after the bid," Rayner said. "[Officials] said at that time they didn't 'have all our subcontractors listed yet, but you'll be happy.' "

But protesters said they aren't.

A Walsh official said the company had no comment and denied a request for information about employee origins.

While Sen. Bob Dvorsky, D-Coralville — who made an appearance at the event — defended the UI, saying it was "dealing with the hand it was dealt," he criticized Walsh.

"Under the laws they were operating under, that's all legal; now, is it ethical? Probably not necessarily," Dvorsky said. "I think Walsh should have looked into what the culture was here and that we wanted more Iowa jobs here."

Some protesters said the problem goes beyond this particular construction project to Iowa's work-force politics and the Governor's Office.

"Within an hour after [Gov. Terry Branstad] took office, he signed an executive order outlawing project labor agreements," said protester Earl Agan.

Project labor agreements — pre-hiring collective-bargaining agreements that can stipulate percentages of in-state workers — were authorized by President Obama in 2009. But Branstad's executive order No. 69, signed the day of his 2011 inauguration, outlawed the agreements. The order cited their effect on "the essence and the spirit of the competitive bidding process for state-funded projects."

Under Iowa Code, the state Board of Regents must choose the "lowest responsible bidder" for any contract more than $100,000. Regent Robert Downer said he is a strong supporter of competitive bidding statutes.

"That law has done a good job of making sure projects are completed at the lowest cost reasonably possible," he said. He confirmed that the matter of employing in-state workers is not part of the regents' policy on construction-project bidding.

According to the Pappajohn Institute's website, the construction cost for the new building is $122.5 million. The Associated Press reported earlier this month that Walsh Construction's contract is worth $77.9 million.

Protester Don Duehr said what especially concerned him was that Iowa-JOBS money was being funneled out of state. I-JOBS, which was created by the Iowa Legislature in 2009, is designed to create jobs and improve infrastructure in the wake of the 2008 flooding.

A large green sign on a fence overlooking the biology building's construction site proclaims that $10 million in I-JOBS money is being used for the project.

"It was designed to get, in [former Gov. Chet Culver's] mind, Iowans to work," Duehr said. "Not a free-for-all to get out-of state contractors to work."

Many of the protesters said the hope is future projects will employ more Iowa workers.

"Looking down the road, there's going to be more than a billion dollars' worth of construction here in the next five years," Dvorsky said.

The UI Hospitals and Clinics is moving toward construction of a new $280 million children's hospital, and the UI has plans to replace many of the buildings destroyed by the 2008 flooding.

Rep. Dave Jacoby, D-Coralville, who spoke to the protesters, said that while bipartisan talks are the key to securing Iowa jobs for Iowans, contractors share the responsibility for employing locals.

"No matter where the contractors come from — from Iowa or Illinois — they need to clear off our benches here … and get our people working here in Iowa."

Despite some of the protesters' grievances with the state government, the demonstrators still focused their blame on Walsh Construction.

"It used to be in the old days, a handshake meant something," Agan said. "Things seem to be different now."

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