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Court rejects Phoenix and Tucson prevailing wage ordinances

A Maricopa County Superior Court judge on Monday ruled that attempts by Phoenix and Tucson to establish prevailing wage ordinances for public works projects violated state law.

Attorneys from the Goldwater Institute successfully argued on behalf of the Associated General Contractors (AZAGC), the Arizona Builders Alliance (ABA), and the Associated Minority Contractors of Arizona (AMCA).

Prevailing wage laws: Rather than allowing contractors to negotiate agreements with workers to determine what a job will pay, prevailing wage laws require contractors on city projects to meet standards determined by the U.S. Department of Labor based on the typical payment for different worker groups in the region. 

Opponents to the ordinances argued that the cities were in violation of state law that bans municipalities from adopting prevailing wage laws.

The challenge 

The plaintiffs argued that municipal prevailing wage laws violate a 1984 law that specifically prohibited prevailing wage mandates. 

The cities, relying on an opinion by Attorney General Kris Mayes, argued that a 2006 ballot measure passed by voters to raise the statewide minimum wage and to permit cities to adopt their own minimum wage essentially overturned the 1984 law. 

The outcome

Judge Bradley Astrowsky ruled that the minimum wage law adopted by voters has no bearing on the existing law banning municipal prevailing wage ordinances.

鈥淎 prevailing wage ordinance is not a minimum wage law, and the Minimum Wage Law did not impliedly repeal the prevailing wage prohibition because the two laws can be harmonized by 鈥榬easonable construction,鈥欌 Astrowsky .

Astrowsky drew a further distinction between minimum wage and prevailing wage, writing, 鈥淭hey have fundamentally different underlying policy goals. Moreover, unlike minimum wage laws, which set a single, across-the-board floor on wages, prevailing wage measures impose a complex, fluctuating schedule of wage standards (determined by federal law and regulation) meant to approximate average wages for specific occupations and localities.鈥

Reaction

The AZAGC cheered the decision.

鈥淲e are thrilled with the court鈥檚 decision, which upholds the principles of a free market and removes unnecessary burdens from contractors,鈥 AZAGC President David Martin . 鈥淲e encourage the City of Phoenix and the City of Tucson to accept this ruling and avoid further wasting taxpayer money on appeals.鈥

Goldwater Institute Vice President for Legal Affairs Timothy Sandefur the decision 鈥渁 victory for Arizona taxpayers鈥攚ho deserve to have public works projects run as closely as possible to true market conditions, instead of having their costs decreed by politicians in order to benefit their political friends. It鈥檚 also a win for workers themselves, who deserve to do work in a competitive environment where wages are based on merit, instead of political dictate.鈥

Phoenix City Councilwoman Betty Guardado she was 鈥渄eeply disappointed by the Maricopa County Superior Court’s decision to deny the city the right to ensure those working within its purview receive fair living wages, improved benefits, and safer working conditions.鈥

Broader implications

The defeat of the Phoenix and Tucson ordinances may deter other Arizona cities from pursuing similar legislation. Tempe has flirted with establishing its own prevailing wage ordinance.

For its part, Phoenix is 鈥渆xploring potential next steps鈥 according to a statement by Mayor Kate Gallego.

Bridget Donahey

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