08/09/2007
CONTACT: Charles Owens, 517-485-3409 or Jason Brewer, 202-406-4435
LANSING, Mich. -- Despite renewed efforts to hike gasoline taxes in the wake of the Minnesota bridge collapse, two business groups are insisting that any increase should be tied to significant labor reforms. According to the National Federation of Independent Business and Associated Builders and Contractors of Michigan, any increase in the gas tax should include the adoption of right-to-work laws and repeal of the state's prevailing wage law. The groups, representing more than ten thousand Michigan small businesses, were responding to calls for a hike in the gasoline tax by nine cents a gallon over three years.
Under a right-to-work law, workers would not be forced into a labor union as a condition of employment. Prevailing wage laws require that workers on state funded construction projects (such as roads) be paid union scale wages -- even for the 78 percent of Michigan construction workers who choose not to belong to a union.
"Michigan taxpayers deserve more efficient use of road tax dollars before we ask for more," said NFIB/Michigan State Director Charlie Owens. "Small business will not support motor fuel tax increases without addressing labor 'feather-bedding' and other money wasting practices first."
Chris Fisher, executive director of ABC of Michigan, echoed Owens' concerns about Michigan's prevailing wage laws and their inflationary effect on road construction costs. According to Fisher, Michigan's prevailing wage law requires that contractors pay union-only scale wages on construction projects financed or sponsored by the state and act as a "super minimum wage" that sets wages much higher than local construction wages determined by fair competition in the free market.
"Taxpayers are currently forced to overpay to build roads while many small businesses and their employees are excluded from the opportunity to participate in these projects," said Fisher. "In addition to increasing state construction costs by over $400 million, studies have also shown that the law discriminates against women and minorities, who are disproportionately represented in the non-union end of the construction industry."
Both Owens and Fisher agreed safer roads and bridges can be built for the same money if labor reforms are included in any funding proposal. "Asking Michigan citizens to pay more for gasoline during the current economic climate is bad enough, but without reforms to the state's outdated labor laws, it is particularly ill-timed," said Owens.
