It all boils down to a single question: Why should a public taxpayer-funded building cost more than a privately-funded one?
When it comes to saving taxpayer money and creating jobs, most would agree that both are “no-brainers.” We are constantly striving to strengthen our economy, lower our taxes and keep hard working Hoosiers employed. Unfortunately, when it comes to repealing the Common Construction Wage, that same logic has not applied. Let there be no mistake, repealing the Common Construction Wage will provide a significant opportunity for Indiana. It will allow cash-strapped school systems to reduce the cost of all building projects. The savings can be used to put more money in the classrooms, hire more teachers or better compensate those that are already teaching our children. Additionally, small independent businesses will create jobs when they are finally able to compete fairly for public projects. The current system is rigged to keep out free market competition.
Studies show that repealing the Common Construction Wage will result in an average savings of 10-15% or more per taxpayer funded public project. That’s money that could be put into increasing the scope of development for a project or towards additional infrastructure for the improvement of our communities. Schools and local governments are having a hard time keeping up with long lists of demands and a shortage of capital to complete them. And so I ask: Why should a school project paid by you, the taxpayer, cost substantially more than the same type of work being performed on a privately funded project?
Although opponents of this legislation are using scare tactics to imply that merit shop workers are somehow not qualified to perform municipal work, unions do not have the corner market on training. In addition to the excellent training and apprenticeships offered by merit shops, there is the built in safeguard that specs for projects are written into public contracts, meaning underqualified contractors would not be awarded a government bid.
Unions would also have you believe that the current convoluted system keeps jobs in Indiana and that out of state workers, including illegal immigrants, will flood the state. Statistics disagree. Tennessee was wise enough to repeal their prevailing wage in 2007, and they have seen neither a precipitous drop in wages across the construction industry nor an increase of undocumented workers.
The economic climate for small businesses is still very tough. Each month NFIB’s Research Foundation produces the Small Business Economic Trends Report. Since 2008, the Small Business Optimism Index has been trending at recession levels with one of the hardest hit sectors being the construction industry.
NFIB has a unique balloting process and will only take a stance on an issue when a majority of members agree. After balloting Common Construction Wage, thousands of members of NFIB Indiana are calling on their legislators to support HB1019 and allow Indiana’s small businesses to compete and grow jobs.
What we have now is a government mandated price-fixing scheme that was established in the 1930’s. It’s not only antiquated, its detrimental to our free market. It is time to embrace competition and put an end to the Common Construction Wage.
While all of this is compelling, the bottom line is this: Why should a taxpayer funded public project cost more than a privately funded one?
Barbara J. Quandt
Indiana State Director
National Federation of Independent Business (NFIB)
