With Council vote delayed, Rebuild hinges on labor inclusion agreement

As the days tick closer to City Council’s summer recess, the fate of a half-billion-dollar program to overhaul city-owned buildings and public spaces is still unclear. 

Despite recent momentum, councilmembers are still locked in negotiation with representatives of Mayor Jim Kenney, who ran for office, in part, on a program to fix up neglected rec centers, libraries and parks. The primary sticking point, according to council sources, is over a memorandum of understanding on labor inclusion.

Aspects of Rebuild require council approval, including, critically, the issuance of hundreds of millions of dollars in bonds that will undergird part of the program’s funding structure. The William Penn Foundation has pledged an additional $100 million towards the project.

Councilmember María Quiñones Sánchez said crafting a labor agreement to ensure that small contractors, minority contractors and nonunion workers get a piece of the largesse was her biggest priority.

“I hope to see a final MOU that creates pathways to union membership both for young people and for experienced, licensed craftsmen who, in the past, have not had access to union opportunities,” she said regarding ongoing talks.

Sánchez is a close ally of Council President Darrell Clarke, who has, along with many other councilmembers, raised similar concerns about labor inclusion in hearings. Many have described project dollars as a way to incentivize change among building trades unions that have historically struggled – or resisted – calls to diversify. Work would be contingent on agreeing to far-reaching MOU.

A memo obtained by City&State PA that circulated between several council offices on May 10 provides a glimpse into the negotiating process. It outlines numerous proposed changes to Rebuild’s authorizing legislation aimed, in theory, at achieving that end.

The wish list includes items like a requirement that participating unions exempt some new workers from certain union entrance exams, agree to fund apprenticeship programs, and provide data on historically secretive worker participation demographics, among other asks. These changes would be part of an effort to speed the entry of new workers into the ranks of union membership. 

A council source said other members have also suggested making smaller projects open-shop in order to allow small, nonunion contractors to participate in Rebuild job sites.

But an accord with the Kenney administration has thus far proven elusive. The administration has signaled an openness to inclusion provisions, but also has ties to building trades. 

After reaching an agreement on project bidding, a Monday council hearing on the bills was abruptly delayed. Sources said the Mayor’s Office had asked for more time to work over a revised MOU after meeting with council members late last week to discuss the issue. At the time, Clarke's office said the hearing was moved for "logistical reasons" to June 5th. The vote was rescheduled, again, to June 7th.

But the new hearing date is about two weeks before council’s summer recess, giving members little time to discuss and pass the legislation before having to wait until the fall session.

However, the Kenney administration disputed Sanchez's assertions.

"The delay had nothing to do with disagreement over workforce diversity. (Councilwoman) Cindy Bass couldn't be there on 5th so we moved to 7th," said spokesperson Lauren Hitt. "We will be happy to share the final plan publicly with all reporters and members of the public at the council hearing on June 7th."

Council President Clarke declined to comment on the current status of negotiations.

Ryan Boyer, business manager for the Laborers District Council, one of the city’s most diverse trade unions, praised many of council’s efforts.

“That's a win-win for the trades (unions) and the community,” he said, speaking generally of inclusion efforts. “Diversity makes us stronger and opening the trades up to underserved communities is both good for the city and our future.”

But Boyer also said there were limits to what unions would agree to, calling the idea of open-shop, city-funded projects “a huge mistake.”

“Non-union construction companies rarely offer family-sustaining wages, health care benefits or pensions. It's short-sighted and foolish,” he said. “Union’s market share in Philadelphia is close to 90 percent. Therefore, after those projects are completed, that worker becomes unemployed again. Union membership offers you a career, not a job.”

This story has been updated with a comment from the Kenney administration. An earlier version of this story listed an incorrect recess date for City Council.