Tuesday, July 5, 2011

Schultz and Summers Engineering Calls For Repeal Of Prevailing Wage

SSE gave ideas to the House Interim Committee on Disaster Recovery on how to speed up levee repairs

SIKESTON, MO – Emotions were high as citizens and local government leaders shared details about how the recent flooding effected Southeast Missouri with the House Committee on Disaster Recovery. Sikeston Police Chief Juden and Mississippi County Sheriff Moore talked about the problems first responders faced. Dr. Stephens from the Delta Center provided information about the soil quality in the Birds Point Levee- New Madrid Floodway. Cheryl White of SEMO Health Network explained how her organization set up health camps that provided free shots and prescriptions to stranded victims. Mayor Leija of Morehouse, a community that was hit hard by the flooding, told how the fast rising waters put his citizens in harm’s way.

Owners Stan Schultz and Bob Summers provided details to the House Interim Committee on Disaster Recovery about the damage caused to Southern Missouri levees by the April spring flooding. Bob Summers said, “We have helped the US Army Corp of Engineers (USACE) repair the levees around New Orleans and along the Mississippi River as well as the emergency spillway on Table Rock Lake. Our funding ideas and streamlining suggestions will speed up the process and eliminating prevailing wages will lower the costs.”

The mission of the committee was to assess whether a special legislative session will be necessary to address the needs of Joplin and the communities in Southeast Missouri. The committee will report its findings to Speaker Tilley on July 31. In addition, the committee will provide a report to the General Assembly by December 31st detailing long-term recovery strategies and how the state can better prepare for future natural disasters. Representative Richardson R-Poplar Bluff mentioned, “Schultz and Summers clearly has some invaluable knowledge and expertise with levee repairs. It was good to have Stan and Bob highlight some of the damage in our region and share their ideas about how we can find funding and quickly repair the levees in Southeast Missouri.”

There were three main funding sources covered in the SSE presentation. Mr. Schultz provided information about Public Law 84-99 which is run through the United States Army Corps of Engineers (USACE). Once asked by the local levee district the USACE will send a project manager and assessment team out to the damaged levee to assess the situation and estimate costs. If approved the USACE will provide 75% of the funding and the local district has to come up with the final 25%. This program was put in place to repair damaged levees after flooding. More information on this program can be found at http://www.fema.gov/government/grant/pa/9524_3b.shtm

The Natural Resources Conservation Service (NRCS) administers the Emergency Watershed Protection program, which provides funding to counties, cities and local levee and drainage districts for repairs after a natural disaster. This program is a 25%-75% match but it allows the local sponsor to in-kind all or some of the 25%. It can only be used in an area that has been declared a disaster by the president. More information on this program can be found at www.nrcs.usda.gov/programs/ewp

Schultz also briefed the committee members on the Congressional appropriations process in Washington. He said, “The House committee has passed a bill providing $589 million for levee repairs in the Mississippi River watershed. Congresswoman Emerson has been our biggest champion on this issue and Senators McCaskill and Blunt are also working to pass this funding in the Senate.” Other suggestions offered by Schultz and Summers included, waving easement recording fees, streamlining condemnation proceedings, eliminating environmental road blocks, and reducing liabilities on emergency work after natural disasters. “The damaged levees in Southeast Missouri expose all our citizens to a huge risk from another flood. These suggestions would speed up the repair process and get life back to normal for all our communities, stated Schultz.

When the topic turned to repealing prevailing wages on emergency work, there was an unspoken tension in the room. Schultz presented a table showing the labor costs of building one mile of levee 15 feet high with a 4 to1 slope on the water side and a 3 to 1 slope on the land side. This would require 189,000 cubic yards of soil being moved and properly put in place. He used 30 miles as the distance to haul the soil. His table estimated it would take 30 truck drives, 4 general laborers and 5 heavy equipment operators. When paying hourly prevailing wages of $35.69, $33.85 and $46.22 for drives, laborers and operators the labor costs to build 1 mile of levee would be $906,394.13. He then showed a table using market labor rates in Butler County of $17, $15 and $25 an hour for the same jobs. The labor costs to build 1 mile of levee without prevailing wages $438,313.33. The table can be found at www.schultzandsummers.com

Schultz stated, “Folks there are going to be a limited number of dollars available for levee repairs and I believe we need to consider that the same contractor with the same workers can build two miles of levee right across the state line in Arkansas for what it costs Missouri to build 1 mile.” He also added, “That contractor can also build the Arkansas levee faster without prevailing wage laws because of the overtime and show up rules. I was raised in a union home and have nothing against unions, but in my opinion we can pay workers a fair and living wage and rebuild twice as many levees in much less time if we would consider repealing the prevailing wage laws for emergency work after natural disasters.”

Schultz’s call to repeal prevailing wages during emergency work after natural disasters generated the most heated discussion of the hearing. Representative Taylor D-Black Jack asked, “How the prevailing wage in Butler County could be as high as St. Louis?” He continued, “I’m a union electrician and have to take a $6 dollar an hour pay cut to work in this area and it seems odd to me that the Butler County prevailing wage would be higher than that.” Schultz looked through the labor department numbers for Butler County and confirmed that the prevailing wage for an electrician in Butler County was just under $50 an hour. Everyone laughed when Representative Taylor said, “I need to move here.”

Representative Brandom R-Sikeston commented, “I used to wonder why prevailing wage rates are so much higher than the real rates we pay in our area. After talking with several contractors in our area they said they didn’t have the time, staff or software necessary to keep up with and report the wages they are paying so the labor department just uses the St. Louis data. The reporting process is too hard and we need to look into simplifying it” Summers added, “Some projects are now requiring the engineer to certify that the contractor is paying the prevailing wage, which is an extra liability on us.” Taylor explained, “They have to report this properly, because when a contractor has to pay a worker the higher prevailing wages, but normally pays the lower $13 or $14 an hour, somebody has to make sure he is not pressuring the employee to give part of his wages back to the contractor.”

Over 100 residents attended the hearing with about 30 of those providing testimony. Chairman Schoeller kept the agenda open so that everyone had a chance to provide testimony to the committee. “Ellen did a great job of organizing our tour of the damage and the local leaders and citizens have given our committee a much better understanding of how the flooding affected this region. I believe we are walking away with some excellent ideas on what we can do. Schultz and Summers explained several federal programs that could help us fund our projects and their thoughts about prevailing wages and emergency work law changes, are something we need to explore further,” concluded Schoeller.

Table: Prevailing Wage Rates vs Local Wage Rates for Butler County

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