Written by Michael Moran on November 18, 2009 – 12:02 pm
New York Times reporter Danny Hakim writes that Gov. David Paterson in a bid to shore up his standing with labor unions is preparing legislation to require prevailing wages be paid on construction projects that receive public financing.
He writes: “The legislation, which has the business community alarmed, would also impose wage requirements on large businesses that use space created by developments financed with public money, according to a draft of the bill. In New York City, those requirements would be $19.20 an hour — nearly three times the minimum wage — for a wide variety of workers.
The bill would exempt some projects, though it would cover a great many developments involving both private business and civic institutions. The governor’s proposal comes after labor unions and business leaders were unable to negotiate their own compromise earlier this year.
Labor advocates said the bill would ensure that fair wages are paid on projects financed with public money through industrial development agencies, which provide below-market-rate financing throughout the state, particularly in New York City, for hospitals, private schools, malls and any number of other development projects. But the business community said the changes would render the development agencies useless, effectively killing an important economic development tool amid a recession.
The importance of industrial development agencies has grown as the state phases out its Empire Zone program, another incentive for development.
“Why — in the middle of the worst crisis since the Great Depression — would the governor want to kill an economic development program that has created over 200,000 new jobs?” said Kenneth Adams, the president of the Business Council of New York State. “It’s a proposal that destroys hope for economic recovery in New York.”