California lawmakers confront union labor stalemate holding up housing bills

SACRAMENTO — California legislators’ efforts to combat the housing crisis keep getting bogged down by a thorny question: To what extent should new housing be required to be built by union workers?

That issue has been at the center of the debate over numerous bills that legislators have rejected in recent years, bills that aimed to allow for more density and to erase hurdles to construction.

But the union labor debate has taken on a new magnitude this year as lawmakers consider a bill that could allow for fast-tracked development of affordable and mixed-income housing in commercial areas, such as parking lots, strip malls and office parks.

The measure, AB2011 by Assembly Member Buffy Wicks, an Oakland Democrat who chairs the Housing Committee, would still require labor protections, but it doesn’t meet all the demands of some union leaders.

Specifically, the Building and Construction Trades Council of California opposes the measure because it doesn’t require that developers use a “skilled and trained workforce,” language from state labor law that, in effect, requires a percentage of the workers on a project to be unionized.

Wicks’ measure would, instead, require developers to pay their workers “prevailing wages” for the area (or the hourly rate earned by the majority of workers engaged in a particular craft), offer health care on large projects with 50 or more units and create apprenticeship programs for some projects.

She said while AB2011 has the potential to bring millions of affordable units to sleepy commercial corridors, the fight is much bigger than one bill. Wicks said it could help re-frame the union-labor “quagmire” that has often derailed aggressive housing bills in the Legislature.

“We have to do something. We can’t let ‘No’ be the answer we go with.” Wicks told The Chronicle. “We are so far behind where we need to be. The impact of that is growing homeless encampments.”

A few recent examples of housing bills that fizzled due, in large part, to disputes over union-labor requirements include a bill that would have allowed housing on any lot zoned for office or retail uses; one that would have created incentives for cities to convert empty big box stores into housing and another that would have allowed churches to build affordable housing on their parking lots and extra land.

“It has really halted a lot of the housing production bills,” Wicks said of the stalemate.

But she faces vehement opposition from the Building Trades Council, a powerful force at the state Capitol and a heavy contributor to many Democrats’ campaigns. In a blistering letter to Wicks last month, the council cast the bill as an existential threat to workers.

“This bill, which is either accidentally or intentionally poorly written by the profiteering developers it will enrich, is a Trojan horse,” the council wrote. “This bill claims to include labor standards, yet the language demonstrates its intent is to enrich developers and embolden the underground economy.”

The Assembly Housing Committee easily approved AB2011 last week. But the measure likely faces a tougher road as it advances to the Appropriations Committee and, from there, a full floor vote.

At the crux of the standoff is a disagreement between construction trade unions, who argue vulnerable workers must be protected, and housing activists and developers, who say the unions’ demands hamstring construction when there’s already a shortage of skilled construction labor.

That stalemate between the building trades and housing activists is nothing new. But this year’s fight is unique due to a split within union circles: the California Conference of Carpenters is one of the key sponsors of AB2011.

Daniel Curtin, director of the California Conference of Carpenters, said in a statement that the bill offers a “workable solution” to help address the labor conundrum and speed up housing production.

“It includes good wages and a strong package of labor protections that will create tens of thousands of steady, well-paying jobs with health benefits,” he said.

According to the California Department of Housing, the state must construct 180,000 new units, including 80,000 affordable units, each year to keep pace with existing demand. The state is only constructing about 80,000 units per year.

California, meanwhile, has around 114,000 residential building construction workers when it needs around 257,000 to 349,00, the Building Trades Council estimated in a 2018 report.

“If we continue to have project-by-project negotiations, it is not possible to meet our housing goals,” said Laura Foote, executive director of YIMBY Action, a pro-housing advocacy group. “There’s just no path where that works, and everybody knows it.”

Wicks’ bill would make it easier for developers to build housing in commercial areas in a key way: Projects approved under the bill would not be subject to review under the California Environmental Quality Act, or CEQA, the state law that makes major projects more susceptible to delays and challenges.

Unions have used the threat of filing lawsuits for alleged CEQA violations as a tool to force developers to hire unionized construction workers to build housing. Housing advocates say the law drives up costs and ultimately kills many projects.

AB2011 would erase the threat of CEQA challenges, and require cities to streamline building permit approvals, for affordable housing on commercial sites. But the developer would have to agree to certain concessions, including paying workers prevailing wages and offering health care coverage and apprenticeship programs on large projects, with 50 or more units.

In its letter, the Building Trades Council alleged that the worker protection sections in the bill are designed to help enrich developers and offer them “a jailbreak to build mostly market-rate housing.”

Wicks downplayed the criticism she has faced from the council: “The bottom line is that this is a strong bill for workers. The carpenters are not going to write a bill that’s bad for their workforce,” she said.

State Sen. Scott Wiener, a San Francisco Democrat and co-author of AB2011, said he hopes Wicks’ effort will motivate opposing labor factions — the carpenters and other building trades — to agree on a compromise that would unleash housing production.

“If we have this permanent state of war, it is going to be hard for everyone to lock arms and pass the strongest housing legislation,” he said. “With that alliance, we can move mountains on housing policy.”

But the political hurdles to approving CEQA carveouts without the union-friendly language remain apparent: Wiener is carrying two CEQA exemption bills this session — one for building student housing and another for transportation projects — and both require using a “skilled and trained workforce.”

Dustin Gardiner (he/him) is a San Francisco Chronicle staff writer. Email: Twitter: @dustingardiner

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