COUNCIL OF THE CITY OF PHILADELPHIA PUBLIC HEARING COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT - - - Room 696, City Hall Philadelphia, Pennsylvania Thursday, March 13, 2003 3:45 p.m. - - - RESOLUTION 020238 - Resolution authorizing City Council Commerce and Economic Development Committee to conduct Public Hearings to investigate the underutilization of Disadvantaged Business Enterprises (DBE)... RESOLUTION 030038 - Resolution calling on the Philadelphia Workforce Development Corporation to conduct a needs assessment of training opportunities within the Building and Construction Trades... - - - PRESENT: COUNCILMAN MICHAEL NUTTER, Chair COUNCILMAN ANGEL ORTIZ COUNCILMAN DAVID COHEN COUNCILMAN W. WILSON GOODE COUNCILMAN MARIAN TASCO COUNCILMAN DARRELL CLARKE COUNCILWOMAN BLONDEL REYNOLDS BROWN COUNCILWOMAN DONNA REED MILLER - - - V A R A L L O, INCORPORATED Eleven Penn Center 1835 Market Street, Suite 600 Philadelphia, Pennsylvania 19103 (215) 561-2220 I N D E X RESOLUTION 020238 SHARMAIN MATLOCK TURNER, GPUAC .............. ERNEST JONES, Phillies New Ballpark Oversight Committee .............................. 9 CHARLES SOLOMON, SR., GPUAC ................. 16 AHMEENAH YOUNG, Eagles New Stadium Oversight Committee .............................. 25 JANICE DAVIS, Finance Director .............. 109 JAHAD ALI, Contractors Roundtable ........... 128 MADELINE DUNN ............................... 134 JOHN SHIELDS ................................ 136 COLIN JAMAL JOHNSON ......................... 145 3 3/13/03 - COMMERCE - RES. 020238
I apologize for the delay. This is a reconvened hearing of the City Council Committee on Commerce and Economic Development. I'm Councilman Michael Nutter, Chair of the Committee. To my left is Committee Member Councilman Angel Ortiz. To his left is Committee Member W. Wilson Goode, Jr. The Committee is now in Session. We will continue with testimony that was started at the last hearing. And the next panel will be comprised of Mr. Ernest Jones, Chairman of the Phillies new Ballpark Project Oversight Committee and Co-Chair of the GPUAC Board of Directors; Ahmeenah Young, Chairwoman of the Eagles Stadium Project Oversight Committee; Sharmain Matlock Turner, President and Executive Director of the GPUAC; and Charles Solomon, Sr., Director of the Economic Development Project of GPUAC. If those individuals can approach the witness table. We'll start with today's testimony. The committee has also been joined by Councilwoman Blondel Reynolds Brown. Please identify yourselves for the record. I'll assume between the two of you or any 4 3/13/03 - COMMERCE - RES. 020238 others that you've already determined who will speak first.
That is correct. Sharmain Matlock-Turner, Greater Philadelphia Urban Affairs Coalition.
I'm Ernest Jones, President of the Philadelphia Work Force Development Corporation and Chair of the Phillies Ballpark Oversight Committee.
Charles Solomon, Director of Economic Development Project of the Greater Philadelphia Urban Affairs Coalition.
Thank you, Mr. Chairman. I will start and then we will have brief comments from Ernest Jones, Ahmeenah Young, and Charles Solomon, because we know that the most important part of this hearing is certainly to answer your questions for us. Good afternoon, and thank you for the opportunity to speak to you today concerning the Greater Philadelphia Urban Affairs Coalition's role in supporting the efforts of the City of 5 3/13/03 - COMMERCE - RES. 020238 Philadelphia to increase the numbers of minorities, women, and disabled who can and should provide services in the building of the Phillies and Eagles stadiums, as well as to find work there. With me today, as I stated earlier, is Ernie Jones, CEO of the Philadelphia Workforce Development Corporation and Chair of the Phillies Oversight Committee; Ahmeenah Young, who is Vice President of Search Wide and Chair of the Eagles Oversight Committee; and Charles Solomon, who works with me at GPUAC and is Director of the Economic Development Projects Unit. I know that City Council and certainly most of your staff are familiar with GPUAC's role through our Economic Development Projects Unit. But for those who may not be, let me just give a brief overview. We work in partnership with project developers, owners, construction firms and universities to help them award contracts to minority women and disabled business owners and to successfully employ females and minorities. We've been doing this successfully since 1983. And also, as you know, the City's Office of Minority Business Enterprise is responsible for the City's minority 6 3/13/03 - COMMERCE - RES. 020238 inclusion program for City contracts. The Greater Philadelphia Urban Affairs Coalition was retained by the Eagles and the Phillies organizations to advise, monitor and support the implementation of their respective projects, specific Economic Opportunity Plans, known as the EOPs. These EOPs address the inclusion of minority, women, and disabled and disadvantaged businesses, and minority and female tradespersons and contracting and on-site employment during the construction of the new Eagles stadium and the Phillies' new ballpark. Just to emphasize exactly what GPUAC does, GPUAC is an advisor. We tell our clients up front, in this case we're talking about the Eagles and Phillies, what they need to successfully meet the goals established in the EOP. We work to identify minority businesses. We map out a strategy and to meet contracting goals. GPUAC's probably chief role in this process is to serve as a monitor. We count the number of contracts. We count the amount of dollars. We count the number of workers and the number of hours worked. We then check and double-check that information to make sure that it's 7 3/13/03 - COMMERCE - RES. 020238 accurate. Our staff does this by on-site visits, as well as looking at daily construction logs, certified payrolls and other contracting information. Comprehensive monthly reports are compiled based on this review and they are presented to the owners and the Oversight Committees. Finally, GPUAC serves as a facilitator, and we believe that we are an honest broker working with all parties to work through disputes and conflicts. The Economic Projects Unit Staff, which is headed by Charles Solomon, participates in Oversight Committee meetings. We also meet with the owners to review bid packages, prepare monthly reports, prepare for upcoming meetings and address issues of concern. The staff also meets with elected officials, community leaders, community groups to discuss opportunities and answer questions about the process and receive information on how to improve the program. And finally, GPUAC serves as a communicator. We communicate information in a fair and appropriate fashion. GPUAC is entrusted with confidential information that we need in order to appropriately monitor these projects. We prepare 8 3/13/03 - COMMERCE - RES. 020238 monthly reports for City Council summarizing inclusion efforts.
These numbers are scrutinized by the Oversight Committee before they are released. I have asked Ahmeenah Young and Ernie Jones to be here with us today to specifically talk about the numbers and what they mean for the two stadium projects. At the end, I've asked Charles Solomon to answer three specific questions that were raised in your letter and also raised in your Resolution: What is GPUAC's interaction with City agencies? Why do we not release certified payroll information? And what information is available on union apprenticeship programs for minorities and women? Thank you very much. At the end of our statements, of course, again, we'll be glad to answer any questions.
Why don't we have the sponsor of this particular Resolution -- I assume you want the panel members to all go through their statements and then we'll ask questions at that point?
Good afternoon, Members of City Council. As indicated earlier, I am currently chairing the Phillies Oversight Committee, and initially I'd just like to give you a list of the members of that Oversight Committee. They include a representative from Council President Anna Verna's office; Councilman Darryl Clarke is a member; Emmanuel Friedman from the Germantown Settlement; Patrick Gillespie, with the Building and Construction Trades Council of Philadelphia; Marla Hamilton, with the Philadelphia Industrial Development Corporation; James Roundtree from the Minority Business Enterprise Council; Don Scott, who is with First Union National Bank; Sam Staton, the Business Manger for Laborer's Local 332; Jerry Swift, the Women's Business Development Center; Hugo Warren, who is the publisher of the Philadelphia Observer; and Ronald A. White, Esquire, who is an attorney in town. Since approximately last May or June, the Oversight Committee has been meeting almost monthly to review the progress and implementation of the EOP as it applies to the building of the new ballpark. We've had some ups some downs, certainly 10 3/13/03 - COMMERCE - RES. 020238 some struggles, and I think on balance the committee has tried to -- and this goes for the Phillies, too -- get the contractors to do what the EOP requires. And we've made, I think, fairly good efforts on meeting the employment goals. I will give you the numbers as it relates to the contracting goals. And I'm pleased to say at this stage of the game, 47.1 percent of the contracts that have been let actually have been committed to minority, women, or disabled, disadvantaged business enterprises.
I'm sorry. Mr. Jones, I apologize for interrupting. Can you say that again, please?
To date, approximately 65 percent, first of all, of the entire project has been bid.
No, just one. My figures are just with the Phillies. The total minority -- and I'll break it down further. The total minority-owned businesses that have been committed contracts amount to $80,631,200, or 39.13 percent. The total 11 3/13/03 - COMMERCE - RES. 020238 women-owned businesses --
The total amount is $80,631,200, or 39.13 percent. The total women-owned businesses, the total is $15,814,206, for a 7.67 percent. And disabled, disadvantaged business enterprise --
Mr. Jones, excuse me. I hate to interrupt you. You said women-owned businesses was $15 million?
7.67. And the disabled is a total of $436,898, for 0.21 percent for that category. That adds up to 47.01 percent. The actual goals for the project are 35 percent minority, 12 percent women disadvantaged, and 2 percent disabled. It is not quite at that goal, but if you add those up, it comes to 49 percent. Yes, sir?
I'm breaking the rule that we agreed to, to ask my questions later. 12 3/13/03 - COMMERCE - RES. 020238 Let me ask this question: The document that you're reading from, are there copies?
Yes. Where we have, I think, the most difficulty in living up to the EOP is in the area of workers, employment. There, as you know, is a minority goal of 45 percent employment, and females are 5 percent, for a total of 50 percent of the work force. To date, we have on the job 29.59 percent minority, .69 minority females -- let me back up. They broke out the minority males and minority females. Minority males is 29.95 percent. Minority females is .69 percent, and females non-minority is 1.32 percent. If you add those up, you can see they fall well below the stated goals of the EOP. Furthermore, over half of the individuals who have worked on the job are not Philadelphia residents. With respect to the apprenticeship program, the EOP was written in such a way that it encouraged apprenticeship. It did not set a minimum number for apprentices on the program. It simply stated that of all the apprentices that you have on there, that percent 25 should be minority. To date, we have of that, all 13 3/13/03 - COMMERCE - RES. 020238 the apprentices, 22.80 percent are minority males and 8.12 percent are females, for a total of 30 percent. So while it has exceeded the stated percentage in the EOP -- and hopefully, this will come out when we talk about it later -- there is still a significantly, in my opinion, lower number of apprentices on the job than we need to bring new people into the construction trades.
The data that you were just giving us, is that on the document that we're also getting a copy of?
So all of the statistics are going to be primarily on the one sheet?
Yes, sir. Just this one sheet, on this. We've had special meetings with contractors. We've met with representatives from the unions in an effort to get more people in the community on the jobs. And also to bring in more apprentices. In the process of doing that, we have actually collected a list of apprentices from 14 3/13/03 - COMMERCE - RES. 020238 Congreso De Latinos Unidos, from the DAP Program and from TOP/WIN, which is another apprenticeship training program. We currently have now over a hundred individuals who have passed the apprenticeship test who still have not been able to get on the work site. That is a challenge. It will continue to be a challenge, and we will continue to push as hard as we can to get both the contractors and the unions to --
I don't have the list, and that information is not here on the document. It's over a hundred. We have over a hundred on a list that we've collected and sent to the general contractors. And maybe Mr. Solomon can speak more specifically to that. So we have a list of people from which we could choose if there were openings there for them to move into.
Well, who decides? 15 3/13/03 - COMMERCE - RES. 020238 How do you get chosen?
This is, as with most construction projects in the City, a union job.
I understand. I'm trying to get to the answer, Mr. Nutter. The hiring is done through the hiring hall. I don't know enough about the intricacies of the labor unions to give you a precise answer. I am told that in order to get one of these people on the job site, there needs to be a sponsor, meaning that one of the contractors down is willing to sponsor that person, and the willingness on the part of the union also to have that person move into that position as an apprentice. And again, we've talked to both the unions and to the contractors, and it's being passed back and forth in terms of who ultimately has the responsibility for it.
I understand. I'm sorry. I'm breaking the rules again.
Take us through what 16 3/13/03 - COMMERCE - RES. 020238 happens, I guess, whenever the morning starts, whenever the day starts and -- now, when you pass the test, you're an apprentice? Is that your status? Is that what people call you?
Actually, could I defer those questions to Charles Solomon? He is probably the expert. I would answer them, but I really don't know.
The process involves one taking -- well, prepping for an exam, which is generally done by Congreso and the DAP Program. Those are the principal sources we usually get apprentices, if you will. Once the applicant takes the test and passes the interview, the hope then is that person will be sponsored. What we've been doing is, once those individuals pass the exam and the interview, then we will provide that list. That list is provided to us by DAP and Congreso. Then we, in turn, provide that list to the CM and the contractors on-site in hopes of getting an individual sponsored.
So let's say I passed the test, or any one of us passed the test, and I've been told I passed the test. Now, do I go 17 3/13/03 - COMMERCE - RES. 020238 somewhere every morning and seek work? Do I go to the job site? Do I sit at home and wait for a call? What happens?
Well, you could do both, but typically the person would wait for a call because it's a matter of getting, again, a sponsor.
I went and I studied; I did my thing and played by the rules; I passed the test. And I'm just going to sit by the phone and wait for somebody to call me to work?
I didn't hear what the second part was. Because the first one doesn't make any sense, so let me understand what the second one is.
You could, in fact, come down to the site and register on site.
There is a sign-in sheet, if you will, or application form on site that you could fill out. That's not a very fruitful approach. But the fact is that the apprentices are drawn from the unions and they're on the list of the unions, then they're requested by the contractor. 18 3/13/03 - COMMERCE - RES. 020238
Let me ask this question. What's the total universe of people who took the test? Mr. Jones said you had over a hundred passed through -- is it either Congreso or DAP?
Do you know what the larger universe of people who recently have taken the test and passed?
No, I do not have the exact number. But the hundred that we talked about is a relatively small percentage.
With Congreso, it's around 280. And DAP, I guess, train twice that many.
Right. Out of 200-some-odd trainees, 90 actually passed the test.
Let me ask this question. Did some other apprentices get hired?
How did they get hired? In what program did they go through?
This is speculation on my 19 3/13/03 - COMMERCE - RES. 020238 part to an extent, but I believe someone in the union knew of an apprentice that took and passed the test, wanted to get that apprentice working on this particular job, and got one of the contractors to sponsor that apprentice. So the apprentice is working.
To a degree, yes. I think that is the case. Back to the earlier question, Councilman Nutter, the programs that we have funded at PWDC -- we funded Congreso's program -- they actually have individuals there who go out and meet with the unions and they advocate on behalf of these people and they try and they push very hard to get these individuals into the union. So it's not a situation where you really graduate and people are just sitting around. A lot of effort goes into trying to get the people into the unions.
So like Michael says, 20 3/13/03 - COMMERCE - RES. 020238 you go to Congreso, you study, you pass all the tests that are necessary, and then, as Mr. Solomon said, you either sit by the phone or go down to the work site. And in the words of Mr. Solomon, going down to the work site is not a very fruitful approach. So that means it's probably nil. But it gets very frustrating to that individual who has studied and can't find that work. That's exactly what we're talking about. We're talking about the doors that are closed to people. And we are not going to allow those doors to be closed any longer. Let me tell you something. If those individuals -- and I think Councilwoman Tasco -- today, we had a press conference where 27 of us stood up and said, "We are not going to allow these things to keep on happening." But if we have to bring in all those contractors in here and say that you're not going to do it that way, you're not going to do it that way any longer, I think that's what we're going to have to do. (Applause.)
I understand that. 21 3/13/03 - COMMERCE - RES. 020238 It's very enlightening what you're saying.
I've seen letters from contractors sent to the unions asking them for more people. For instance, just asking them for minorities, apprentices and so forth. You have to understand, they don't have liberty to go out and hire anybody except --
To go out hire anybody off the street on this project. Hiring is done through the union hall.
Yes. That's a contract. That's a contractual relationship that's spelled out in the collecting bargaining agreement.
Do they have the ability to determine the make-up of the work force that they want to see on the site working through the union hall?
Not ultimately they don't. They can request, for instance, in the case with 22 3/13/03 - COMMERCE - RES. 020238 some of the trades where we need to get minorities and women on pursuant to the EOP. They will request -- if you're building up your carpenters staff, and you've got 10, in order for us to meet our EOP goal we need four of those at least to be minorities. And they will specifically request those. But what gets sent to them is really not their doing.
Let me understand this. The EOP, who developed the EOP?
Is it a signed document? Well, I didn't develop it, but there were many of us, I'm sure, involved in different phases of this. Councilman.
I think both plans were drafted by Marla Hamilton, who was an employee of City Council, then moved on to PIDC.
What's the penalty for not fulfilling it? 23 3/13/03 - COMMERCE - RES. 020238
We're actually trying to ascertain that. At our last meeting, Marla sent a letter to a City attorney asking that very same question, what are the potential sanctions. And again what she wanted to do -- she sent a letter earlier --
The good side with the Phillies is that, I guess, 75 percent to 80 percent of the work is still in front of us in terms of the employment side. So there is some time to make amends and change things there. But you're right with the Eagles stadium.
They're roughly 75 percent complete, 75 to 80 percent complete at this point, at least in format.
And up to this point we've not determined what the penalty is for non-compliance or for missing a goal?
We have not. But as I indicated, that request is before Council. And as 24 3/13/03 - COMMERCE - RES. 020238 soon as we get a letter from them, I'll be happy to share it with you, Councilman Nutter, and the other Members of the Committee.
Okay. That was a long interruption, and I apologize. Councilwoman Reynolds Brown.
Good afternoon, everyone. You spoke to the level of success of young people or individuals who go through TOP/WIN or DAP and don't successfully get through the program. What are some of the factors that contribute to those ultimately dropping out or being unsuccessful in the completion of the program?
Again, I'm guessing a lot of these are young people who need to earn income. The training program is of such length that many of them have to drop out and get a job. I can't tell you now the percentage of those who start who actually finish and take the test. I would guess probably only 60 to 70 percent are around at the end of program. And then you have the test to take. You know, apprentice tests aren't that easy. They require an understanding of mathematics and other 25 3/13/03 - COMMERCE - RES. 020238 elements that, again, if you didn't get that education at a high school level, it comes back to haunt you.
Who's responsible for maintaining the records of who comes, who successfully completes, or not? What entity is responsible for the monitoring of the actual trainees?
We, actually, at Philadelphia Workforce Development Corporation keep those records, as well as the training provider.
Good afternoon, Members of Council and those who are here listening. Rather than be redundant, I am going to do two things. One, let you know who was on the Committee, and then just talk a little bit about our processes involved with the Oversight Committee. And I certainly will then answer questions. On the Committee are both Councilman Goode and Councilman Clarke, Marla Hamilton, Jim Roundtree, Pat Gillespie, Linda Swain from TOP/WIN, 3/13/03 - COMMERCE - RES. 020238 Universal Homes, myself and members of the Eagles. What is so disheartening is that I sit here and it's like deja vu. Seventeen years ago when I started at the Pennsylvania Convention Center, I began there as Director of Affirmative Action. Almost the very same questions in testimony at Council came up. We have made such little movement as a City to define our relationships with our unions. It requires very specific partnerships. And no matter how eloquently we talk about it, no 12 matter how high the numbers are on contracting, when you talk about employment, committees, no 14 matter who the composition is, we have no control over that. We request and request. As Mr. Jones said, the contractors can do the same. But for whatever reasons, it's out of our control. It all happens at the union halls. They send who they want, how often they want. And no matter what kind of cajoling, no matter what issues that we have raised, and even having union officials on our committees who sit with us and agree and are as aggressive as most of are us are, the decision is made at the union halls. Until someone can speak to dealing with those issues, 27 3/13/03 - COMMERCE - RES. 020238 probably years from now we will be sitting here answering the same questions unless something is done about it. So my testimony here is that, certainly, with Council and with your efforts to understand and then make some decision is the only way we're going to see our employment numbers rise on a level that make sense for our citizens. And until that happens, we're not going to be able to do anything. We can have Oversight Committees. We can have panels. But until that is addressed, we will sit before you with the same abysmal numbers and we'll have the same kind of talks about who did what, how many, where was your outreach, how many people passed the test, how many didn't. It really gets to that decision that gets made at the union hall. I thank you.
Thank you . Councilwoman Tasco has a comment, but I would also say, Ms. Young, that before it ever gets to the union hall, most of these projects end up having to come through here. And if we learn anything out of this process, it may be one more reason why on large dollar projects that have 28 3/13/03 - COMMERCE - RES. 020238 significant economic impact, significant City and/or State funding, it's probably one more reason why we shouldn't rush to get these done, vote on them in the middle of the night. The Economic Opportunity Plans and other plans like that are always the last piece at the end of the process when we're told that, if we don't approve it now, the whole thing will fall apart. The one big fallacy of this was, we passed stadium legislation in December of 2000 being told that, as we were going out for the Christmas holidays, if we didn't get it done then, the whole project would fall apart. The fact of the matter is, is that the two teams didn't sign their agreement with the City until a year later, in December 2001. So there is a fair amount of up-front work that needs to be done and this kind of discussion and dialogue and detail worked out up front. And what are the penalties for non-compliance should all be clear to all the parties before anybody either votes for anything or signs a document. Councilwoman Tasco.
Good afternoon to the panel. 29 3/13/03 - COMMERCE - RES. 020238 Ms. Young, I really appreciate your candor. You cut to the chase. And you're right. Until something happens at that point -- and we can have all the panels and we can put all the stuff into contracts, and it's not going to work, because we don't have any control. I'm not sure whether we do or not. Maybe someone can answer this question for me. Is it the law who requires us to have to go -- walk me through the process of why -- and I know this is a union town and I'm going to be cast as anti-union, but I'm not. I believe in union and representation and all that. But I also believe in parity and fairness and inclusion. And if we find that a system is not inclusive -- and you and I know, without being said, what happens in the union halls. What requires us to have to use union labor?
I know on both of these projects, we have project labor agreements that state that we'll use union labor basically. And it's just been the practice here in the City, as far as I can remember, that if a project is a prevailing wage or a union job, the unions are, in fact, in 30 3/13/03 - COMMERCE - RES. 020238 control of that. I'd like to make one other point. You know, the training programs, I think, are good programs. They're doing a really great job in terms of training folks. The one missing link is that you train a person, groups of people, but you don't have slots. You don't have negotiated slots before the project starts. You talk about looking at the EOPs, but it's a matter, then, of saying in that EOP that there will be some slots negotiated. In some cases, on other projects we've worked on, we have tried to circumvent the union issue by going directly to the contractors and making it a requirement of their contract to hire certain folks. That has worked to some degree, but, of course, the union has closed that down. So the point is, is that there needs to be some negotiated number of slots on a job. Because the people are there, they're going through the training programs, and they're pretty much ready. But if we don't have those slots, it's a waste of time. We are at the mercy of each union.
But I think what she asked was, is it law that we have to use -- and it 31 3/13/03 - COMMERCE - RES. 020238 isn't. It is not. It is not law. It is public policy, really of, this government. It is the public policy of this government, of the Administrations that we've had, and the public policy is that when they do a construction project they put it almost into the contract that it has to be union labor. But it does not need to be in the contract. There is no law in the books, either state, local or federal that says that all construction in the City of Philadelphia must be done by union labor. The only thing that is there, is that if federal monies are used in a project, you have to hold to Davis Bacon wages guidelines, which are set usually by the union contracts that have been negotiated in the City. That is the only thing that is in the books, that if there's federal money involved in any project, you have to go by Davis Bacon wage guidelines, and that is all. The union thing is added into the contract by the Mayor's Office when they negotiate with the teams or they negotiate with the contractor. The Mayor, when they negotiate those contracts, could say, "Labor should be done according to Davis Bacon wage guidelines, but open 32 3/13/03 - COMMERCE - RES. 020238 it up. That could be done.
We would also open up the process to contractors who have been excluded also. Not only the workers, but the contractors who have been excluded. And I want to say that this has been going on a long time. You're right, Ahmeenah. And I must say, the Urban Coalition, when Charlie Bowser was executive director, set up a journeyman outreach program, a program that was designed to help those people who had gone through the apprentice program to become journeymen on these jobs. I'd like to know where some of those people are who went through that program. We have all these people who were trainees, who have been in these programs. Where are they? We're talking about the expansion of the Convention Center. Now, it would be smart if these training programs would begin now to get a pool of people ready so when that -- and if it should come, that there is a pool of people ready to go. And those of us who do what we have to do when we make the demands know that there is a pool of people waiting to go to work. I want to ask a question. When you all 33 3/13/03 - COMMERCE - RES. 020238 are checking the job sites, do you check the job sites to see if these workers are there?
There's a person assigned permanently to work each project, if you will. That person is generally on site one or two days a week, and more often, if necessary. Basically, what we look at is what's called the Daily Construction Logs that will list all of the workers on site and those that are minority or women or non-minority or women. And along with that, we review the certified payrolls that we receive directly from the construction manager. So we look to verify participation and we look to just account for those persons listed that are, in fact, there.
Have you ever found in any instance where they may have -- you know, they hire one person and move him around and they get double count? Where they're on a job today, you go there two, three days, and they're someplace else? They may not have as many people as you think they have. 34 3/13/03 - COMMERCE - RES. 020238
The fact of the matter is -- and let's be specific to the stadium projects. Both of those projects are such that they're working 40 hours plus a week, everyone on site. That's documented by the certified payrolls.
The stadium project. The Eagles stadium and the Phillies new ballpark.
Also, Charles, we should add, we measure the attainment of the goals, not in terms of bodies, but by total hours worked. So if they move somebody around, we would still know what hours. They're the ones we measure. And going back to the issue about the unions. Let me just say, I'm not anti-union, and I think unions have done some good. The big problem is, we don't have enough of us in the unions. I don't examine their books, but I've been advised by some experts that not one union in the building trades, excluding the laborers, has a minority membership that's even 10 percent in a City where the minority population is almost 50 percent. And I also think, given the history of the City and a lot of other things, the likelihood of getting 35 3/13/03 - COMMERCE - RES. 020238 non-union jobs on these big projects is, I think, remote. But I think, really, Council can do a great deed for the City if somehow we can increase the membership in these unions of people, like the people in this room and the people have who have passed apprenticeship tests. And if you do that, and if there's equal representation or at least corresponding representation in the unions as it relates in the general population, you wouldn't need theses programs. In every single project, you would automatically get people from the City, minorities and women who work on these jobs and even jobs where there are no public dollars. So I think what we need to focus on is to get more people of color, more women, into these unions so that they can work and share in it.
Thank you. And you're correct. I want to go back to the man-hours versus bodies. Do you get more people with bodies than with man-hours?
On the stadium and the 36 3/13/03 - COMMERCE - RES. 020238 ballpark project, they're close percentage points. For instance, in terms of bodies on the project, we're looking at about 27 percent. The actual hours is around 30, 31, 32 percent, percentage of hours worked. So they're kind of in the neighborhood. That's primarily due to the fact that we're working 40-plus hours a week.
It would be really good to have him here now. It would be his dream to be right here now. He would be quite helpful. For those of you who don't know it, he was a guy who raised a lot of these issues, had a lot of information and could be very helpful in helping to work through this maze of things. I don't have any more questions yet.
Thank you, Mr. Chairman. Good afternoon to the panel. Let me take care of a couple of housekeeping things first. Let me thank Mr. Jones 37 3/13/03 - COMMERCE - RES. 020238 in his capacity as head of Philadelphia Workforce Development Corporation for following up on issues raised at the last hearing and for taking this issue very seriously. And I concur with Councilman Tasco that it is about training enough people so there is no 8 excuse for lack of entry into the unions. That's the purpose of my Resolution, to make sure that we can take that excuse away and that we continue to train people to reach the level of participation that we desire. Let me thank Mr. Glancey and Mr. Jones from the organization as well. Secondly, let me thank the people at the table. I know of the work you do and I know how hard it is. And I actually am somewhat satisfied with what's happening on the stadiums projects, particularly because I know that it's at a different level than it has been before. It's because we pushed in this Council to make sure it was at that level, and it's something I am proud to have done in my first year here, to say that, on the first project that comes on my watch, we're going to set historic goals and we are going to reach those 38 3/13/03 - COMMERCE - RES. 020238 goals. I should also state for the record, sharing something confidential, as you can attest to, I also told you that if I was not satisfied at that table in terms of the Eagles Oversight Committee, that you were going to pay me a visit in City Council and that essentially I don't have to sit at your table. I am very proud to sit at this table and then to be able to put some other things on the record. I want to get into some very technical issues very quickly. Just a few questions. One is a very general question about disparity between supposedly meeting the business, but not meeting the employment contracting goals. And to a certain extent, you have explained it, but to a certain extent, you have not. Why is there such disparity in supposedly with meeting business contracting goals, but not employment goals?
I think a large part is a matter of availability. If you look at the contracting community, there are a number of businesses, if you will, that are ready, willing and able to do contracting work. When you compare that 39 3/13/03 - COMMERCE - RES. 020238 to the availability in the construction trades in terms of members in the union, you drop right off the scale. They just aren't, aren't there. I think someone mentioned a to percent number. That's 6 probably very, very true, if we look at our data. 7 When we look at the projects that we've done over 8 the last 20 or so years and look at the availability 9 of minority tradespersons, that's somewhere between 10 and percent. Now, compare that to the fact 11 we've got a 50 percent goal on the stadium projects. 12 Now, data, comprehensive data, about the union 13 memberships just isn't readily available, 14 particularly as it relates to minorities. What we 15 have is, I guess, a reasonable statistical sampling 16 of what's actually there. 17
That doesn't quite 18 get to where I want to go, so I will ask the 19 question I really want to ask. On the business 20 contracting, if you subtract the majority portion of the joint ventures, what is the actual participation number?
But I've asked the question at the other table, but I told you I was 40 3/13/03 - COMMERCE - RES. 020238 going to bring you here to ask you the question on the record. When you subtract the majority portion of the joint ventures, what is the actual minority contract participation number? See, my guess is it's 30 to 35 percent.
Then you won't be able to answer my next question either.
Well, let me say this to you. The joint ventures on the Eagles project in total is about $98 million. That's the total number. Okay. And each joint venture is 51/49, but the actual dollars in terms of the question you asked will vary from deal to deal. So we could answer that question for you.
The third question I was going to ask, and the final question is, is there or is there not -- and this is a technical question -- a direct or indirect correlation between minority contracting and minority employment?
I would say no. I was trying to answer your question. Implicit in your 41 3/13/03 - COMMERCE - RES. 020238 earlier question was, if we could get close to 50 percent minority contractors, it would lead one to believe that we should at least get 50 percent, close to that, minority workers.
I wasn't necessarily going that far in the theory. But I was going as far as to say that the disparity between 50 percent contracting and 30 percent employment may be and probably is due in part to the fact that the actual minority contracting number is only about 35 percent. This question, if you can't answer it in this hearing, you'll have many opportunities because this issue is not going to die anytime soon unless somehow it becomes resolved. I actually wanted to know whether there is a direct correlation or not between minority contracting and minority employment.
And I said, I don't think so. And I'll give you a couple of reasons. Number one -- and I think Charlie talked about the availability. Right now -- and let's take carpenters again for an example on a particular package. We may get 20, 25 percent participation. 42 3/13/03 - COMMERCE - RES. 020238 If you've only 9 percent out of all the carpenters in this whole area that are minority, you've basically tapped out. And that's what's happening. We're tapping out on that. And the other reason I will give you is that while we would like to think that minority contractors are more sensitive, in many cases --
Mr. Jones, I'm sorry. Can we have a microphone for Councilman Cohen? The committee has been joined by Councilman Cohen and Councilman Clarke. The Chair recognizes Councilman Cohen for a point of information.
I just wonder if the witness would repeat that explanation about 9 percent and 50 percent. I was trying to follow it and I couldn't.
Yes, sir. What I was saying is that the membership in the various building trades, excluding the laborers, I believe for every different trade they don't go above 10 percent minority representation. 43 3/13/03 - COMMERCE - RES. 020238 So if you have a situation where you're trying to bring on carpenters, there's a limit. There's not an unlimited pot of people from which you can draw. So you're capped by that. But the another part of that is, some of the problem contractors that we've had, in trying to get more minorities, have been minority contractors.
But, Mr. Jones, the reason why I don't completely accept that and why I want an answer down the road in terms of what is actually, from a technical standpoint, direct correlation is because that's true in terms of the construction sites across the City on public and private projects, and we're limited in terms of participation across the City by the lack of union membership. But when we know that people who were trained are not working, who may be available to work are not working on other projects, and we come in and set aggressive goals on stadium projects and on neighborhood transformation. I'm still not convinced that we can't put all of the people who are available to work on those couple of projects at an increased level. So that may be true about participation on construction projects Citywide, but 44 3/13/03 - COMMERCE - RES. 020238 in terms of those projects, I'm not convinced yet that we are completely limited by a union membership in terms of those particular projects.
If we can expand, I agree with you a hundred percent. But I believe if we put every single minority carpenter to work that's in the union now we would not meet these goals.
I need to know that from a technical standpoint whether that is true or not true, because we're about to redefine Affirmative Action participation in this City. We're going to do it based upon availability. We're going to move away from the rhetoric and anecdotal discussion of this issue. We're going to get down to the technical numbers in terms of who's available and not being used, and we need to know.
I think that's a good idea, but I would suggest and respectfully request that you get the unions to come and give you that. We don't have access to their membership numbers and the level of minority participation. But I think you've hit a good point and if you could get that, I think that would be a great benefit to all of us on this business. 45 3/13/03 - COMMERCE - RES. 020238
I have one comment -- or an observation. You mentioned the relationship being minority contractors being on site as contractors, prime or subs, and the employment of minority individuals. Now, from what we've seen, some of the smaller contractors -- when we say small, those who are doing projects under $2 million. They tend to have really good participation. I mean, from 60, 70, and in some cases 100 percent. Of the larger contractors, the real big guys, in terms of minority firms, they have the same difficulties other large firms have, apparently because they are not employing minorities at the same rate.
Thank you, Mr. Chairman. I was actually going to ask that question with respect to the smaller contracts. In an earlier question about the likelihood of a minority contractor having a minority workforce, 46 3/13/03 - COMMERCE - RES. 020238 there was a response that that was not necessarily the case. But I think that's if it's a larger scale project. If it's a smaller project, the likelihood is pretty high that there will be a minority workforce. And that is primarily because the availability of union membership, the access to union membership on larger projects, as you said, we don't know if that's, in fact, the case.
Well, we really don't know because we don't have the information. I think we can make an inference that, yes, maybe that's the case, but not knowing what the universe looks like, you don't know whether or not on the larger projects that that is the question or that it's based on what that particular contractor's relationship is with that particular union. I would absolutely agree that we can get from the unions some certification process in place so that we know what the universe is, how many people do we actually have that are available, and then how many people do we have in the pipeline that are going through training programs that could be available. Then that would give you your universe, and that would give you the feeling as to whether or 47 3/13/03 - COMMERCE - RES. 020238 not people are adequately doing what they need to do or not.
Councilman Clarke, if I may. During the hearings before, the stadium hearings and prior to that, I asked the union leaders who came before City Council to give us sort of a census of their membership within the area. They never provided that. I think what Mr. Jones says is probably correct, that the universe in each of the skilled trades, not including the laborers, but the skill trades, is probably at or below 10 percent for African American; for Latinos is way below that. And that the only way, I think, that you could correlate minority increase in employment in some construction projects with minority contracts is if you let those minority contractors have their own workers come onto the site. Because most of the minority contractors have workers that don't belong to unions, and they're African Americans and they're Latinos and so on. So the only way that that can increase the correlation between giving contracts to minority contractors and seeing an increase is if you, in 48 3/13/03 - COMMERCE - RES. 020238 essence, say you've got to pay, again, Davis Bacon wages, but you can hire your own workers and they don't have to belong to the union. But if you adhere today to the contracts assigned, and it's public policy of the City that you got to go through the building trades as such, I think the universe will be limited. (Applause.)
If I could get back to my question. My question was, the likelihood of a minority contractor having minority workers. The issue is, if it's a smaller contract, the likelihood is high; if it's a larger contract, the likelihood is lower? That's what I am asking.
And you're saying that that is because of the inability to access the individuals from the union?
I would say so. Again, the way it works is, to my knowledge, contractors call the union hall and they'll say, "Beginning Monday, I need 10 X workers." And they will request or can request, of those 10, send me four or five who are African American or Latino or women. What they 49 3/13/03 - COMMERCE - RES. 020238 ultimately get, it's not up to that contractor. So to that extent, all of the contractors are really at the mercy of what's sent them. If you have the rules that we have now, that is, hiring through the union hiring hall.
So we don't really know that they're not available in the hall. We just know what's sent from the hall?
That's correct. Now, we've had meetings, Mr. Solomon and others have had meetings with the unions. They said they will try to reach out and get as many minorities. And after applying, quote, some pressure, we've gotten more referred in some instances. But I personally do think there is a limitation problem. The solution to which, we've got to get more African Americans and Latinos and women into the unions.
And the more projects that are going on simultaneously, the less likelihood that you're going to have the numbers that you project on any one project. So if there's construction going on all over the City and there's City monies and they're mandated to do X amount on each project, the number is lowered. And we don't 50 3/13/03 - COMMERCE - RES. 020238 know -- we can't say to the union hall, "You sent us and we asked for 10, and we know you have 20." We 4 have no idea what that universe is for each 5 construction trade.
Okay. Let me go a little deeper into the issue. With respect to -- and I don't know if these are official agreements or handshakes, gentlepersons' handshakes. With respect to the ratio of apprenticeships, pre-apprenticeships versus journeyman, traditionally on larger projects there is this agreement in terms of the ratio of new hires or hires, apprenticeships versus journey people. Is that a written rule with the union, or is that a written rule at the time of the signing of the contract between the trades and the building owner? What's that -- first of all, what's that ratio traditionally?
It varies from trade to trade. I don't think there is a written rule. It's practice within the industry.
That's correct. Basically, we've been struggling with that issue for some time now. Because one of the Oversight 51 3/13/03 - COMMERCE - RES. 020238 Committees felt if there's a ratio, it should determine the pool of opportunities for apprentices. But the fact of the matter is, based on what goes on on the site, it is not a written rule. The ratios are in existence, but whether or not they adhere to them or not, there's nothing hard and fast about that. The only instance I know where there is a reaction is when the ratio of apprentices to journeyperson goes out of scale, if there are more apprentices than journeypersons, then we may get some issues. But beyond that, I don't know of adherence to those ratios.
So it's not a law. It's a negotiation. So if we, through DAP or Greater Philadelphia Urban Coalition, are in a process of creating opportunities through our training programs so people can enter into the pre-apprenticeship program, their apprenticeship program, we can on these major contracts prior to the implementation of the contract make sure that the ratio, as it relates to apprentice, pre-apprentice versus journeypersons, is increased at a minimum equal, the likelihood of our ability to enhance the numbers that come in on a minority is 52 3/13/03 - COMMERCE - RES. 020238 pretty high? Since we all agree that the number of journeymen currently in the union, that number is abysmal, at best. So if we can figure out a way to change that ratio in terms of new entries into the apprenticeship program to increase the number of new entries as it relates to that ratio, then we can enhance the numbers that will come in on the job.
That's correct. Let me just say this. On the Phillies project, if they were currently operating under the existing ratios, it would triple the number of apprentices that we would have slots for down there. If they simply went along to current industry standard, which in some cases allow you to put an apprentice for every four journeymen or every five journeymen, if the project were performing at those existing standard types of ratios, we would double or triple the amount of apprentices on the job. We've been fighting with that issue for some time.
So at the onset of the discussion about a major municipally or quasi-municipally sponsored project, if we can negotiate a ratio per trade that is reflective of 53 3/13/03 - COMMERCE - RES. 020238 what you're talking about, having a one for one, then the likelihood of us being able to increase our minority participation will be substantially more?
Yes. Even if you didn't increase it. If you simply wrote into the EOP -- which we don't have in this EOP -- that we expect on this project that you do what you do on all the other projects in terms of the number of apprentices to journeymen, we would open up 50, 60, 70 slots now immediately, at least at the Phillies.
Okay. With respect to contractors -- because one of the things that, during the debate early on -- and I was in the midst of my discussions with the Phillies and the Eagles. It was our understanding that the importance of getting minority-owned contractors on these particular projects was about capacity building. Because too often we are told that minority contractors don't have the capacity to bid on that job or this job because they don't have the appropriate bond, they don't have the assets, the whole nine yards. And we were given all types of reasons. Based on the information that we have 54 3/13/03 - COMMERCE - RES. 020238 been provided, it appears that a number of these minority contractors have received substantial contracts in terms of dollars on these projects. Is there a program in place, or is there a level of discussion that ensures that these individuals -- and I understand they're independent contractors, but given the understanding of the intent of building capacity, is there some level of discussion or something being in place by the agencies that are supporting the outreach programs or the government to ensure that we, in fact, build capacities in these organizations, so when the next large scale project comes about, that individual can bid as a prime? Not as a 51 percent, but as an 80 percent prime or a 90 percent prime or a 75 percent prime, not simply taking advantage of a lucrative contract and then continue with business as usual? Are we having that kind of discussion?
The answer is yes. We've talked about that, at least at the oversight level, about trying to increase the capacity of minority firms to what you just described. And perhaps Charlie can give you more details on what we've actually done. 55 3/13/03 - COMMERCE - RES. 020238 As I indicated, yes, we have discussed this issue on a number of occasions at the oversight level. We are conscious of the intent to increase the capacity of minority firms, and I'll ask Charlie to talk specifically about what we've done in that area.
I'm sorry. Just to interrupt just a second. In reference to what you passed out, there should be two reports, one on the Phillies and one on the Eagles, which gives more detail on exactly what we're talking about, the names of the companies and the contracts and those kinds of things that are available on both projects. I just wanted to let you know what we passed out.
You've got the name of every minority contractor in there?
Yes. Every minority contractor is listed in that report and the number of contracts that they have, as well as the unions are listed, the trades are listed specifically with their number of hours that are worked, the number of people. And then how that's has been apportioned within the minority community. 56 3/13/03 - COMMERCE - RES. 020238
To answer your question on the whole issue of capacity development, when we looked at the Economic Opportunity Plan in terms of the numbers we're looking at, it was a matter of being somewhat creative about how you actually increase the capacity of a firm. And one of the vehicles was that of the joint venture approach. One contractor in particular through the joint venture effort has increase his capacity from a little over a million, million-and-a-half, to about $8 million a year just in terms of contracts that he has been involved with. So the point is, it's been a matter of trying to, one, institute a policy or a strategy, if you will, to get contractors involved in the process early on by giving them long lead information about the various bid packages so they can strike relationships with businesses that will allow them to, in fact, increase their capacity. And that's been true on a number of contractors on both of these projects.
So during or after, near the completion of this, beyond your scope, because I know your organizations are hired for 57 3/13/03 - COMMERCE - RES. 020238 these particular projects, the Phillies and the Eagles, will there be a follow-up that will involve the government or anybody else? I guess I'm kind of offering our assistance to some degree to ensure that the capacity building that took place during these projects will continue as it relates to being able to access these particular companies to bid as primes on other large scale development that we hope will come down the pipeline in the City. I guess basically what I'm saying is, I want it to go beyond the Phillies and Eagles. There was some contractors who got some very lucrative contracts, minority contractors. It's our hope and, as you said, the intent on forming the joint ventures was to put them in a position to do just that. What I want to do is to make sure that now that they have experienced that level of participation in a major project. Can we now look for those entities to now bid on larger contracts as the sole prime and not necessarily in a joint venture capacity?
Well, it's something that we're looking at very, very cautiously. It's kind 58 3/13/03 - COMMERCE - RES. 020238 of limited to the projects that we're involved with.
That's why I'm offering or suggesting that we continue that further than your arrangement with the Phillies and the Eagles, because the reality is once that's done, that's done. You're on to something else. What we need to do is have in place, be it government or be it some other entity, something in place to make sure that those companies that have experienced that capacity building continue to now be in a position to hopefully work on the Convention Center, if it so expands or some of the NTI projects that we hope will take place. Do you understand what I'm saying?
It's going to require a number of things happening. One of the issues that kind of stifles the growth of businesses when the whole capacity development ends is the absence of technical assistance in terms of hitting those areas where there's deficiencies within a business to help them kind of move up incrementally. So the point here is that, from our perspective, we're going to have to work with firms, put the best firms in the mix, you will. And generally when that happens, they're able to bid and bid successfully. 59 3/13/03 - COMMERCE - RES. 020238 But working with the MBEC and other entities here in the City, we need to work with each of those businesses to get them involved.
My point is -- and I don't want to keep belaboring the point, but I will if I have to. I hate to single a name out. McRae got a substantial contract. They know how to submit a bid. They have technical experience. What I'm saying is, will we be in a position if we need to participate in assisting them, will McRae next time around be in a position to bid as a prime, period? Not a joint venture, not a 75/25. Do you understand what I'm saying? Because that was the objective of making sure that people participated in that. And I guess I'm suggesting to you, if you need the assistance of government to be in a position to do that, because this will run beyond your existing contract with the Phillies and the Eagles, you need to say that now so that we can put the mechanisms in place to make sure that that happens.
The answer is yes. We will be very glad to work with you to make sure that happens. One thing that we did do is that once we've established a list, whether it's working at 60 3/13/03 - COMMERCE - RES. 020238 the Convention Center or the Phillies and Eagles, because we also work on privately funded projects, especially at the University of Penn and Temple, and we're constantly trying to market to make sure that other institutions in Philadelphia know what we do. We bring those companies to the table and we always offer to let them know about who's out there, who's available and how they can really reach their goals. So, yes, we would love to be able to continue that and to figure out ways to expand it.
Okay. Because I have two large scale projects happening in my district in the upcoming months, so I would like to be in a position to make sure that they're at the table to bid as a prime.
Absolutely. We have been from the beginning, especially around NTI, offering our services and we hope that --
Well, that, and certainly something else. Absolutely. We'll be glad to work with you.
Thank you. 61 3/13/03 - COMMERCE - RES. 020238 Thank you, Mr. Chairman.
I just want to ask this question. In your report of March 11th, you indicate that the total project hours worked by minorities was 28 percent or 451,932.50; 28.47 out of a total of 1.5 million hours worked -- actually 1,587,625.45. What is the total money participation in those hours? What are the total minority contract participation amount in dollars and cents?
The Eagles. That 28 percent, what does it mean in terms of dollars and cents, and what does the 1.5 million work hours mean in dollars and cents?
I understand that. I want to know how much money that 28 percent is worth vis-a-vis that other 1.5 million?
It's not included in this 62 3/13/03 - COMMERCE - RES. 020238 packet. We'll get that for you. We can get that for you.
Because I think that will tell us a lot in terms of the workforce. I believe that that 28 percent of work hours is probably laborers and lower level minority workers.
Don't we have that broken out, Charles, in the packet between laborers and -- we have the total number. We can certainly get you the payroll numbers.
If you can get me that information. Can you get me that information?
We can get you that information, yes. One quick comment about the relationship between laborers and skilled tradespersons, if you will. That number is generally in the percent to 19 30 percent range. In terms of the 25 percent of the 20 hours worked by skilled trade workers, and that's 21 improving. It used to be much lower. 22
I will just say, if you 23 look at the last two pages of the packet where we do 24 the employment numbers you will see that the numbers 25 are broken down between laborers and skills. So you 63 3/13/03 - COMMERCE - RES. 020238 will at least be able to see the hours and the numbers and we'll add the actual dollar amounts to that.
The last two pages in the Eagles packet, there's letterhead page. At the top it says, "Project Employment Goals."
In section Q -- I'm sorry, Section R. You're right, Section R.
You have a February '03 monthly report that has a listing of probably 20-some-odd different trade positions, total hours is MIN, minority hours, and then percent minority hours. Is that what that means?
And just quickly tell me, what's -- I have two charts. The second one appears to be female hours.
Okay. That's the trade 64 3/13/03 - COMMERCE - RES. 020238 report. That addresses the hours per trade. If you look at that, it's two basic sections. The first section gives you hours per trade for minorities, if you will, on the first page for the month would be project to date hours of those hours per trade for minorities. If you look across the top page, the top of that where it says, "bricklayers," all the way over to the project to date, you've got 60,000 bricklayer hours worked on this project as of the writing of this report; 12,700 of those were worked by minority individuals, or percent. If you 13 could further look down the trade, you get a sense 14 of where the concentration of minority hours in 15 areas, again, like carpentry, electricians, laborers 16 and plumbers. 17
If you take the 18 laborers out of the equation, out of the work 19 force, what are you left with? 20
Well, let me give you the laborers less the skills first. We've got 451,000 65 3/13/03 - COMMERCE - RES. 020238 hours. Of that, 162,000 are laborer hours. The balance of that would be skilled workers. It would 288,000 hours. Now, in terms of giving -- you want an ethnic break out? We can give you that.
Without the laborers, if 19 you look at the total skilled hours, it's 21 20 percent. And the laborers' hours are 69 percent. 21
I see that. But I think the question was, when you take the laborers' hours of 162 divided by the total hours of 451, it's about 36 percent of the total is from laborers. Okay. Let me ask a couple questions. 66 3/13/03 - COMMERCE - RES. 020238 First, Ms. Young, I want to go back to something that you said that I was quite intriguing. You gave the impression on the record that somehow, the more work there was throughout the City, the less opportunity there is for either African Americans and females. I'd like to better understand that. Is that what you were saying?
For each project. So that if we've got five construction projects going on simultaneously in the City, the availability for any particular trade and employment on each one of those is reduced because of the competition to have minorities on all of those projects.
To the hundred or so who are sitting around waiting for a phone call.
Exactly. And what we have found out, as Councilwoman Tasco said, in some instances, they may move the same person. 67 3/13/03 - COMMERCE - RES. 020238
And so it doesn't increase the numbers at all. Just that person gets more hours. And then you've got all this pool waiting by the phone, as you said.
Which is one of the reasons they went to counting hours, just to make sure that we weren't just counting bodies.
Let me ask this question about the EOP. At what point were you involved in the development of the EOP? Was that after Council had approved the overall project -- and Councilman Goode and I have had some conversation -- it may not seem like that long ago, but December of 2000 for us, at least in the legislative world, is a couple thousand bills ago and many things happen, daytime, nighttime and other times trying to deal with these things. My vague recollection of this is that there was discussion about an EOP at the time of the 68 3/13/03 - COMMERCE - RES. 020238 passage of the legislation, but the EOP was not complete. But there were, I believe, some general parameters that we were looking at, but it needed to be fully developed. And that the stadium projects were approved by Council, the EOP was subsequently worked on and developed -- Councilman.
I believe stadium legislation called for us to approve the EOP by resolution, which we did a month or so later, but it was pretty clear on the record that we wanted half. We just approved of the deal with the understanding of what we were getting in terms of percentages from contractors and employment.
And that's what I meant by the general -- I think we had a general understanding of what the parameters were supposed to be and then waiting for the appropriate language and all the documents that go with it.
But if we weren't getting half in the EOP, then we were not going to approve the resolution.
Right. I understand. At what point did GPUAC come into the 69 3/13/03 - COMMERCE - RES. 020238 EOP development?
We were able to review the EOP once it was completed and to basically just give an opinion whether or not it was something that was achievable or not.
So you didn't participate in the development of the document?
None other than to discuss what was there. One issue that I recall was the issue of whether or not disabled workers would have been included in EOP. We felt that it should not.
I understand that. Well, let me ask this question. Is it better or easier for you to ensure that an EOP is being followed or complied with if you have the opportunity to work on it as it's being developed or if you get it when it's done and you're then asked to enforce it?
We would much rather work on the EOP while it's being developed. As the case, for instance, with the University of Pennsylvania, we worked with them for a year developing the EOP prior to the implementation of it.
Okay. Let's talk a 70 3/13/03 - COMMERCE - RES. 020238 little bit about this joint venture situation. I know we just received these other documents that give of a listing of many of the firms by name. What I would actually ask, as we go forward, the reports that we receive on a monthly basis -- and I'm looking at one that indicates the data is as of February 20, 2003, which I think is probably the last one that we received. It lists types of work. For instance, on the first page, abatement, MDBE, 49 percent; general requirements, 94 percent; demolition, 38 percent; site fence, 100 percent; bulk excavation, 100 percent. We had some discussion in another hearing. It may have been this hearing, it may have been some other hearing about this issue of the joint venture and the calculation for reporting purposes on these documents as to how things are categorized and accounted for. And so I'd like to understand from you, if I a joint venture -- let's say that I was crazy enough to actually go into business. If I had a joint venture with a non-minority person and whatever our arrangement is, but we represent to you that somehow through this new joint venture, I own -- and you can then tell us 71 3/13/03 - COMMERCE - RES. 020238 how you determine this -- 51 percent of the joint venture entity. How do you calculate the work that the joint venture receives in the context of minority work versus non-minority work?
The first step in that process, of course, is to, through working very closely with MBEC, they've established a guideline by which the joint venture preliminarily would be approved, which is what we do, a preliminary review of that. Basically what we attempt to ascertain is clearly the role of the minority/majority. If it's a 51/49, the 51 percent person's role in terms of whether or not they make it in some equity contribution or initial capitalization, if you will, that speaks to 51 percent of the dollars required, then there must be an agreement, of course, that speaks to the fact that they have operational control and they have meaningful and substantial participation. Let's assume that all that moves forward and the agreement is ultimately approved by the Minority Business Enterprise Council, then that is viewed as a business entity as any other and the majority control -- 72 3/13/03 - COMMERCE - RES. 020238
Does the joint venture have to have its own business privilege license?
That, I'm not aware of. I don't think so. I think both partners in the joint venture need to have their necessary state licensing.
So the individual entities have to have business privilege licenses, but the joint venture does not have to have a business privilege license?
That's to the best of my knowledge. I'm not absolutely certain.
So how do you determine the validity or the legitimacy of the joint venture. How to you make that determination?
If they have, again, a legally binding agreement to perform a venture as a business entity -- and again, we do the first run, preliminary review. It's ultimately reviewed by MBEC. That's the entity that actually says yes or no. 24
Okay. So let's say we're successful in winning a bid. When you do your 73 3/13/03 - COMMERCE - RES. 020238 calculation of either the -- I guess this is in the contracting side. Is that characterized as 51 percent or is that characterized as a 100 percent?
What happened to, in this case, the minority partner and what they're doing? Why is it characterized as a 100 percent?
But 100 percent of the money is not going to the minority contract or the minority vendor or the minority partner? Speaking as the African American as opposed to the 49 percent partner.
To some extent -- I'm not making any allegation. I'm just posing a question. Doesn't that possibly askew the actual calculation of who's getting what if -- I mean, we're doing the 51/49 thing. If I'm the 49 person, I'm assuming that I'm getting 49 percent of the money, not that the other guy is taking 100 74 3/13/03 - COMMERCE - RES. 020238 percent, but he's a 51 percent owner. You can't have it both ways.
I'm not necessarily asking you to say okay. I'm asking you to help me understand why it's that way. Because, I mean, we know that the money is not going that way, so why are we calculating it that way?
I would have to defer to the MBEC because we get guidance from that office as to how we count or don't count it. My understanding is that, if it is approved by them, then we can 100 percent.
Okay. I appreciate that. But when I read these reports, based on that example, I think I now have slightly less confidence that when I read -- and I don't know this for a fact. I have no idea who did the work. But based on what you just laid out, I am not absolutely sure that the company or whatever entity did this site fence -- and you got 100 percent MBE -- I now don't know whether that was one minority contract or a joint venture operation and they've got their own thing going on. So tell me now, you've got site 75 3/13/03 - COMMERCE - RES. 020238 fence, 100 percent; bulk excavation, 100 percent; playing field excavation, 100 percent; plumbing, 100 percent; mechanical piping, sheet metal, glass, electrical, site concrete work, masonry, wall coverings, structural steel painting -- the structural steel painting is very interesting at 100 percent and interior painting at 100 percent because I think we're getting some painting work done here in City Hall and I ain't seen no black people doing that work. (Applause.)
That's a solely owned firm. That's not a joint venture or anything like that.
If I go through this 100 percent listing, I don't think you're now going to sit there and tell me that these are all individual minority-owned businesses as opposed to possibly joint ventures with the 51/49 or 75/45 -- you can split it anyway you want -- that there is an untold part of this story here that we can't even 76 3/13/03 - COMMERCE - RES. 020238 calculate. Now, is that true?
Okay. So what I'm now going to ask you to do for the Committee, notwithstanding whatever the guidelines are with regard to MBEC because they can calculate whatever they want to calculate and we'll deal with them about that particular issue, but you can do a recalculation based on the reality and the fact, right? (Applause.)
So what I'd like to see for both the Eagles and Phillies, based on reports, I'd like to know the true percentages and I'd like every category to list out if it's an individual business, and I'd like to know who they are and what their business address is. And if it's a joint venture, I want to know who the joint ventures partners are and I want to know the participation or the financial relationship or ratio between those two entities and I'd like their addresses as well. Now, let me ask this question: On the same report for the Eagles -- and then we can go 77 3/13/03 - COMMERCE - RES. 020238 through the Phillies -- there's some numerical error here. I am on of this report. You've got site workforce, total of 3,257, but below the line where you list out in the five categories of where the people live, that actually only adds up to 3,237. So there's a 20-person difference here. But that will be no big difference in the final result here. I'm going to accept the 3,257 number, although it's slightly in dispute by 20. It doesn't matter. 3,257 people on the site workforce, right?
1,317 are Philadelphia residents; 912 outside of Philadelphia I'm going to assume based on the way you calculated the other report that that means that they're in Pennsylvania but outside of Philadelphia, right?
This is the shorter report that has the listing of the project goals, the minorities, and then it starts laying out the workforce numbers. Are you with me there? 78 3/13/03 - COMMERCE - RES. 020238
No. The 1,317 is a part of the total site workforce, correct?
You have 1,317 Philadelphia, 912 outside Philadelphia, 108 Delaware from, 809 from New Jersey, and 91 from other areas. Are we on the same --
This is your report that came in a couple weeks back. Stick with me. Don't stray on me. We're cooking with gas heat now. It's 5:20 in the afternoon. I just woke up. I had a half a bag of Twizzlers. I'm ready to do something. Okay. That's your document, right?
3,257 site workforce, right? That's everybody that's worked on 79 3/13/03 - COMMERCE - RES. 020238 the project; is that what that means?
1,317 Philadelphia residents, 912 outside of Philadelphia. Again, I'm going to assume that means outside Philly but inside Pennsylvania?
108 from Delaware, 809 from New Jersey, 91 from other areas, right? Is that what we're doing?
Okay. Now, you don't break out, at least in this report similar to what we did for the Phillies, what those other places are, specifically those other areas.
The 91. But let's stick with this report for the moment. Can you tell me -- because, you know, we're always intrigued by this. I mean, the outside Philadelphia but in Pennsylvania, you know, we love Philadelphians, but certainly we love Pennsylvanians as well. And in terms of the stadiums, the State did put money in. Other Pennsylvanians contributed to this. 80 3/13/03 - COMMERCE - RES. 020238 Given the unemployment rate in Philadelphia and specifically in some our communities, why are 108 people coming up here from Delaware? Why are 809 people flying across the bridge every morning and then going back at night so they can send thier kids to a better school system or live in a split level house or do whatever they do? And I don't know about the other areas. And maybe you can tell me about those. But in the Phillies, which is the other report that you guys sent, your total workforce -- that was not added up. That appears to be about 1,125, something like that?
512 out of Philly, 323 other Pennsylvania. We'll deal with that; they're Pennsylvanians, we like them. 18 from Delaware, from Indiana, 1 from Kentucky, 1 from Maryland, 256 from New Jersey, 5 from New York, 21 from Ohio, and the granddaddy of them all, why did a 22 person have to come here from Texas? What skill do 23 they have that no one here on the east coast has? 24
Do you have an 81 1 3/13/03 - COMMERCE - RES. 020238 understanding -- I don't mean to cut you off. Do you have an understanding of how people get wound up about this kind of stuff when you see this data and this information? I mean, until we solve the unemployment problem here in Philadelphia, I don't know why other people are coming here to work. Can you tell me why this happens?
Was that person in the hall that morning? Or were they waiting on the phone call?
Probably a phone call. The point is well taken, Councilman Nutter.
Well, I appreciate your recognition of the point, but what's the answer? Why is this happening?
Well, if I had the authority to designate the workforce, then I could answer that question for you. We don't have that authority.
I understand. I'm not criticizing you about the numbers. I'm just 82 3/13/03 - COMMERCE - RES. 020238 trying to understand what's going on. I've been reading these things for months. I mean, it's bizarre.
We have been advocates, as well as monitoring the project, but ultimately the decision does not rest with anybody at this table.
Well, you know I have to ask the follow-up question. Who does it reside with?
Well, you can start with the general contractors and they will tell you that we put in requests for laborers, we put in requests for carpenters, for bricklayers. We don't know Joe Blow from John Doe and we get who the unions sent us.
Mr. Jones, could you get us, for both projects, a list of -- you made reference to the contractors. Get us a list of the contractors, the principal's name, the address of the business and a phone number.
The contractors' names are listed, are in your report. It will give you all 83 3/13/03 - COMMERCE - RES. 020238 the information that you're looking for. Principal's name and address.
I think I didn't ask for this because we were dealing with the Eagles. But for the Phillies, could you give us, again, the same information with regard to -- you have in this report by cover letter, signed by Mike Stiles (ph) of February 24, 2003, again, water and sewer, 100 percent; electrical duct bank, 100 percent; mechanical, plumbing, 100 percent, 100 percent; temporary site electric, 100 percent; plumbing, concrete, 100. How many joint ventures are there at the two stadiums?
There are nine at the Eagles, I know. There are nine joint ventures at the Eagles.
When you do the break-out, we'll be able to figure out those. How many joint ventures at the Phillies?
It should be in the packet. I don't have the Phillies in front of me, but I do believe we do have the break-out. I know on the 84 3/13/03 - COMMERCE - RES. 020238 Eagles -- Charles, did we do the break-out also on the Phillies on the joint ventures?
We don't have the addresses and phone numbers, but we do have that and the total amount of money that was spent by the joint ventures.
I've never believed in the trickle down theory, whether it comes from the Republican Party economic theories or from the republican wing of the Democratic Party economic theories or whether it comes from the labor unions or anybody else. I think the real issue is the worker, and I tend to concentrate on the worker rather than on the entrepreneur. The entrepreneur is, of course, important, but if we're talking about availability of worker supply and everybody's dependent upon what the unions produce, then it seems to me we have to go to the heart of the problem. Why is there an unavailability in any of the areas of the construction industry? 85 3/13/03 - COMMERCE - RES. 020238 When I drive through the City of Philadelphia, I find plenty of people able of work all over the City. And in the areas heavily populated by African Americans, there seem to be more people on the street than anywhere else. So I know there's plenty available. And if there is a technical unavailability at a given moment, don't the unions which benefit from government laws, don't they have an obligation to provide the necessary steps to see that there's always available many more people than are needed at any time. Because people who are skilled sometimes have sickness at home, sometimes they're sick themselves. So they are not always going to be available, so you have to have a big pool of trained laborers. And I don't know why we don't make that demand because the building trades operate under -- and they're the only unions that do that in the whole country -- these big, independent folk who like to brag about how independent they are and everybody else is weak and needs government help but they don't. The truth is just the reverse. They are the only labor group in the whole country that have federal laws, state laws and city laws that guarantee their wage scale. 86 3/13/03 - COMMERCE - RES. 020238 There's nobody else that has prevailing wage rates. So these unions whose wage rates are guaranteed through the complex process of prevailing wage rates owe an obligation, since they benefit from government laws, they owe a special obligation to obey government laws. And I would think if there's one law that by this time is paramount it is that there has to be equal opportunity for everybody. (Applause.)
And that's particularly the responsibility of those labor organizations that run apprenticeship programs. So that I think we play games in a sense, games in which we participate, but never get to the heart of the problem unless we include what do we do about providing increased labor availability? And the only way I know to do that is to make sure that the whole process is democratic from beginning to end. Everybody, no matter what the color of their skin or their ethnic background or their gender, male or female, have a right to qualify for these training programs, all of which are paid for by government tax money, which minorities and women certainly contribute to, to the same extent as the 87 3/13/03 - COMMERCE - RES. 020238 non-minorities and the non-women. So I think we've got to find ways to make sure that those who benefit from democratic processes like from the prevailing wage rate are compelled to comply with those democratic processes. I think we've got to go to the heart and say, we're never going to solve this problem until there is full availability of everyone. Now, I know what that means. You know, there are code words that are used in every area. Over the years, more years than I want to admit, I've been struggling with this issue of, how do you increase the labor supply with skilled people regardless of color, regardless of gender, regardless of any consideration other than the fair and equal opportunity to everybody. And when I say to unions, "You're not doing what I think you ought to be doing in a democratic society where you're benefiting from government laws," they say to me, "Well, Councilman, if you ever feel that there's got to be a minority concern working anywhere, just tell us. We'll provide a minority firm." Well, that's not how a democracy works. 88 3/13/03 - COMMERCE - RES. 020238 It's not their right to determine what minority is working. You answered about that by saying sometimes they take workers from one project and put them in another project, rather than spreading the work around. So I think that one of the things this Body has to deal with is what we tried to deal with unsuccessfully a number of years ago in the Council. But it sounds to me from the way this Committee is talking that it maybe means business. (Applause.)
I have to say I've been very impressed by this Committee's activities. Because for years I've worked -- and many of you know my wife Florence when she was working with me as my chief of staff. We worked on a Bill called 649, which was aimed and democratizing the functioning of unions, that would require every union to have a democratic process so that we don't have what happens today where most people of color and women are screened out at the beginning before they get to apprentice school. And those that get in, find life so uncomfortable that most of those that get in don't last the whole program. And then those that finally last don't get in the union. And 89 3/13/03 - COMMERCE - RES. 020238 the few that get into the union get the worst possible jobs as far away as possible so they're discouraged and have to go somewhere else. (Applause.)
Now, they're the facts that I have found, the real facts in life. So I don't pay too much attention to these figures because I think these figures are arranged, not by you people, but by the people who try to maintain the current discriminatory system. They manage to make it look good, or as Councilman Ortiz' report said, the illusion of inclusion. It's total illusion. It's false. It's a lie. (Applause.)
So I would hope that at some stage we move in that direction. I don't know why a Democratic City strong in labor as Philadelphia has always been, at least since the days of Franklin D. Roosevelt than when Philadelphia would choose to be a bastion of Republican politics turned overnight when Roosevelt led the way with the social programs of Social Security, Workmen's Compensation, Unemployment Insurance. When government began accepting the responsibility for 90 3/13/03 - COMMERCE - RES. 020238 the quality of life of people, that's what turned Philadelphia around. It became a real labor city. Why we should tolerate the present condition that exists today when labor unions or any organizations are given the right to limit the availability of laborer supply? There ought to be full labor at every level of color or gender available, no matter what the level of skill is. There never ought to be a limitation like, "Well, we only have carpenters or 14 electricians or 32 12 cement masons or 3 painters available." There ought 13 to be a full supply and then we would get that kind 14 of skill. And I don't know of any reason why there 15 isn't that skill. We've got to develop the kind of 16 programs that produce those skilled workers, the 17 outreach programs that are necessary. You know, we learned in the schools that you have to have better trained teachers. You've got to start school at an earlier age. You've got to give kids full-scale kindergarten. And now we've moved on to the understanding that you've got to have pre-kindergarten classes. You need to do whatever you have to do to make the schools work. And that's what you've got to do in the labor market. 91 3/13/03 - COMMERCE - RES. 020238 I'm sure that people want jobs. Those who are unemployed would welcome the opportunity if they don't face discouragement at every level. And I believe that that's a major responsibility of this City Council and the Mayor of this City working together. And I would like to see a lot of attention paid to this and I would like your reactions to that. Because why should you fine people sitting at this panel have to confront the fact, well, we're told there were only cement masons 13 available and actually we would need 200 of them, so 14 obviously 173 got to be white because there are only 15 23 others available for five jobs and, therefore, 16 the percentage in each job has got to lowered. And 17 that when prosperity comes, it hurts minorities because there are going to be fewer jobs available because their spread over so many jobs. I think we've got to talk the basic truth and wherever that leads us, I suggest that we've got to move in that direction. We no longer ought to be diplomats. We no longer ought to accept the nonsense that we put up with when it seems to clearly the Eagles and the Phillies are scheming to get with their contractors 92 3/13/03 - COMMERCE - RES. 020238 to fool us, to make us believe that there exists something which doesn't exist at all. And I think we've got to get to the root of it. Mr. Chairman. (Applause.)
Mr. Chairman, I don't know what to suggest, but I would like to suggest that this Committee give special attention to perhaps coming up with a Bill that relates directly to the workforce. I think it's important to have minority contractors, but I think it's more important even than minority contractors to have not a lot of men a women unemployed in the neighborhoods. I think they all ought to be gainfully employed. And then the question of entrepreneurs will resolve itself. If you get a good, trained workforce, any trained man or trained woman begins to think in terms of owning a business once they get to know it, and I believe in building from the ground up, rather depending on the entrepreneurs to provide jobs that trickle down. That's why I opened this comment with the fact that 93 3/13/03 - COMMERCE - RES. 020238 I don't believe in trickle down. I want to lift up, beginning with the people in the neighborhood. Let's put our people to work. Let's get them all the training they need us. Let's demand that the City government take action. The City has close relations with the building trades. The head of the Redevelopment Authority that hands out hundreds of millions of dollars in contracts is from one of these unions. The head of a number of other agencies are from the building trades, so there ought to be no problem whatsoever. The Mayor meets with them all the time. We in Council often meet with them. I think we've all got to get together and show them that we really mean for the first time we want our folks in the minority community and the women trained, everything made available to them to encourage them, rather than to discourage them. Thank you. (Applause.)
Thank you, Councilman. The Chair recognizes first Councilwoman Miller and then Councilwoman Reynolds Brown and the Chair is requesting that Ms. Davis come to the table 94 3/13/03 - COMMERCE - RES. 020238 for a question. Councilwoman Miller.
Thank you. Good afternoon, everyone. I'd just like to know that -- I want to talk just a little bit about minority participation. Certainly that's been an issue for many elected officials for a whole lot of years, too many years, and people have been fighting this battle for a long, long time. I was really glad to hear that when Mr. Solomon and Mr. Jones spoke of helping to develop Equal Opportunity Plans, because I think that's an important place in where it starts. And I think what we need as elected officials -- because we're not the experts on everything. And if you're doing monitoring, then you sure know a lot more about this than most of us do. We just fight and we know that we get to a certain percentage point. Some of us were real active in working on the numbers for the stadiums, but certainly didn't know about what you describe, Mr. Jones, in terms of how we could have increased those numbers based on journeymen or apprenticeships. So I'm glad to hear that you'd be willing to help us develop and educate us around developing good Equal Opportunity Plans where we can 95 3/13/03 - COMMERCE - RES. 020238 have real numbers, real goals related to real numbers. The stadium numbers have always seemed good. I try to read the report every month that it comes in. On the other, the stadium numbers are good, and they're up, but numbers on other projects in other parts of the City go down. And we know that that's because we can't -- we don't have that many contractors that are in the union. Because sometimes it makes me wonder if we need to develop our own union. I don't even know whether that's something we can do sometimes. But sometimes when you brainstorm and think of crazy things, you think of ways to get things done. So when I watched the picture 10,000 Men called George and A. Randolph Phillips went out there and developed a black porters union, that solved a whole big problem across the nation. But in any event, I was wondering, have you seen -- and your opinion of this document, maybe haven't seen it -- but it was circumstanced to me anyway maybe about a month or two ago, called, "How to Evade Affirmative Action Programs for Minority Contractors or How To Drive Compliance 96 3/13/03 - COMMERCE - RES. 020238 Officers Off Their Rockers." Have you seen that?
Okay. Well, you, know, when I read this -- and certainly, I'm not a subcontractor -- and like Councilman Nutter, I don't want to be in business, at least not this business. It just describes a whole lot of ways to avoid giving a contract or getting a sub. I'll just read this one rule, "Always been courteous. Always be congenial, especially to compliance officers." But then there are all these pages that gives -- and I don't whether this is a joke and only a joke or whether this is real. But I'm telling you, this is some of what the contractors do to me as an elected official when I call them and they duck me and they call me in the morning when they know I'm not here or call me late. And it's just all kinds of ways and tactics. And I'd really like to make sure that you get a copy of this. It was submitted -- I know some of the Councilmembers have seen this and I know that some of the people in the audience have seen it. But I would hope that, as compliance officers or as people that monitor more or less what's going 97 3/13/03 - COMMERCE - RES. 020238 on, that you would help us, to the best of your ability, to help us to figure out a way to really begin to tackle this problem because these kind of hearings are important, but the problems will still exist tomorrow. And we have -- I know that with the document that we signed, one of the things we talked about was not signing off on projects that don't have inclusion. But, you know and I know they can sit down and agree to inclusion today and then play these games tomorrow and you have to fight and fight and fight for inclusion and then you have to take to your activist activities and shut jobs down and so on and so forth. But I'm going to ask somebody to make a copy and make sure that you get this. But I think we just have to have a better way of communicating with each other so that we get a better understanding of how to put together good EOP plans.
We will be very glad to, number one, accept that document and to see, certainly, if there are issues on there that you really want to make sure that we address. We certainly will respond, at least based on what we know and what we do in monitoring the process. And 98 3/13/03 - COMMERCE - RES. 020238 if there are ways that people are figuring out to get around us counting and monitoring and double checking payrolls and looking at contracts and sitting down weekly, sometimes twice a week looking at all that information, if they're still figuring out a way to get around it, we definitely want to know that. Certainly, we are available to meet with Council either one on one or as a group, to always go over the information. Charles Solomon always says to me, "Sharmain, the numbers are what we count and so we don't give you anything that's not." Maybe the way it's broken down doesn't always give you the information, but we can always break those numbers down into smaller units and into smaller subsets to make sure that they answer your questions and that they make sense.
The document you have that, we're aware of it, but we're also keenly aware of the games that contractors and other entities play to avoid the program effort. In implementing this program with the stadiums, we've incorporated some things. For instance, on the Eagles alone, we must have had in excess of 110 or so meetings to 99 3/13/03 - COMMERCE - RES. 020238 talk about these issues and these problems to face them head-on to generate some change. And it's not easy, but you've got to maintain a constant, vigilance and that's what we do, and we run into problems on both sides of the fence. But the fact of the matter, it's something we've got to do. The more we can do that with Council, with City Council, and also share some of the difficulties but also come up with some strategies to address them jointly, I think it would be very, very helpful.
Thank you, Mr. Chairman. While we move to fix the current situation and seek to better improve our outreach efforts, the one thing I would like us to be mindful of is the next generation of young people who are currently not on-line, not on track to take advantage of these kind of opportunities. We should be aware of the fact that the Philadelphia Public School District is currently in discussions about the types of high schools they plan to build. 100 3/13/03 - COMMERCE - RES. 020238 And there's question on whether or not there should be a trade school that would provide young people the opportunity in all the trades that we hear we can't find people who look like us. So when the request and the appeal is made on what types of high schools should be built, we need your support, the School District is going to need your support to say, yes, we need a trade high school that speaks to all the existing trades where you don't see people who look like us so, so that we can get young people on line and not have to worry about what has been articulated by Ms. Ahmeenah Young. We have all these construction projects, and because there are so many, even if we were able to touch those in the City who are equipped, we still would not have enough. So that call is coming. That appeal is coming. My point is, we have to be mindful that we think about the next generation of young people, too, who deserve these kinds of opportunities and those who choose not to go on to college education. That's my point. Thank you.
The Chair recognizes Councilman Cohen for one question which I believe he wants to ask of Mr. Jones. Mr. Jones needs to leave 101 3/13/03 - COMMERCE - RES. 020238 after he answers this particular question. He's communicated to me he has to MC a program.
Thurgood Marshall Scholarship Fund. So if there's no objection, after this question, we're going to let Mr. Jones go. We may keep the rest of the panel until about 10 o'clock tonight. Thank you. Councilman, and then Councilwoman Tasco.
Is there anything that stops the panel in front of me from raising the question when told we only have cement masons -- 16 I'm using that figure. This is an example. There 17 are only 23 that are needed and, therefore, the 18 great bulk have to be non-minority. Is there 19 anything that stops this panel from asking, "What 20 are you are doing to remedy the lack of 21 availability?" Are you under any compulsion from 22 any higher authority than yourselves, at the city or 23 state or federal levels that prevent you from making the demand on the labor unions that give you the reply as to availability as to why there aren't more 102 3/13/03 - COMMERCE - RES. 020238 and what are they doing to bring about more? Is there anything that stops you from doing that?
No, there is nothing that stops us. In fact, we do ask the same questions that you've just posed, Councilman Cohen. We've had a number of meetings with contractors, with union representatives to try to increase the number minorities on this project. We keep saying, give us more, give us more, give us more. And with enough pressure -- I think we have gotten an increase in the numbers because of our persistence and our pushing. But in the end, we don't have them.
But you said you had discussions with contractors. Have you had discussions with the source of the problem, the labor organizations that control the supply?
And did they tell you they are trying to increase the availability?
No, they do not say, "We are trying to increase the availability or our membership, the minority membership in our respective unions."
What do they say? 103 3/13/03 - COMMERCE - RES. 020238
I think you owe a duty to the public to let the public know of those kind of answers you're getting. Because I think they have a responsibility.
But when you identify that you have over a hundred people who passed the test, what happened to those folks? Did they disappear somewhere? They're all home waiting on the call?
It's been like going up a brick wall sometimes trying to get them into the unions.
I want to say to my colleague, Councilwoman Blondel Reynolds Brown, this is a comment on your statement about more training. I mean, we have been training for the last 40 years. We have enough trained. The problem is you train 104 3/13/03 - COMMERCE - RES. 020238 them -- and I think that's why the Vocational Tech School Program closed with the School District. Because no matter what you trained in the trades, the people did not get into the unions. The bottom line is getting into the unions and getting the union membership. We have a lot of people in this room and in this City who have gone through the DAP Program. We heard the other day there were 400-some people who went through the DAP Program; 90 of them were in one union, the carpenters. The carpenters. Women, Latinos, African Americans. So where are they? We have 400 people waiting for a telephone call. So the bottom line is, and it's been stated today, what is the effort to open those doors? And that is the bottom line. So if I've got to have a choice in terms of some of the other stuff in the School District, we got the DAP Program, we got this program, we got that program. Everybody's got a training program, but nobody's working. Nobody's working. Let me ask you a question. What is your thought -- this is probably for us as politicians to answer. Is it out of the question to 105 3/13/03 - COMMERCE - RES. 020238 have a residential requirement in the contracts? Have you ever had that experience?
On the Temple projects we did have a specific residential requirement in terms of hours worked. Each contractor was expected to come in and gives us some sense of how many hours of residential work they could provide. It wasn't like having a residential union membership requirement, but I think, though, in looking at what we're doing, in looking into the communities, you've got to have that. You've got to have some sort of residential requirement. That needs to be worked out.
We got probably a 50, 55 percent reaction from the contracting in terms of offering hours. But there, again, it was not very dissimilar from the situation with housing where someone came in and worked five, six, seven, eight, nine, ten hours or so and that was it. But they didn't get into the union. Some folks did, but to a large extent, that requirement did not translate into union membership. 106 3/13/03 - COMMERCE - RES. 020238
Were the skills across the board or were the majority laborers? The majority of those were laborers. There were some folks who got into skilled trades, but basically they were laborers in terms of the hours. Again, the requirement in that instance was to offer work hours to community residents on a per project basis. And the point is that, that was something negotiated at the beginning of the contract. It was in the solicitation from the very start and then we responded to it, reviewed it, and either accepted it or rejected their agreement. But I think it is required.
I do not want to be misunderstood. I am in complete agreement that the unions are the roadblock. My message is for that contingency of young people who know in 9th grade, whether they believe it or not, that they are not college material, that they don't want to go to college. We have to be prepared to provide them options at the 9th grade level. So that they graduate really having not a clue about what they want to do, decide that they want to go into the 107 3/13/03 - COMMERCE - RES. 020238 building trades across the board, go into the training programs and then don't meet the standard because, as one of our testifiers indicated, they go through the training and they drop out because they cannot meet the test standards. So I believe we have a responsibility as a City, if we're going to roll out a number of high schools, yes, some of them should be academic high schools. Yes, some of them should be specialty high schools, like the performing arts and the like. And yes, one of them should be a trade school so that we can capture young people who know in 9th grade that they want to go into the trades. And I preface my comments by saying there are discussions. A part of those discussions are to look to see how, for as impossible as it may seem, to bring some of the unions at the table at the door and craft an agreement that when they graduate from high school, they are immediately on line to move into those trades. Yes, it's going to be impossible because we've already had that experience with what we're not seeing around the kind of discussion we're having today. My point is, we have to be mindful of young people who want trade as an option as well. 108 3/13/03 - COMMERCE - RES. 020238 And we can't wait until they are out of high school to discover that they want to go to trade school and can't meet the standard. Let's capture them at 9th grade and follow them all the way through. The unions are a roadblock, without a doubt. Thank you. (Applause.)
Maybe someone can answer this question. In terms of even if you go into training and you work, that you have to work 500 hours before you can be eligible for membership or for the employment. Is there any hourly requirement prior to going into the union as an apprentice?
I don't know if that's true. If we look simply at the NTI project, we had individuals in the Strawberry Mansion area who started working on the project and after, I think, it was two weeks, they were entered into the union. So it may vary from union to union, but I'm not aware of that.
Ms. Davis, I need to 109 3/13/03 - COMMERCE - RES. 020238 ask you a couple questions. Please identify yourself for the record.
Ms. Davis, first, I believe that you were not the Finance Director at the time that Council took up the Philadelphia Phillies and the Philadelphia Eagles stadium and ballpark projects; is that correct?
May, right. Okay. What's the City's total financial commitment to both of the stadiums?
$304 million. A total of $390 when you include the maintenance support for the Eagles.
Just an operating 110 3/13/03 - COMMERCE - RES. 020238 and maintenance agreement?
Over 20 or so. 20 to 25 9 years. But it's $294 million total. 10
So since we're up in 11 that neighborhood, why don't we just say roughly 12 $400 million? 13
And with the 15 exception of the operating and maintenance 16 agreement, although I could be fuzzy on the details, 17 the operation and maintenance agreement, we're doing 18 out of -- are we doing that out of debt service -- 19
The 304, that was from bond proceeds; is that correct?
Who's the agent or 111 3/13/03 - COMMERCE - RES. 020238 who is holding the money on the bond proceeds?
The bond proceeds for the most part have already been distributed to the two teams. In the case of the Eagles, it was for land aquisition, and the land aquisition has been completed. And I believe on the Phillies part it was a combination of land and then towards construction and that would have been disbursed to the teams.
Yes, they do. Either the money or the land that the money was used to purchase.
And what, if any, in the contractual agreements -- and I know there were many pages and multi contracts. I think there's probably a master agreement between the City and PAID and then sub-agreements between PAID and the teams directly and I'm sure other parties. What provisions were there in any of those contracts with regard to non-compliance to the terms and conditions of the contract regarding any financial penalties? 112 3/13/03 - COMMERCE - RES. 020238
I will have to get back to you on that. I couldn't quote that. There are roughly seven, three-inch binders in my office that contain that deal, but I will get it back to you.
In your relatively short time, are you aware of any project that the City has funded whose payments for which the City may have an obligation, whether those payments have ever been suspended for non-compliance with the terms and conditions of the contract?
There have been instances where we have suspended payments. If someone is not in compliance with the terms of the agreement we do have the right to suspend.
I can think of one where we held payments because someone was not paying their sub and we were proceeding towards debarment on that particular vendor until they did. I'd like to not mention their name, but I will talk to you about it.
No, I understand. But you will get back to us on the issue of -- 113 3/13/03 - COMMERCE - RES. 020238
So once the bonds were issued, shortly after that, the money went directly to the teams?
We purchased the land. In the case of the Eagles we went through the condemnations and the acquisitions. And in the case of the Phillies, I think it was partially land and partially actual payment to the team.
Okay. And then let me ask Mr. Solomon, I guess as the expert on EOP, the Economic Opportunity Plan. I've flipped through one of these very quickly and I'm almost certain that both of these are probably the same. Can you tell me what provision in the Economic Opportunity Plan lays out any penalty for non-compliance with the Economic Opportunity Plan?
Is that typical of these kinds of agreements? Was another built into 114 3/13/03 - COMMERCE - RES. 020238 Economic Opportunity Plan if there is no penalty for non-compliance.
One of the few things that's available to the construction manager or owners is a suspension or a slow-down of payments. That's the only remedy that I am aware of in terms of these two projects.
How would we do that? I mean the money that the City put into the project was long gone before any of these contractors came.
No, I'm talking about the owners actually suspending payment to contractors or holding up payments to contractors who are in non-compliance.
If they have an overriding interest in the success in the EOP and they are firmly committed to it and I think if they get clear indication that contractors have not been in 115 3/13/03 - COMMERCE - RES. 020238 compliance.
In the case of at least the two big matters that we've talked about today -- and Mr. Jones went through some of the numbers; I wrote them down. Are both of these projects in compliance?
No. As it relates to the employment aspect, we have a 45 and 5 participating, 45 percent, 50 percent of the hours to be worked by minority and women. The projects at this point are at roughly 30, 32 percent participation.
Do you know what they are separately? Do you know what the break-out is between the two facilities?
The Eagles project is at about 31 percent. The Phillies is around 32 percent thereabouts today.
The goal is 45 -- the goal is 50. 116 3/13/03 - COMMERCE - RES. 020238
45 and 5, right. So neither facility is in compliance?
What we basically do is try to encourage the contractors who are not in compliance to do better. Case in point, on the Phillies project --
We cannot as an organization and as someone who monitors and advises, we can not take any action to force compliance. We're not --
From your perspective, who does have the authority to force compliance, based on your knowledge and information about this whole process?
The owners. Again, it's a matter of whether there is commitment to --
There are three individuals I have listed, the first being Jahad Ali, Madeline Dunn and John Shields who are listed 117 3/13/03 - COMMERCE - RES. 020238 as wishing to testify. Are there any other questions by Members of the Committee from this panel? Councilman Cohen.
Have you ever been invited by the Mayor of the City to come to a meeting with the unions which the Mayor said to the unions, "You've got to comply"?
Could there be anything wrong in being invited to such a meeting?
I'm sorry, would we participate in a meeting if the Mayor invited us to talk about this issue?
Have you ever suggested to the Mayor that he do it? He meets with the labor leaders all the time. He appoints them to top level positions. It would seem to me that the most natural thing if you wrote a report saying that they are not in compliance as to what could be done, 118 3/13/03 - COMMERCE - RES. 020238 the easiest thing in the world would be to have the Mayor call them in and say, "Look, you gave your word and you're not meeting your word." They are totally dependent on the Mayor for many, many benefits that they derive, particularly the prevailing wage rate. It just seems to me that the City just bows down and says, "We can't do anything." There are no incentives, there are no penalties. Why should they do anything other than laugh at us? (Applause.)
And they're doing that, aren't they? They're laughing at us basically when they feel free to violate? What we're doing is in their benefit. Laborers got to be democratic in order to be meaningful to people. It's got to provide a means whereby workers have a sense of dignity when the work, a sense that they're going to be treated fairly by an employer because they have the protection of a union behind them. So what would any labor organization fight against democratization of the process? And why should we permit any labor organization to benefit from government if it violates government policies like 119 3/13/03 - COMMERCE - RES. 020238 equal opportunity for everybody? Seems to me that -- I know you have a difficult job, but it seems to me that you ought to report based on what testimony we heard today indicating that what's needed in this situation is strong action by the Mayor. He is the only one who can in the Administration, based upon what you're telling me if there are no contractual provisions, only the Mayor is in a position. And if the Mayor does it, it won't weaken him one iota; it will in fact strengthen him enormously. People would flock to polls to support a mayor that's saying, "We don't want people idling their time in the community; we want them at work or training for work." Isn't that right? So what you would be doing would be serving everybody's interest. I don't want to preach anymore on that. But I think we have a great job to do. And I've heartened recently by the tremendous new amount of activity taking place in the communities which said, after all these years, nothing basic has happened. And we're determined to end that. And I think these hearings show that that determination is strong and solid, and I think this Committee and the whole 120 3/13/03 - COMMERCE - RES. 020238 Council is going to do everything it can. And we urge the representatives of the Administration to speak to the Mayor so we can have a uniform citywide approach to support the right of everybody to an equal opportunity for a job. (Applause.)
Thank you, Councilman Cohen. The Chair recognizes Councilwoman Tasco.
And I'd just like to say to Councilman Cohen, and I think advocacy part from the GPUAC could be helpful in just reminding us that they're not in compliance. But I think the responsibility for what is happening rests with us here in the City Council. We voted on this legislation. We were -- I can't say duped. We were all elected and we should know better. We were told we had to sign this deal. You can rest assured that story won't be used on this Council anymore. But certainly we have a responsibility to give some assurance and make sure that we pay more attention to when legislation comes down that we write in the legislation what we really want to happen. And if they don't like it, then the project doesn't get 121 3/13/03 - COMMERCE - RES. 020238 done. (Applause.)
And I think that's what we have to do. I just hope that -- you know, a letter to us and to the Administration that they are not in compliance. Although we don't know what the enforcement rules are, you just have to let us know what's going on. You're the reporting agency. You report to us. We get these reports. We get a lot of stuff. We need to be reminded that they're not in compliance. And certainly, that's very important. And we will take care of our end of the business in the future. Thank you.
Councilwoman is also reading my mind. What I wanted to ask is, as we get these monthly update reports, two things: One, I would like a designation in either the letter communicating the report to us, probably in the letter and as well in another section where you have all of your statistics, I'd like a direct determination on these monthly reports as to whether or not this particular project or any other project that you're monitoring is either in compliance or non-compliance. 122 3/13/03 - COMMERCE - RES. 020238 And for your distribution list, certainly that same information should go as it's listed here, Office of the Mayor, Mayor John F. Street; Joyce Wilkerson, Chief of Staff; George Burrell, Secretary of External Affairs; City Council President; PIDC; Jim Roundtree at the MBEC, and the rest. In that regard, Ms. Davis, do you get these reports as well?
Could we add the Finance Director to the distribution list? And secondly, Ms. Davis, notwithstanding whether you ever received one of these reports or not, do you recall since you've been Finance Director in May of 2000 ever having a meeting to discuss the compliance, non-compliance or opportunities to be in compliance for either one of these two projects, specifically with either the Mayor, other cabinet members or high level secretaries?
I don't remember us dealing with the compliance issue, not as it involves the employment. 123 3/13/03 - COMMERCE - RES. 020238
Have ever had a conversation with Mr. Roundtree as director of the MBEC about either of these two projects?
On the compliance side or just how the projects are going?
Just how the projects were going and whether or not there was participation because, again, we look at the entrepreneurial side and not the employment side.
I understand. Well, who is looking an at the employment side in the government.
In the government there is no one department that is tasked with monitoring employment performance. As Mr. Roundtree explained before, if there is a project labor agreement, then his office collects the data. But normally there is no one in the government with that responsibility.
Let me suggest to, at least, Ms. Davis, and I'm always mindful of which part of the government I work in or which side I'm on or not on. It would seem to me that just as a 124 3/13/03 - COMMERCE - RES. 020238 course of public policy, someone in the government should have the responsibility to monitor all aspects of these respective projects, not only on the entrepreneurial side -- and we care about contracts and the like -- but I think there is a larger public policy concern as it ripples through many other aspects of any what any Administration and Mayor Street in particular, is trying to accomplish. It must be a priority of the government that employment is good for the City, that people working in Philadelphia who are of Philadelphia are working. I think it will probably cut down on crime. It will probably cut down on drug abuse. It will probably cut down on a whole host of negative things that impact the City, but more importantly, specifically from your particular perspective, possibly lower the cost of running the government because if we're not taking advantage of these opportunities in this way, then we're going to spend it when the Police Department comes for their budget or DHS comes for their budget or a whole host of other agencies to correct what we're not taking care of. I mean, there are employment opportunities out here. We approve them a fairly 125 3/13/03 - COMMERCE - RES. 020238 regular basis. But someone has to monitor and enforce and insist what happens afterwards. So I would only -- have you had an opportunity to talk with GPUAC about any of these issues?
I'd like to encourage, not only the dialog and the connections -- I mean, who is GPUAC under contract with? Are you under contract to the teams directly? Do you have any contract with the City for this?
No. The contracts for the stadiums is with the owners, the Phillies and the Eagles.
I understand that. But as a part of the EOP approved by this body put you in that contract; is that correct?
By way of our approval process. It would seem to me that the government would then at a certain level, even indirectly, be the beneficiary of the work that's 126 3/13/03 - COMMERCE - RES. 020238 being produced which we required you to do for us working for the teams. How do you get paid?
We're paid directly by the Eagles and the Phillies organization. (Audience reacts.)
That, I did not know. Okay. We'll deal with that. I mean, from our perspective, credibility of the work is not a function of how the dollars are flowing, although I did not know the answer to that question. We can deal with that going forward. You're going to have a wider distribution? You can certainly, whether you have a contract with us or not, you can meet with our Finance Director, I assume, and Mr. Roundtree and other people to make sure that someone in the government is paying attention to this? Ms. Davis was very forthright in her comments at our last public hearing about her commitment and concern about minority and female contracting and other opportunities. And I know her to be a person of her word and that she's going to follow through on the commitment. I mean, we have to make these 127 3/13/03 - COMMERCE - RES. 020238 connections. We have to connect the dots on some of the these things. We all know each other. We are not impossible to find. Everybody's operating in the same two or three square miles of each other. This is not impossible. The Chair recognize Councilwoman Tasco.
I was just going to say, maybe in the future the GPUAC should be working for the City and maybe the contract paid for by whomever but they actually work for the City because putting them -- well, I mean I trust their honesty, but I think for them and for us it would be better if you were working for us.
May I make just one comment about that? Historically we've been here for over 30 years, years very much involved in 18 this particular business. And we have -- regardless 19 of who we're contracted with, we've reported the 20 data actually as it exists, good, bad, or indifferent. So who we're working with doesn't taint the data any way, form, or fashion.
The numbers are what the numbers are. In that regard, though, on the last page of Ms. Matlock-Turner's testimony, there 128 3/13/03 - COMMERCE - RES. 020238 is a client list. It says "Over the past years, economic development projects unit, partner with organizations to help them successfully launch economic inclusion plans on the following projects," and then there must be 20-some-odd projects here. What I would like to ask you is the data on what the project goals were, MBE, WBE, DBE, and what the actual results were for all the projects on this list. I'd like to be able to understand the comparative analysis of that.
We've got Jahad Ali, 14 Madeline Dunn, John Shields if there are no other 15 questions for this particular panel. Thank you very 16 much. 17 Please identify yourself for the record 18 and proceed with your testimony. 19
My name is Jahad Ali. I'm an 20 African American carpentry contractor. I'm also a member of the Contractors Roundtable African American Chamber of Commerce. I'm a member of Minority Enterprise Associates. One thing I'd like to say, Councilman Nutter, there's a quote by the lawyer by the name of Gary Spencer who says that 129 3/13/03 - COMMERCE - RES. 020238 it's the question that is the great weapon that frees. And we see by the question that you just put to the panel how we arrive at the truth, and it's easy to see why we're 's in the situation today at 6:30, in the evening because we've had organizations such as that for the last years still haven't 8 been able to answer questions that you're asking 20 9 years later. 10 I'm so easy to let them off the hook. I 11 think that there was a plan to dupe Council, and 12 that plan was put in effect years ago and it was 1-2 13 process. No matter what they agency says, they work 14 for the Phillies and they work for the Eagles. They 15 can't say anything or disclose anything that the 16 Eagles and the Phillies don't agree with because 17 they're paying them. And I think that we should be 18 mindful of that. And I think before we let GPUAC 19 come back, I think Council should solicit other 20 organizations to monitor stuff on behalf of the Council because no matter who -- if we give this power to the Mayor, depending on how that political climate might go, the Council will always have representatives of the community on Council and more than like in a majority point. So we should 130 3/13/03 - COMMERCE - RES. 020238 make sure that a lot of that power stays with Council to effect what we want to take place. But I'm here today to -- I wanted to thank the honorable Council for this opportunity to comment on this important issue. I commend you for providing the ordinary citizens an opportunity to describe to you the difficulties for minorities to get construction work or construction contracts. I will not belabor these hearings with a lot of details because many others concerned about these mattered have already provided details in previous testimony. However, I do want to emphasize that there has been and continues to be a systematic and successful program of denying minority contractors and workers opportunities to work in the City of Philadelphia. What is most disheartening is that the City and other agencies designated to ensure that there is minority participation in awarding of contracts, subcontracts and man-hours employed on projects funded by tax dollars have failed to carry out their responsibility and in some cases have been complicit in seeing that minorities do not get work. Agencies like Minority Business 131 3/13/03 - COMMERCE - RES. 020238 Enterprise Council have the responsibility to certified firms and ensure that each contract awarded has minority utilization built into it. MBEC has instead worked against minority contractors. On many occasions the minorities have been scrutinized to death, while non-minority contractors have been allowed to present bogus minority companies and yet receive certification that is routinely endorsed by the MBEC director. It is a disgrace. No one person should have so much power that he alone can sink the entire African American construction community with no oversight. If MBEC had done the job that was mandated to carry out, we would not need these hearings day. Greater Philadelphia Urban Affairs Coalition has become the corporate choice for monitoring and reporting of minority participation efforts on major projects in the City. GPUAC consistently presented bogus information on the stadiums and other projects. We just saw that with the adding of the construction contracts. I contend that these two, MBEC and GPUAC, have been coconspirators with the building trade unions and non-minority contractors to severely limit the 132 3/13/03 - COMMERCE - RES. 020238 opportunity to minorities.
I appeal to this Council to sponsor hearings to investigate how these two agencies have systematically prevented minority companies from participating in a substantial way in the construction industry in Philadelphia. According to the Philadelphia Consortium, the city and quasi-city agencies, business utilization study report, also known as the disparity study of 1998 that was just released this year, since 1969 both the federal government and courts have found Philadelphia trade unions to discriminate against black workers. Even so, the City and other consortium members have repeatedly entered into contractual agreements with the labor unions to provide services. The court stated that in 13 years equal opportunity in the trades have not been as unions have been found to discriminate and contractors have been found to have acceded to that discrimination through passively following the hiring procedures via the collective bargaining agreements. Agencies like the Philadelphia Housing Authority, the Philadelphia Redevelopment Authority spend billions 133 3/13/03 - COMMERCE - RES. 020238 of dollars each year and less than one percent of these dollars end up with minority companies or workers. According to the 2000 census, the City population is 43 percent African American, percent 6 Hispanic, 2 percent Asian, and 45 percent white. 7 Despite these numbers, the practice of 8 discrimination continue to prevail. In conclusion, if we want to seriously find a solution to the patterns of discrimination against the African American and Latino contractors and workers, there must be more direct oversight by this Council. Council must have adequate reporting and monitoring system in place that will allow it to oversee how construction dollars are spent. This is the only way to reduce the opportunity for corruption, inefficiencies and systematic discrimination. While the courts have held that quotas in and of themselves to be unconstitutional, there will be nothing illegal about this Council assuring that City agencies improve their use of minority contractors by at least 500 percent each year over the next 5 years. One thing I'd like to bring a point of the other testimony was, they gave you a document 134 3/13/03 - COMMERCE - RES. 020238 that said that they have a million 500 hours per year. If we round that up just for the sake of my argument to $2 million a year, if we multiply that by $12 an hour that each company is sending into those trade unions, the trade unions have made $25 million over the course of those two contracts that went to their health and welfare fund. Now, we, the City, is paying for that discrimination, and that's what we should hold them accountable for.
I asked GPUAC to give me a dollar among of how those hours translate, and they've got to come up with that person. Next person.
Hi. My name is Madeline Dunn, and I come before you today to talk about a building at the corner of 63rd and Lansdowne Avenue. This building has been vacant almost years. It's 19 the corner of my block. It can be a magnificent 20 building. I've had about four developers over the years that wanted to do this building over. Could not afford to do it. What they actually came back and would say is, "If we made it into an apartment building, it wouldn't cover the debt service." In fact, Henry Smith who is Will 135 3/13/03 - COMMERCE - RES. 020238 Smith's brother was the last person before John Shields here that was at my dining room table talking with their foundation about doing this building over. And then at the last minute when we thought everything was set, he backed up and he said again, the debt service. Now, I guess last June I met this gentleman John Shields. John Shields is a part of Triumph Investment. And they started talking about doing this building, but doing it with their own money. What we needed the City to do was to get us the building, give us the building, and we could do it ourselves. We were joint venturing with Carroll Park Community Council. It's not a Madeline Dunn thing. It's about getting the end of this block looking good and it's about building a relationship with them carrying on so we can hire some of those carpenters who know how to be carpenters or whatever else without going to the unions. I really think it's time -- and I always was a union person because my husband was always a union man. He was electrical union 43 years. But a lot of things have not changed that need to change. So at this point I would say, people need jobs. We 136 3/13/03 - COMMERCE - RES. 020238 need work done. We need to get it done with people who can do it. Just as we were ready to do our contract, RDA says you have to do prevailing wage. I'm going to let John tell you prevailing wage would mean when we have a half million dollar capital to work with that we have verified, and then to say that, what that does to our contract.
That's right. And my block would look the same. They don't give a shit. Excuse me.
But you just couldn't hold it. That's why I love you. Please identify yourself for the record.
I'm Chief Operating 137 3/13/03 - COMMERCE - RES. 020238 Officer for Triumph Investment Group and Development Corporation. We are a multi-million dollar corporation. I've been in Philadelphia all my life. I'm a die-hard Philadelphian. I'm one of the few of my original group of friends who is still here, and I intend to stay here.
I have made major contributions to this City over the years, working through the Negro Trade Union, through other training programs, so I'm well aware of the problem that exists for getting labor, training labor, and so forth. One of the things that we want to do at this building is to put our home base, that's one of the things. The other thing that's going to happen out there is the building is just not going to be for us. It's going to be a gathering place for other minority contractors, community people that would come together. We will strategize and figure out how we can first make our neighborhood better, and then move out of that perimeter to other areas of the City. Together, if we pull our resources together financially as well as manpower and 138 3/13/03 - COMMERCE - RES. 020238 credibility, I think e can do the kinds of things that you just spoke about.
We have $500,000 allocated to the reconstruction of this building.
If Madeline's proposal goes -- if she says these other problems have arisen, if you have to use the union work that Madeline says, how much money would you need?
They said prevailing wage, and so I understand that that works in levels.
We didn't ask them for any 139 3/13/03 - COMMERCE - RES. 020238 money. We just asked them for the building. So now they're saying that because they're giving us the building, we have to follow some federal guidelines. And in investigating that, I understand that's a crock; that is not true at all. So what we're looking to do is to get some support from Council. Because this is not the only project we want to do. There's a building at 60th and Haverford that's been vacant about years. It's 11 like gateway, a segue into Overbrook. 12
You only have to 13 Davis Bacon if there's federal money involved. 14
If there's no federal money involved, you don't have to follow Davis Bacon guidelines.
Ms. Dunn knows that based on our conversations, we are going to seek to get a resolution to this particular issue. I mean, again, there has to be a balance in the public policy discussion between the interest of people trying to work, the importance of paying good wages, and getting projects done. And it makes no sense that in an effort to pay good wages, nothing 140 3/13/03 - COMMERCE - RES. 020238 happens, because then you have a hundred percent of nothing. Now, I don't believe that that's the goal. I don't think that's necessarily -- it's certainly not the City's goal. I don't think it's necessarily the union's goal. It's clearly not the residents' goal. It ends up being reality by default. You can have all the great ideas you want. You can want to build the monument to the sky. If your money is too short and the price is too high, it's not going to happen. And so you have all this deterioration and stuff falling down. And people have ideas and want to go forward, but for lack of money and some of these other complications, nothing happens. Now, that can't be good public policy. It cannot be the goal of this government to have great projects that can not be funded and end up just being wonderful ideas that turn into, not dreams, but nightmares. I mean, that is not the goal, that's not the interest. We need to work it out..
So let me ask you a question. Is there any way -- let me tell you that right now I've been on my block it will be 40 years in May of '04, it will be 40 years. And right now we have two houses. One was given to an agency and the other 141 3/13/03 - COMMERCE - RES. 020238 house, the family just moved out. They broke up, the husband and wife. And roof is collapsing, it's coming like it's sinking. And there was one where the old person died and it was an heir property and they never sold it. Now, this was a block that everything was intact. Now I have four houses that look awful. Now I'm not moving. This is my neighborhood, and anybody knows I've fighting the bars druggies and everything. This is my neighborhood; I'm not going anywhere. And not only do I want to do this building, I want those other buildings done. And I'm saying if I ask the City to give me buildings that people are not paying taxes on it and we can get these buildings done and up and running again, do I have to deal with unions? Do I have to do Davis Bacon?
Well, it's interesting. I think what's going to benefit all of us, certainly me and I think some other Councilmembers might be in this position, but also the general public. There are actually some provisions for certain types of work. And I think one of the lines of demarcation is -- I remember 142 3/13/03 - COMMERCE - RES. 020238 this debate about is it eight units or more. I think that may be the number. And that there are certain guidelines that go with eight units or more and there are certain other guidelines or virtually no guidelines that go with or less. If you're a 7 eight or less situation, the rules are completely 8 different. I think that we need a better understanding of what's the law, what are the rules, what's the general practice, what's been the history and the tradition and kind of lay all that stuff out so we can better understand what in the world is going on in the first place. And then because we're a City government, I think our primary focus has to be on, well, what is the law? What are we required to do based on the funding source, based on the dollar amount, based on the number of units? And then go from there. Because, you know, to some extent all this historical stuff is not benefiting many of us. I don't have a lot of interest other than as a person who loves history in some of these issues because it's not helping to redevelop either community that I represent or other places in the City. So I'm not sure who the real beneficiary is. 143 3/13/03 - COMMERCE - RES. 020238 And when we look at the numbers, at least on these big high-profile projects, and it's not just on the big high-profile projects, because we get these other reports every month or so from OHCD. I mean, you want to talk about the Phillies and the Eagles and all of that stuff; let's talk about the Business and Technology Center project at 1741 Callowhill Street, just to pick on. Percentage of non-Philadelphia workers on the entire project, 65 percent. Chinatown North, Phase II, 59 percent. These are projects with just a few hundred people on them. I mean, this is all over the City. You've got to love it if you can come to this town, make all the money you want, ultimately leave, pay your taxes somewhere else, send your kids to a different school system. You only have to pop back and forth across the bridge, you pay your $3 or whatever the case may be or you get your EZPass and whatever that costs and pop through at 5 to 10 miles an hour. It's a great place to work. It's just that hardly anybody wants to live here. Well, what's the incentive? I mean, if you can live in Maryland and work in Philadelphia -- I don't know what they're doing in Maryland, but it's not bad deal. So I'm 144 3/13/03 - COMMERCE - RES. 020238 trying to understand what's going on with the rest of us. We stayed. We toughed it out. So whether it's the big high-profile projects or the four little houses down the street, there's a lot of work opportunities out here. It doesn't mean we're going rehab every house in the City. But we don't have to do all of them. And in some instances, all we have to do is free these properties up for -- last I checked, we're in America. People have a right and an opportunity to make money. We don't live in Iraq or Bagdad or any of these other places. Free this market up, give people the opportunity to work, both union and other people who have their little businesses and are just trying to make a living. That's where the opportunity is. I mean, as much deterioration as there is in most communities around town, there would be a whole lot of work for a whole lot of folks. We don't need to fighting people about whether there's work or not. There's plenty of work out here.
We have just purchased a 5-acre parcel of ground in North Philadelphia near Temple Hospital. We're developing 63 houses, market 145 3/13/03 - COMMERCE - RES. 020238 rate houses on that land because from our surveys there's no decent housing available for the people that must live here, the police, the fireman.
They can't find it. Also from our understand, this would be the first market rate housing built since Yorktown.
Any other testimony? Please identify yourself for the record.
My name is Colin Jamal Johnson from Jamal Electrical Contractors, and I'm a local contractor in the City of Philadelphia. And I started business in 1988. And from the onset of me being in business, I always had a hard time getting the Public Works jobs because I historically been a non-union contractor. And from me dealing with the unions, I found it very difficult to excel as an entrepreneur, as a businessman because, apparently, they just didn't like me. I was a participant with a lot of Public Works jobs under the Goode 146 3/13/03 - COMMERCE - RES. 020238 Administration. Apparently, I was doing some pretty good jobs, me and a few other contractors that were African American. But apparently when Rendell came over and pretty much handed the job to the unions, our work suddenly just dropped. So now we're really just sustaining ourselves off of the private sector. But some of the main problems that we were having was, when we had these jobs, the general contractor had a clause saying that he needed work site harmony. And when we came in as non-union contractors and the unions picketed us because we were non-union, the general contractor said that because he has a work harmony clause in his contract that we are potentially endangering our contract. So those are the problems that we were having. And because of the contractors asked us were we union, they pretty much said "we can't use you." But I find that if it's a Public Works job and there's no law stating that we have to be union, then I think that a by the City and by the CDCs under this illusion that these jobs have to be union, I think that the City has to come in and do something to stop this intimidation, to stop this illusion that, you know, contractors have to be 147 3/13/03 - COMMERCE - RES. 020238 union; because historically, African American contractors, we haven't been in the union. I think maybe the City has to put some kind of situation out that allows a non-union contractor to participate on these Public Works jobs. They shouldn't have to be exclusively union to participate in them.
I'm going to get you some information about that in a second.
In closing, I just think that, you know, until we rectify this situation with the unions which are predominately are ran by white males, the staff members are predominately white -- for instance, like in the Elevators Unions, there's no African Americans, from what I understand. It's 100 percent white union. And if they get in these public jobs they should have some obligation to the make-up of the City.
From what I understand, the Elevators Unions, they're a hundred percent white. Now, if they're getting Public Works jobs and their membership is less than 10 percent, I 148 3/13/03 - COMMERCE - RES. 020238 think that there should be some kind of situation where if you're 90 percent non-African American and you're on these Public Works jobs, the unions are the benefactors of these Public Works job and the African American and minority community are not on them, then the City should say, "Hey, look, something's wrong here." You've got to have some kind of leverage to tell these guys to open their doors. Now we've got the laborers union sewed up, but even African American contractors, we can't even get contracts to use the labor union people because we're not even in the mix with the benefactor public dollars. It seems like the unions just took the City dollars over, like they're disenfranchising the African American contractor, the African American entrepreneur, even the African American workers. We can't even get no Public Works jobs because these guys exclusively got control of the public dollar jobs. And this has been going on for a long time. It got to the point now where we're actually being disenfranchised. We're going out business. We can't provide for our family. We're just surviving just off the private sector. If you don't have a 149 3/13/03 - COMMERCE - RES. 020238 large customer base, you might not even survive in construction because you need to make -- in order for a contractor to build capacity, he needs or 5 6-digit contracts. These are the dollar amounts that he needs to give his workers 401Ks, to give his workers health benefits and become a real legitimate contracting force in the City. Well, that can't happen. The proliferation of this can't happen if we're not the benefactors of the Public Works projects, because the private sector, they already don't hire us because the private sector is basically corporate America. Those are the ones that give out the 5 and 6 and 7-digit contracts. So in order for us to build capacity, it's all we really can participate is in the Public Works jobs because we very rarely get any of the private sector jobs. And it's been documented. It said that for every billion dollars in Public Works jobs, 32,000 jobs are produced. And we're not even getting any part of that benefit of public dollar jobs. I think that for the sake of the African American existence in the construction industry, we 150 3/13/03 - COMMERCE - RES. 020238 need Council or we need some kind of government body to come in and try to shake this thing up because it's not working now, and we're suffering from just attrition at this point because we can't grow substantially without the 5 or 6 or 7-digit contracts, which we get that opportunity from Public Works jobs. And since the unions got that sewed up, it's like they're high-jacking the Public Works jobs. Thank you.
Thank you. Ms. Davis, since as a high-level official in the Administration, I need to make a request for, at a minimum, a legal memorandum; if not, a legal opinion. This will be somewhat just a number of different points. I'll leave it to your discretion to figure how to ask the question. I need a document that lays out the issues that have been raised today from strictly a point of information with no judgment, just an explanation. I need to better understand a couple terms, one of which is prevailing wage, Davis Bacon. I need to know what, if any, law, ordinance, or statute requires either prevailing wage or Davis Bacon requirements as well as union 151 3/13/03 - COMMERCE - RES. 020238 contracts or contract participation. I need to know what the provisions are specifically with regard to City construction, State construction, and the use of City capital dollars.
Yes. The quasi-public agencies like SEPTA. I'd like to better understand the provisions of Section 3. And as we discuss on the housing side, I have vaguely some information in the back of my mind, this was a big debate a couple years ago, the issue -- and again, I believe the magic number is 8. It may have been 10 or it went to 10. But I have a recollection that there was a big debate a few years ago about how many units became the threshold which determined whether or not work was subject to union workforce or non-union workforce in the housing area. I thought it was a number of units threshold.
Adding to your request for Ms. Davis, Executive Order 5-95 PLA, the Public Labor Agreement, I'd like to get a copy of that.
Thank you. And I recognize that that was not the greatest dissertation on how to get the information, but you understand what it is I'm looking for.
I had started kind of writing down myself because I wanted to be a little more enlightened on some of things that people were bringing up.
Councilman Nutter, one thing I wanted to ask was, in the future when you bring back GPUAC, would it be possible to bring back some of the other committee members that are on those advisory committees, for instance, like John Macklin and Tony Lewis so we can get a better idea what actually goes on at those meetings.
The sponsor of the particular resolution, Councilman Ortiz, I'm sure will make that request.
I think there are no 23 further questions of the committee. This committee which is hearing testimony on Resolution 020238 and 030038 will 153 3/13/03 - COMMERCE - RES. 020238 reconvene and will be in recess until April 23rd at o'clock a.m., at which both resolutions will 4 continue to be heard and testimony will be taken. 5 The panel that we were going to hear on 6 Resolution 030038 on the DAP Program will be the 7 first panel at the next hearing on April 23rd at 10 8 o'clock a.m. That panel was not heard today, and by 9 agreement between the two sponsors of the resolution 10 and great cooperation, that panel will be the first panel. And then any other individuals testifying either on that resolution or other resolutions will be heard after that. Thank you very much. (Council adjourned at 6:50 p.m.) - - - 154 C E R T I F I C A T I O N I HEREBY CERTIFY that the foregoing proceedings of the Council of the City of Philadelphia of March 13, 2003, were reported fully and accurately by me, and that this is a correct transcript of the same. RE: COMMITTEE ON COMMERCE AND ECONOMIC DEVELOPMENT ___________________________ Lisa C. Bradley, RPR and Notary Public