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.