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May 21, 2009

Live or let die?

Mayor’s veto forces council to re-examine labor ordinance

For only the third time in 20 years, Louisville Mayor Jerry Abramson pulled out the veto pen on Tuesday to send back legislation he says would undermine Louisville's economic rebound.

In a letter to Metro Council, the mayor stated the labor standards ordinance that passed last week would put Louisville at a serious disadvantage with competitor cities and create obstacles to job growth. Abramson, who’d been in budget meetings most of the day, further suggested the city bill would impose unnecessary mandates on private investors that receive public funding.

“The last thing we need is an impediment or hurdle or an obstacle placed in front of opportunities for investment by businesses and the creation of jobs,” he said during a press conference announcing the veto.

When pressed about what specific language in the bill prompted the veto, the mayor only repeated the same talking points, saying the ordinance would put Louisville at a disadvantage in these tough economic times. Abramson reiterated that job creation should be the first priority for Metro government.

Sponsored by Councilmen Jim King, D-10, and Rick Blackwell, D-12, the labor standards ordinance passed the Metro Council by a 16-10 vote last week after an agonizing seven-hour meeting.

The city bill would have required any company that used $500,000 or more in tax money to pay a prevailing wage, which is the average pay given to workers in a particular jurisdiction, depending on the type of work. The ordinance also required businesses to use 75 percent local contractors and workers on their projects and to award 20 percent of those contracts to minority-owned businesses, and 5 percent to businesses owned by women.

When the bill was first introduced in March, King told LEO Weekly the council’s haphazard approach in approving the Center City deal made it clear the legislation was needed.

“This ordinance is a priority for us and now that the mayor has expressed his concerns, we will react appropriately,” King stated in a press release responding to the veto. “This is too important to our local workers and contractors to stop now.”

The council needs 18 votes to override a mayoral veto, which is unlikely given the hours of debate preceding the vote. For most of the night council members spent hours discussing the bill’s minutia, including the size of a small business that lasted until 1:30 a.m. King and Blackwell say they will review the mayor's veto before moving forward.

“I feel like after the veto this ordinance should die and go away,” says Billy Parsons, chief executive officer of Associated Builders and Contractors of Kentuckiana Inc., an association representing more than 200 Louisville-area contractors, adding he supports the mayor’s veto. “You can amend it until the cows come home, but by then no one would want the ordinance.”

Regardless of Metro Council’s intentions, Parsons says it’s a mistake to legislate how companies operate and hire workers during a deepening recession.

“They were going in a direction they had no business in and the mayor was pretty firm in his resolution,” he says. “You cannot, through mandate of an ordinance, control how we play the game.”

Whether the bill will live or die depends largely on the conversation at today’s Democratic caucus meeting. It appears the ordinance will require serious changes to make it back to the mayor’s desk.

“I certainly agree with the mayor’s concerns for job creation. In fact, ‘local jobs for local workers’ are at the heart of this intent of this ordinance,” says Councilman Blackwell, adding the last mayoral veto in 2006 resulted in a compromise on labor requirements for the arena project. “When we invest local tax dollars in a project there needs to be balance between the gains for business and the gains for workers.”