A superior court judge deemed Phoenix and Tucson prevailing wage ordinance illegal in a ruling Monday.
Judge Bradley Astrowsky rejected arguments from the cities, premised on an earlier opinion from the Attorney General, that contended cites could adopt ordinances requiring government contractors pay on par with prevailing wage rates in the area under state minimum wage law.
Astrowsky found prevailing wage and minimum wage to be two distinct concepts and state law, “by its plain language” prohibits prevailing wage rates.
“A superficial overlap in the colloquial meaning of the word ‘minimum’ does not mean that ‘minimum wage laws,’ as a term of art, encompasses ‘prevailing wage laws,’” Astrowsky wrote.
Phoenix and Tucson city councils adopted respective prevailing wage rates on January 9.
Both ordinances required construction contractors to pay no less than the prevailing wage rate for the same class and kind of work in the surrounding area, with Phoenix setting a minimum contract value of $4 million and Tucson setting a minimum contract value of $2 million.
The cities were met with a lawsuit from the Associated Minority Contractors of Arizona, Arizona Chapter of the Associated General Contractors of America and the Arizona Builders Alliance.
The associations, represented by attorneys for the Goldwater Institute, argued the ordinances were explicitly barred by a state law which held “political subdivisions of this state shall not by regulation, ordinance or in any other manner require public works contracts to contain a provision requiring the wages paid by the contractor or any subcontractor to be not less than the prevailing rate of wages for work of a similar nature in the state or political subdivision where the project is located.”
The cities, meanwhile, relied upon an opinion from Attorney General Kris Mayes. Mayes concluded state minimum wage law, which granted cities authority to enact higher minimum wages than the state, encapsulated prevailing wage and therefore amended the past law outlawing prevailing wage.
In a ruling Monday, Astrowsky found the two laws did not address the same substantive issue, are not calculated using the same method and deemed equating the two to be illogical.
“The minimum wage and the prevailing wage are two different things,” Astrowsky wrote. “Unlike minimum wage laws, they set entire schedules of pay rates for specific industries. Moreover, these schedules are highly variable, and they represent an average wage based on a particular trade and locality, not an across-the-board floor.”
He granted summary judgment to the plaintiffs.
Jon Riches, Vice President for Litigation at the Goldwater Institute, said the group was “glad the court saw through their very thin legal argument.”
“What was most troubling about what Phoenix and Tucson did was the lawlessness,” Riches said. “I mean, you have a situation here where state law says directly that cities can't pass a prevailing wage, but Phoenix and Tucson decided to do that anyway.”
Richie Taylor, a spokesperson for the Attorney General, said the office “ respectfully disagrees” with the ruling.
“In short, the voters gave cities the authority to increase the minimum wage in those cities, and a prevailing wage is a type of minimum wage,” Taylor said in a statement. “The questions we get asked in AG Opinions are always the hard questions. Inevitably, courts will sometimes disagree. After all, courts disagree with each other all the time. In this case, we believe our opinion was correct, and as I said, we respectfully disagree with the Superior Court. And, of course, the appellate courts might also disagree with the Superior Court.”
Dan Wilson, city of Phoenix communications director, noted the prevailing wage ordinance had an effective date of July 1 so the city had not yet implemented it. Phoenix city council has yet to meet and review the ruling to decide whether to appeal, Wilson said.
Mayor Regina Romero said in a statement, “ “I’m disappointed in today’s ruling. Prevailing wages have been a tool to uplift our communities, improve our local economy, and protect workers from being underpaid and taken advantage of. The City of Tucson will continue to find ways to create a better quality of life for workers and their families, as we’ve done previously.”
Tucson’s ordinance does not take effect until July 1 as well, meaning no new or prior city contracts have any prevailing wage requirement written in, Tucson City Attorney Mike Rankin confirmed.
Rankin said in a written statement. “Over the next few weeks, we will review our appeal options and discuss those options with the Mayor and Council.”
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