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APPLICABILITY OF PROJECT LABOR POLICIES <br />Regardless of the exact nature of a project labor policy, most cities attempt to clearly articulate <br />the types of projects that will be covered. Some cities limit project labor policies to public <br />infrastructure or projects receiving substantial public assistance. Projects that require only basic <br />land use approvals are generally exempt, while projects receiving City funding might be required <br />to comply. <br />It is also possible to exempt projects most likely to be negatively impacted by labar policy. Small <br />projects under a specified construction cost, for example, could face a substantial cost increase in <br />percentage terms. The City may also opt to exempt affordable housing, or projects meeting other <br />policy objectives, in order to ensure that development costs remain as low as possible, thereby <br />ensuring that other important City goals are met. <br />Applicability of labor policies can also vary in terms of the phases of project development <br />covered. Most commonly, requirements only extend to initial shell construction and do not apply <br />to internal furnishing, tenant improvements, or operation of facilities. <br />IMPLEMENTATION OF PROJECT LABOR POLICIES <br />Effective project labor policies will ensure that developers and contractors are aware of the <br />City's requirements as early as possible in the development process. Early notice of the City's <br />policy and goals for a given project can mitigate the impact of cost uncertainty. <br />As a matter of general policy, many cities have adopted resolutions or ordinances affirming their <br />support of fair labor policies while articulating the requirements for development projects. For <br />specific projects, cities commonly reiterate their general policies regarding labor agreements in <br />all Requests for Qualifications (RFQ), Requests for Proposals (RFP) and Exclusive Negotiating <br />Rights Agreements (ENRA). More precise requirements are most appropriately addressed in a <br />Disposition and Development Agreements (DDA). A DDA provides an opportunity to explicitly <br />note how the city's labor policy will be applied to a particular project and this can only be <br />determined once the project is defined. The DDA also allows for an opportunity to add additional <br />requirements that may not be appropriate for general citywide application but make sense for a <br />given development. <br />ROLE OF PREVAILING WAGE REQUIREMENTS <br />Regardless of the presence of project labor policies, all development projects are subject to the <br />provisions of existing Prevailing Wage Laws (California Labor Code Section 1720 et seq). <br />Although prevailing wage requirements vary by project, most new development projects that <br />receive public agency assistance will be required to pay prevailing wages. Prevailing wage <br />specifics vary by trade classification and include both base salary and fringe benefit <br />requirements. <br />4 <br />