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Young pushes bill to fuel local hiring on city contracts

BusinessJob MarketLocal GovernmentStephanie Rawlings-BlakeUnemployment and Layoffs

Any business that gets a city contract or major financial help from City Hall could be required to hire 51 percent of new workers from within the city limits or face a criminal sanction.

Those are the terms of a new bill proposed by City Council President Bernard C. "Jack" Young, who believes such legislation is needed to reduce what he calls Baltimore's "stubbornly high unemployment rate."

Young introduced the "local hiring mandate" legislation Monday night to the City Council.

"We must ensure that our tax dollars invested in our city-funded projects are invested back in the community," Young said at the council hearing.

The proposal comes as Baltimore struggles to shake off the effects of the economic downturn. The city's unemployment rate was 10.2 percent in September, the most recent month available from state figures. Five years ago, the city's unemployment rate was 5.4 percent for that same month, state figures show.

Promoting local hiring has been a key issue at City Hall. Last year, Mayor Stephanie Rawlings-Blake issued an executive order — called "Employ Baltimore" — that assisted companies that hired city residents on their contracts with the local government.

Young's legislation would require 51 percent of new jobs to go to residents of Baltimore. The ordinance would apply to a business receiving any city contract of at least $300,000 or any project that benefits from at least $5 million in city assistance.

Only a handful of city-supported projects topped that $5 million mark in 2010, according to the most recent annual report from the Baltimore Development Corp., the city's quasi-public economic development arm.

Under Young's proposed law, businesses that do not comply could be barred from receiving city contracts for one year and face a $500 fine.

Waivers may be issued, on a case-by-case basis, under certain conditions, Young said. For instance, if the company can demonstrate it made a "good faith" effort to hire city residents but couldn't find those with the right skills, it could avoid a penalty, the legislation states.

Businesses that are located — and perform their work — outside the area also may be eligible for waivers, according to the proposed legislation. For instance, American Eurocopter Corp., which has supplied the Police Department's helicopters, wouldn't fall under the proposed law because its headquarters and production facility are outside Maryland.

Young cited similar local hiring programs in Boston and San Francisco as models for Baltimore.

Rod Easter, president of the Baltimore Building and Construction Trades Council, said the Boston and San Francisco programs involve local trade unions. But he said that Young never consulted his organization, which is an umbrella group that represents 15,000 people in various unions in the Baltimore area.

"Normally, we have good communications with the council president," said Easter. "I'm just confused I see it in the paper and I didn't hear it from him."

Easter said training and apprenticeship programs exist, and he'd like to see those supported more by the city, to encourage people to develop their skills for hire.

He feared that Young's proposal may be a temporary fix that would encourage companies to hire and fire workers as they need them to comply with a city law, rather than figure out a long-term employment solution for workers.

"When people have careers, they can have some pride," said Easter, an electrician. "They're not hanging on the corners."

Through a spokesman, Young said that his legislation would not harm the city's unions, and that "Mr. Easter will certainly have a seat at the table to offer suggestions concerning the bill."

Michael Theriault, secretary-treasurer of San Francisco's Building and Construction Trades Council, said that city's law is in its second year and will be up for review next year. Under the law, the city increases the residency requirement by 5 percent each year. The law will face a review, and it could be revised in negotiations next year, he said.

Theriault said it's important that the companies that are awarded contracts and hire workers have "relief valves" in the process, so they are not overly penalized if they can't find workers within city limits. If contractors spend too much money hiring workers, or pay too many penalties, they end up declining to bid on city projects, or building those extra costs into their bids, he said.

Either way, the costs for the city could go up, he warned.

"It's a much more complicated thing than people tend to believe," he said. "You have to build fairly robust relief valves if you're going to work with contractors."

Ryan O'Doherty, a spokesman for Mayor Stephanie Rawlings-Blake, said the administration looks forward to "looking closely at the bill as part of the legislative process."

"Mayor Rawlings-Blake and the City Council have worked hard to increase job opportunities for City residents on contracts through the Mayor's Employ Baltimore initiative," he said in an email. "It requires contractors to work with the City's Office of Employment Development [to] match employment with qualified city residents. And there's always room for improvement."

Joann Logan, a spokeswoman for the Baltimore Development Corp., said the organization has not yet reviewed Young's proposal, and couldn't comment on it.

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