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ORANGE COUNTY
BOARD OF COMMISSIONERS
ACTION AGENDA ITEM ABSTRACT
Meeting Date:February 10, 2015
Action Agenda
Item No.1
SUBJECT:
Discussion Regarding Potential Requirement that Contractors Doing Business
with Orange County Pay Employees aLiving Wage
No
DEPARTMENT:PUBLIC HEARING: (Y/N)
County Attorney
ATTACHMENT(S):INFORMATION CONTACT:
John Roberts,245-2318
Public Bid Requirements
City of Asheville Staff Reports
PURPOSE:
To discuss requiring certain contractors to pay employees a living wage.
BACKGROUND:
At the December 9, 2014 meeting the Board adopted a motion to direct the
attorneyto “come back with an explicit policy for when and under what circumstances the board
of commissioners can, might, and cannot require vendors orcontractors to pay a living wage.”
In 2013 the North Carolina General Assembly limited the authority of counties and cities by
amending §153A-449, which authorizes contracting with private contractors, to include a new
sentence, “A county may not require a private contractor under this section to abide by any
restriction that the county could not impose on all employers in the county, such as paying
minimum wageor providing paid sick leave to its employees, as a condition of bidding on a
contract.”
Thislanguagelimits the County’s authority tocontractually require a living wage to those
contracts for which the County does not solicit bids. A contractual living wage requirement
could therefore only apply to construction contracts below $30,000, purchases of supplies and
apparatus below $30,000, and service contracts in any amount so long as the County did not
choose to solicit bids.
Proposed policy: It is the policy of Orange County that vendors who enter contracts with
Orange County must pay their employees a living wage. This policy shall not apply to contracts
in the formal and informal bidding ranges or to any other contract on which the county solicits
bids.
This policy maybe adopted as a standalone policy, as part of the budget ordinance, or as part
of the general ordinances.
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Issues for Consideration
1)What is the living wage? Is it what it costs to live in the county or the state?With or
without benefits?
2)Do we require the equivalent of an Orange County living wage when both the vendor and
the vendor’s employees live outside the county? Outside the state?
3)Do we require the vendor pay all of its employees a living wage or just those assigned to
the contract project?
4)Vendors can avoid this requirement by designating workers as subcontractors. Do we
require vendors to pay their subcontractors a living wage? Require vendors to require
subcontractors to pay their employees a living wage?
5)How do we verify and enforce the requirement(s)? Audits?Such a policy must be
enforced because it likely creates third party beneficiaries who could have grounds to
sue Orange County for its failure to enforce the provisions.
6)Is this policy to apply to contracts within a designated range of amounts to all vendors or
just those with more than a designated number of employees?
7)Some sole source vendors are likely to refuse to sign such a contract. Examples include
Time Warner, MuniCode,and Apple. How should this be addressed?
FINANCIAL IMPACT:
There is no cost to consider this item. Should the Board adopt this as a
policy going forward such policy will cause increases in the costs associated with contracting for
certain goods and/or services.
RECOMMENDATION(S):
The Attorneyrecommends the Board discuss this item and provide
direction.
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Dollar Thresholds in North Carolina
Public Contracting Statutes
Dollar limits and statutory authority current as of September 1,
Requirement Threshold Statute
Formal bidding
(estimated cost of contract)
Construction or repair contracts $500,000 and above G.S. 143-129
Purchase of apparatus, supplies, materials, and equipment $90,000 and above G.S. 143-129
Informal bidding
(actual cost of contract)
Construction or repair contracts $30,000 to formal limit G.S. 143-131
Purchase of apparatus, supplies, materials, and equipment $30,000 to formal limit G.S. 143-131
Construction methods authorized for building projects
Over $300,000 G.S. 143-128(a1)
Separate Prime (estimated cost of project)
Single Prime
Dual Bidding
Construction Management at Risk (G.S. 143-128.1)
Design-Build and Design-Build Bridging (G.S. 143-128.1A; G.S. 143-128.1B)
Public Private Partnership (P3) (G.S. 143-128.1C)
Historically Underutilized Business (HUB) requirements
Building construction or repair projects
Projects with state funding $100,000 or more G.S. 143-128.2(a)
Locally funded projects (formal HUB requirements) $300,000 or more G.S. 143-128.2(j)
Projects in informal bidding range (informal HUB requirements) $30,000 to $500,000* G.S. 143-131(b)
*Note: Formal HUB requirements should be used for informally bid
Limit on use of own forces (force account work)
(not to exceed) G.S. 143-135
Construction or repair projects $125,000 (total project cost) or
$50,000 (labor only cost)
Bid bond or deposit
Construction or repair contracts (at least 5% of bid amount) Formal bids ($500,000 and above) G.S.143-129(b)
Purchase contracts Not required
Performance/Payment bonds
Construction or repair contracts (100% of contract amount) Each contract over $50,000 of G.S. 143-129(c);
project costing over $300,000 G.S. 44A-26
Purchase contracts Not required
General contractors license required
$30,000 and above G.S. 87-1
Exemption Force account work (see above)
Force account work (see above)G.S. 87-14(a)(1)
Use of licensed architect or engineer required
Nonstructural work $300,000 and above G.S. 133-1.1(a)
Structural repair, additions, or new construction $135,000 and above
$100,000 and above
Selection of architect, engineer, surveyor, construction manager
All contracts unless exempted G.S. 143-64.31
Exemption authorized Only projects where estimated G.S. 143-64.32
fee is less than $50,000
From A Legal Guide to Purchasing and Contracting for North Carolina L, 2nd ed., by Frayda S. Bluestein,
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