Associated Builders and Contractors Inc. v. San Francisco Airports Commission (San Mateo County Building and Construction Trades Council)

ASSOCIATED BUILDERS AND CONTRACTORS, INC. et al., Appellants v. SAN FRANCISCO AIRPORTS COMMISSION, Respondent SAN MATEO COUNTY BUILDING AND CONSTRUCTION TRADES COUNCIL Real Party in Interest C.A. 1st, No. A076022, Div. 2 S066747 California Supreme Court Filed February 18, 1998         Petition for review GRANTED.




[Editor's Note - For your convenience we reprint below the Daily Journal's Ruling Column brief which summarized the earlier decision of the lower court.]


GOVERNMENT

Project Stability Agreement Between Agency and Labor Organization Complies With Public Contracting Competitive Bid Laws.
        The C.A. 1st has held that requiring bidding contractors on a public works contract to agree to be bound by a Project Stability Agreement (PSA), which provided for the settlement of labor disputes, did not violate state competitive bidding laws.
        To meet the need for expansion of the San Francisco International Airport, the city and county of San Francisco, acting through its Airports Commission, adopted a $2.4 billion airport design and construction Master Plan. The centerpiece of the Master Plan was a $211 million International Terminal Expansion Project. In order to avoid disruption and delay in completion of the Plan, the Commission entered into a PSA with the San Mateo County Building and Construction Trades Council, which ensured that there would be a continuous supply of labor during the life of the project, and that the project would not be disrupted by labor disputes. The PSA provided that in return for the Trades Council ensuring that there would be no labor disputes, the contractors' core employees would become union members and the union would be given the first chance to furnish new employees. The day before the opening of International Terminal Project Expansion bids, The Associated Builders and Contractors Inc. (ABC) and others filed a petition and request for a stay, alleging that the PSA was unlawful. Judge David Garcia determined that the PSA was constitutional and consistent with the competitive bidding laws and entered judgment for the Commission. ABC contended that requiring bidding contractors to agree to be bound by the terms of the PSA as a prerequisite to a contract award violated state competitive bidding laws.
        The C.A. 1st affirmed. The applicable regulation is Section 6.1 of the Administrative Code of the City and County of San Francisco, which requires that all public works contracts involving expenditures of more than $50,000 must be given to the lowest reliable and responsible bidder. The PSA did not violate that provision. The legal requirement for competitive bidding as a prerequisite to the award of a construction contract involving public funds has been part of the statutory and regulatory fabric governing public works in California for many years. The use of the PSA on the Project was compatible with the publicly charged quest to find the "lowest responsible" or "lowest responsible and reliable" bidder as mandated by Section 6.1 and state law. " 'Responsibility' and 'reliability,' either individually or collectively, includes the virtue of timely completion of the contracted work so as to make the PSA compliance requirement in this case consistent with the competitive bidding regulations contained in both local and state law."
        Associated Builders and Contractors Inc. v. San Francisco Airports Commission (San Mateo County Building and Construction Trades Council), C.A. 1st, No. A076022, filed November 12, 1997, by Ruvolo, J.
        The full text of this case appears in 97 Daily Journal DAR page 13933, November 14, 1997.