Nevada senators hear bill to require prevailing wages on large utility construction projects

Senate Majority Leader Nicole Cannizzaro introduced Senate Bill 443 at the Senate Committee on Government Affairs hearing, saying the bill would require that contractors on certain large natural gas and electric utility projects pay prevailing wages and meet high-quality construction standards.

"What Senate Bill 443 is really seeking to do is to make sure that we are emphasizing the importance of fair compensation for workers and ensuring high quality standards in the construction of electric and gas utility projects," Cannizzaro said during her presentation.

The bill, and a conceptual amendment distributed to the committee, would (among other changes) define "significant operational or capital requirements" for natural gas and electric utilities, require compliance with prevailing-wage provisions for covered projects even if the projects are not defined as public works, and exclude projects whose primary construction work is already covered by a collective bargaining agreement, worksite agreement, or project labor agreement.

Proponents — including Nick Vasiliades of the Southern Nevada Building Trades Union and representatives of multiple trade unions including Teamsters Local 631, Operating Engineers Local 12, Plumbers and Pipefitters Local 525, and others — told the committee the bill targets large projects and would help ensure well-paid, local, highly skilled labor on those projects.

"We think we've been able to narrowly tailor this to those large scale infrastructure projects, which was the intent of this bill," Vasiliades said.

Opponents raised concerns about the bill's scope and economic effects. Anahit Bakhshatsyan of Nevada Policy testified the prevailing-wage requirements historically raise labor costs and said extending them to utility projects could increase construction costs and slow hiring. Industry trade groups including the Associated Builders and Contractors, Associated General Contractors, and the Nevada Contractors Association also testified in opposition, arguing that prevailing-wage rules were designed for publicly financed public works and should not be extended to private utility projects.

Southwest Gas, which described itself as neutral following recent negotiations, told the committee that the projects to which the bill would apply include pipeline replacement projects approved through the utility's new resource planning process created by Senate Bill 281 last session.

Senators pressed proponents on several points: how "significant" projects would be defined, how the bill would treat existing collective bargaining or project labor agreements, and how many affiliate entities might be affected by the language. Cannizzaro and proponents repeatedly said the bill was intended to be narrow and targeted at larger-scale projects where many workers are employed and where regulatory oversight of utilities and ratepayer funding create a public-interest rationale for the measure.

Committee members did not take a vote on Senate Bill 443 at the hearing. Cannizzaro said she would continue working with stakeholders to address concerns raised during testimony and that the amendment on the record clarified some definitions and exemptions.

Outcome and next steps: The committee held the public hearing and closed discussion without a final vote; sponsors and stakeholders said they would continue negotiations on the amendment language.