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By Dave Roberts, California Political Review
Hancock and fellow Democrats say SB54, which passed the Legislature last week, will improve refinery safety by increasing the number of trained contract workers at refineries. But critics say the bill actually will make refineries less safe, while providing a sweetheart deal for labor unions that will also benefit Democrats’ political campaigns.
“Refinery safety is an increasing problem in California due to recent incidents which truly risked workers’ health and public health, including the 2012 Chevron refinery explosion in Richmond,” Hancock told the Assembly Labor and Employment Committee on Aug. 14.
Pipe, not worker, failure
But it’s unlikely that Hancock’s bill, had it been in place years ago, would have done anything to prevent the Chevron refinery pipe rupture and fire on Aug. 6, 2012. SB54 focuses on the training, skills and experience level of contracted workers, which was not a factor in the accident, according to an interim investigation report by the U.S. Chemical Safety and Hazard Investigation Board.
“[T]he pipe failed due to thinning caused by sulfidation corrosion, a common damage mechanism in refineries,” the report states.
But rather than deal with the problem of corroded refinery pipes, Hancock’s bill focuses on getting more union-trained workers into refineries. Beginning Jan. 1, 2014 at least 30 percent of a refinery contractor’s on site workforce must have completed at least 20 hours in a state-approved apprenticeship program. That increases to 45 percent in 2015 and 60 percent in 2016. And SB54 requires that they be paid prevailing (i.e., union) wages.
Naturally, the industrial unions, with one notable exception, are strong backers of the bill.
“Our apprenticeship programs have been around for over a hundred years,” Cesar Diaz, representing the State Building and Construction Trades Council, told the committee. “We spend over $100 million into apprenticeship at state-of-the-art facilities and have the most rigorous training to perform this industrial safety type work. Our members are proud of that training. They enter as apprentices, and gradually through their skill level being increased they reach the journey person status.
“These are some of the most dangerous facilities. Our members live in and around those communities. They breathe in the air, but often times get skipped out on the job opportunities that happen there. It’s a two-fer for us to basically be able to access and improve the quality of our communities by the economic impact, but also to make them safer. So that these leakages that happen basically on a weekly basis at these facilities do not occur. This is one way to mitigate against those factors.”
Possible 5,000 USW jobs lost
One union that is not on board is the United Steelworkers, which currently provides 95 percent of the refinery workforce, and estimates that SB54 will result in as many as 5,000 of its members losing their jobs.
“These are folks who have been doing the job anywhere from five years up to 35 and 40 years, a large percentage of them at the same refineries,” said USW representative Catherine Houston. “We have an issue with the bill in the inability to be able to access the training through the apprenticeship programs. We are precluded under current California labor code law to create our own apprenticeship program. And so we have always had very strong, very intensive training programs.
“In fact, our programs are the best in the industry as evidenced by the fact that we have the best safety record in the industry. So we are very proud of our safety record and stand solidly behind it. We have highly skilled, highly trained workers. And so what we don’t want to see is a situation where we have our workers, who are currently in these jobs now, displaced and replaced by another group of workers.”
Eloy Garcia, with the Western States Petroleum Association, which represents California’s refineries, argued against the bill’s requirement that refineries pay prevailing wages to contractors. The prevailing wage requirement has historically been reserved for public works projects — a distinction that the courts have upheld.
“It is not a small step, but a tremendous leap in the extension of the public works law,” said Garcia. ‘We think it’s completely inappropriate to use a very unfortunate incident last August as a guide to essentially move forward a workforce mandate that is not needed. In the end this is not about safety. In fact, it degrades safety. Excluding workers that are long trained, specialty trained, that have the experience and expertise, that have worked in refining sites for years, is a degradation of safety. It is by no means an improvement of safety.”
Hancock not moved
Hancock was unswayed.
“They have no reason to want an explosion in that Chevron plant,” she acknowledged. “Engineers told them for 10 years that those pipes needed to be replaced. Sometimes they do short-term cost cutting. We do not want it to impact the public safety of the workers in the refinery or safety of entire communities. We have people dying in the refineries. We need a skilled work force, they need to be trained in a state-accredited program.”
Safety was also the mantra of Democrats when the bill reached the Assembly floor on Sept. 9.
“SB54 keeps our communities safer from potential accidents by making sure we have the best trained people working in our high-hazard facilities,” said Susan Bonilla, D-Concord, who has four refineries in her district.
She was echoed by Richard Pan, D-Sacramento, who said, “This is about safety. We want to be sure that people working in our refineries, which are very complex, highly technical facilities, are highly trained, that they meet the standards that we need to have here in California. That they are not pulling in workers from out of state that don’t have the appropriate qualifications to run these facilities.”
GOP: Bill not about safety
Republicans countered that safety has little to do with the legislation.
“The bottom line is we are making these refineries less safe,” said Don Wagner, R-Irvine. “We are bringing in journeymen, who by definition do not have the skills, the training and the experience to provide the level of safety that our refineries need. So what are we doing? We are not making our refineries safer. We are setting up a court challenge [on the prevailing wage requirement]. It’s likely to fail. All because this body wants to tell businesses once again how to operate. Let’s not do that. Let’s focus on putting more Californians back to work. Let them guarantee the safety. Let them hire the workers that are capable of doing the job. And let’s not enact our own social preferences into law by violating federal law.”
Shannon Grove, R-Bakersfield, argued that SB54 is actually the Democrat Protection Act of 2013.
“Being a person who pays your [union] dues out of your paycheck does not make you highly skilled or highly trained,” she said. “In these bills mandated by this legislative body, you are requiring only union workers. I don’t know how it is not completely criminal to mandate that only union workers have these jobs when those union wages are … at three to five percent, and they do nothing but give the Democrats political capital in their campaigns. That is something that should be stopped, and it should be looked at.
“Five thousand employees, three percent of their wages [for union dues], $7 million for your political campaigns for 2014. All refineries are required to be unionized under the guise of safety and highly trained. Those wages at $40, $50, $60 and sometimes up to $80 a hour will be taxed or … union benefits to benefit your political capital in the election. That should be criminal that this body passes legislation like that.”
Tim Donnelly, R-Twin Peaks, noted the negative impacts the bill could have for the state’s motorists.
“This bill is going to make it harder to build another refinery in California,” he said. “We need at least two more. If we want to lower gas prices for the average hard-working Californian, we need to get off the backs of those who are refining the fuels that operate the vast majority of vehicles in this state. This is the government coming in and interfering in the name of safety in a private contract. We need to make it easier for those who are willing to go through the inordinate amount of regulation we already have on them to put a refinery in to refine the special fuels we use in California. We need more refineries. This is not going to add refineries.”
Despite those warnings, the bill passed easily in the Assembly along party lines, 27-11; passed in the Senate; and awaits Gov. Jerry Brown’s signature.
(Dave Roberts is a contributor to CalWatchdog. Originally published on CalWatchdog.)