Photo by Mark Turnauckas is licensed under CC BY 2.0
Here’s an interesting quirk. Private firms competing for construction projects in Akron, Ohio, may encounter a strange competitor in the near future – a public construction company. No kidding! Akron may become the first city in Ohio to incorporate its own construction company.
Akron Mayor Don Plusquellic is not happy because contractors for city projects have not met the city’s expectations, or quotas, for the hiring of local workers. He has decided to force the issue.
On a multi-phase $1 billion sewer project that is currently under way, Plusquellic said he wants 30 percent of the employees hired by private contractors to live in Akron. And, he wants the number of local workers to increase by 5 percent each year. His goal is to have 50 percent of the work being done by locals by 2018.
Private contractors have explained to the mayor that it’s simply not possible to find that many workers in Akron for their projects. The number of skilled and trained workers in the city is too small. That was not what the mayor wanted to hear, so he intends to prove them wrong. He announced plans to launch a city-owned construction firm. This competitive initiative runs contrary to what most public officials believe – that government has no business competing with private-sector firms.
City officials designated a construction manager-at-risk (CMAR) project model for the sewer project. That means the entire project will fall under a single oversight management contract. Early plans are for the city’s engineer to lead the construction firm, which would then be a subcontractor to the CMAR contractor.
Akron officials have launched a commercial driver’s license training program and a construction pre-apprentice program. Fifty local residents are already being trained in areas where there will be job openings.
There are supporters but an abundance of naysayers. The legality is being questioned and some lawmakers are discussing legislation to prohibit such initiatives by cities in Ohio. One contractors’ association filed suit to have the local hiring requirement ruled unconstitutional, but has since dropped the challenge. Other organizations have argued that taxpayers will be better served if the city uses a competitive bid process and hires firms with years of experience and expertise. They argue that competition always results in lower costs and quicker completion dates.
The mayor admits there may not be enough skilled workers to handle the jobs, but that has not stopped him. The sewer project is the largest construction project in the city’s history and this strange situation is being watched by numerous interested parties. It will be interesting to see if the concept of a city-owned construction company can survive.
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