State Legislation: AB 199 (Chu) Public Works: Private Residential Projects

State Legislation: AB 199 (Chu) Public Works: Private Residential Projects

Updated July 27, 2017

AB 199 would eliminate the long-standing residential exemption from prevailing wage rates and thereby make private, market-rate residential development a public work project for which a prevailing wage would be paid.

This measure would have dramatic negative cost implications for newly constructed and privately financed housing in California and it could not come at a worse time. With the current crisis of undersupply, highest-in-the-nation housing costs, and exploding unaffordability ranking at the top of the state’s most pressing political, social and economic concerns, it would seem that a proposal to add as much as 45-50 percent to the cost of a newly built home is ill-advised as it will definitely hamper housing production in the state and make housing more expensive and more out of reach for an ever-growing number of Californians.

Given that for every $1,000 increase in the cost of a home, 15,000 California households are priced out of the market, this measure would directly impact hundreds of thousands of Californians and their ability to attain the American dream of homeownership, disproportionately impacting teachers, firefighters, police, nurses, service employees in the public and private sector, minorities and millennials.

SVO POSITION: OPPOSED

STATUS: Referred to Senate Appropriations. Placed on suspense file.

Questions? Please contact Victor Cuauhtémoc Gomez, Sr. Director of Public Policy at victorg@thesvo.com

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