Goldwater Puts Tucson on Notice to Repeal Illegal ‘Prevailing Wage’ Mandate

It’s a costly, burdensome policy that excludes qualified businesses from competing for public-works contracts. Decades of data and research show that it hurts taxpayers, workers, and businesses (especially small and minority-owned businesses) alike.

It’s called a “prevailing wage” mandate, and city officials in Tucson recently followed in the footsteps of their Phoenix counterparts by forcing such a mandate on businesses. The Goldwater Institute is suing Phoenix over its prevailing wage ordinance, which violates state law and the Arizona Constitution, and now Goldwater is putting Tucson leaders on notice too, demanding they ditch their own burdensome mandate.

Just like the Phoenix ordinance, Tucson’s mandate restricts qualified contractors and subcontractors from competing for public-works projects unless they follow a slew of burdensome regulations: paying employees well above market rates based on complicated formulas produced by the federal government, keeping painstaking records, submitting lengthy paperwork to city bureaucrats every week, and risking heavy fines and other penalties if they slip up on any of these requirements—even for minor or accidental violations.

Tucson’s ordinance is illegal for the same reasons as Phoenix’s ordinance. That’s why Goldwater sent a letter last week to Tucson’s mayor, city council, and city manager, informing them of the ongoing lawsuit challenging the Phoenix prevailing wage mandate, and urging them to repeal their version of the ordinance if they hope to “avoid the unnecessary, costly, and futile defense of this illegal mandate in court.”

Learning from failed experiments with “prevailing wage” laws in dozens of other cities and states, the state of Arizona has wisely prohibited cities and towns from enacting this backward policy since 1984. When government officials ignore the law and infringe on their citizens’ economic liberty, saddling local businesses and workers with unnecessary costs and red tape—they can expect a fight from the Goldwater Institute.

You can read our letter here.

John Thorpe is a Staff Attorney at the Goldwater Institute.