Equitable Adaptation Legal & Policy Toolkit

 

Local Hiring Requirements or Incentives

Two men working on installing solar panels on a school roof. There are rows of solar panels and the men are bent over working on installing two.
Solar panel installation at Bennett High School in Buffalo with workers in the PUSH Hiring Hall program (Credit: PUSH Buffalo)

In addition to providing workforce development and training, state and local policymakers can cultivate partnerships with project developers to create local hiring requirements and incentives for employers and small businesses. These arrangements are often project-specific, and promulgated through project labor or community workforce agreements.

Project labor and community workforce agreements are binding legal documents that lay out the employment terms and conditions of a specific project or projects. Examples of these provisions include “agreements on targeted or local hiring, wages and benefits, health and safety training, and processes for communication and resolving conflicts among stakeholders.”See footnote 1 Generally, there are several parties involved in the creation of a project labor or community workforce agreements, which can include labor unions, contractors, developers, project owners, and a local government body, when applicable.See footnote 2 

Essentially, local hiring requirements and/or project labor agreements require that employers on a project set aside several jobs for local and/or disadvantaged members of the community, or that they look to specific workforce agencies that help to staff these individuals for employees.See footnote 3 These legally binding partnerships are an innovative way to facilitate a resilient economy in frontline communities by ensuring job opportunities are available to residents that will be directly impacted by the project. 

A successful hiring program centered around clean energy and resilience addresses the roles and responsibilities of contractors and subcontractors; has a centralized coordinator and job center for community members to use and apply to; provides some sort of apprenticeship or training program; and works with the private sector to find and manage projects appropriate for local residents’ skill sets.

Additionally, local governments may also need to establish MWBE contracting and subcontracting ordinances and regulatory schemes to avail themselves of certain grants issued by federal agencies. For example, in the aftermath of Superstorm Sandy, federal funding was allocated for recovery efforts that were distributed by FEMA and HUD. FEMA issued guidance for local governments that included provisions for ‘socioeconomic contracts.’ This language required that state agencies take affirmative steps to assure that small, minority, women-owned businesses participated and submitted in the grant proposal process. Additionally, once funding was awarded, grantees were to take all “necessary affirmative steps to assure that minority firms, women’s business enterprises, and labor surplus area firms [were] used when possible.”See footnote 4 Similarly, some HUD statutory disaster recovery provisions require that recipients of specific funding must use best efforts to contract economically disadvantaged business owners residing in the project area to complete said project.See footnote 5 Local governments must be in compliance with these provisions to achieve minimum goals for contracting in order to receive federal funds.

The fewer people in a community that are unemployed and the more that are employed in a resilient, clean energy job — the more likely it is that the community in question will (1) Be able to recover more quickly from a climate event; (2) Be able to withstand some shocks; and (3) Avoid the impacts of a climate event altogether.See footnote 6 

Considerations of Local Hiring Requirements and Incentives Programs for Economic Resilience

Economic

  • Successful implementation of local hiring requirements often involves incentivizing local businesses to hire local community members.
  • Incentives can be monetary, and funding can come from federal sources, county fees (like Prince George’s County’s Clean Water Act Fee), public bonds, private activity bonds, private investments, utility fees, and grant programs.

Environmental

  • Local hiring requirements and incentives can be used to complete green/environmentally friendly projects, like stormwater management and solar panel installation.
  • Funding can come from sources like HUD and FEMA, but require that a state legislatively implement MWBE or low-income hiring requirements.

Social/Equity

  • One way to realize the goal of frontline community employment is to implement specific hiring targets within agreements or contracts.
  • These targets or provisions can require that underserved workers perform a specific number of hours or a certain percentage of the project, or that businesses or communities retrofitted through projects with hiring incentives are owned or occupied frontline or disadvantaged people.
  • Homes and businesses owned by members of nearby disadvantaged populations are often affected most by climate events, and typically overlooked when it comes to retrofitting for solar panels, stormwater management, etc.
  • Targeting these buildings and areas through projects that hire locally can help frontline community members feel more invested in the results, as they could be working on improving their own community.

Administrative

  • The creation of local hiring programs can be done purely through non-profit/private organizations, or through government agencies.
  • To help draw in potential contractors, organizations, or agencies seeking to advance local hiring practices can educate businesses about the potential benefits of hiring local workers (compensation, incentive fees, tax breaks, etc.).

Legal

  • Using legally binding documents, such as community workforce agreements and project labor agreements, can help achieve local hiring requirement goals. The provisions of a contract can explicitly set out the targets for hiring frontline community members for projects.
  • Some jurisdictions have requirements on hiring local laborers for publicly funded projects.See footnote 7 Local governments or policymakers can seek to implement similar legislation to encourage local economic stability.
  • Local governments may need to implement MWBE specific language in local laws and ordinances that include regulations to satisfy procurement requirements under regulations associated with federal grants that contain socioeconomic contracting provisions.

Lessons Learned

  • Programs that have both training curricula and hiring agreements with local businesses have proven to be very successful. By having both programs, organizations can ensure that training graduates feeding into hiring processes are adequately prepared to enter the clean energy workforce.
  • As with workforce development programs, those looking to implement or promulgate hiring requirements should look to both the public and private sectors for incentivization funding. For example, because local hiring helps to advance economic stability within a region, private organizations promulgating these types of programs should work with the local government to see if there is an opportunity to leverage local funding.
  • Hiring programs, contracts, and regulations should focus on ensuring that local, frontline community members have opportunities for placement on projects, and that local businesses owned by frontline community members benefit as well. In addition to requiring that contractors hire a specific number or percentage of disadvantaged workers, hiring programs can also require that contractors selected to participate in the program come from frontline or disadvantaged communities.
  • Having explicit language within a contract or agreement with a contractor that members of frontline communities must complete a specific portion of labor for a project has helped to ensure that programs hit and often surpass their targets. Provisions included in contracts relating to frontline community members include hours of work completed, percentage of workers involved in the project, businesses reached and participating in the hiring process, and more.
  • Public-private partnerships have proven successful when it comes to getting large-scale projects done using a local workforce. In specific instances where a project may be too large or expensive for the local government to undertake alone, policymakers can choose from contractors bidding on the project based on a variety of factors, including commitments to hire from the local frontline community. In exchange for a private organization to take responsibility for carrying out the project, the local government can agree to sign over a portion of the profits the project accumulates.

 

Related Resources

 
Clean Energy Works Portland, Oregon

The City of Portland’s Bureau of Planning and Sustainability partnered with a wide variety of stakeholders to begin a pilot program — Clean Energy Works Portland. The Program provides solar panel installation and energy efficiency upgrades to members of the Portland, OR community, with a focus on employing disadvantaged populations, including people of color and women. This goal of employing disadvantaged community members was realized through a legally binding “Community Workforce Agreement” (CWA). The CWA required that, among other things, individuals that have historically been disadvantaged or underrepresented in the workforce — which includes people of color, women, and those with lower income — had to complete 30% of the total hours the project required. Additionally, historically underrepresented individuals owned businesses representing 20% of the contractors selected to complete the project. By the time the pilot was completed in March 2011, 500 homes had been enrolled in the program; almost 400 workers received paychecks who otherwise may not have had work; and people of color worked nearly 50% of the total hours.

Prince George's County, Maryland Clean Water Partnership

The Prince George’s County Clean Water Partnership (CWP) — between Prince George’s County and a private company, Corvias — began in 2014 to retrofit 2,000 acres of property for the purposes of stormwater management. As part of this process, both partners agreed that an emphasis on providing employment for local, under-represented communities was necessary. Within a three-year period, completion of the project involved contracting 66 businesses, reaching almost 1,600 businesses, and generated over 200,000 hours of work. The project also blew past their goals for under-represented employment: target class participation was 40%, but actual participation was 87%; target participation of local businesses was 50%, but actual participation was 82%; targeted hours for local employment was 51%, but actual was 57%. In all, the program delivered on all 2,000 in half the time for half the price. Because of the success of the first project, the Clean Water Partnership between Prince George’s County and Corvias was extended 30 years for 4,000 acres with the same goals of hiring underrepresented community members as a requirement.

People United for Sustainable Housing (PUSH Buffalo), New York

PUSH Buffalo was founded in 2005 to serve as a resource to residents in Western New York communities to help provide affordable, resilient housing, create local hiring opportunities for underserved members of the community, and “advance economic and environmental justice in Buffalo.” Since its founding, the nonprofit has established a wide variety of programs that advance these goals, including the Hiring Hall, which in turn helps to staff PUSH Green. PUSH’s Hiring Hall works with underemployed and unrepresented members of the Buffalo community — primarily people of color and women — to train frontline community residents on a variety of different careers, especially focusing on the green energy/technology field. Since its founding, the Hiring Hall has trained more than 225 disadvantaged Buffalo residents of the community, and employed almost 50 full time with companies across Western New York. PUSH Green contracts these employees from the Hiring Hall and other members of the Buffalo community to facilitate its vision: to create a resilient community that transitions from fossil fuel to green energy, and to help build green, affordable housing throughout the city. Since beginning its work in the GDZ, PUSH has created more than 100 living wage jobs for local residents and retrofitted 120 properties within the zone. PUSH Green has now extended beyond its initial GDZ program to offer its services — retrofitting, energy assessment, solar installation, financing, etc. — and employment opportunities to under-represented individuals statewide.

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