Construction contractors on projects that get a tax break would be asked to pay workers the prevailing wage under a proposed City Council proclamation.
The proclamation – sponsored by Councilmen Doug Linkhart and Rick Garcia – is the latest move by labor groups and supporters to require market-rate wages on projects that get tax-increment financing.
Tax-increment financing is used to encourage private developers by subsidizing projects through property- and sales- tax reimbursement.
Mayor John Hickenlooper’s administration and the Denver Urban Renewal Authority – which manages tax-increment financed projects – have resisted “blanket” prevailing-wage legislation.
A proclamation does not have the force of law, but the sponsors say it would set an “expectation” for projects that need council approval.
The measure could be brought before the council Monday, the sponsors said.
The mayor’s position has not changed, a spokeswoman for Hickenlooper said.
Linkhart said the proclamation would request, not require, prevailing wages.
“It doesn’t mean that they have to every time,” Linkhart said.
“It means that when they present a plan to us using tax-increment financing, they should show it using prevailing wage,” he said. “And if that keeps the project from getting financed, then they need to show us why – give us the numbers.”
Helping along “difficult projects”
Tax-increment financing has been used to prime projects such as the Gates rubber plant redevelopment and the Lowenstein Theater.
“By definition these are the most difficult projects around,” said Tracy Huggins, executive director of the Urban Renewal Authority. “That’s why we are involved.”
The city of Denver has a prevailing- wage ordinance on city projects, but Huggins said tax-increment financing is used to help private businesses on private property.
The financing allows the development to pay off loans using the tax revenues generated by the project itself.
“You have to believe in the ‘but for’ argument,” she said, “which is that, but for this project there would not be any revenues.”
But Tom Rutherford, an electrician with the Prevailing Wage Committee labor group, called the measure “common sense.”
“We don’t want to stop any development,” he said. “Basically we want a fair wage that is involved in one of these projects.”
Staff writer George Merritt can be reached at 303-954-1657 or gmerritt@denverpost.com.
