EDITORIAL: Administration's Alaska-hire decision followed the law

Local hire has always been a favorite issue to demagogue in Alaska, and, as the 2014 election approaches, the well-worn theme has reappeared.

The catalyst for last week’s dust-up was the state administration’s decision to drop a rule giving Alaskans in certain areas a hiring preference on public construction projects that are paid for entirely with state and local funds.

Critics said that Gov. Sean Parnell’s administration was somehow doing this for political gain. That argument is difficult to swallow, given that the Alaska hire preference is a perennially popular concept, however fraught with legal problems it may be.

In fact, Parnell’s administration was just following the law. Would his critics want the administration instead to break it?

In effect, that’s what they suggest, because there is no way the preference can stand under current law in the urban areas of the state. The administration did the only honest thing it could when it dropped the preference for those regions. Preferences continue in effect in many rural areas because high unemployment makes them applicable in those areas, though not in every trade.

The state’s law evolved after numerous court decisions rejecting earlier Alaska-hire preferences. Current law hasn’t been successfully challenged.

The law says the commissioner of labor “shall” declare a zone of underemployment if he finds that “the rate of unemployment within the zone is substantially higher than the national rate of unemployment.” In that zone, the commissioner is allowed to decide how much work “must be performed under this section by qualified residents” on projects. The state has required 90 percent, given the flexibility in the law.

The preference only applies on projects that are completely funded by the state and its political subdivisions, local governments. Projects with full or partial federal funding, which provide a majority of the public construction jobs in the state, don’t qualify. The preferences apply by craft and trade. (The law says an area, to qualify as a zone of underemployment, also must have “a substantial number of residents have experience or training” in typical public works jobs.) The zones are reviewed every two years, by law.

The problem is obvious. Across the urban areas of Alaska and in some rural areas, the unemployment rate has fallen well below the national rate. That’s great news, but, when it happens, the state cannot by law maintain the preference. So last week, when the state released its biennial list of places where the preference applies, the major urban areas — Fairbanks, Anchorage, Juneau, Kenai and Ketchikan — were not on it. Most rural areas, where unemployment remains well above the national rate, are on the list, although many specific trades are no longer covered. For example, the preference still applies in the Denali Borough but only for carpenters.

Some critics said the state has in the past treated the entire state as a zone of underemployment, implying that this policy should have been continued. However, had the Parnell administration analyzed the state as a single zone, all the Alaska hire preferences in rural areas would have disappeared as well.

The administration did its job. It followed the law, and it did so in a fashion that preserves preferences where they’re defensible under the long legal history behind this policy.

Updated: 
08/29/2013 - 10:40am

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