Master Builders: Regents decision will cost Iowa jobs

A decision by officials in the state Board of Regents office to not require an Illinois construction firm to use mostly Iowa workers for a University of Iowa project will cost 150 to 175 Iowa jobs, Master Builders of Iowa says.

Master Builders of Iowa, a trade association representing more than 2,000 businesses in Iowa construction, on Tuesday said the regents office rejected legal arguments presented by Master Builders asking the regents office to enforce Iowa's “reciprocal preference law” for the UI's Pappajohn Biomedical Discovery Building.

“We had hoped that the regents would stand up for Iowans and work through whatever gray areas that there might be and save some jobs,” Scott Norvell, president and chief executive officer of Master Builders, said. “There wasn't an effort made to do that, and we're very disappointed.”

Officials with the state Board of Regents office in Des Moines declined to comment Tuesday on the statements from Master Builders.

But the regents office memo, dated Aug. 16, regarding the awarding of the nearly $70 million construction contract to a Chicago firm for the UI project says “the board office thoroughly reviewed the issue raised by the Master Builders of Iowa and finds it to be without merit.”

The regents office last week chose Walsh Construction Company from seven bidders on the project. Walsh had the low bid of $69.9 million. Two Iowa companies were among the seven – Knutson Construction Services Midwest of Iowa City, with a bid of $70.4 million, and McComas-Lacina Construction of Iowa City, with a bid of $74.95 million.

The Board of Regents doesn't have to approve the awarding of a construction contract, which can be done by the regents executive director. The board has approved other steps for this UI project, such as the design and budget.

Illinois in June enacted the Illinois Preference Act, which says any out-of-state construction contractors must hire 90 percent of its workers from Illinois for projects in that state.

Masters Builders of Iowa argues that Iowa law is a “reciprocal preference law,” which says when contractors from other states that have preference laws - such as the new one in Illinois - will be held to that same restriction in Iowa. Norvell says the regents are obliged to follow that Iowa law.

He is referring to Iowa code 73A.21, which says “when a contract for a public improvement is to be awarded to the lowest responsible bidder, a resident bidder shall be allowed a preference as against a nonresident bidder from a state or foreign country which gives or requires a preference to bidders from that state or foreign country. The preference is equal to the preference given or required by the state or foreign country in which the nonresident bidder is a resident.”

Norvell said the estimate of 150 to 175 lost Iowa jobs is based on past projects of similar size and on Walsh Construction's proposed subcontractor list for the UI project.