May, 2009

THE LEGAL LANDSCAPE FOR COMMUNITIES SEEKING TO BRING WEATHERIZATION BENEFITS HOME

The American Recovery and Reinvestment Act commits $789 billion in tax dollars “to create jobs, jumpstart growth and transform [the] economy to compete in the 21st century.”[1]In more than 400 pages of text the Act appropriates these funds through numerous Federal departmentsthat have the responsibility of dispersing them directly to the states or through competitive contracts.[2]Although many of these laws are broadly applicable, we focus particular attention on the Act’s potential to impact the states of Alabama, Kentucky, Mississippi, New Mexico, North Carolina, South Carolina, and Virginiathrough funds dispersed by the Department of Energy and the U.S. General Services Administration for “greening” buildings and creating a “smart grid” to transition the country to renewable energy.This paperexamines numerous federal laws that can help ensurethat communities – especially people of color, women, and low-income individuals – can benefit from the many employment and community improvement opportunities the Recovery Act is expected to generate at the local level.

“The purposes of this Act include the following:

(1) To preserve and create jobs and promote economic recovery.

(2) To assist those most impacted by the recession.

(3) To provide investments needed to increase economicefficiency

byspurring technological advances in science and health.

(4) To invest in transportation, environmental protection, and

other infrastructure that will provide long-term economic

benefits.

(5) To stabilize State and local government budgets, in order to

minimize and avoid reductions in essential services and

counterproductive state and local tax increases.”

– Section 3, American Recovery and Reinvestment Act of 2009

RECOVERY AT THE STATE LEVEL

According to the Department of Energy, from its $38.7 billion in Recovery Act funds, afull $5 billion has been set aside to weatherize private homes with an additional 3 billion going to states for “their own energy priorities.”[3] Recently, the White House announced that the $5 billion weatherization fund, which is meant to focus on low-income households, will be coordinated by the DOE and the Department of Housing and Urban Development.[4]This interagency collaboration is expected to “help minimize administrative barriers and simplify the process for residents of HUD public and assisted housing that are seeking to weatherize their homes under the DOE Weatherization Assistance Program.”[5]Additionally, this agreement is expected to impact rural communities, chiefly seniors and low-income residents, through the U.S. Department of Agriculture’s Multi + Housing Direct Loan Program.[6]The DOE also reports that another $3.2 billion in funds has been designated for energy efficiency and conservation efforts at the state and local levels; these monies are expected to be used for improving the efficiency of homes and buildings, such as schools, libraries, and fire stations.[7]In the seven states we are examining, weatherization funding alone has been earmarked as follows:[8]

  • Alabama:$ 71,800,599
  • Kentucky:$ 70,913,750
  • Mississippi:$ 49,421,193
  • New Mexico:$ 26,866,604
  • North Carolina:$131,954,536
  • South Carolina:$ 58,892,771
  • Virginia:$ 94,134,276

Moreover, the U.S. General Services Administration has been allotted $5.55 billion to move Federal buildings “into high-performance green buildings” and for the renovation and construction of Federal buildings, courthouses, and land ports of entry.[9] The GSA has already created its spending plan, purporting to have selected projects using two criteria: (1) The project’s ability to employ people quickly, and (2) the transformability of the building into a high-performance green building.[10] To date, the buildings identified for greening in our focus states include three buildings each in Alabama and South Carolina, four each in Kentucky and Mississippi, and five each in New Mexico, North Carolina, and Virginia.[11]

The pending distribution of these funds not only representsvast changes for the one million homes that are expected to be weatherizedthroughout the country, but also for the many thousands of workers needed to ensure these Recovery Act funds achieve their intended outcome. At the state level, the estimated growth in new jobs and/or the retention and expansion of existing jobs is projected to be as follows:[12]

  • Alabama: 52,200 jobs
  • Kentucky: 48,000 jobs
  • Mississippi: 30,000 jobs
  • New Mexico: 22,000 jobs
  • North Carolina:105,000 jobs
  • South Carolina: 50,000 jobs
  • Virginia: 93,000 jobs

When viewed through the lens of Congressional Districts, according to the White House, the impact of Recovery Act jobs is predicted to be:[13]

State / Dist.
1
jobs / Dist.
2
jobs / Dist.
3
jobs / Dist.
4
jobs / Dist.
5
jobs / Dist.
6
jobs / Dist.
7
jobs / Dist.
8
jobs / Dist.
9
jobs / Dist. 10
jobs / Dist.
11
jobs / Dist.
12
jobs / Dist.
13
jobs
AL / 7,400 / 7,200 / 7,500 / 7,200 / 7,700 / 8,200 / 6,800
KY / 7,600 / 8,200 / 7,700 / 8,300 / 7,600 / 8,400
MS / 7,900 / 7,000 / 7,500 / 7,500
NM / 7,600 / 7,100 / 7,500
NC / 6,900 / 8,300 / 8,000 / 9,200 / 7,700 / 8,000 / 8,200 / 7,800 / 9,500 / 7,800 / 7,500 / 7,800 / 8,700
SC / 9,200 / 8,800 / 7,900 / 8,400 / 8,300 / 7,600
VA / 9,100 / 7,800 / 7,700 / 8,700 / 7,800 / 8,000 / 9,000 / 8,300 / 7,700 / 9,500 / 9,300

IMPACTING THE LOCAL LANDSCAPE

With both funding resources and employment opportunities expected to increase substantially in short order, now is the time for communities to prepare to influence the allocation of those resources and jobs, to ensure that people of color, women, and low-income individuals are not bypassed as the nationprepares to “preserve and create jobs” and to “assist those most impacted by the recession.”[14]Because it unclear that current approaches to retrofitting buildings encourage the type of community participation and project planning necessary to ensure strategic, community-focused distribution of Recovery Act funds and its benefits, we encourage communities to take a two-step approach to prepare for the coming changes.

First, we encourage communities to become familiar with the numerous federal civil rights protectionsthat govern the distribution of Recovery Act funds. Second, we encourage communities to consider negotiatingagreements that spell out how local decision-makers will distribute the Recovery Act benefits in a way that supports community organizing and community benefits.

STEP ONE: GETTING TO KNOW KEY LAWS

It would be a monumental task to analyze every federal law impacting distribution of Recovery Act funds because many of the federal departments and agencies handling the funds are subject to particular requirements and laws based on their respective regulatory framework. Nevertheless, there are some federal laws that can – and should – be applied without regard to which department is allocating the funds. Here we will briefly introduce some key federal protections that communities can incorporate into their organizing efforts to ensure training opportunities and jobs are made available to minority workers and that these workers are paid a livable wage.

In its April 3, 2009 implementing guidance, the OMB instructs Federal agencies to take steps to ensure Recovery Act recipients “comply fully with their responsibilities under the full range of civil rights laws.”[15]It goes on to say “to the extent possible and consistent with the principles underlying our national commitment to civil rights and equal opportunity,” Recovery Act fund recipients should be encouraged to “implement best practices for ensuring that all individuals – regardless of race, gender, age, and national origin – benefit from the Recovery Act.”[16]Specifically, the OMB states that Recovery Act funds must be distributed in accordance with:

“All anti-discrimination and equal opportunity statutes, regulations, and Executive

Orders that apply to the expenditure of funds under Federal contracts, grants,

cooperative agreements, loans, and other form of Federal assistance. Grant-

making agencies shall ensure that their recipients comply with Title VI of the Civil

Rights Act of 1964, Title IX of the Education Amendments of 1972, Section 504 of

The Rehabilitation Act of 1973, the Age Discrimination Act of 1975, and any

program-specific statutes with anti-discrimination requirements. Generally applicable

civil rights laws also continue to apply, including (but not limited to) the Fair Housing

Act, the Fair Credit Reporting Act, the Americans with Disabilities Act, Title VII of the

Civil Rights Act of 1964, and the Equal Educational Opportunities Act, the Age

Discrimination in Employment Policy Act, and the Uniform Relocation Act”[17]

Executive Orders

While there are a number of Executive Orders that might apply to Recovery Act funds, numbers 13166, 11246, and the order issued on February 6, 2009 by President Obama regarding the use of Project Labor Agreements for federal construction projects, are of particular significanceduring this time of massive economic recovery. These orders create a useful framework for grassroots leaders interested in ensuring equitable access to job training and allocation of Recovery Act jobs.

Executive Order 13166: According to the Civil Rights Division of the Department of Justice, Coordination and Review Section, this order requires federal agencies to ensure that “recipients of federal financial assistance provide meaningful access to Limited English Proficient (LEP) applicants and beneficiaries.”[18] This means that if a federal agency contracts with a private agency or other entity to provide a service to the public, that agency or entity must ensure LEP access to the services it is providing. Moreover, this order has been defined to apply to all federally conducted activities. In turn, these activities have been broadly defined to include all federal “benefits or services.”[19]

In terms of Recovery Act funding this means, for example, that job training programs and vocational schools funded with federal monies will be required to comply with Executive Order 13166. Furthermore, once a locality accepts federal funds, the federal requirement mandating meaningful access for LEP individuals supersedes local or State “English-only” laws.[20]

Executive Order 11246:This order requires that federal contractors take affirmative steps to ensure minority applicants are employed – and once on the job – treated without regard to their race, color, religion, sex, or national origin.[21] For the purposes of this order, applicants who are American Indian, Alaskan Native, Asian, Pacific Islander, Black, or Latino are considered minorities.[22] A contractor who violates the requirements of this order may have her/his contracts canceled or suspended and s/he may be declared ineligible for future government contracts.[23]The regulations accompanying Executive Order number 11246 distinguish between construction and non-construction contractors, setting out different affirmative action provisions for each.The fact that contractors are grouped into two categories is worth noting because both types of contractors will likely operate using Recovery Act funds.

  • Non-Construction Contractors

The non-construction grouping of contractors includes supply and service contractors that have at least 50 employees and government contracts reaching at least $50,000.

Supply and service contractors meeting the 50/$50,000 threshold are required to develop and implement an Affirmative Action Program for each site. The AAP must be in writing.

According to the Office of Federal Compliance Programs, an AAP is created by the contractor her/himself and it is a “set of specific and result-oriented procedures to which a contractor commits itself to apply every good faith effort.”[24]

The AAP is expected to demonstrate which areas of the contractor’s workforce include women and racial minorities. This helps the contractor and the Office of Federal Contract Compliance Programs determine if women and minority workers are being underutilized.

The regulations accompanying Executive Order 11246 define underutilization of women and minority workers as a work force that has fewer minorities or women employed in a single job group than one would expect to find based on their availability. When considering the “availability” of minorities and women, contractors are expected to take into consideration “the presence of minorities and women having requisite skills in an area in which the contractor can recruit.”[25]

  • Construction Contractors

Because the workforce in the construction industry is often fluid and temporary, the construction industry is subject to tailored affirmative action requirements under Executive Order 11246.

First, it is the responsibility of the Office of Federal Contract Compliance Program to specify goals and to identify the affirmative action the contractor must take. Along these lines, the OFCCP has issued a national goal for the hiring of women. This goal has been set at 6.9 percent since 1980 and remains in effect.

Second, unlike supply and service contractors, construction contractors do not have to create a written Affirmative Action Plan but they are required to take certain “good faith steps” to increase the hiring of minorities and women.[26]

Executive Order on Project Labor Agreements:This February 6, 2009 Executive Order can also prove helpful to community in efforts to ensure green jobs are made available to minority workers. While the order does not, in and of itself make Project Labor Agreements mandatory, it does two very important things: (1) It revokes Executive Order 13202 which forbade federal agencies from requiring contractors to sign PLAs with unions; and (2) it makes clear – and in fact encourages – federal agencies to “consider requiring the use of project labor agreements in connection with large-scale construction projects in order to promote economy and efficiency in Federal procurement”[27] (emphasis added). Additionally, when a PLA is created, the Executive Order requires that it “bind all contractors and subcontractors on the construction project.” This is important because it is anticipated that Recovery Act fund distribution could involve numerous levels of subcontracting. Lastly, it requires PLA’s to set out procedures for resolving labor disputes and that the PLA create mechanisms for fostering cooperation between labor and management on “matters of mutual interest” such as “productivity, quality of work, safety, and health.”[28]

Civil Rights Laws

As noted in the implementing guidance issued by the OMB, a number of civil rights laws apply to Recovery Act funding. Below we examine some of the leading statutes that community can use to ensure the doors of opportunity are open to them at the job-training and job-allocation stages.

Title VI of the Civil Rights Act of 1964: Programs receiving federal funding are subject to Title VI of the Civil Rights Act of 1964, which makes it illegal to discriminate on the basis of race, color, or national origin.

“No person in the United States shall, on the ground of race, color,

or national origin, be excluded from participation in, be denied the

benefits of, or be subjected to discrimination under any program or

activity receiving Federal financial assistance.”

– Section 2000d,CivilRights Act of 1964

Where a recipient of federal funds is found to have discriminated on the basis of race, color or national origin, the federal agency or department responsible for issuing the funds must take one of two steps: (1) Move to terminate the funds or (2) Refer the issue to the Department of Justice for the proper legal action. Additionally,individuals impacted by a violation of Title VI can file an administrativecomplaint with the agency responsible for having issued the money.[29]Unfortunately, in 2001 the Supreme Court severely limited the public’s ability to file suit based on Title VI violations by finding that a Title VI violation only exists where intentional discrimination has taken place and that Title VI regulations do not afford individuals a private right of action where the claim alleges disparate impact.[30]

Title IX of the Education Amendments of 1972: This statute applies to education programs or activities funded with federal monies.[31] It forbids discrimination, exclusion, or the denial of benefits to anyone on the basis of their sex.[32]

“No person in the United States shall, on the basis of sex, be

excluded from participation in, be denied the benefits of, or

be subjected to discrimination under any education program

or activity receiving Federal financial assistance.”

- Section 1681(a), Title IX, Education Amendments of 1972

Title IX extends to a wide range of educational institutions including, “any public or private preschool, elementary, or secondary school, or any institution of vocational, professional, or higher education, except that in the case of an educational institution composed of more than one school, college, or department which are administratively separate units, such term means each such school, college or department.”[33]It also protects individuals living with blindness or severe vision impairments because it makes denying them admission into “any course of study by a recipient of Federal financial assistance for any education program or activity,” illegal.[34] The Federal department or agency extending the funds is entitled to demand compliance by terminating assistance or refusing to grant assistance “to any recipient…where there has been an express finding on the record, after reasonable notice and opportunity for hearing, of a failure to comply” or the Federal department or agency can use “any other means authorized by law.”[35]

In anticipation of a rise in the need for vocational training in order to produce a workforce capable of meeting the large-scale demand for weatherization of homes and greening of public buildings, combined with community’s interest in ensuring such learning opportunities are made available to low-income and minority individuals, this law can play a key role in helping community examine spending plans with an eye for equitable access.

Section 504 of the Rehabilitation Act of 1973: Section 504 is meant to protect persons with disabilities. Specifically, it prohibits disability discrimination where federal monies are used to fund a program or activity. Persons with disabilities are defined to include persons who have a physical or mental disability resulting in a “substantial handicap to employment” but which person “can reasonably be expected to benefit in terms of employability from vocational rehabilitation services…”[36]

“No otherwise qualified individual with a disability in the United

States, as defined in section 706(20) of this title, shall solely by

reason of her or his disability, be excluded from the participation

in, be deniedthe benefits of, or be subjected to discrimination

under any programor activity conducted by any Executive agency….”

- Section 504(a), Rehabilitation Act of 1973

While Section 504 defines programs or activities receiving federal monies to include many entities, those most relevant in the context of Recovery Act opportunities are likely to be the following:the departments, agencies, special purpose districts or other instrumentalities of a State or local government; where a State or local government has received federal financial assistance, “the entity” of the State or local government “that distributes such assistance and each such department or agency (and each other State or local government entity) to which the assistance is extended;” colleges, universities, or “other postsecondary institution or a public system of higher education;” and systems providing vocational education or “other school system[s].”[37]Where an entity is believed to have violated Section 504, the Rehabilitation Act makes available to the aggrieved party all of the “remedies, procedures, and rights set forth in title VI of the Civil Rights Act of 1964.”[38] In turn, the Rehabilitation Act defines a violation as including “any act or failure to act” by an entity receiving Federal assistance to provide assistance to the public or by a Federal provider who is expected to provide assistance.[39]