Arizona State Building and Construction Trades Council v. Brnovich

          ORDER

          Honorable Roslyn O. Silver Senior United States District Judge.

         Plaintiff Arizona State Building and Construction Trades Council believes a statutory provision Arizona enacted in 2011 as well as a statutory provision enacted in 2015 are preempted by federal law. In their current form, the statutory provisions prohibit political subdivisions of the state from requiring bidders for public contracts to enter into certain labor agreements or participate in apprenticeship programs. Plaintiff believes these provisions are preempted by, among other federal laws, the National Labor Relations Act. Plaintiff also alleges the way the provisions were passed violated other state laws. Defendant Mark Brnovich, sued in his capacity as the Attorney General of Arizona, seeks dismissal of the complaint, arguing Plaintiff lacks standing, the claims are not ripe, and the claims are barred by sovereign immunity. The motion to dismiss will be granted and the Court will provide Plaintiff with limited leave to amend.

         BACKGROUND

         Plaintiff describes itself as “an association of Arizona construction trade unions . . . with a mission to provide and continue to grow an exceptional labor force.” (Doc. 16 at 2). While not explicitly alleged or explained, Plaintiff apparently lobbies public entities regarding the type of labor agreements those entities should use in completing publicly funded projects such as public transportation facilities. As part of its lobbying efforts, Plaintiff believes public entities should enter into “project labor agreements.” A “project labor agreement” or “PLA” “is a type of collective bargaining relationship involving multiple employers and unions that agree to abide by a uniform labor agreement in their bids on public works projects.” Interpipe Contracting, Inc. v. Becerra, 898 F.3d 879, 885 (9th Cir. 2018). In other words, a PLA “systemize[s] labor relations at a construction site” by ensuring the “wages, hours, and other terms of employment [are] coordinated or standardized . . . across the many different unions and companies working on the project.” Bldg. & Const. Trades Dep't, AFL-CIO v. Allbaugh, 295 F.3d 28, 30 (D.C. Cir. 2002).

         In connection with its lobbying efforts, “[i]n late 2010 and early 2011, ” Plaintiff lobbied the Arizona Corporation Commission to “encourage” the use of PLAs. (Doc. 16 at 4). The Corporation Commission was close to imposing PLA-type requirements for certain work when, in direct response to Plaintiff's efforts, Arizona added a provision to A.R.S. § 34-321. The new provision precluded state agencies or political subdivisions from requiring PLAs in connection with contracts for public works. The new statutory provision stated, in relevant part,

Agencies and political subdivisions of this state shall not require in any public works contracts that a contractor, subcontractor, material supplier, or carrier engaged in the construction, maintenance, repair or improvement of public works, negotiate, execute or otherwise become a party to any project labor agreement or other agreement with employees, employees' representatives or any labor organization as a condition of or a factor in bidding, negotiating, being awarded or performing work on a public works contract.

EMPLOYEES AND PUBLIC WORKS, 2011 Ariz. Legis. Serv. Ch. 23 (S.B. 1403).

         If Arizona had not enacted this “anti-PLA provision, ” Plaintiff's “efforts to have political subdivisions use PLAs would have remained active and ongoing.” (Doc. 16 at 5). Passage of the provision, however, allegedly prevents Plaintiff from continuing its efforts. Plaintiff alleges it wishes to “advocate for, propose, testify, and enter into negotiations with political subdivisions to adopt PLAs” but it cannot do so at present because of the existing statute. (Doc. 16 at 5).

         After the change in Arizona law regarding PLAs, Plaintiff “began working with municipalities to encourage the use of highly skilled labor on publicly funded construction projects.” (Doc. 16 at 6). As part of those efforts, Plaintiff recommended “Arizona charter cities, ^[1] including Phoenix, Tempe and Tucson, adopt a Responsible Contractor Ordinance that would require any contractors performing work that is funded with the city's tax dollars participate in a Department of Labor approved apprenticeship program.” (Doc. 16 at 6). In response to Plaintiff's actions, the state legislature passed another statute aimed at frustrating Plaintiff's work. That statute restructured A.R.S. § 34-321 and added a new prohibition on state agencies or political subdivisions from requiring bidders for public works contracts “[p]articipate or contribute to an apprenticeship program that is registered with the United States department of labor.” PUBLIC WORKS-EMPLOYEES, 2015 Ariz. Legis. Serv. Ch. 144 (S.B. 1090).

         Once this 2015 statute went into effect, Plaintiff stopped its lobbying efforts regarding apprenticeship programs. Plaintiff alleges it is not presently engaged in efforts to “advocate for, propose, testify, and enter into negotiations with political subdivisions” regarding apprenticeship programs but Plaintiff would like to do so. (Doc. 16 at 7).

         Plaintiff's failure to engage in lobbying efforts regarding PLAs and apprenticeship programs is allegedly because of a statute Arizona enacted in 2016. That statute allows for any member of the legislature to direct the Attorney General to investigate an “ordinance, regulation, order or other official action adopted or taken by the governing body of a county, city or town that the member alleges violates state law or the Constitution of Arizona.” A.R.S. § 41-194.01. If the Attorney General determines the “county, city or town” has taken action contrary to state law, the Attorney General must notify the State Treasurer and the State Treasurer must then withhold state funds the county, city, or town otherwise would receive. If there is some question whether the local action violates state law, the Attorney General is required to file a special action in the Supreme Court of Arizona to resolve the issue. The Attorney General has filed at least one special action against a local entity after concluding there was a substantial question about the legality of a local ordinance. See State ex rel. Brnovich v. City of Tucson, 399 P.3d 663, 672 (Ariz. 2017) (addressing City of Tucson's ordinance regarding disposition of firearms). According to Plaintiffs, this statute is so draconian that no county, city, or town is willing to “pass[] an ordinance to challenge the unconstitutional state law, including for the purpose of bringing a lawsuit.” (Doc. 16 at 7).

         On November 30, 2017, Plaintiff filed the present suit. The original complaint, brought solely against the State of Arizona, alleged the provisions of A.R.S. § 34-321 regarding PLAs and apprenticeship programs were preempted by federal law. The original complaint asserted two claims based on federal preemption theories. The original complaint also asserted two claims under Arizona law. Those claims alleged the relevant provisions of § 34-321 were enacted contrary to the requirements of other state laws. The State of Arizona moved to dismiss, arguing sovereign immunity barred all of Plaintiff's claims.

         Instead of responding to the first motion to dismiss, Plaintiff amended its complaint to name the Attorney General as the sole defendant. (Doc. 16). The Amended Complaint contains the same four claims. That is, two federal claims and two state-law claims. Plaintiff seeks only injunctive and declaratory relief in the form of an order finding federal law preempts the relevant portions of § 34-321. The Attorney General now seeks dismissal of ...