The Buffalo Bills’ Stadium Subsidy Is a Hand-Off to Unions

Hochul’s giveaway comes with a ‘prevailing wage’ provision that will inflate construction costs by 20%

By Peter Warren. Excerpts:

"Ms. Hochul has attached conditions to the deal that will drive up the construction cost by roughly 20% and assure that a big chunk of the subsidy will be wasted."

"Ms. Hochul is the first New York governor to hail from Buffalo since Grover Cleveland. Her husband is general counsel of Delaware North, the chief concessionaire at Highmark Stadium, the Bills’ current home in suburban Orchard Park. The new 60,000-seat facility is to be erected nearby, on the site of an existing stadium parking lot."

"That’s because of the state’s so-called prevailing-wage law, which effectively mandates that contractors on public construction projects such as schools, roads, bridges and subways pay union-level wages and benefits. Last year, a “source familiar with the negotiations” told the Buffalo News that the project’s $1.4 billion price tag was driven in part by “prevailing wage and union workforce requirements, among other rules.” Exactly how much the prevailing-wage law adds to the stadium deal is hard to know, but it’s likely in the hundreds of millions."

"A 2017 analysis by the Empire Center found that prevailing-wage laws added 13% to 25% to the cost of public construction in New York"

"The term “prevailing wage” is misleading since the pay levels it requires are neither prevailing nor limited to wages. The mandate applies in locales where 30% or more of construction workers are unionized. It jacks up benefits more than wages—including a portion that goes into underfunded union pension plans.

The state Labor Department refuses to disclose its methodology for implementing the law. Employee surveys aren’t conducted to verify if the 30% threshold is met—even in thinly unionized upstate regions. So there’s no way to know if taxpayers are being bilked worse than the law permits."

"most construction workers in the Buffalo area will be excluded from what the governor called “the largest construction project in Western New York history.”"

"Ms. Hochul’s initial press release crowing about the deal quoted the union council’s president, Gary LaBarbera, thanking the governor “for making union labor the focal point of the new Bills stadium construction project.”"

Mr. Warren is director of research for the Empire Center for Public Policy.