Indiana Port commissioner resigns over Pence, construction wage

David Fagan, a Portage resident who was appointed twice by previous Gov. Mitch Daniels, submitted a letter of resignation Friday over concerns that middle-class wages would be slashed if the state got rid of local panels that establish wages for publicly financed projects. Fagan is a Republican labor leader who founded the Lunch Pail Republicans group that encouraged his party to be both pro-business and pro-labor.

"In light of your public support for the repeal of Indiana's Common Construction Wage, I can no longer in good conscience be associated with your administration," he wrote.

The Indiana House has voted to repeal an 80-year-old law that sets a minimum wage for trade union workers who work on public construction projects that cost more than $350,000. Supporters say a repeal would reduce the cost of public projects and save taxpayers' money, while opponents say it would cut wages, kill local jobs, and invite a slew of out-of-state contractors.

"Indiana is ranked 38th in per capita income, and the governor's solution is to cut wages on good middle class jobs," Fagan said. "What sense does that make?"

Fagan, who is also financial secretary of the International Union of Operating Engineers Local 150, helped oversee the state's port system, which includes the Port of Indiana-Burns Harbor. He will step down from the seven-member bipartisan port commission April 30. 

The former Portage city councilman said he had enjoyed pursuing good-paying jobs and economic growth at Indiana's three ports on Lake Michigan and the Ohio River. But he said in his resignation letter he was troubled that Pence had done nothing to invest in long-term infrastructure needs. 

"Instead, you have put your energy toward an initiative that will do far more harm than good in the lives of working Hoosiers, Indiana contractors and small businesses," he wrote. "The repeal of Indiana's Common Construction Wage undermines the free market wages negotiated in the private sector and supporters of the repeal have publicly stated their support for utilizing foreign guest workers in our construction industry. I cannot understand why Indiana's Republicans have sided with out-of-state and foreign workers. That this is even being considered is a tragedy for our party and our state."

A state Senate committee hearing will take place this week to consider an amendment to the bill the House passed in February.

Fagan, whose four-year term expires June 30, believes the legislation would harm construction workers by bringing in out-of-state contractors to do construction work that now employs local residents.

"By repealing Common Construction Wage, you will slash wages for Indiana workers, cripple Indiana contractors, starve small businesses and reduce our state's tax revenue," Fagan wrote. "In addition, you will undermine private sector training for Indiana’s youth, which directly contrasts your statements in support of additional worker training."

Pence was vacationing in Europe on Friday. His office did not immediately respond to a request for comment.