ABC's 2013 Issue Brief on Government-Mandated Project Labor Agreements (PLAs)

Posted In: [Public-PLAs: Federal (ABC Policy)]

ABC strongly opposes anti-competitive and costly government-mandated project labor agreements (PLAs). They are special interest schemes that end open, fair and competitive bidding on public works projects. PLAs drive up the cost of construction by reducing competition and effectively excluding merit shop contractors and their skilled employees from building projects paid for by their own tax dollars

ABC opposes government-mandated PLAs on federal and federally assisted construction projects.

In 2012, just 13.2 percent of the U.S. private construction workforce belonged to a union.

Learn more via ABC's 2013 issue brief on government-mandated PLAs.

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ABC's 2012 Issue Brief on Government-Mandated Project Labor Agreements

Posted In: [Public-PLAs: Federal (ABC Policy)]

ABC strongly opposes anti-competitive and costly government-mandated project labor agreements (PLAs). They are special interest schemes that end open, fair and competitive bidding on public works projects. PLAs drive up the cost of construction by reducing competition and effectively excluding merit shop contractors and their skilled employees from building projects paid for by their own tax dollars

ABC opposes government-mandated PLAs on federal and federally assisted construction projects.

In 2011, just 14 percent of the U.S. private construction workforce belonged to a union.

Learn more via ABC's 2012 issue brief on government-mandated PLAs.

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Federal Legislation Restricting Government-Mandated Project Labor Agreements Introduced in 113th Congress

Posted In: [Public-PLAs: Federal (Legislation)]

In the 113th Congress, ABC will educate lawmakers about the impact of discriminatory project labor agreement (PLA) mandates and preferences, and promote commonsense legislation restoring a level playing field in federal contracting. 

The Government Neutrality in Contracting Act (H.R. 436/S. 109), introduced by Rep. Andy Harris (R-Md.) and Sen. David Vitter (R.-La.) in the 113th Congress, prohibits federal agencies from requiring or prohibiting contractors to execute PLAs as a condition of winning a contract to build a federal or federally assisted construction project. It also prohibits discriminatory PLA preferences on federal and federally assisted construction projects. While allowing contractors to voluntarily enter into PLAs without government coercion, this legislation will effectively stop anti-competitive and costly government-mandated PLAs promoted by the Obama administration.

Key Resources:

• ABC National press release supporting legislation (1/30/13)
• 113th Congress issue brief on government-mandated PLAs (1/30/13)

Popular Tags: Project Labor Agreements (PLAs), government neutrality, federal contracting

A Review of Efforts to Restore Fair and Open Competition in Government Contracting in the 112th Congress

Posted In: [Public-PLAs: Federal (Legislation)]

In the 112th Congress, ABC educated lawmakers about the impact of discriminatory PLA mandates and preferences, as well as promoted commonsense legislation restoring a level playing field in federal contracting.

The Government Neutrality in Contracting Act (H.R. 735/S.119), introduced by Rep. John Sullivan (R-Okla.) and Sen. David Vitter (R. La.), prohibits federal agencies from requiring or prohibiting contractors to execute a PLA as a condition of winning a federal or federally assisted construction contract.

It finished the 112th Congress with a record 181 cosponsors in the House, 32 cosponsors in the Senate, and broad support from a diverse coalition of construction industry associations and employer groups opposed to government-mandated PLAs.

• Cosponsor Packet for H.R. 735
• Cosponsor Packet on S.119

In addition, the House voted five times—another important milestone—on the following amendments restricting government-mandated PLAs on various bills funding and authorizing federal construction projects:

• Rep. Guinta amdt. to Continuing Resolution (H.R. 1), (ABC supported, amdt. defeated via tie 210-210), 2/19/11.
• Rep. Scalise amdt. to Homeland Security Approps. 2012 (H.R. 2017), (ABC supported, amdt. defeated 207-213), 6/2/11.
• Rep. LaTourette amdt. to MilCon/VA Approps. 2012 (H.R. 2055),   (ABC opposed, amdt. passed 204-203), 6/13/11.
• Rep. Bartlett amdt. to National Defense Authorization Act (NDAA) for Fiscal Year 2013 (H.R. 4310) , (ABC supported, amdt. passed 211 to 209), 5/21/12. (Provision was removed in conference).
• Rep. Grimm amdt. to MilCon/VA Approps. 2013 (H.R. 5854) (ABC opposed, amdt. passed 218-198), 5/31/12.
  • Congressional Research Service memo on anti-PLA mandate and preference amendments, proving the amendment language does not prohibit voluntary PLAs, but simply prohibits government-mandated PLAs and PLA preferences, 5/25/12.

These amendments, like H.R. 735/S. 119, attempted to restore government neutrality in contracting by prohibting government-mandated PLAs on federal and federally assisted construction projects authorized in these spending bills.

In the 112th Congress, U.S. House Oversight and Government Reform subcommittees held multiple hearings exploring government-mandated PLAs and the benefits of H.R. 735.

Key Hearings:

On June 3, 2011, the House Oversight and Government Reform Committee’s Technology, Information Policy, Intergovernmental Relations and Procurement Reform Subcommittee held a hearing, “H.R. 735 and Project Labor Agreements: Restoring Competition and Neutrality to Government Construction Projects.” Review hearing video, transcripts, testimony and analysis here.

On March 16, 2011, the House Oversight and Government Reform Committee’s Regulatory Affairs, Stimulus Oversight and Government Spending Subcommittee held a hearing, "Regulatory Impediments to Job Creation: The Cost of Doing Business in the Construction Industry." Review hearing video, transcripts, testimony and analysis here and here.

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President Obama's Executive Order 13502 Promotes Government-Mandated PLAs

Posted In: [Public-PLAs: Federal (Regulations & Guidance)]

On February 6, 2009, President Obama signed Executive Order 13502: Use of Project Labor Agreements for Federal Construction Projects.

On April 13, 2010, the Federal Acquisition Regulatory (FAR) Council issued a final rule (pdf), effective May 13, 2010, implementing President Obama’s Executive Order 13502 into federal procurement regulations.

President Obama's Executive Order 13502 encourages federal agencies, on a project-by-project basis, to mandate PLAs on federal construction projects exceeding $25 million in total cost. The order also permits (it does not require) private, local and state recipients of federal assistance to mandate PLAs —a practice prohibited from 2001 to 2009 by President George W. Bush’s Executive Orders 13202 and 13208.

Section 7 of Executive Order 13502 directs the Secretary of Labor and OMB director to make "recommendations about whether broader use of PLAs, with respect to both construction projects undertaken under Federal contracts and construction projects receiving Federal financial assistance, would help tp promote the economical, efficient, and timely completion of such projects" within 180 days of Feb. 6, 2009.  To date, there has not been an expansion of Section 7, although officials from federal agencies have been pushing PLAs on federally assisted construction projects.

There is concern President Obama will expand this order during his second term to more federal and federally assisted construction projects.

The Obama order fulfilled his campaign promise to organized labor. In a September 16, 2008, letter to the International Brotherhood of Electrical Workers (IBEW) union, Obama wrote, “We need to make sure the government uses project labor agreements to encourage completion of projects on time and on budget. One of the first things George Bush did when he got into office was to ban PLAs. One of the first things I’ll do as President is repeal that ban."

It is now the policy of the federal government to discourage competition from qualified merit shop contractors and their skilled employees whenever PLAs are mandated by federal agencies.

Some federal agencies have adopted policies determining how they evaluate and mandate PLAs.  Most agencies issue PLA surveys on FBO.gov requesting feedback from the contracting community in order to determine if a PLA project is appropriate for a project. ABC responded to and has helped contractors reply to more than 150 federal agency PLA surveys during President Obama's first term.

Agency Policies:

• 4/13/10 OMB Memo from Administrator Dan Gordon, Implementation of New Regulatory Coverage on Project Labor Agreements
• USACE
• NAVFAC
• GSA

Please visit www.TheTruthAboutPLAs.com for the latest regulatory, legal and legislative updates on Executive Order 13502 and federal government-mandated PLAs.

Popular Tags: executive order

FAR Council Releases Final Rule to Implement Executive Order 13502

Posted In: [Public-PLAs: Federal (Regulations & Guidance)]

On April 13, 2010, the Federal Acquisition Regulation (FAR) Council released a final rule implementing President Obama’s Executive Order 13502, which encourages federal agencies to use PLAs on federal construction costing more than $25 million.

This final rule represents the culmination of a regulatory process that began in July 2009 with the FAR Council’s release of a proposed rule to implement the content of Executive Order 13502 into federal procurement regulations.

The contentious proposed rule was subject to two 30-day public comment periods. The first comment period closed Aug. 14, 2009; it was reopened on Aug. 24 and closed again on Sept. 23. Nearly 1,000 supporters of fair and open competition on taxpayer-funded construction projects submitted comments to the FAR Council opposing the proposed rule. ABC National’s comments are available at www.abc.org/plastudies, all comments submitted to the FAR Council are available via Regulations.gov.

• Applies to federal construction projects costing more than $25 million and does not specifically address smaller-scale federal projects.
• Does not mandate the use of PLAs and allows federal agencies flexibility in developing individual agency PLA policies that that can be applied to federal projects on a case-by-case basis.
• Allows federal agencies several options when they can require contractors to submit a PLA during the acquisition process: (1) when the offers are due; (2) prior to award (by apparent successful offeror); or (3) after award. This is a departure from the proposed rule issued in 2009.
• Allows agencies to specify the minimum terms and conditions of a PLA in the project bid solicitation. As a condition of receiving a contract award, federal agencies can require the successful offeror to become a party to a PLA containing a minimum of agency-drafted terms and conditions. This is a departure from proposed rule.
• Prohibits agencies from mandating PLAs on federal projects already underway retroactively. This is a clarification of the proposed rule.
• Gives agencies discretion in addressing the impact of a PLA on small businesses. This is a very modest attempt to address concerns raised by nonunion contractors who perform work on federal contracts under small business requirements and standards.
• The rule does not address federally-assisted projects specifically (Section 7).

On April 21, 2010, ABC National released, "The Final Rule Implementing the PLA Executive Order: Why it Should Be Challenged," by ABC general council Maurice Baskin, Esp., Venable LLP. This document lays out ABC's argument for how the Obama Administration’s actions violate federal procurement laws; discriminate against 85% of the construction industry workforce and many small businesses; and hurt taxpayers.

Popular Tags: Federal Acquisition Regulation

ABC National's Comments on Proposed Rule Encouraging Federal Agencies to Mandate PLAs (FAR Case 2009-005 and Executive Order 13502)

Posted In: [Public-PLAs: Federal (Regulations & Guidance)]

On August 13, 2009, ABC National filed comments with Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council in response to a proposed rule to implement Executive Order 13502, which encourages federal agencies to require PLAs on federal construction projects via the Federal Aquisition Regulation (FAR) Council "FAR Case 2009-005, Use of Project Labor Agreements for Federal Construction Projects".

Hundreds of contractors and groups filed comments opposed to the proposed rule. All comments can be viewed here.

ABC's comments express serious concerns with the proposed regulation, particularly with its impact statement, the absence of any meaningful criteria for agencies to use in deciding whether to impose PLAs and the absence of any empirical justification for using PLAs on federal projects.

ABC's comments highlight numerous problems with government mandated PLAs and reference a variety of arguments and studies that document how this bad public policy will harm taxpayers, contractors and their employees.

Resources:

• ABC National comments
• ABC member survey supplement to ABC comments (Learn why contractors oppose government-mandated PLAs)
• ABC National comments specifically addressing the impact of FAR rule on small businesses in violation of the Regulatory Flexibility Act
• ABC news release on FAR final rule (4/12/10)
• ABC news release on FAR proposed rule (9/24/09)
• ABC Survey Finds PLAs on Public Construction Projects Will Injure Competition (June 2009)
• ABC Survey Finds PLAs on Public Construction Projects Injure Competition (Jan. 2011)

Popular Tags: Project Labor Agreements (PLAs), executive order

OMB Urges Federal Department and Agency Heads to Utilize PLAs on Federal Construction in Advance of Proposed Rule Implementing Executive Order

Posted In: [Public-PLAs: Federal (Regulations & Guidance)]

On July 10, 2009, the Office of Management and Budget (OMB) issued a policy memorandum informing all federal department and agency heads that rules prohibiting government-mandated project labor agreements (PLAs) on federal and federally funded construction had been revoked. Additionally, the policy memorandum encouraged federal agencies to consider utilizing PLAs on a project-by-project basis and require PLAs in “appropriate circumstances.”

This memorandum came in advance of the Federal Acquisition Regulation (FAR) Council’s July 14, 2009, proposed rule (FAR Case 2009-005, Use of Project Labor Agreements for Federal Construction Projects) on President Obama’s Executive Order 13502, which encourages the use of PLAs on construction projects costing more than $25 million.

The contentious proposed rule was subject to two 30-day public comment periods. The first comment period closed Aug. 14, 2009; it was reopened on Aug. 24 and closed again on Sept. 23.

Government officials, associations, taxpayers, contractors and hard hat employees answered a call to action in opposition to the proposed rule and submitted almost 1,000 comments to the FAR Council.

ABC’s comments to the proposed rule can be viewed here. (Review ABC member survey supplement to ABC comment here, ABC National’s comments addressing the impact of the rule on small businesses in violation of the Regulatory Flexibility Act here, and a blog post about surveys measuring the anti-competitive effect of PLAs on contractors here). Every comment submitted to the FAR Council, including close to 1,000 comments filed by ABC members, is available for public review here.

ABC has serious concerns with the proposed rule's impact statement, the absence of any meaningful criteria for agencies to use in deciding whether to impose PLAs, and the absence of any empirical justification for PLAs on federal projects.

• ABC National July 15, 2009, Newsline Story Regarding Proposed Rule to Implement E.O. 13502
• FAR Council Proposed Rule to Implement E.O. 13502, Encouraging PLAs on all Federal Construction Costing More than $25 million
• FAR Case 2009-015, Revocation of Executive Order 13202
• ABC National July 10, 2009, Newsline Story Regarding OMB Policy Memo and Proposed Rule to Implement E.O. 13502
• OMB July 10, 2009, Policy Memorandum Encouraging PLAs
• ABC National July 14, 2009, News Release on OMB Memo and FAR Council Proposed

Popular Tags: Federal Acquisition Regulation

President George W. Bush's Executive Orders 13202 and 13208

Posted In: [Public-PLAs: Federal (Regulations & Guidance)]

On February 17, 2001, President George W. Bush signed Executive Order No. 13202: Preservation of Open Competition and Government Neutrality Towards Government Contractors' Labor Relations on Federal and Federally Funded Construction Projects.

The order declares that neither the federal government, nor any agency acting with federal assistance, shall require or prohibit construction contractors to sign union agreements as a condition of performing work on government construction projects.

On April 6, 2001, the Bush Administration amended Executive Order No. 13202 with Executive Order No. 13208, which exempts from Executive Order 13202 any project which has had at least one contract awarded with a PLA.

Between 2001 and 2008, Executive Order 13202 ensured that at least $147.1 billion worth of federal construction projects was bid without discriminatory and wasteful government mandated PLAs. The actual value of construction projects protected by Executive Order 13202 is exponentially larger, as the above figure does not include local construction spending from 2001-2008 that received federal funding or assistance that was protected by Executive Order 13202. It is estimated that free and open competition saved American taxpayers between 12 percent and 18 percent on federal construction spending and provided women, minorities and qualified nonunion craft professionals the opportunity to work in their communities.

Popular Tags: executive order

Understanding Government-Mandated Project Labor Agreements And The Law

Posted In: [Public-PLAs: Federal (Legal)]

Lawmakers, the media, taxpayers and members of the construction industry frequently inquire about government-mandated project labor agreements (PLAs) and the law. They question how such blatant favoritism and cronyism is legal.

In the landmark Boston Harbor case, the Supreme Court held that government-mandated PLAs are not prohibited by the National Labor Relations Act (NLRA), 29 U.S.C. §§ 151-169. [1]

Sections 8(e) and (f) of the NLRA, 29 U.S.C. §§ 158(e) and (f) make special exceptions from other requirements of the NLRA in order to permit employers and unions in the construction industry to enter into PLAs.

The Boston Harbor court was not asked to decide whether government-mandated PLAs violate competitive bidding laws at either the federal or state level. As a result, nothing in the Boston Harbor decision requires or prohibits government entities from imposing PLAs on government construction contracts, as long as the government entity is acting as a market participant for services it is procuring.

On Feb. 17, 2001, President George W. Bush signed Executive Order No. 13202, “Preservation of Open Competition and Government Neutrality Towards Government Contractors’ Labor Relations on Federal and Federally Funded Construction Projects.” This Executive Order declared that neither the federal government, nor any agency acting with federal assistance, shall require or prohibit construction contractors to sign union agreements as a condition of performing work on government construction projects.

The Bush order was challenged by PLA proponents in a lengthy legal case, Building and Construction Trades Department, AFL-CIO et al., v. Joe M. Allbaugh, Director, Federal Emergency Management Agency, et al. commonly referred to as the Allbaugh case. The unions contended the Bush executive orders conflicted with the NLRA.  

In January 2003, the U.S. Supreme Court denied certiorari in the case, upholding the U.S. Court of Appeals for the District of Columbia Circuit decision, which upheld President Bush’s Executive Order 13202 and 13208.

Federal legislation like the Government Neutrality in Contracting Act, related amendments, and state and local anti-PLA mandate legislation closely mirror the neutral language used in the Bush executive order and is consistent with legal precedents.

Under the Bush executive order, the federal government awarded $147 billion worth of federal construction contracts without any government-mandated PLAs. During the eight years of the Bush administration, there were no significant labor-related problems on federal construction projects (such work delays, cost overruns or similar problems), without any need for government-mandated PLAs. [2]

The Allbaugh case remains the controlling case on government-mandated PLA law. Governments can enact a position of neutrality when it comes to the use of PLAs by contractors.

Here are five key points about government-mandated PLAs and the law:

• Via law or executive order, governments can enact a position of neutrality regarding the use of PLAs by contractors on taxpayer funded construction projects as long as the government is acting as a market participant.
• Governments can mandate PLAs on contractors on single projects under certain circumstances, as long as the government is acting as a market participant.
• Governments can prohibit government agencies and recipients of government assistance from mandating PLAs on publicly funded construction projects.
• The NLRA ensures contractors have the right to voluntarily enter into PLAs, regardless of existing laws requiring, encouraging or restricting government-mandated PLAs.
• Legislative efforts to restrict government-mandated PLAs restore government-neutrality in contracting and do not interfere with a contractors' right to voluntarily execute a PLA. 

[1] Review the Boston Harbor case here: http://www.law.cornell.edu/supct/html/91-261.ZO.html

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Legal Challenges Against Federal Government-Mandated Project Labor Agreements During President Obama’s First Term

Posted In: [Public-PLAs: Federal (Legal)]

Here’s a brief review of legal challenges to federal government-mandated project labor agreements (PLAs) during President Obama’s first term.

On April 13, 2010, the Federal Acquisition Regulatory (FAR) Council issued a final rule (pdf), effective May 13, 2010, implementing President Obama’s Feb. 6, 2009, pro-PLA Executive Order 13502 into federal procurement regulations. It encourages federal agencies, on a project-by-project basis, to mandate PLAs on federal construction projects exceeding $25 million in total cost. The order also permits (it does not require) private, local and state recipients of federal assistance to mandate PLAs —a practice prohibited from 2001 to 2009 by President George W. Bush’s Executive Orders 13202 and 13208.

During President Obama’s first term, federal contractors (with assistance from ABC) filed five bid protests with the Government Accountability Office (GAO) against PLAs mandated by federal agencies. For the following federal projects, each bid protest resulted in the agency removing the PLA mandate in the face of the protest:

• U.S. Department of Labor (DOL) Job Corps Center in Manchester, N.H. (November. 2009).
• U.S. General Services Administration (GSA) federal office building (the Lafayette Building) in Washington, D.C. (February 2010).
• U.S. Army Corps of Engineers (USACE) Armed Forces Reserve Center in Camden, N.J. (August 2010).
• U.S. Department of Veterans Affairs (VA) research office building in Pittsburgh (January 2011).
• U.S. DOL Job Corps Center in Manchester, N.H. —a second failed DOL attempt at a PLA mandate (October 2012).

Legal arguments for these GAO bid protests focused on how PLA mandates fail to improve the economy and efficiency in federal contracting and violate federal regulations requiring full and open competition in federal procurement. Additional bid protest arguments mirror concerns raised by ABC in comments submitted to the FAR Council in response to its July 14, 2009, proposed rule (FAR Case 2009-005, Use of Project Labor Agreements for Federal Construction Projects).

ABC’s comments to the proposed rule can be viewed here. (Review ABC member survey supplement to ABC comment here, ABC National’s comments addressing the impact of the rule on small businesses in violation of the Regulatory Flexibility Act here, and a blog post about surveys measuring the anti-competitive effect of PLAs on contractors here). Every comment submitted to the FAR Council, including close to 900 comments filed by ABC members, is available for public review here.

On April 21, 2010, ABC released, “The Final Rule Implementing the PLA Executive Order: Why it Should Be Challenged,” by ABC general counsel Maurice Baskin, Esq., Venable LLP.  This document lays out ABC’s argument for how the Obama administration’s actions violate federal procurement laws; discriminate against 85 percent of the construction industry workforce and many small businesses; and harm taxpayers. Check out the related blog post here.

Federal agencies will likely experience GAO bid protests and additional legal action if they needlessly mandate PLAs on federal construction projects during President Obama’s second term.

In addition, any expansion of Executive Order 13502 onto federal or federally assisted projects via Section 7 of the order will be met with an aggressive, legal, legislative, political and public relations response.

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Resources on Government-Mandated Project Labor Agreements (PLAs)

Posted In: [Public-PLAs: Federal (Resources)]

ABC National has a vast library of resources to help educate the public about the negative impact of government-mandated project labor agreements (PLAs) including:

• Talking Points
• Model Legislation
• Studies
• Legal Analysis
• Sample Op-Eds and Letters to the Editor
• Educational PowerPoints
• Literature
• Videos 

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Summary of PLA Research (2012 Edition)

Posted In: [PLAs], [Public-PLAs: Studies (Academic and Private Reseach)]

The Impact of Government-Mandated Project Labor Agreements (PLAs): A Review of Key Reports and Studies document highlights excerpts from studies pertaining to common points of contention during PLA debates.

Popular Tags: Project Labor Agreements (PLAs)

ABC's Statement on Why the Final Rule to Implement Executive Order 13502 Should be Challenged

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

On April 21, 2010, ABC National released, "The Final Rule Implementing the PLA Executive Order: Why it Should Be Challenged," by ABC general counsel Maurice Baskin, Esp., Venable LLP. This document lays out ABC's argument for how the Obama Administration’s actions violate federal procurement laws; discriminate against 85% of the construction industry workforce and many small businesses; and hurt taxpayers.

• TheTruthAboutPLAs.com blog post about Baskin's finale rule analysis
• Final Rule, effective May 13, 2009
• TheTruthAboutPLAs.com blog post summarizing final rule and regulatory process

Popular Tags: Project Labor Agreements (PLAs)

Government-Mandated Project Labor Agreements: The Public Record of Poor Performance (2011 Edition)

Posted In: [PLAs], [Public-PLAs: Studies (Academic and Private Reseach)]

The 2011 edition of ABC General Counsel Maury Baskin's report on government-mandated PLAs documents a record of PLA construction projects experiencing an unfortunate pattern of cost overruns, reduced competition, delays in construction, construction defects, safety problems and diversity issues. It is a key resource to find failed government-mandated PLA projects in your community, illustrating why anti-competitive and costly government-mandated PLAs are nothing more than a bad solution in search of a problem.

Read Maury Baskin's Government-Mandated Project Labor Agreements: The Public Record of Poor Performance (2011 Edition)

Popular Tags: Project Labor Agreements (PLAs)

Project Labor Agreements on California School Construction Raise Costs up to 15 Percent, Study Says

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

According to a July 2011 study released by the National University System Institute for Policy Research (NUSIPR), California school construction projects built using project labor agreements (PLAs) experienced increased costs of 13 percent to 15 percent, or $28.90 to $32.49 per square foot, compared to projects that did not use a PLA.

Read the report

Popular Tags: Project Labor Agreements (PLAs)

Report Opposes PLAs in the District of Columbia Construction Market (April 2010)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

An April 2010 report by ABC Chief Economist Anirban Basu, "The Problem with PLAs in the District of Columbia," provides an assessment of the economic implications of government-mandated project labor agreements on construction projects in the District of Columbia. Specifically, the study finds that government-mandated PLAs are not economically sensible in the context of the current environment for construction services in the District of Columbia market.

Read the report

Popular Tags: Project Labor Agreements (PLAs)

Cato Journal on Why PLAs are Not in the Public Interest

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A compelling piece critical of government-mandated project labor agreements by David G. Tuerck, executive director of the Beacon Hill Institute for Public Policy Research at Suffolk University, appears in the current issue of the Cato Journal (Volume 30 Number 1, Winter 2010, “Are Unions Good for America?”). "Why Project Labor Agreements Are Not in the Public Interest,” surveys the historical decline of construction union membership and poor performance of government-mandated PLAs while countering common union arguments for PLAs. The piece attacks the faulty logic and methodology often employed in studies promoting PLAs as a mechanism to reduce construction costs (p. 53-61).

Read the article

Popular Tags: Project Labor Agreements (PLAs)

Report Calls Washington, D.C. Nationals Ballpark PLA a Failure

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A November 2009 report by DC Progress, "The True Cost of the Washington Nationals Ballpark Project Labor Agreement," exposes the problems that PLAs present for DC taxpayers, as well as unemployed, and underemployed residents. The report focuses on the, "broken promises of the D.C. Ballpark PLA, in order for policymakers, stakeholders in the local economy, and citizens to understand the burdens that PLAs impose on state and city governments. The Nationals Park PLA created a huge barrier for the District's nonunion workforce: 85 percent of construction workers and 95 percent of minority-owned contractors were left out of work."

Read the article

Popular Tags: Project Labor Agreements (PLAs)

Study Finds that PLAs and President Barack Obama's Executive Order 13502 Will Hurt Nonunion Workers (October 2009)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

An October 2009 report by Dr. John R. McGowan, "The Discriminatory Impact of Union Fringe Benefit Requirements on Nonunion Workers Under Government-Mandated Project Labor Agreements" finds that employees of nonunion contractors that are employed under government-mandated PLAs suffer a reduction in their take home pay that is conservatively estimated at 20 percent. The report estimates that as a result of President Obama's pro-PLA Executive Order 13502, hundreds of millions of dollars of nonunion employees' income on federal construction projects will be distributed to union pension funds, from which nonunion employees will likely receive no benefits.

In addition, the report found that PLAs on federal projects substantially increase costs (approximately 25 percent) for nonunion employers. Nonunion contractors will also face increased and unnecessary exposure to pension fund liability if they perform work under PLAs, including possible withdrawal liability when the PLA project is completed.

The study found that had President Obama's pro-PLA Executive Order 13502 applied to federal contracts in 2008, additional costs incurred by employers related to wasteful PLA pension requirements would likely have ranged from $230 to $767 million per year. Lost wages for nonunion construction workers would have ranged from $184 million to more than $613 million, depending on the assumptions made for companies executing contracts via PLAs. In total, the move to PLAs could cost nonunion workers and their employers $414 million to more than $1.38 billion annually.

Related Information on Topic

TheTruthAboutPLAs.com Blog Entry on McGowan PLA Pension Study

Popular Tags: Project Labor Agreements (PLAs), executive order

Beacon Hill Institute Study Says Federal PLAs and Executive Order 13502 Will Harm Taxpayers (September 2009)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A study released Sept. 23 by the Beacon Hill Institute (BHI), “Project Labor Agreements on Federal Construction Projects: A Costly Solution in Search of a Problem,” found that PLAs significantly increase construction costs on federal projects. Had President Obama's pro-PLA Executive Order 13502 been in effect in 2008, and all 2008 federal construction projects worth $25 million or more had been performed under PLAs, it would have increased the cost to federal taxpayers by $1.6 billion to $2.6 billion.

In addition, the BHI review of federal construction projects from 2001-2008, the years under which government-mandated PLAs were prohibited, also revealed that there were no instances in which labor disruptions occurred that resulted in significant project delays or increased costs. The study concludes that “the justifications for PLAs provided by Executive Order 13502 are unproven.”

The Beacon Hill Institute (BHI) at Suffolk University in Boston, Mass. Sept. 23 released a new study that finds project labor agreements (PLAs) significantly increase construction costs on federal projects without adding benefits for taxpayers. The study is titled, “Project Labor Agreements on Federal Construction Projects: A Costly Solution in Search of a Problem.”

In February, President Obama issued Executive Order 13502, which encourages agencies to require contractors to use PLAs on federal construction projects costing $25 million or more. In addition, the Federal Acquisition Regulatory Council (FAR) issued proposed regulations in July that will turn the executive order into a formal rule that federal agencies must follow when procuring construction services.

“Our report shows that there is no reason to implement a PLA on a federal construction project, except perhaps for political payback to union leaders,” said David G. Tuerck, one of the authors of the study and executive director of BHI. “PLAs are anti-competitive by nature and add costs to the taxpayers. The federal government should consider this research when making its final decision about implementing the President’s order.”

BHI used the findings of three previous studies that analyzed the effect of PLAs on school construction projects and demonstrated that PLAs add 12-18 percent to construction costs, to estimate the effect Obama’s executive order would have had on projects initiated in 2008. According to the results, if President Obama’s Executive Order 13502 were in effect in 2008, construction costs would have increased an additional $1.6 billion to $2.6 billion.

The study pointed out that although taxpayers would have footed an unnecessarily large bill for these projects because of PLAs, they would not have received any benefits in return. Although the purpose of a PLA is to keep labor “peace” during construction projects, BHI’s examination of federal projects with a price tag of at least $25 million, initiated between 2001 and 2008, did not reveal any evidence that those built without a PLA suffered significant delays or cost overruns due to labor issues.

“The justifications for PLAs provided by Executive Order 13502 are, therefore, unproven,” the study pointed out. “What is proven is that PLAs add to the dollar amount of winning bids and increase construction costs…The Obama Executive Order should be seen as a costly giveaway to the construction unions with no proven benefit to the taxpayers.”

To read the complete BHI study on PLAs, visit http://www.beaconhill.org.

Popular Tags: Project Labor Agreements (PLAs), executive order

Government Funded Study Finds PLAs Increase Costs and Offer Limited Value (June 2009)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A June 2009 study conducted by property and construction consulting firm Rider Levett Bucknall prepared for the U.S. Department of Veterans Affairs (VA) Office of Construction and Facilities Management found that PLAs would likely increase construction costs by as much as 9 percent on three of the five construction markets (Denver, New Orleans and Orlando) in which the VA is planning to build hospitals.

The VA hired this firm to evaluate the cost impact of PLAs in various markets where the VA plans to build hospitals in light of President Obama's order that encourages federal agencies to mandate PLAs (Executive Order 13502).

Read Project Labor Agreements – Impact Study for the Department of Veterans Affairs

Read analysis of this study here.

Popular Tags: Project Labor Agreements (PLAs), executive order

Study Questions Effectiveness of DC Baseball Stadium PLA (October 2007)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A PLA on the District of Columbia's new $611 million baseball stadium has completely failed to ensure that local residents get the majority of work on the project, according to a report released Oct. 2, 2007 by the District Economic Empowerment Coalition.

A project labor agreement (PLA) signed to ensure local residents the majority of work on the District of Columbia’s new $611-million baseball stadium has failed completely, according to a new report released Oct. 2 by the District Economic Empowerment Coalition (DEEC).

The “Broken Promises, Big Losses” study details how none of the 56 contractors on the project met the four stipulations of the PLA. The agreement, which was signed in March 2006 by former Washington, D.C. mayor Anthony Williams, local construction trade unions, the project’s construction manager and the D.C. Sports and Entertainment Commission, mandates that 50 percent of journeyperson hours be performed by D.C. workers; 100 percent of apprenticeships go to city residents; at least 25 percent of total work hours be performed by apprentices; and 51 percent of all new hires be D.C. residents.

“The construction of this stadium has been a disaster for the District of Columbia,” said Ted Trabue, DEEC executive director. “Not one contractor subject to this PLA has achieved all four goals. This was a tremendous opportunity for D.C. residents, and they have been forced to watch from the dugout as outside workers take desperately needed jobs on a project funded by their own tax dollars.”

According to the report, non-D.C. residents have worked 506,926 journeyperson hours (71.1 percent of total journeyperson hours), while D.C. resident have worked just 206,444 journeyperson hours (28.9 percent), far below the PLA requirement that D.C. residents work 50 percent of total journeyperson hours. Additionally, the study found that half of the contractors involved in the project have hired no new apprentices, and of those companies that have hired new trainees, only 17 (of 56) have met the PLA requirement that 100 percent of new apprenticeships go to D.C. residents.

“This report details how the guarantees of the PLA—and the interests of Washingtonians—have been ignored,” said Trabue. “It is disappointing that the contractors and unions involved on this important project did not devote the necessary time and energy to job recruitment, and the city did not provide the oversight needed to ensure that the residents of D.C. would not be left out in the cold.”

Click here to download a copy of the “Broken Promises, Big Losses” study.

For more information, contact Ted Trabue at DEEC, ted.trabue@dceec.org.

Popular Tags: Project Labor Agreements (PLAs)

Beacon Hill Institute Report Examines Case Study Supporting Previous PLA Research on the Effect of PLAs on School Construction Costs (December 2006)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A December 2006 report by the Beacon Hill Institute at Suffolk University, “Project Labor Agreements and Financing Public School Construction in Massachusetts” reviews a real-world case study supporting BHI’s previous research on the effect of PLAs on school construction costs. In 2006, the City of Fall River, MA bid three school construction projects under a PLA. Then, after attracting few bidders, with those providing bids coming in well above the projected budget, the city canceled the PLA and reopened the bidding process. The report found that the city of Fall River saved $5.8 million on total construction bids by removing the PLA and bidding the project using free and open competition.

Read the Report

Read a related academic paper, "Do Project Labor Agreements Raise Construction Costs?"

Read update on Fall River case study in July 2007 Boston Globe Op-Ed

Read a letter encouraging open competition from Fall River, MA City Councilor Camera

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Beacon Hill Institute Recommends Against Project Labor Agreement on the Nationals’ Stadium (September 2006)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

The Beacon Hill Institute’s paper, Washington National’s Ballpark: Cost and Timeliness Implications of Using a Project Labor Agreement, found that “the D.C. Sports and Entertainment Commission would benefit from lower costs, without sacrificing quality or timeliness, by not using a PLA and introducing more competition into the process.”

The paper concluded, “we find that claims of cost savings from the use of PLAs to be erroneous and misleading. Using a PLA reduces competition and, keeping with standard economic theory, drives up bids and final construction costs. Extrapolating from our prior work, we estimate construction costs to be inflated $34 million to $49 million due to the inclusion of a PLA.”

Popular Tags: Project Labor Agreements (PLAs)

Beacon Hill Institute Study Finds PLAs Increase Cost of School Projects in New York (April 2006)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

This April 2006 study conducted by the Beacon Hill Institute at Suffolk University found that PLAs add an estimated $27 per square foot to the bid cost of construction (in 2004 prices), representing an almost 20% increase in costs over the average non-PLA project.

Read the study

The Beacon Hill Institute at Suffolk University in Boston May 22 released a new study which found that the use of project labor agreements (PLAs) on school construction projects in New York increased the cost of the projects by 20 percent.

The report, titled “Project Labor Agreements and Public Construction Costs in New York State,“ concluded that the presence of a PLA increased the projects’ base construction bids by $27 per square foot relative to non-PLA projects.

“This study provides further proof that PLAs drive up the cost of construction projects, while discriminating against the four out of five construction workers who choose not to join a labor union,” said Kirk Pickerel, ABC president and CEO.

Of the 117 schools examined by the researchers, 19 municipalities entered into PLAs for school projects. The researchers took into account differences in both the type of schools (elementary, junior and high schools) and the size (controlling for square footage). The majority of school districts that chose not to enter into such agreements saved between $2.7 million for a 100,000-square-foot building and $8.1 million for a 300,000-square-foot structure.

In 2004, the Beacon Hill Institute released a similar study that found that the use of PLAs on school construction projects in Connecticut increased the cost of the projects by nearly 18 percent. The report concluded that the presence of a PLA drove up the projects’ final base construction costs by $30 per square foot compared to non-PLA projects. (Newsline, Vol. 4, No. 36, Sept. 15, 2004)

Click here for more information on the Beacon Hill Institute.

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Iowa Events Center PLA Study (March 2006)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

The Public Interest Institute, a nonpartisan, nonprofit research and educational institute in Mt. Pleasant, Iowa, has released a new study that concludes the PLA on the Iowa Events Center project in downtown Des Moines, placed an “unnecessary burden” on local workers, businesses and taxpayers.

Read the study

The Public Interest Institute, a nonpartisan, nonprofit research and educational institute in Mt. Pleasant, Iowa, has released a new study that concludes the project labor agreement (PLA) agreed to for the construction of the Iowa Events Center project in downtown Des Moines, placed an “unnecessary burden” on local workers, businesses and taxpayers.

The Iowa Events Center project was conceived by the board of supervisors of Polk County, Iowa, to help revitalize Des Moines’ downtown area. The board decided to renovate the city’s existing Polk County Convention Complex and Veterans Memorial Auditorium, while building a new 17,000-seat sports and entertainment arena and a new exhibit and meeting hall. In 2002, the board signed a PLA with the Central Iowa Building and Construction Trade Council, stating that the agreement was necessary to “keep the project on time, keep it on budget, and complete it in a safe manner.” According to the study, the PLA “failed on all three counts.”

Under the PLA, contractors were forced to recognize “the union as the sole and exclusive bargaining representative of all craft employees,” and “hire employees for covered work through the job referral systems offered by each signatory local union.” The study found that as a result, many local merit shop contractors did not bid on the project, which reduced competition and increased the cost of the project.

“One might think that completing a project on budget, on time and safely would be the goal for each and every construction project, but apparently the Polk County Board of Supervisors felt these goals could not be accomplished on the Iowa Events Center project without a project labor agreement,” the study concludes. “Having been granted the PLA, was the Iowa Events Center completed on budget, on time and safely? No. Instead, workers were frozen out of the opportunity to work, businesses were not allowed to compete, and the taxpayers were forced to pay even more for the Iowa Events Center construction because of the cost overruns of the project. The project labor agreement for the Iowa Events Center project was an unnecessary burden on the workers, businesses and taxpayers of Iowa.”

Popular Tags: Project Labor Agreements (PLAs)

Union-Only Project Labor Agreements: The Public Record of Poor Performance (2005 Edition)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

The 2005 edition of ABC General Counsel Maury Baskin's report on union-only PLAs documents a record of union-only construction projects experiencing a consistent pattern of cost overruns, adverse impacts on competition, delays in construction, construction defects, safety problems and diversity issues.

Read the study

Popular Tags: Project Labor Agreements (PLAs)

Beacon Hill Institute Study Finds PLAs Increase Cost of School Projects in Connecticut (September 2004)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

This September 2004 study conducted by the Beacon Hill Institute at Suffolk University found that the use of PLAs on school construction projects in Connecticut increased the cost of the projects by nearly 18 percent. The report concludes that the presence of a PLA increased the projects’ final base construction costs by $30 per square foot relative to non-PLA projects.

"This study provides further evidence that PLAs drive up the cost of construction projects, while discriminating against the four out of five construction workers who choose not to join a labor union," said Kirk Pickerel, ABC president and CEO.

Read study

Popular Tags: Project Labor Agreements (PLAs)

Beacon Hill Institute Study Finds PLAs Increase Cost of School Projects in Massachusetts (September 2003)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

A September 2003 study completed by the Beacon Hill Institute entitled, "Project Labor Agreements and the Cost of School Construction in Massachusetts," finds that "PLA projects add an estimated $18.83 per square foot to the bid cost of construction (in 2001 prices), representing an almost 14 percent increase in costs over the average non-PLA project. The low estimates find that actual project costs are raised by 8.4 percent; the high estimates find that bid costs are raised by 14.9 percent.

Read the study

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Erie County (NY) Courthouse Construction Projects: Project Labor Agreement Study (September 2001)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

This September 2001 study, completed by the firm of Ernst & Young, was commissioned by Erie County in New York to analyze a PLA on a public construction project. Ernst & Young concluded that "bidder participation was diminished because the county chose to utilize a PLA. Further, the use of PLAs adversely affects competition for publicly bid projects to the likely detriment of cost-effective construction… the use of PLAs strongly inhibits participation in public bidding by non-union contractors and may result in those projects having artificially inflated costs."

Read the study

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PLAs on Public Construction Projects: The Case For And Against (May 2001)

Posted In: [Public-PLAs: Studies (Academic and Private Reseach)]

The Worcester Municipal Research Bureau May 21, 2001 released a study titled "Project Labor Agreements on Public Construction Projects: The Case For and Against.". The study concluded that "PLAs tend to constrict the number of bidders on a project compared to those without PLAs, and are likely to reduce the savings to the public that would accrue if nonunion contractors who are employed were allowed to follow their customary methods."

Read the study summary

Read the study

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Federal Contracting: ABC National's Comments on Proposed Rule Encouraging Federal Agencies to Mandate PLAs (FAR Case 2009-005 and Executive Order 13502)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

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Congressional Hearing: ABC Members Testify in Support of Legislation Restoring Fairness in Federal Contracting (June 2011)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

On June 3, 2011, the House Oversight and Government Reform Committee’s Technology, Information Policy, Intergovernmental Relations and Procurement Reform Subcommittee held a hearing, "H.R. 735 and Project Labor Agreements: Restoring Competition and Neutrality to Government Construction Projects."

Review hearing video, transcripts, testimony and analysis here.

Popular Tags: Project Labor Agreements (PLAs)

Congressional Hearing: Regulatory Impediments to Job Creation: The Cost of Doing Business in the Construction Industry (March 2011)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

On March 16, 2011, the U.S. House Subcommittee on Regulatory Affairs, Stimulus Oversight and Government Spending held a hearing on the cost of doing business in the construction industry. Click the below link to view testimony and video of the hearing.

TheTruthAboutPLAs.com Blog Entry on the March 2011 Hearing

Popular Tags: Project Labor Agreements (PLAs)

Congressional Research Service Report on Project Labor Agreements (July 2010)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

July 1, 2010, the Congressional Research Service issued a report on project labor agreements (PLAs) by Labor Policy Analyst Gerald Meyer. It provides analysis on President Obama's pro-PLA Executive Order 13502 and reviews the arguments made by PLA opponents and PLA proponents.

Read the report.

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Congressional Research Service Report for Congress on PLAs (Aug. 1999)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

"Project Labor Agreements in Federal Construction Contracts: An Overview and Analysis of Issues," by Gail McCallion, Specialist in Labor Economics, Economics Division (August 24, 1999)

Read the 1999 CRS Report

Popular Tags: Project Labor Agreements (PLAs)

Congressional Hearing: The Administration's Policy of Discrimination: Project Labor Agreement's Negative Impact on Women and Minority Owned Small Businesses (August 1998)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

Testimony from an August 6, 1998, U.S. House Small Business Committee hearing on project labor agreements and their negative impact on women and minority owned businesses. Click the below links to view testimony before the committee in opposition to PLAs.

Read ABC's testimony

Read the Associated General Contractors of America's Testimony

Read Phoenix Construction Services' Testimony

Popular Tags: Project Labor Agreements (PLAs)

U.S. Government Accounting Office (GAO) Report: Project Labor Agreements: The Extent of Their Use and Related Information (May 1998)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

A U.S. General Accounting Office (GAO) report, issued May 5, 1998, demonstrated that it is nearly impossible to show any cost savings or increased quality derived from the use of union-only project labor agreements, largely because of the difficulty in finding two identical projects, with or without a PLA, to study.

Read the report

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Senate Committee on Labor and Human Resources Hearing on the "Proposed Executive Order on Project Labor Agreements" (April 1997)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

Testimony from an April 30, 1997, hearing before the U.S. Senate Committee on Labor and Human Resources on President Clinton's Proposed Executive Order on PLAs that later became a memo on PLAs. Click the below organizations to view their testimony before the committee in opposition to union-only PLAs.

Read ABC's Testimony

Read ABC Member Testimony

Read Associated General Contractors' Testimony

Read U.S. Chamber of Commerce Testimony

Popular Tags: Project Labor Agreements (PLAs)

U.S. Government Accounting Office (GAO) Report: Labor Management Relations: Construction Agreement at DOE's Idaho Laboratory Needs Reassessing (May 1991)

Posted In: [Public-PLAs: Studies (Federal Gov. Reports & Hearing Testimony)]

A U.S. General Accounting Office (GAO) report, issued May 23, 1991, reviewed the site stabilization agreement between a labor union and organizations within the DOE'S Idaho Laboratory. The report looked at whether nonunion contractors had access to DOE Idaho Operations Office construction contracts.

Read Report

Popular Tags: Project Labor Agreements (PLAs), executive order