On Sept. 29, the U.S. House Committee on Transportation and Infrastructure held a hearing, “Investing in our Nation’s Transportation Infrastructure and Workers: Why it Matters,” which covered the impacts of the American Rescue Plan Act of 2021, the Infrastructure Investment and Jobs Act of 2021 and the Inflation Reduction Act of 2022.
Before the hearing, ABC sent a letter to the committee communicating how the ARP, IIJA and the IRA have all missed the mark on providing pathways into the construction industry for all Americans, as they have effectively prevented merit shop contractors, who employ 87.4% of the construction industry’s workforce, from having a fair chance at competing to build taxpayer-funded projects funded by these bills.
ABC’s key concern with President Biden’s executive order and proposed rule to require project labor agreements on federal construction contracts of $35 million or more, and many federally assisted projects, was echoed by several members of Congress.
In the hearing, Rep. Brian Babin, R-Texas, expressed his opposition to government-mandated PLAs, saying, “I'm very deeply concerned about our President Biden’s project labor agreements or PLA mandates, threats from the left to ensure that infrastructure funds only pay for union labor. These comments are very concerning, especially for the 87.4% of nonunion workers in construction. I have received correspondence from more than 1,000 construction companies and another letter from nearly 20 business groups that all oppose Biden’s PLA mandate. They say that PLAs discriminate against firms and workers based on whether or not their workers are union.”
Watch Rep. Babin’s statement and question on government-mandated PLAs here.
Rep. Dusty Johnson, R-S.D., also voiced concern with the Biden administration’s pro-PLA policies, noting that the vast majority of contractors have “indicated that they wouldn't bid on a federal project that had a project labor agreement as a requirement. I look at a workforce crisis out in this country; we have a lot of big things we want to get done. We don’t have enough talented and hardworking people to get done what we want to get done.
“You got a number of outstanding firms across our country where the workers have chosen not to unionize, they have made that decision. And they are at risk. Now, this is of particular importance in my state, South Dakota, where 4% of the workers are unionized. There are simply not enough unionized shops to be able to respond to the edicts that the administration has put out, saying that some workers will be frozen out of this kind of work. It seems to me that if we are shrinking the number of firms and workers available to bid on these projects, it will by necessity increase the price of those projects at a time when inflation is already destroying the purchasing power of these federal dollars.”
Watch Rep. Johnson’s statement and question on government-mandated PLAs here.
Additionally, ABC noted the increase in nonresidential construction input prices, which are up 16.7% from a year ago and more than 40% since February 2020. On top of the significant increase in materials prices, ABC was also joined by several members of Congress opposing the new inflationary U.S. Department of Labor Davis-Bacon regulations, which will make construction more expensive and discourage participation from small businesses.
During the hearing, Rep. Beth Van Duyne, R-Texas, discussed the regulatory burden that both the public and private sector face with the implementation of complicated Davis-Bacon wage regulations, saying, “State funds have to have all of these different regulatory, federal regulatory costs on top of them. For example, the Biden administration wants to obligate every Navy grant applicant, regardless of local or state regulations, to use Davis-Bacon wage requirements … the problems associated with the implementation of Davis-Bacon Act are well documented. I’ve worked at HUD; people who worked in [the] Davis-Bacon department hated it and wanted it to go away. We’ve seen it directly and indirectly; the compliance requirements are burdensome and costly.”
Watch Rep. Van Duyne’s statement on the burdensome Davis-Bacon Act here.
In what is expected to be the last significant hearing for the retiring Rep. Peter DeFazio, D-Ore., as chairman, the committee could turn to a different focus next session if control of the House flips to Republicans, as priorities would shift to the committee’s oversight capacity.