Status Update on Executive Order 13502 and Federal Project Labor Agreements

1 December 14, 2009  Federal Construction, Uncategorized

The construction industry is still waiting for the federal government to issue a final rule on regulations that promote project labor agreements (PLAs) on federal construction projects exceeding $25 million. 

Five months ago (July 14) the Federal Acquisition Regulation (FAR) Council issued a proposed rule (FAR Case 2009-005, Use of Project Labor Agreements for Federal Construction Projects) that will implement Executive Order 13502 into federal procurement regulations. 

The proposed rule was subject to two 30-day comment periods during which the public could submit comments related to the proposed rule. The first comment period closed Aug. 14, 2009; it was reopened on Aug. 24 and closed again on Sept. 24.

TheTruthAboutPLAs.com readers, associations, taxpayers, contractors and hard hat employees answered our call to action in opposition to the proposed rule and submitted almost 1,000 comments to the FAR Council.  ABC National’s comments can be viewed here (www.abc.org/plastudies), and every comment submitted to the FAR Council is available for public review here.

With one exception, federal agencies and procurement officials have not implemented government-mandated PLAs, partially because they are waiting for the final rule from the FAR Council, and partially because PLAs are bad public policy.  These special interest giveaways increase the cost of construction, are a form of government corruption and discriminate against nonunion contractors and employees.  

In fact, a recent independent study conducted on behalf of the U.S. Department of Veterans Affairs (VA) confirms that government-mandated PLAs will increase construction costs in numerous construction markets across the country where the VA is planning to build new facilities.

The exception to this government-wide hesitation in implementing PLAs was a PLA mandated by the U.S. Department of Labor (DOL) on a Job Corps Center in Manchester, N.H.  After a protest was filed against the PLA with the Government Accountability Office (GAO) by ABC member North Branch Construction of Concord, N.H., with ABC support and representation, the U.S. DOL cancelled its solicitation to construct the project.

Here is an explanation from the DOL:

The solicitation was cancelled because DOL believes that it is in the public interest for the Department to further evaluate the issues involved in the PLA requirement. The PLA requirement is a new issue to DOL.

The development was a win for taxpayers and proponents of fair and open competition.  However, the cancelled solicitation rendered the pending bid protest before the GAO moot.  A GAO ruling on the bid protest could have addressed the legality of federal government-mandated PLAs and Executive Order 13502.

The U.S. General Services Administration (GSA) is also evaluating the use of PLAs on about $1.25 billion worth of American Recovery and Reinvestment Act-funded construction projects in seven states and Washington, D.C. To date, none of these projects has been awarded with a PLA, although this Procurement Instructional Bulletin (PIB) 09-02 from the GSA’s Public Building Service (PBS) demonstrates that many of these projects will require contractors to submit two price proposals — one that is subject to a PLA requirement and one that is not.  The GSA has hired a firm to conduct research about the feasibility of PLAs in the various markets identified in the GSA Bulletin and the results likely will be revealed in early 2010.

Finally, there has been no movement on Section 7 of Executive Order 13502. Here is more on Section 7:

The Director of the OMB, in consultation with the Secretary of Labor and with other officials as appropriate, shall provide the President within 180 days of this order, 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 to promote the economical, efficient, and timely completion of such projects. [Note: Order was issued Feb. 6; 180 days sets deadline at Aug. 5, but an order hasn’t been issued]

We will be posting more information about Section 7 later this week.

TheTruthAboutPLAs.com will continue to educate the public about the status of Executive Order 13502 and special interest handouts in federal contracting, as well as provide commentary and links to media reports about local, state and federal PLAs.

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One Response to Status Update on Executive Order 13502 and Federal Project Labor Agreements

Obama’s Giveaway to Progressives/Labor Unions: Plan to Seek Use of U.S. Contracts as a Wage Lever « Romanticpoet's Weblog February 27, 2010 at 10:06 am

[…] Still who can blame the GSA? Government-mandated PLAs were virtually nonexistent during the last administration when a presidential order prohibited wasteful PLAs on such projects. And there have yet to be any government mandated-PLAs executed under Mr. Obama’s watch because the Federal Acquisition Regulatory (FAR) Council has yet to finalize his order. […]

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