Last week the U.S. Department of Labor (DOL) confirmed the elimination of a controversial project labor agreement (PLA) mandate on its estimated $20 million to $50 million Job Corps Center in Manchester, N.H., when it issued a pre-solicitation for construction services without discriminatory and costly PLA mandate or preference language.
When mandated by government entities, PLAs unfairly steer taxpayer-funded construction contracts to unionized contractors and their unionized employees at the expense of taxpayers, qualified contractors and skilled nonunion tradespeople.
Local, state and federal lawmakers are persuaded by Big Labor lobbyists to require contractors to agree to use a PLA as a condition of being awarded a taxpayer-funded construction project. Studies have found such special interest favoritism kills construction job creation, reduces competition, and increases costs between 12 percent and 18 percent, on average, compared to similar non-PLA projects.
In New Hampshire, 85.6 percent of the construction workforce does not belong to a union. The Job Corps Center was the first federal project subject to a government-mandated PLA following President Obama’s Feb. 6, 2009, Executive Order 13502, which encourages federal agencies like the DOL to mandate PLAs on a case-by-case basis for federal construction projects exceeding $25 million in total cost.
President Obama’s union-favoring executive order was widely criticized as a handout to his biggest political supporters, Big Labor, and another example of the administration interfering in the free market and engaging in crony contracting.
The PLA mandate resulted in considerable delays and prevented the creation of badly needed new jobs for the construction industry, which suffered from an industry-wide unemployment rate of 27.2 percent in February 2010 – the highest level recorded since the federal government began making the data available in 1976.
PLA Mandate Delayed Project
In September 2009, the DOL mandated a PLA on this project before the FAR Council had even issued a final rule implementing regulations into federal procurement code permitting federal agencies to mandate a PLA. In the face of a bid protest filed at the Government Accountability Office (GAO) by a New Hampshire contractor opposed to the PLA mandate, the DOL canceled the Job Corps Center solicitation in November 2009.
Rather than remove the controversial PLA mandate and proceed with the procurement process, the DOL waited more than two years to issue a new solicitation for the Job Corps Center in December 2011.
The solicitation still contained a PLA mandate, and public record requests uncovered the DOL spent almost $430,000 paying for Hill International to evaluate the use of PLAs in federal contracting and justify the DOL’s use of a PLA on the project.
Once again, federal contractors, with the assistance of ABC National, filed a protest at the GAO against the DOL’s PLA; in June 2012, the DOL once again canceled the solicitation in the face of a bid protest.
The DOL’s recent PLA-free pre-solicitation is a win against special interest favoritism in federal contracting.
New Hampshire Lawmakers Fought for Granite State Economy
New Hampshire lawmakers supporting fair and open competition like Rep. Frank Guinta, Rep. Charlie Bass and Sen. Kelly Ayotte should be commended for their vigilance against crony contracting and efforts to expose waste and protect taxpayers in New Hampshire and across the country.
Reps. Guinta and Bass also voted in support of amendments limiting PLA mandates on various federal construction projects funded via appropriations and authorizing legislation (Roll Call No.’s 302, 267, 413, 396, and 26). (There has not been a vote on this legislation in the Democrat-controlled Senate.)
More lawmakers in Washington must be willing to stand up and fight for construction jobs and advocate for fair and open competition in federal contracting so taxpayers receive the best construction project at the best price.