The $3.9 billion project to replace New York’s Tappan Zee Bridge is being built by union labor and robots.
The $3.1 billion construction contract is subject to a government-mandated project labor agreement (PLA) pushed by Albany’s pro-union lawmakers and New York Gov. Cuomo (D) because it will result in a huge windfall of political contributions to the Empire State’s Democratic party.
It is a design-build contract, which gives bridge builder Tappan Zee Constructors (TZC) financial incentives to finish early and under budget. With money on the line, TZC has hired an innovative Louisiana subcontractor that has developed efficiencies utilizing robotic welders on Gulf Coast oil rigs.
Unions like the Dockbuilders and Timbermen Local 1556 and the New York City District Council of Carpenters are designated by the PLA to dispatch union welders to the TZ jobsite, but were unable to supply the project with enough experienced local welders.
One of the alleged selling points of a PLA is to “ensure a steady supply of labor,” according to President Obama’s 2009 pro-PLA Executive Order 13502 and pro-PLA remarks made by New York building trades union leaders over the years.
So when Big Labor couldn’t keep its promise, local jobs were outsourced to robots and out-of-area businesses and employees.
More from The Journal News (“Robotic welders are helping build the Tappan Zee Bridge,” 6/4/14):
TZC would also be responsible, in most cases, if the project went beyond the $3.1 billion construction contract. In addition, TZC faces stiff penalties if the bridge is not completed on time in 2018.
The New York State Thruway Authority has paid TZC $809 million to date, officials say.
Pile challenges from the start
The Journal News first reported in November that crews were having trouble with the first batch of piles. Thruway Authority project director Peter Sanderson told the board many local welders didn’t have the experience with piles that size and that work was delayed.
In April, project officials said while the pace of pile welding improved, they were still struggling to find qualified welders. Just 23 percent of welders were passing a series of five tests to work on the job, TZC officials said.
TZC spokeswoman Carla Julian said TZC spent a “significant amount of time, money and resources” working with unions to boost the welding level and productivity rate needed on the project. The test passing rate is now at about 35 percent, the industry average, union officials said.
The ebb and flow of progress
The Louisiana welders arrived at the same time 25 [union] welders were laid off, though project and union officials said they were not connected. Cavanaugh claims a delay in pile deliveries prompted the layoffs.
TZC on Friday reiterated the project was “on time and on budget,” and disputed that there was a shortage of piles on site.
“As with all construction operations, they peak at certain points and drop off at other times and this requires managing the workforce accordingly in partnership with each local union,” Julian said.
In total, the council has more than 150 members working on the job site, including 38 welders from local 1556.
Ross Pepe, president of the Construction Industry Council of Westchester and the Hudson Valley, said though TZC is allowed to bring in as many out-of-region workers as “the project demands,” he still expects locals to do much of the work.
Brian Conybeare, special adviser to the governor on the project, said that as of last month, 70 percent of the union workers are state residents and more than 91 percent are from the tri-state region.
What’s troubling is skilled local nonunion construction workers like welders, and their qualified nonunion employers, cannot work on this project unless they sign the PLA. This PLA forces firms to hire most or all of their construction employees through union hiring halls, follow archaic union work rules and pay into union benefit plans.
Unions secure PLAs through political influence and are rewarded with a huge competitive advantage for union-signatory contractors that exclusively use union labor, and a monopoly for construction trade unions supplying labor to the project.
The main argument for PLAs is that they minimize costly delays by preventing strikes, especially on big projects (even though there have been strikes on numerous New York PLA jobs). But these deals are anti-competitive, effectively shutting out nonunion contractors that might otherwise do the same quality work for less, and whose employees make up 75 percent of the statewide construction workforce.
Studies show PLAs significantly drive up school construction costs, in particular — by up to 20 percent, in New York ‘s case.
Yet the Obama administration is encouraging the use of PLAs on federal projects exceeding $25 million and on federally assisted projects like the Tappan Zee bridge — not that New York needed the push, as it enacted Executive Order No. 49 in 1997, which encourages the use of PLAs when appropriate.
Like all such agreements, the PLA for the Tappan Zee project was negotiated behind closed doors, and it’s unclear whether the Thruway Authority conducted the legally required due diligence study to demonstrate that a labor agreement should be required as the most cost-effective approach to building the bridge.
In June 2012, construction trades councils in Rockland and Westchester counties voted down the PLA proposed by Gov. Cuomo because it called for prefabricating bridge materials upstate, where wages are less expensive and union work rules are more relaxed. The PLA was eventually agreed to once the prefabrication cost-saving measures were axed. However, Gov. Cuomo claimed the PLA would save $452 million by obtaining money-saving concessions from unions to existing collective bargaining agreements (CBAs) such as modifications to shift work hours, uniform holiday schedules, premium wage adjustments for certain shifts, and relaxing apprenticeship ratios.
Unfortunately, Cuomo’s figures are plagued by a serious error in methodology. The calculations are based on the flawed assumption that 100 percent of the project would be constructed with union labor absent a PLA.
This assumption isn’t true in this market. Without a PLA, it is likely that a percentage of this project’s labor hours would be performed by nonunion contractors and their nonunion workforces. In other words, Cuomo’s sleight of hand calculations give false and unwarranted credit to a PLA for concessionary cost savings to union agreements that would have been realized in the absence of a PLA and through the competitive bidding process inclusive of qualified nonunion firms. It makes no sense to score the modification of costly rules applicable only to union contractors as a “cost savings” when qualified nonunion contractors and skilled employees are not saddled with such inefficiencies endemic to unionized contractors in the first place.
While discriminating against capable and experienced local merit shop firms and employees, the PLA has failed to deliver on its promise of supplying the Tappan Zee project with a local workforce, including skilled local welders.
Nobody will ever know how much more the PLA is costing taxpayers because it discouraged competition from qualified firms opposed to PLA mandates.
With broken promises like these, when will lawmakers pull the plug on government-mandated PLAs?