On Nov. 9, 2010, Solis made these remarks in support of PLAs and President Obama’s pro-PLA Executive Order 13502 to the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada at the Hollywood, Fla. Westin Diplomat Hotel and Resort:

…And while we are working with businesses to ensure employee safety, we are also working with them to strongly consider Project Labor Agreements.

We are glad to be working with you on the President’s Executive Order encouraging the use of PLA’s

We know PLA’s can contribute to economy and efficiency of large construction projects.

We are very interested in learning from your experience in the private sector and how we can get some of those advantages in federal construction.

We know that PLA’s are a win-win: good for workers and for contractors.

At a Feb. 2, 2010 House Education and Labor Committee hearing, Solis again confirmed her support of PLAs in response to a question by Rep. Glenn ‘GT’ Thompson (R-Pa.).

In September 2009, Solis addressed the AFL-CIO Convention in Pittsburgh and reaffirmed her support of these special interest schemes that will kill jobs, unfairly help unionized contractors win federal contracts and harm American taxpayers, workers and businesses:

“Not only do the President and I support Employee Free Choice Act, we are strong supporters of Project Labor Agreements.

We know that they are a win-win: good for workers and for contractors Project Labor Agreements improve the economy and efficiency of construction projects.

President Obama issued an executive order encouraging the use of PLA’s for large federally funded projects, and we have been working very hard at DOL with Vice President Biden and the Middle Class Task Force to ensure that Project Labor Agreements are really encouraged and used.

Project Labor Agreements help make Good Jobs!”

Taxpayers, qualified merit shop contractors and their skilled employees should be dismayed by this statement because it signals a possible expansion of President Obama’s Executive Order 13502, which encourages federal agencies to require discriminatory and anti-competitive PLAs on federal construction projects exceeding $25 million in total cost.

Section 7 of Executive Order 13502 instructs the director of the Office of Management and Budget, in consultation with Labor Secretary Solis and other White House officials, to make “recommendations about whether the broader use of project labor agreements, 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.”

Expansion of Executive Order 13502 could translate into requirements or incentives for state and local governments to use PLAs on construction projects receiving federal assistance. (Federally-assisted projects are local, state or private construction projects that receive a federal grant, loan, tax-break or other form of financial assistance.)

Section 7 PLA Expansion’s Impact on Communities
States and local communities should take interest in the expansion of Executive Order 13502 via Section 7. Accepting federal assistance for construction projects with strings attached that favor Big Labor could bust strained budgets. Will states and local communities swallow the typical 18 percent PLA premium? Can they afford to build four schools, hospitals, bridges and courthouses for the price of five?

Section 7 PLA Expansion Is a Job Killer
PLAs on federally-assisted projects also will cost jobs. The impact of higher costs resulting from PLAs on finite state and local budgets translates into fewer construction projects. Less building means fewer jobs in an industry that faced an unemployment rate of 27.2 percent in February of this year – the highest level recorded since the federal government began making the data available in 1976.

Between August 2006 and August 2010, employment in the construction industry dropped 27.4 percent, as 2.1 million construction workers lost their jobs. To put the construction industry’s job losses in perspective, the 5.6 million people working in construction today is barely higher than the 5.59 million people who were working in construction in August 1996.

With the U.S. construction unemployment rate at 17.3 percent—nearly twice the overall national unemployment rate in all industries—expensive and job-killing government-mandated PLAs make little sense.

In addition, will local and state governments understand that PLAs give preference to out-of-state union members ahead of local and qualified nonunion employees? PLA projects in areas with low union density and market share often fall victim to this boneheaded fiscal policy, as local nonunion employees continue to rely on state unemployment and entitlement services and not pay into the local tax base while PLAs give preference to out-of-state union members obtaining work through local union hiring halls.

Finally, it is discriminatory and shortsighted public policy for states and communities to tell skilled nonunion labor they cannot work on these projects unless they agree to pay union dues and lose employer contributions to union benefit and pension plans for the life of a PLA project–typical negative consequences of PLAs on nonunion labor and key reasons why nonunion contractors rarely compete to work on PLA projects.

Big Labor’s Infamous Hotel Boondoggle
It is bizarre that Solis’ recent remarks in support of PLAs were given at a construction industry union conference held at the Hollywood, Fla. Westin Diplomat Hotel and Resort. The union-only construction of the Westin Diplomat Hotel is infamous for suffering from embarrassing delays and cost overruns that wiped out money invested by a construction union pension fund.

The Westin Diplomat Hotel was funded in part by an $800 million investment from the National Federation of Plumbers, Pipefitters and Journeymen’s pension fund–an amount that was nearly 20 percent of the pension fund’s total assets at the time.

The hotel opened in February 2001, almost 18 months late and at a cost almost $400 million above projections after two years of construction.

The pension fund fired the original developer and pension plan trustees were sued by the DOL under auspices of the Employee Retirement Income Security Act (ERISA), a conflict-of-interest statute designed to prevent the trustees of a multiemployer national pension fund from engaging in self-serving actions and to ensure fund investments are prudent.

According to reporting by Engineering News Record, the suit eventually led to an Aug. 2, 2004, settlement with the DOL where trustees Maddaloni and Patchell paid an $11-million civil fine. The settlement allowed union leaders Maddaloni and Patchell to keep their union posts, but they had to resign as trustees of seven pension funds.

The Westin Diplomat hotel is a curious place to be touting the benefits of anti-competitive and costly union-favoring PLAs as this boondoggle was a black eye for Big Labor and it should serve as an ominous warning to communities around the country about the problems with union-only construction and PLAs, should Section 7 of Executive Order 13502 expand and apply to federally-assisted projects.

The solicitation contained a crony contracting scheme called a project labor agreement (PLA) that would funnel construction contracts to unionized contractors. It was the first time a federal agency attempted a government-mandated PLA on a federal construction project since President Obama issued the controversial Executive Order 13502 Feb. 6, 2009.

However, after ABC member North Branch Construction of Concord, N.H., with ABC support and representation, filed a protest against the illegal, costly and anti-competitive PLA with the Government Accountability Office (GAO), the U.S. DOL cancelled its solicitation to construct the project.

Rather than build the project without the unethical and illegal PLA, the DOL decided to sit on the project and deny local residents services offered by the Job Corps Center and badly needed construction jobs.

Yesterday the stalled project made headlines as it was raised as n issue in the New Hampshire gubernatorial race (“Stephen hits Lynch on stalled Job Corps Center, 6/24″):

Republican gubernatorial candidate John Stephen blasted Gov. John Lynch for failing to move the project forward. The U.S. Department of Labor had halted the bid process in November when a local contractor complained about labor requirements.

“I find it unconscionable that nothing has been done in eight months to move this project forward when we need jobs,” said Stephen at a press conference in the Legislative Office Building yesterday. “Being silent on the issue is not leadership.”

Lynch’s press secretary Colin Manning said Lynch, an early supporter of the project, has been in contact with the Department of Labor since the bidding was halted. He said the governor was told recently that the bidding process would be restarted in 30 to 60 days.

“The governor is very supportive of that center, and is working to get people back to work in this state,” Manning said.

[snip]

Yesterday, Stephen declined to say if he supports or opposes the PLA, but said all sides should sit down and work out their differences so workers could have badly needed jobs. With 50,000 people out of work in the state, the priority must be jobs, he said.

“Gov. Lynch has said he wants to do all he can to create jobs, but for the past eight months, he has been silent on a contract that could be putting hundreds of people to work today,” Stephen said.

Here is more from the Stephen campaign. Nothing from the Lynch campaign.

Either candidate would serve New Hampshire residents appropriately by urging the DOL to deliver the best possible product at the best possible price free from corrupt and costly PLA mandates.

Let’s hope common sense prevails over politics and special interests and the DOL builds the project using fair and open competition without a PLA.

In 2009, just 958,000 members of the U.S. private construction workforce belonged to a labor union, compared to 1.195 million construction union members in 2008. Union membership in the construction industry is at its lowest point since 1995, when 908,000 union members composed 17.7 percent of the U.S. private construction workforce according to the Union Membership and Coverage Database, available at www.unionstats.com.

So how will the decline in overall union membership in the construction industry change the public policy debate surrounding project labor agreements (PLAs) and President Obama’s pro-government-mandated PLA Executive Order 13502?

In short, there will be added pressure on politicians to intervene and help keep Big Labor afloat. I predict that Congress and the White House will attempt to create construction jobs and they will try and steer those jobs to construction union members through PLAs. There will be an increase in wasteful and corrupt PLAs in federal contracting in 2010.

Congress and the Obama administration have already called for additional federal construction spending to stimulate the economy. The next step is to give Big Labor a big advantage on federal construction projects.  This will be achieved by pressing the Federal Acquisition Regulation (FAR) Council to publish their final rule implementing President Obama’s pro-PLA Executive Order 13502 into federal procurement regulations and then pressuring federal agencies to use PLAs as much as possible.

The construction industry’s jobless rate hit its highest level in at least a decade, climbing to 22.7% in Dec. 2009, the Bureau of Labor Statistics has reported. 

Numerous parties have an interest in creating jobs for construction union members.  It’s stating the obvious, but fewer union jobs spells disaster for union institutions, union retirement plans and the politicians that depend on union contributions to get elected and pass public policy favoring Big Labor.

Fewer employed union members translates into less money flowing into union retirement accounts, known in the construction industry as multi-employer pension plans (MEPPs).

A Sept. 2009 report by Moody’s Global Corporate Finance, “Growing Multiemployer Pension Funding Shortfall is an Increasing Credit Concern,” found construction industry MEPPs are only 54 percent funded with an estimated shortfall of a whopping $72.484 billion.  In other words, for every dollar that these funds owe, they hold only 54 cents of invested assets. Because some union retirement accounts are insolvent, and most depend on incoming cash to fund benefits for retired workers and future beneficiaries, the union plans are under greater pressure because of a lack of incoming revenue due to high construction union unemployment (the U.S. workforce has a similar problem with Social Security funding).

Politicians understand that a lack of union jobs in the construction industry means fewer union dues and “voluntary” political contributions deducted from union members’ paychecks that are funneled into union slush funds and PACs that support Big Labor’s political friends.

The symbiotic relationship (it is called mutualism in nature) between Big Labor and their political supporters cannot continue without healthy union institutions and continued political contributions from labor unions that fuel Big Labor’s political machine.

So the latest union membership numbers, coupled with 22.7 percent unemployment in the construction industry and the complex relationship of entities dependent on union revenue point to a greater need for the government to use PLAs.

There are valid economic and ethical reasons why promoting the special interests of Big Labor, who compose just 14.5 percent of the U.S. private construction workforce, ahead of the needs of the rest of the construction industry through PLAs is a mistake.

PLAs increase the cost of construction and waste taxpayer dollars. With the added cost premium of PLAs, there is less construction money available. And less construction money means fewer total construction projects and construction jobs. So union-favoring PLAs could actually make unemployment in the construction industry even worse.

In addition, there is no compelling reason (other than political self-interest) to create jobs for union members ahead of nonunion employees via PLAs. Nonunion employees deserve just as fair a shot to feed their families as union members. Unions should use the ultra-competitive market and tough economy as an opportunity to retool their product and make it more lean and efficient to compete in today’s marketplace instead of relying on government handouts to stay alive.

The U.S. economy and the construction industry would benefit from free and open competition, without corrupt government-mandated PLAs.

The General Services Administration admitted it made a mistake when it placed a non-competitive, cost-raising, union-pleasing Project Labor Agreement (PLA) on a federal construction project in Washington before the Federal Acquisition Regulation (FAR) Council issued its final ruling on President Obama’s executive order, which encourages the use of PLAs on all federal construction projects worth more than $25 million.

The $100 million Lafayette Building Modernization project is currently the only active federal government-mandated PLA.
Here’s a link to the project (See Section H, 12.02 and Section 16 page 24 on Section H for the PLA language).

After jumping the gun, GSA is now requiring contractors to submit two proposals – one subject to a PLA requirement and one that is not.  The Associated Builders and Contractors criticized this highly unusual two-bid process, saying it puts even more obstacles before the 86 percent of local D.C. contractors, many minority owned, who are non-unionized.

UPDATE: On 2/4, the GSA cancelled this solicitation. Qualified local contractors submitted a bid protest with the Government Accountability Office (GAO) against the GSA’s dual bidding/PLA requirement. Similar to the outcome of the bid protest issued against the U.S. Department of Labor Job Corps Center in Manchester, N.H., the GSA opted to cancel the solicitation instead of move forward without a PLA.

However, according to the GSA solicitation cancellation notice, “GSA expects to re-issue the Lafayette Building Modernization solicitation in the near future.”

The DOL’s Job Corps Center PLA was believed to be the first government-mandated PLA on a federal construction project since President Obama’s Executive Order 13502 was issued Feb. 6, 2009. 

An Associated Press (AP) story appeared in The New York Times, Boston Globe, WBZ38-TV (DE), The News Journal (DE), CBS 4 Denver, Yahoo! News, Seattle Post-Intelligencer, The Miami Herald, The Sacramento Bee, ABC News and other media outlets (“US Labor Dept Reviews NH Job Corps Building Terms, 11/12).

The piece mentions a statement by Republican Senator Judd Gregg, a vocal critic of the discriminatory and costly PLA on this project:

…Thursday, Republican Sen. Judd Gregg, who had lobbied for the Job Corps center, called the Labor Department’s recent decision ”just another unnecessary bureaucratic delay to the progress of this critically important project.”

”This setback clearly illustrates that the administration’s decision to discriminate against successful, independent construction firms because Granite State employees choose to work in a union-free environment simply does not hold water in New Hampshire,” he said.

In September, Gregg had urged the department to reconsider its decision, saying that only 8.7 percent of the construction workers in New Hampshire were unionized…

Additional coverage from the Concord Monitor, Job Corps Site Sits in Silence (11/12), explains why this project is so important to qualified New Hampshire contractors who oppose the discriminatory and costly PLA:

Kenneth Holmes, president of North Branch Construction, which filed the protest that lead to the bid delay, said he hoped his firm could qualify for the project. He said that he had laid off about 18 workers in the past couple of years because of the economy but that a big project such as the Job Corps center might require him to call some of them back.

“I’ve got 40 workers, and I’d like to put them to work,” Holmes said.

Additional coverage, besides the stories linked here and here, include:

• (BNA) Construction Labor Report: Labor Department Cancels Bid Solicitation Under Challenge in New Hampshire for PLA,” 11/12 (password required)
• The Nashua Telegraph: Labor Dept Examining Requirement for NH Jobs Corps, 11/12
• OpenMarket.org: Obama Administration Hits Brakes on Project Labor Agreement, 11/12

Let’s hope that the increased media attention will shed some light on Executive Order 13502 and PLAs, which are special interest giveaways to Big Labor and have no place in fair and effective public policy.

North Branch Construction challenged the PLA as unlawful and discriminatory. 

The DOL’s Job Corps Center PLA was believed to be the first government-mandated PLA on a federal construction project since President Obama’s Executive Order 13502 was issued.

Yesterday’s Amendment No. 10 to the DOL solicitation offers an explanation why the solicitation was cancelled:

Nov. 9, 2009 Federal Business Opportunities Notice re the Manchester, NH Job Corps Center Construction Project

 As announced in our November 5, 2009 notice, the Department of Labor (DOL) has canceled the Manchester New Hampshire Job Corps Center construction solicitation. This solicitation included a requirement that each bidder have in place a Project Labor Agreement (PLA) at the time of submission of its bid to 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 for DOL.

The solicitation was also the subject of a bid protest before the Government Accountability Office challenging the PLA requirement. The Department of Labor is currently considering next steps for building a new Job Corps Center in Manchester, New Hampshire.

This cancellation shall be recorded in accordance with 48 C.F.R. § 14.403(d).

An article by the Daily Reporter notes the practical implications of the cancelled solicitation ( ”Canceled Contract Delays PLA Resolution,” 11/10):

A federal decision to delay bidding out a New Hampshire project sidesteps a legal challenge over whether such contracts can include project labor agreements…

…The decision to cancel the contract also terminates the opportunity PLA opponents had to challenge the legality and merits of using the agreement on federal contracts.

The good news is that the DOL has not abandoned the project entirely, and has acknowledged the need to “further evaluate” a PLA on this issue.  The bad news is that the legality of these giveaways to Big Labor on federal contracting remains unsettled. 

Time will tell if  the DOL’s cancelled solicitation is an admission that discriminatory and costly government-mandated PLAs have no place in federal contracting, or if the cancelled solicitation is simply a special interests-driven tactic to avoid an unfavorable ruling against PLAs and Executive Order 13502.

ABC and a coalition of associations, taxpayers, employees and businesses who champion free and open competition on government construction contracts will continue to fight government-mandated PLAs at the local, state and federal level.

The development is 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 may have addressed the legality of federal government-mandated PLAs and Executive Order 13502.

The Labor Department has not disclosed why the solicitation was cancelled but is required by FAR regulations to provide cause.

Here is a summary of media coverage since Friday:

• New Hampshire Union Leader: Job Corps Center Plan Hits Wall in Bid Process
• WMUR 9: Feds Cancel Bidding on Manchester Job Corps Center
• Daily Reporter: Proposed PLA Project Canceled
• National Right to Work Blog: Obama Administration Backs Down (For Now) Rather than Defend Discriminatory Project Labor Agreements

The Union Label Blog post, Victory Against Obama’s Unionism in New Hampshire, provides a practical explanation of the relationshop between PLAs and politics. 

A PLA ruling either outright excludes non-union companies…   …or forces them to be hobbled under union rules, but PLAs are nothing less than a government payoff to unions. In essence a PLA is a direct transfer of government money to union coffers and that is precisely why President Obama decreed via Executive Order that henceforth all government construction projects would be forced to proceed under PLAs

While the Obama order does not subject ALL federal construction projects to a PLA, it encourages federal agencies to require PLAs on appropriate federal projects exceeding $25 million. 

Section 7 of the executive order may expand a PLA encouragement or mandate to local and state construction users receiving federal assistance (grants, loans, tax breaks etc.).  Forcing federal special interests onto state and local procurement officials is a recipe for discrimination, corruption and increased costs on local and state budgets already strained by weak revenue due to the sagging economy.  States should not be hoodwinked into paying for four schools, bridges and hospitals for the price of five (the federal government shouldn’t tolerate this waste either, but that’s politics).

In addition, in states with low construction union density and/or a tight labor market, out of state union workers will take the jobs of qualified in-state nonunion workers under PLA mandates.

David Denholm’s blog post, Obama/Labor Bid Rigging Scheme Unravels, provides a sharp analogy of PLAs:

PLAs are bid rigging and protection racket schemes under which the construction owner agrees to use only union labor, thus driving up the cost of the project at the public’s expense, while the unions guarantee “labor peace.”

To put this in perspective, picture a thug at a candy store in Chicago telling the store’s owner that for a weekly payoff his windows won’t be broken and his customers will not be molested. The cost of the weekly payoff is, of course, passed along in higher prices to the purchasers of candy. The thug has the additional economic responsibility to impose the same terms on all other candy stores in the area so that his client won’t be at a disadvantage.

 Stay tuned for more updates and coverage.

Below is a news release from ABC National.

New Release

ABC Defeats Unlawful and Discriminatory New Hampshire Construction Contract

 Move Comes in Response to ABC Member Protest

Washington, D.C. – Associated Builders and Contractors (ABC) today announced that the U.S. Department of Labor (DOL) has cancelled its solicitation for bids to construct a new Job Corps Center in Manchester, N.H. under a government-mandated project labor agreement (PLA). The cancellation came in response to a protest filed with the Government Accountability Office (GAO) by ABC member North Branch Construction of Concord, N.H., with ABC support and representation. North Branch Construction challenged the PLA as unlawful and discriminatory.

“This is a real win for the principle of fair and open competition in government procurement,” said North Branch Construction attorney Maurice Baskin of Venable LLP, ABC’s General Counsel. “It is no coincidence that the Department of Labor cancelled its unlawful PLA mandate the day before the agency was required to file a response to our bid protest. We demonstrated that there was no justification for imposing a PLA on this project and that the PLA mandate violated the Competition in Contracting Act and other longstanding federal procurement requirements.”

“There is no justification for playing favorites in the government procurement process,” said ABC President and CEO Kirk Pickerel. “We hope that other federal agencies will heed this example and recognize that PLAs only result in delayed construction and harm to taxpayers. ABC will continue to protest any attempt to impose PLAs on federal construction projects in violation of competitive bidding laws.”

“The Department of Labor can still move this project forward by abandoning this illegal PLA,” said Ken Holmes, president of North Branch Construction. “Our company and other New Hampshire businesses deserve a fair opportunity to provide the public with the best construction product at the best price and we hope the Labor Department will build this project without a PLA in early 2010.”

A PLA is a contract that discourages competition from nonunion contractors and their nonunion employees by requiring a construction project to be awarded only to contractors and subcontractors that agree to recognize unions as the representatives of their employees on that job; use the union hall to obtain workers; obey the union’s restrictive apprenticeship and work rules; and contribute to union pension plans and other funds in which their employees will never benefit unless they join a union.

The bid protest challenged the legality of the federal government’s recent shift in federal procurement policy concerning the use of discriminatory and costly PLAs. On Feb. 6, President Obama signed Executive Order 13502, which repealed a 2001-2008 prohibition on federal PLAs and encourages agencies to require PLAs on federal construction projects whose total costs exceed $25 million. The Federal Acquisition Regulatory (FAR) Council is in the process of reviewing public comments on its controversial July 14 proposed rule that would implement Executive Order 13502 into federal procurement code. ABC filed detailed comments challenging the implementation of Executive Order 13502.

The DOL’s Job Corps Center PLA was believed to be the first government-mandated PLA on a federal construction project since Executive Order 13502 was issued.

###

Media Inquiries: Gail Raiman, (703) 812-2073 or Gerry Fritz, (703) 812-2062

TheTruthAboutPLAs.com on this development: Rather than build this project without a discriminatory and costly (and probably illegal) PLA – and generate the related economic benefits this project would create for New Hampshire taxpayers - the DOL has inexplicably cancelled this project. 

This unfortunate decision also stopped the bid protest pending before the Government Accountability Office (GAO) that would have addressed the legality of federal government-mandated PLAs and Executive Order 13502.

Justice delayed, is justice denied.

Holmes filed a bid protest with the Government Accountability Office about the discriminatory and costly government-mandated project labor agreement (PLA) on the new U.S. Department of Labor Job Corps Center in Manchester, New Hampshire.  It is the first government-mandated PLA issued on a federal construction project since President Obama signed Executive Order 13502.

KH on the impact of a PLA on his local New Hampshire workforce:

•Q: How did your employees feel about being shut out of a project in the middle of their own state? You had looked at the project as a way to get some of your guys back to work, right?

•A: That’s correct. We’ve actually had in the last year at least a couple of layoffs. … And to answer your question, our employees are, of course, annoyed, particularly when it’s their dollars that are paying for this project and it essentially shuts us out of the game. And this is the type of project that would be right up our alley, so this was a project that we clearly had expressed interest in and wanted to bid and wanted to put our own people to work on. And we’re not being allowed to. From our perspective it’s arbitrary and … incredibly discriminatory. We just don’t understand it at all.

KH on why government-mandated PLAs are special interest “paybacks” to Big Labor:

•Q: President Bush had barred agencies from using PLAs and then Obama quickly repealed that executive order. Some folks see that as political payback. Do you agree?

•A: That’s certainly my opinion. … President Obama issued the executive order encouraging agencies to consider using PLAs, but they haven’t even put the guidelines or rules in place as to when it’s appropriate to consider — or even under what circumstances. Now, from my perspective, I can’t see that there would ever be an advantage to a PLA. We’ve been building for literally decades — my company has been in business in New Hampshire for 51 years — and there’s never been a need to have a PLA. Our projects get built, they are on time or ahead of schedule, they are on budget. We don’t have work force issues here in New Hampshire, so I don’t understand it. But be that as it may, what’s particularly perplexing is the public comment period hadn’t even ended on how President Obama’s executive order would be implemented and they came out with this project making it a mandatory PLA. … The only explanation that comes to my mind is that it’s political payback

KH on Big Labor’s bogus claim that a PLA guarantees high wages and benefits for all workers:

•Q: Doesn’t the Davis-Bacon Act mandate prevailing wages for federal projects?

•A: It does. … So when somebody has said, “Well, wouldn’t a worker for the union get paid more than one of your workers on this project?” the answer is no. The actual worker’s take-home would be the same or quite possibly even higher for my workers because union workers have to pay so much money in for union dues and so forth, which our workers don’t pay. Our workers get it in terms of actual gross pay. They actually get a paycheck that equates to the Davis-Bacon wages.

KH on why PLAs waste taxpayer dollars and why everyone should oppose government-mandated PLAs:

•Q: A Beacon Hill Institute study concluded that had PLAs been in place in 2008, the cost of federal construction projects exceeding $25 million would have increased by as much as $2.6 billion. In this economy a lot of projects might not get built, right?

•A: It’s been suggested that if you only have $100 million and the PLA is going to cost, say it’s 15 percent or 18 percent more, instead of building five $20 million projects you are going to end up building four $25 million projects. So I have heard a suggestion that that means for the same amount of dollars you are going to build less schools or less job corps centers or less courthouses or what have you. It certainly seems like a rip-off of the American taxpayer to me.

Let’s recap. This PLA is a rip-off of the American taxpayer, will shut out qualified local workers that are unemployed, is not responsible for high wages and benefits, and a special interest payback.  And President Obama wants more PLAs on federal construction projects?  Let’s hope a ruling from the GAO will put an end to this bad public policy.

The Concord Monitor ran a piece that features a quote from a qualified New Hampshire nonunion business, demonstrating that a PLA cuts competition (“Builder Confronts Union Law,” 10/8).

At least one New Hampshire company has withdrawn its stake in the project as a result of the labor agreement requirement. Pro Con Construction in Hooksett had put its name on a list of interested bidders early on.

The company is too large to qualify, but Executive Vice President Dan Dal Pra said it could have entered into a joint venture with a smaller contractor. The requirement for a labor agreement ruled that out.

“It would require that we change our whole way of doing business,” Dal Pra said. “It’s a good-sized job, and it seems that it’s a shame to cut out qualified contractors because they’re not union.”

The Washignton Examiner’s follow-up piece to this by Barbara Hollingsworth chronicles how PLAs discriminate against local and qualified construction employees (“NH firm files protest with GAO over PLA,” 10/7).

Ken Holmes, president of North Branch Construction, told The Examiner that “one of the requirements of the bid is that it is subject to a PLA, which very specifically requires general contractors to use exclusively union workers. But virtually every major contractor and subcontractor in New Hampshire is non-union. This basically knocks all of us out of the ballgame. We believe it’s discriminatory and violates the federal Competition in Contracting Act.”

Like all federally financed projects, Holmes says, the project is already required to pay Davis-Bacon wages. “Problem is, none of our employees could work on the job if the PLA stays on the contract.”

Holmes says his employees are “outraged” at being shut out of a construction project in their own state. “We all pay our federal taxes. With unemployment skyrocketing in New Hampshire over the last year and a half, they’d like to be able to work on a project right here,” Holmes said. “PLAs are special interest handouts that deny taxpayers the accountability they deserve from government contracts.”

Well said Ken Holmes. Executive Order 13502 and government-mandated PLAs are bad public policy.

The Union Label blog (“Obama’s Stimulus for Unions,” 10/8) provides an interesting persepctive about what a PLA means to taxpayers.

But even worse than that, these forced union sops will drive up the costs of the project, cause delays, and fill the pockets of corrupt union officials. So the federal dollars going to these projects will not be cost effective. It should be also remembered that these projects are being funded by the taxpayers.

In the end, this is neither about jobs, nor stimulus. In truth, this is simply a massive payoff from Obama to his supporters in the unions made at the expense of the national treasury as well as the exclusion of New Hampshire’s successful small businessmen.