In a press release and letter to the White House issued Monday, Sen. Ayotte asked President Obama to repeal his pro-union Executive Order 13502 and remove the anti-competitive and costly union project labor agreement (PLA) mandated by the U.S. Department of Labor (DOL) on a $20 million to $50 million DOL Job Corps Center in Manchester, N.H.

The DOL’s Jan. 30 solicitation (DOL121RB20457) for the Manchester Job Corps Center mandates a union-favoring PLA.

Bidding is only open to certified small business contractors willing to agree to the terms and conditions of the union-friendly PLA drafted and mandated by the DOL. 

Qualified federal contractors played no part in creating this government-mandated PLA, which requires contractors to obey numerous union collective bargaining agreements, pay into union pension and benefit plans, follow inefficient union work rules, hire most of their employees through union hiring halls for the life of the project and force unwanted union representation on nonunion employees.The PLA is a direct assault on New Hampshire’s ”Live Free or Die” state motto.

In New Hampshire, 85.5 percent of the construction workforce does not belong to a labor union, according to new government data. The state does not have a history of using government-mandated PLAs and few federal small business contractors are unionized, leading many in the industry to believe out-of-state union contractors and union workers from Boston will steal jobs away from the New Hampshire construction industry, which is already suffering from a grim construction economy.

According to a press release issued by ABC New Hampshire/Vermont President Mark Holden:

The government-mandated PLA has the potential to again delay this project, increase costs, reduce competition from qualified New Hampshire businesses and deny badly needed jobs to skilled New Hampshire construction workers who have freely chosen not to belong to a union.

The Union Leader ran an article about this controversy (“Sen. Ayotte slams bidding for Manchester Job Corps Center,” 2/7/12):

Sen. Kelly Ayotte is calling on the Obama administration to scrap all union-friendly project labor agreements, saying they are the reason the planned Job Corps Center in Manchester has yet to be built.

In a letter to Obama released Monday, Ayotte asked the President to reverse his executive order requiring federal projects over $25 million to consider using project labor agreements, or PLAs. In his State of the Union address, Obama said he wanted to cut government red tape. These agreements would be a good place to start, the Republican senator said.

“Federal government-mandated PLAs needlessly increase construction costs and limit the ability of non-union companies to successfully compete for government construction contracts,” wrote Ayotte. “This Washington mandate also significantly slows down the procurement of construction projects, forcing workers to wait on the sidelines until the PLA winds its way through the federal bureaucracy.”

A Foster’s Daily Democrat editorial also blasts the DOL’s anti-competitive and costly union-friendly PLA mandate on the Job Corps Center (“The union souffle is falling fast,” 2/9/12):

While there is some debate on the actual impact of PLAs on construction costs, PLAs should play no role in a free an open marketplace.

Unions argue that even though union labor — or union labor rates — may increase the cost of constructions projects, their workers bring to the table better skills and quality assurance. These, in the long run, supposedly make the extra costs worthwhile.

If that is true unions should be willing to compete on the merit of their argument. Bidding on such projects as the Job Corps Center should not be delayed by the prerequisite of a PLA. The impact of union labor on a projected should be part of the bid offered by contractors who may of their own free will choose to use union labor — no pre-mandate.

Such dictatorial practices go a long way in alienating the general public. They fuel Right to Work efforts in states such as New Hampshire. And they leave such a sour taste in he mouths of Mr. and Mrs. John Q. Public that union ranks nationally have fallen faster than a souffle after the oven door is slammed shut while baking.

PLA Controversy Delayed Project
TheTruthAboutPLAs.com readers may recall previous media coverage of the Job Corps Center project, which most recently included a Dec. 23  holiday-themed op-ed in the New Hampshire Union Leader  by Holden. It summarizes the long-running controversy surrounding the DOL’s PLA mandate on the Job Corps Center and the absurdity of this gift to Big Labor at the expense of New Hampshire businesses and workers. It was penned in response to the DOL’s Dec. 22, 2011 pre-solicitation indicating the project would be subject to a PLA mandate.

By Mark Holden

It may be beginning to look a lot like Christmas, but many New Hampshire construction workers and businesses are expecting a lump of coal in their stockings from the federal government.

In this case, the Grinch is the U.S. Department of Labor (DOL), which is planning to build a $35 million Job Corps Center in Manchester with federal tax dollars.  Unfortunately, the DOL is poised to ensure the project is built by out-of-state union labor and union contractors, despite the fact that more than 91 percent of New Hampshire’s construction workforce chooses not to belong to a construction labor union.

The DOL is mandating a union-favoring project labor agreement (PLA) on the Job Corps Center.  Created by unions as a way to circumvent the free market and regain lost market share, a PLA typically requires contractors to replace most or all of their existing workforce with unfamiliar union labor, follow archaic and inefficient union work rules, and pay into underfunded union pension and benefit plans if they want to win contracts.

New Hampshire’s skilled nonunion workers are forced to accept unwanted union representation and pay union dues, yet they will forfeit benefits paid into union pension and benefit plans during the life of the project unless they join a union and become vested in these plans. 

Such humbuggery has the effect of discouraging competition from New Hampshire’s qualified contractors and their local employees.

Reduced competition coupled with costly union red tape needlessly increases construction costs.  Studies by the Beacon Hill Institute in Boston indicate projects subject to prevailing wage laws built with government mandated PLAs are 12 percent and 18 percent more expensive compared to similar non-PLA projects subject to government-determined wage and benefit rates. The research comes as no surprise to anyone familiar with Boston’s Big Dig boondoggle, which was built with a PLA mandate.

In short, government-mandated PLAs are a gift to Big Labor at the expense of taxpayers and New Hampshire construction businesses and tradespeople.

If this controversy has the disappointing familiarity of a re-gifted fruitcake, it is because the DOL tried to mandate a PLA on the Job Corps Center in 2009.  In the face of such blatant discrimination, a brave contractor, North Branch Construction of Concord, filed a bid protest against the DOL’s anti-competitive PLA. Instead of proceeding with PLA-free construction subject to fair and open competition – which would result in badly needed local job creation – the DOL canceled the project.

Not to be deterred, the DOL retained the services of a consultant, Hill International, to prepare a report justifying and defending a PLA requirement. The report cost taxpayers $130,000. It was the second PLA report Hill International prepared for the DOL. The first report, which trumpeted the alleged benefits of PLAs on federal construction projects, cost taxpayers $300,000. The latest report is so shoddy and full of pro-PLA bias, taxpayers will wish it came with a gift receipt.

The DOL and the federal government’s discriminatory policy is the product of an executive order signed by President Obama just a few days after moving into the White House in 2009. The measure encourages federal agencies to mandate PLAs on a case-by-case basis on large federal construction projects exceeding $25 million in total cost.

It is no coincidence it steers federal contracts to one of the White House’s and Democrat party’s biggest political patrons: Big Labor.

So while the Grinch has come to town, stealing Christmas hopes and dreams away from The Granite State’s workers and their families, will any of the GOP presidential candidates take a stand against deceptive payback to Big Labor prior to New Hampshire’s Jan. 10 primary?  

All nonunion contractors and their employees want this holiday season is the ability to fairly compete.  Some members of Congress, such as New Hampshire Sen. Ayotte, Rep. Frank Guinta and Rep. Charlie Bass, have stood up for free enterprise and New Hampshire families in support of legislation (S. 119 and H.R. 735) to “preserve open competition and federal government neutrality toward the labor relations of federal government contractors on federal and federally funded construction projects.”

That’s exactly what should happen. The federal government should preserve the right of everyone to fairly compete for jobs, not just a select few.

Congress should pass this legislation or a new president should undo President Obama’s destructive policy catering to well-connected special interests. It’s the only surefire way to keep the federal Grinch at bay.

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Mark Holden is the president of the New Hampshire/Vermont Chapter of the Associated Builders and Contractors. To learn more about anti-competitive PLAs, visit www.TheTruthAboutPLAs.com.

Obama Administration’s First Federal PLA Mandate
The DOL mandated a PLA on this project in 2009. It was the first PLA mandated by a federal agency on a federal construction project following President Obama’s Feb. 6, 2009 Executive Order 13502, which encourages federal agencies to mandate PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost. The DOL’s 2009 PLA mandate was especially unusual because it was issued prior to the Federal Acquisition Regulatory (FAR) Council final rule (pdf), issued April 13, 2010, and effective May 13, 2010, implementing Executive Order 13502 into federal procurement regulations (learn more here).

Similar attempts by federal agencies to mandate PLAs before and after the effective date of the FAR final rule were foiled by ABC contractor-led bid protests (learn more here).

Last summer, the project and PLA controversy received attention from the New Hampshire Union Leader (“Jobs Corps Center project going forward,” 8/20/11) and a related press release from Sen. Ayotte (“Senator Ayotte Expresses Concerns about Labor Requirement for Manchester Job Corps Project,” 8/19/11) in response to the DOL’s August announcement they will proceed with construction and mandate a PLA despite previous controversy.

Executive Order 13502 and the related FAR rule remain controversial White House gifts to Big Labor likely to increase federal construction costs, reduce economy and efficiency in federal contracting, reduce competition from quality nonunion contractors and their skilled employees, and deny taxpayers the accountability they deserve from the government.

TheTruthAboutPLAs.com will be following the DOL Job Corps Center project closely in the coming weeks.

According to BLS data, the construction industry recorded the lowest number of union members in 2010, when just 801,000 private construction workers belonged to a union.

From 2010 to 2011, union membership grew from 13.1 percent to 14 percent of the U.S. private construction workforce, with construction unions adding 73,000 new members.

The recession has hit the construction industry hard.  The average construction industry unemployment rate in 2011 is 16.4 percent. According to government data, the current industry unemployment rate is at 16 percent, but it was as high as 22.5 percent in Jan. 2011 .

The construction industry has shown few signs of improvement. From 2010 to 2011, the construction industry added 141,000 jobs and grew from 6,103,000 workers to 6,244,000 workers. However, this few workers have not been employed in the construction industry since 1998, when 5,946,500 workers were employed and 17.8 percent of the workforce was unionized, according to the Union Membership and Coverage Database, available at www.unionstats.com. In addition, government data indicates construction spending has been flat.

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

In short, there will be added pressure on politicians to pander to Big Labor’s special interests and help keep their political base afloat. As they did in 2009 and 2010, the White House, members of Congress and federal officials beholden to Big Labor’s costly special interest agenda will try to steer federal construction contracts to unionized employers and create jobs exclusively for union members through federal government-mandated PLAs. On April 13, 2010, the Federal Acquisition Regulatory (FAR) Council issued a final rule (pdf), effective May 13, implementing President Obama’s Feb. 6, 2009, pro-PLA Executive Order 13502 into federal procurement regulations.

While the final rule does not mandate PLAs on all federal construction projects — and it offers agencies some flexibility when deciding whether to mandate a PLA on a specific large-scale construction project — the regulation is nothing but a handout to special interests.

The decision to agree to a PLA should be left up to individual contractors and not forced onto qualified contractors by government agencies as a condition of winning a federal construction contract. PLAs mandates reduce competition, increase costs and steer contracts to unionized firms.

This election year, special interests and their political allies will turn up the heat on federal bureaucrats to ensure more PLAs are attached to federal construction projects and other taxpayer-funded construction projects.

After all, numerous elected officials have a politically motivated self-interest in creating jobs for construction union members.  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.

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 various union slush funds coordinated through Labor Management Cooperation Committees (LMCCs), 527 groups and Political Action Committees (PACs) that support Big Labor’s friends in politics.

This symbiotic relationship between Big Labor and its political chums cannot continue without healthy union institutions and political contributions from labor unions that fuel the Democrats’ political machine.  

So the latest union membership numbers—coupled with high unemployment in the construction industry and the complex relationship of entities dependent on union revenue—point to a greater push for local, state and federal governments to mandate PLAs at the expense of taxpayers and the merit shop contracting community.

There are valid economic and ethical reasons why promoting the special interests of Big Labor, which composes just 14 percent of the U.S. private construction workforce, ahead of the needs of the rest of the construction industry through PLAs is bad public policy.

For example, on prevailing wage projects, PLAs on average increase the cost of construction between 12 percent and 18 percent compared to similar non-PLA mandated projects. With the added cost premium of anti-competitive PLAs, there is less construction money available. And less construction money means fewer total construction projects and construction jobs. So union-favoring PLAs could 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 government-mandated PLAs. Qualified 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 relevant.

The U.S. economy and the construction industry would benefit from free and open competition, without corrupt government-mandated PLAs, where taxpayers can get the best possible construction product at the best possible price.

“Building this new energy future should be just one part of a broader agenda to repair America’s infrastructure. So much of America needs to be rebuilt. We’ve got crumbling roads and bridges. A power grid that wastes too much energy. An incomplete high-speed broadband network that prevents a small business owner in rural America from selling her products all over the world.

“During the Great Depression, America built the Hoover Dam and the Golden Gate Bridge. After World War II, we connected our States with a system of highways. Democratic and Republican administrations invested in great projects that benefited everybody, from the workers who built them to the businesses that still use them today.

“In the next few weeks, I will sign an Executive Order clearing away the red tape that slows down too many construction projects. But you need to fund these projects. Take the money we’re no longer spending at war, use half of it to pay down our debt, and use the rest to do some nation-building right here at home.

“There’s never been a better time to build, especially since the construction industry was one of the hardest hit when the housing bubble burst. Of course, construction workers weren’t the only ones who were hurt…”

On behalf of the merit shop contracting community, ABC 2012 National Chairman Eric Regelin, president of Granix, LLC, Ellicott City, Md., today reacted to President Obama’s remarks:

“In his speech, the president said ‘we can restore an economy where everyone gets a fair shot, and everyone does their fair share,’” said Regelin. “Yet, one of his first official acts when he took office was to sign an executive order on project labor agreements that discriminates against the 87 percent of the nation’s construction workforce that chooses not to belong to a labor union.

“It is not clear at this point what President Obama meant when he spoke of removing red tape from construction projects, but any sincere effort to do so must involve the elimination of government-mandated project labor agreements and Davis-Bacon wage requirements on taxpayer-funded construction projects,” Regelin said.

“The president’s insistence on a so-called ‘millionaire’s tax’ to fund his various priorities will expose the 80 percent of construction firms that are taxed at the individual rate to a significant tax increase,” said Regelin. “This does not represent a ‘fair share’ that will help the economy and create jobs, but rather the president’s continued use of the nation’s job creators as his personal piggy bank.

“The nation’s construction industry continues to struggle with an unemployment rate of 16 percent – nearly twice the national average,” Regelin said. “However, the president’s only solution to fix the economy is to hand out favors to special interests and punish those who work hard and take risks.”

To view this statement, click here.

So will President Obama’s new executive order cutting red tape slowing down construction projects be helpful, or, will it be another gift to special interests?

Cartoon courtesy of the Boston Globe

It is quite possible President Obama’s new executive order is just repackaging a policy the White House announced in October 2011 to speed along the approval of 14 high priority infrastructure projects. If so, this won’t likely be controversial. It could be something else equally noncontroversial

However, there is concern President Obama will make some changes this election year to federal policy concerning government-mandated PLAs on federal and federally assisted projects. See Section 7 of Executive Order 13502, issued Feb. 6, 2009:

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, 2009, 180 days sets the deadline at Aug. 5, 2009, but a recommendation has not been publicly issued.] 

An expansion of Section 7 could decrease the current $25 million threshold when federal agencies are currently required to evaluate if a PLA mandate is appropriate on a federal construction project. More PLA mandates on smaller projects would help Big Labor at the expense of everyone else. 

Section 7 could also force pro-PLA policies on federally assisted projects built by private owners and state and local governments. An expansion could increase costs for local and state projects already suffering from difficult budget realities. It could also lead to out-of-area union workers taking jobs away from qualified nonunion construction workers in the local economy.

TheTruthAboutPLAs.com explained the concerns with Section 7 expansion here.

Let's hope Section 7 of Executive Order 13502 is not.

TheTruthAboutPLAs.com will be following White House policies impacting the construction industry closely.

The PLA mandate harms Washington’s experienced and skilled nonunion construction workforce and will discourage competition from qualified contractors that have successfully built federal projects in Washington and across the country without PLA mandates.  It will also needlessly increase costs.

According to an article in the Kitsap Sun, NAVFAC Northwest mandated a PLA after Sens. Maria Cantwell and Patty Murray, and Reps. Norm Dicks and Jay Inslee (all Democrats from Washington) wrote to the Navy in support of a PLA at the request of construction trades unions (“Navy to hire local workers for second explosives handling wharf,” 1/1/12):

The trades council contacted the area’s federal delegation — Sens. Patty Murray and Maria Cantwell and Reps. Norm Dicks and Jay Inslee — who wrote to the Navy supporting a PLA, Whetham said. Four trade council officials and seven from the Navy met in November to explore the benefits and arrived at cost savings and skilled labor.

According to information obtained from opensecrets.com, construction trades unions have donated the following political contributions totaling $814,375 to the four Washington Democrats who signed the letter:

Rep. Inslee:       $340,000   from 2000 – 2012
Rep. Dicks:       $183,125   from 1998 – 2012
Sen. Murray:     $279,250   from 1998 – 2012
Sen. Cantwell:   $ 12,000    from 2002 – 2012
Total:               $814,375

Is this PLA mandate the product of a crony contracting scheme by federal officials? 

Prior to mandating the PLA, NAVFAC Northwest did not consult with the merit shop contracting community about the negative impact of PLA mandates on qualified federal prime contractors, subcontractors and their skilled local employees.

First Navy PLA Mandate Under Obama Administration
This is the first PLA mandate on a Navy project since President Obama issued Executive Order 13502 on Feb. 6, 2009, just a few weeks after his inauguration. The order strongly encourages federal agencies to mandate PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total costs.

As a result of Obama’s encouragement of federal PLA mandates, NAVFAC has issued several PLA surveys to the contracting community to determine if a PLA mandate will advance the economy and efficiency in federal procurement of numerous large-scale construction projects across the country.  ABC National and ABC members have responded to these PLA surveys.

NAVFAC Northwest did not issue a survey to evaluate if a PLA would be appropriate for this project.

In contrast, NAVFAC directly contacted ABC National and the merit shop contracting community for feedback on possible PLA mandates on other federal projects.

For example, after soliciting comments from ABC National and the contracting community in October 2010 concerning NAVFAC’s potential use of PLAs on billions of dollars worth of construction for Guam base realignment, NAVFAC elected not to mandate a PLA.

NAVFAC’s PLA Mandate Creates Inefficiencies
NAVFAC Northwest’s solicitation instructs qualified contractors invited by NAVFAC to bid on Phase 2 of the solicitation (the short-listed contractors) to negotiate a PLA with specific trade unions and submit an executed PLA within 10 days of the contract award.

NAVFAC supplied short-listed contractors with a pre-drafted PLA containing the terms and conditions NAVFAC already developed with specified construction trade unions and councils.

NAVFAC asked contractors to submit feedback on the pre-drafted PLA by Dec. 28. 

ABC advised short-listed contractors about the numerous problems with NAVFAC’s mandatory PLA language and cumbersome and inefficient procurement approach. Some of these concerns were submitted by short-listed contractors to NAVFAC.

NAVFAC is expected to review and share these comments with unions and provide contractors with a final PLA at a later date that they must use as the starting point in PLA negotiations.

Proposals from short-listed contractors are due Feb. 13. It is unclear when NAVFAC will award the contract, although it should be in early 2012.

Under this inefficient procurement process, it is possible for contractors to not know the terms and conditions of the executed PLA – which impacts labor costs and final bid costs – before submitting a final price proposal to NAVFAC.  If PLA negotiations are stalled by unions or NAVFAC does not supply the final terms of the pre-drafted PLA in time, contractors cannot submit an accurate price proposal.

In addition, the project could be delayed pending the outcome of the post-award PLA negotiations.  The project may have to be re-bid if the final agreement cannot be executed.

In 2010, a General Services Administration (GSA) project, the GSA Headquarters at 1800 F Street in Washington, D.C., suffered delays as a result of labor unions refusing to agree to the terms of a PLA the contractor presented and signed with other labor unions. Congressional testimony from GSA deputy administrator Susan Brita described this scenario, which also required the contractor to present an executed PLA within 10 days post-award.

Even regulatory comments  filed by Frank Dean, NAVFAC’s labor advisor, on the FAR Council’s proposed rule implementing Executive Order 13502 identify concerns with this inefficient post-award PLA procurement approach.

PLA Will Harm Local Nonunion Workforce and Small Businesses
From 2001 to 2009, when President George W. Bush’s Executive Orders 13202 and 13208 prohibited PLA mandates on federal and federally assisted construction projects, Washington’s skilled nonunion tradespeople constructed large-scale projects for the Navy, Army and other federal agencies absent a PLA mandate with no reported problems.

This union-favoring PLA is sure to serve as a barrier to new jobs for 84 percent of Washington’s private construction workforce and 86.9 percent of the U.S. construction workforce that has chosen not to join a construction labor union.

The Washington State Building and Construction Trades Council, AFL-CIO announced “construction labor on this project will be provided by Olympic Peninsula Building Trades and the Northwest Regional Council of the National Construction Alliance II (NWNCA),” and it is unlikely this project’s PLA will allow nonunion contractors to use few, if any, of the existing skilled nonunion employees they have invested training and resources in while employed at the company.

As this letter to the editor in the Kitsap Sun points out, if the PLA even allows nonunion construction workers to build this project, they will have to join a union and/or pay union dues and pay into union pension plans that they will never benefit from unless they join a union and meet vesting requirements.  The PLA results in a huge financial windfall for Big Labors coffers.

Favoritism for unionized construction workers is especially despicable because the construction industry is plagued by high unemployment in Washington and across the country. The number of construction workers employed in Washington in July 2011 was as sparse as the number of workers employed in Washington in August of 1997. Meanwhile, the U.S. construction industry is suffering from an unemployment rate of 16 percent as of December 2011. 

Don’t nonunion construction workers deserve a fair shot at new federal construction jobs?

Provisions in a PLA that force contractors to swap their existing workforce out for unfamiliar union labor is problematic for short-listed contractors that self-perform specific trade work, as well as subcontractors performing specialty trades.

This PLA mandate will make it difficult for short-listed contractors to meet NAVFAC’s small and disadvantaged business subcontracting targets because small businesses are traditionally not unionized:

Because building trades union membership is traditionally not diverse, a PLA mandate also may make it difficult for short-listed contractors to meet minority and women hiring goals set by the FAR’s Equal Opportunity and the Affirmative Action Compliance Requirements for Construction regulations required in federal construction contracts.

The PLA mandate’s inefficient procurement approach and pro-union language will discourage competition and increase costs to remaining competitors. Studies indicate PLA projects subject to prevailing wage laws increase construction costs between 12 percent and 18 percent compared to similar projects subject to prevailing wage laws not subject to government-mandated PLAs.

ABC Committed to Fair and Open Competition
ABC is opposed to government-mandated PLAs because these agreements typically restrict competition, increase costs, create delays, discriminate against nonunion employees and place merit shop contractors at a significant competitive disadvantage. Typical government-mandated PLAs are nothing more than anti-competitive schemes that end open and fair bidding on taxpayer-funded projects.

ABC has led industry opposition against federal PLA mandates, utilizing a variety of educational, public relations, grassroots, political and legal strategies to ensure fair and open competition on taxpayer-funded construction projects.

ABC has helped ABC member contractors file bid protests against federal PLA mandates during the Obama administration, which resulted in the removal of PLA mandates on a Veterans Affairs medical center in Pittsburgh, an Army Corps of Engineers project in Camden, N.J., a General Services Administration project in Washington, D.C., and a Department of Labor Job Corps Center in Manchester, N.H.     

ABC National also has responded to and helped ABC members participate in more than 50 PLA surveys issued by federal agencies to determine the feasibility of a PLA on a federal project.

ABC supports the Government Neutrality in Contracting Act (H.R. 735/S.119), cosponsored by 31 Senators and 172 Representatives and supported by a diverse industry coalition. The measure would eliminate waste and favoritism in federal contracting by prohibiting federal agencies and recipients of federal assistance from mandating PLAs, yet it would allow contractors to voluntarily enter into PLAs. This bill is good for taxpayers and the principles of free enterprise.

In 2011, House committees held two hearings in Washington and three field hearings on the negative consequences of federal PLA mandates and the benefits of H.R. 735.

Additional hearings and votes are expected in 2012.

Stay current on government-mandated PLAs and “Like” us on Facebook at www.facebook.com/TheTruthAboutPLAs and visit TheTruthAboutPLAs.com often.

To help fight this PLA and other federal PLA mandates, please contact Ben Brubeck or TheTruthAboutPLAs.com here.

Bidding is open only to certified small business contractors willing to agree to the terms and conditions of the DOL’s union-friendly PLA. The DOL issued a sources sought notice Sept. 23, 2011 (DOL111RI20431), to determine if there were enough interested and qualified small business general contractors to designate it a 100 percent small business set-aside.

Controversy concerning the union-favoring PLA mandate will heighten once the project’s solicitation containing the PLA is issued the second week of January.

Update Jan. 30: The DOL solicitation, issued  Jan. 30, 2012, can be read here. Here is the actual PLA and here are the numerous union collective bargaining agreements (CBAs) contractors will have to agree to in addition to the PLA for the life of the project. Bids are due March 21, 2012.

Update Feb. 6: Sen. Kelly Ayotte (R-NH) issued a press release and sent a letter to the White House asking for President Obama to repeal his pro-PLA Executive Order 13502 and remove the DOL’s PLA mandate on this project. The Union Leader has a piece on the controversy here.

Dec. 23, the New Hampshire Union Leader ran a holiday themed op-ed by ABC New Hampshire/Vermont President Mark Holden. It summarizes the long-running controversy surrounding the DOL’s PLA mandate on the Job Corps Center and the absurdity of this gift to Big Labor at the expense of New Hampshire businesses and workers.

Executive Order 13502: Obama's Gift to Big Labor. Image courtesy of The Boston Globe, "Obama kowtows to labor unions," 10/07/09.

By Mark Holden

It may be beginning to look a lot like Christmas, but many New Hampshire construction workers and businesses are expecting a lump of coal in their stockings from the federal government.

In this case, the Grinch is the U.S. Department of Labor (DOL), which is planning to build a $35 million Job Corps Center in Manchester with federal tax dollars.  Unfortunately, the DOL is poised to ensure the project is built by out-of-state union labor and union contractors, despite the fact that more than 91 percent of New Hampshire’s construction workforce chooses not to belong to a construction labor union.

The DOL is mandating a union-favoring project labor agreement (PLA) on the Job Corps Center.  Created by unions as a way to circumvent the free market and regain lost market share, a PLA typically requires contractors to replace most or all of their existing workforce with unfamiliar union labor, follow archaic and inefficient union work rules, and pay into underfunded union pension and benefit plans if they want to win contracts.

New Hampshire’s skilled nonunion workers are forced to accept unwanted union representation and pay union dues, yet they will forfeit benefits paid into union pension and benefit plans during the life of the project unless they join a union and become vested in these plans. 

Such humbuggery has the effect of discouraging competition from New Hampshire’s qualified contractors and their local employees.

Reduced competition coupled with costly union red tape needlessly increases construction costs.  Studies by the Beacon Hill Institute in Boston indicate projects subject to prevailing wage laws built with government mandated PLAs are 12 percent and 18 percent more expensive compared to similar non-PLA projects subject to government-determined wage and benefit rates. The research comes as no surprise to anyone familiar with Boston’s Big Dig boondoggle, which was built with a PLA mandate.

In short, government-mandated PLAs are a gift to Big Labor at the expense of taxpayers and New Hampshire construction businesses and tradespeople.

If this controversy has the disappointing familiarity of a re-gifted fruitcake, it is because the DOL tried to mandate a PLA on the Job Corps Center in 2009.  In the face of such blatant discrimination, a brave contractor, North Branch Construction of Concord, filed a bid protest against the DOL’s anti-competitive PLA. Instead of proceeding with PLA-free construction subject to fair and open competition – which would result in badly needed local job creation – the DOL canceled the project.

Not to be deterred, the DOL retained the services of a consultant, Hill International, to prepare a report justifying and defending a PLA requirement. The report cost taxpayers $130,000. It was the second PLA report Hill International prepared for the DOL. The first report, which trumpeted the alleged benefits of PLAs on federal construction projects, cost taxpayers $300,000. The latest report is so shoddy and full of pro-PLA bias, taxpayers will wish it came with a gift receipt.

The DOL and the federal government’s discriminatory policy is the product of an executive order signed by President Obama just a few days after moving into the White House in 2009. The measure encourages federal agencies to mandate PLAs on a case-by-case basis on large federal construction projects exceeding $25 million in total cost.

It is no coincidence it steers federal contracts to one of the White House’s and Democrat party’s biggest political patrons: Big Labor.

So while the Grinch has come to town, stealing Christmas hopes and dreams away from The Granite State’s workers and their families, will any of the GOP presidential candidates take a stand against deceptive payback to Big Labor prior to New Hampshire’s Jan. 10 primary?  

All nonunion contractors and their employees want this holiday season is the ability to fairly compete.  Some members of Congress, such as New Hampshire Sen. Ayotte, Rep. Frank Guinta and Rep. Charlie Bass, have stood up for free enterprise and New Hampshire families in support of legislation (S. 119 and H.R. 735) to “preserve open competition and federal government neutrality toward the labor relations of federal government contractors on federal and federally funded construction projects.”

That’s exactly what should happen. The federal government should preserve the right of everyone to fairly compete for jobs, not just a select few.

Congress should pass this legislation or a new president should undo President Obama’s destructive policy catering to well-connected special interests. It’s the only surefire way to keep the federal Grinch at bay.

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Mark Holden is the president of the New Hampshire/Vermont Chapter of the Associated Builders and Contractors. To learn more about anti-competitive PLAs, visit www.TheTruthAboutPLAs.com.

Well said, Mark.

To date, The Government Neutrality in Contracting Act (H.R. 735/S.119) has 170 cosponsors in the House, nearly 30 cosponsors in the Senate, and broad support from industry groups.

Concerned taxpayers can write Congress here to help keep the federal Grinch at bay this holiday season.

Image Courtesy of the Columbus Dispatch

TheTruthAboutPLAs.com readers may recall previous media coverage of the Job Corps Center project, which most recently includes a New Hampshire Union Leader article (“Jobs Corps Center project going forward,” 8/20/11) and related press release from U.S. Sen. Kelly Ayotte (“Senator Ayotte Expresses Concerns about Labor Requirement for Manchester Job Corps Project,” 8/19/11) in response to the DOL’s August announcement they will proceed with construction and mandate a PLA:

MANCHESTER — A project labor agreement, which delayed construction of New Hampshire’s Job Corps Center for 21 months, will be a project requirement according to the U.S. Department of Labor.

The department announced last week it would move forward with the long-delayed $35 million project off Dunbarton Road. A New Hampshire contractor challenged the requirements two years ago, delaying project construction.

U.S. Sen. Kelly Ayotte said in a press release Friday she is concerned that the PLA favors out-of-state unionized contractors over local firms and could drive up the project’s cost.

“The administration’s plan to keep in place the PLA represents yet another senseless government mandate that could put New Hampshire businesses and workers at a competitive disadvantage. A PLA effectively gives unionized firms an unfair advantage over non-union firms, making it less likely that New Hampshire contractors would be able to bid successfully for the work,” said Ayotte. “This is a New Hampshire project, and local contractors should be able to compete for it on a level playing field.”

Project labor agreements usually require companies working on a construction project to provide health care, retirement benefits and apprenticeship programs. And PLAs usually include work rules, safety provisions, dispute resolution and a no-strike clause.

Contractors balked when the Job Corps agreement called for experience with three or more PLAs. North Branch Construction of Concord filed a protest with the Government Accountability Office and that brought the bidding process to a halt.

Manchester Mayor Ted Gatsas said Friday his concern with the original PLA was the prior PLA experience. That meant no New Hampshire firms could qualify to do the work, because no firm had experience with three PLAs, he said.

“My understanding was that was not going to be in there,” Gatsas said. “It should be New Hampshire people doing this project.”

Gatsas said he has not seen the documentation, but noted “This is a project we need to move forward. It’s 300 construction jobs to the city and 135 permanent jobs.”

In response to a request from Ayotte asking to clarify the PLA issue, the DOL wrote that in keeping with a January 2009 executive order by President Obama, construction projects over $25 million should use PLAs. A PLA is appropriate for the $35 million Job Corps project, the department wrote.

Mark Holden, president of the Associated Builders and Contractors of New Hampshire/Vermont said: “It is important for all New Hampshire taxpayers to understand the impact of this decision. Requiring non-union contractors to execute union agreements for the project, agreeing to replace their employees with union workers, pay into union funds and abide by union work rules and conditions creates unknown costs that are impossible to plan and bid for and are conditions that make it non-competitive for non-union contractors.

“To suggest that a non-union contractor’s ability to compete would not be impacted by this PLA is untrue. A PLA requirement will have a chilling impact on competition from non-union contractors and will dramatically inflate the construction cost of this taxpayer funded project. At a time when a challenging economy is dependent on real solutions for job creation and accountability for every taxpayer dollar, this decision is unbelievable.”

Joe Casey, president of the New Hampshire Building and Construction Trades Council, said Ayotte and Holden are making a lot of assumptions about the PLA and what it will require. “It all depends on what the project labor agreement is and I have yet to see one for this project,” Casey said. “This is a debate we should have once the Department of Labor releases the project (documents).”

He noted the DOL hired an independent group, Hill International, to determine if a PLA is feasible for the project, but he had not seen the study. “We should all take a step back and see the actual contents of the project labor agreement,” Casey said. “The provisions could benefit New Hampshire contractors and New Hampshire workers.”

He noted the last major federal construction project in New Hampshire was the Berlin prison and the contractors and almost all of the workers came from out-of-state. That prison has yet to open because the federal government has not released operation money.

“That is the type of thing the project labor agreement addresses,” Casey said. “If federal money is coming to the state of New Hampshire, why shouldn’t it stay in New Hampshire with the New Hampshire workforce. At the end of the day, that is what we are looking for.”

Dick Anagnost, a Manchester developer who is chairman of the Job Corps Task Force, told the New Hampshire Union Leader last week that the project will take about 18 months.

He said the Labor Department should take a month to prepare bid specifications. Another month will be needed to solicit bids, and a final month will be needed to review them.

A Job Corps Center will help train economically disadvantaged youth to enter high-growth industries. New Hampshire is among the last states to have a Job Corps Center. The state began efforts 10 years ago to land a center of its own.

The DOL’s 2009 PLA mandate was the first PLA mandated by a federal agency following President Obama’s Feb. 6, 2009 Executive Order 13502, which encourages federal agencies to mandate PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost. The DOL’s 2009 PLA mandate was especially unusual because it was issued prior to the Federal Acquisition Regulatory (FAR) Council final rule (pdf), issued April 13, 2010, and effective May 13, 2010, implementing Executive Order 13502 into federal procurement regulations (learn more here).

Similar attempts by federal agencies to mandate PLAs before and after the effective date of the FAR final rule were foiled by ABC contractor-led bid protests (learn more here).

However, Executive Order 13502 and the related FAR rule remain controversial White House gifts to Big Labor likely to increase federal construction costs, reduce economy and efficiency in federal contracting, reduce competition from quality nonunion contractors and their skilled employees, and deny taxpayers the accountability they deserve from government.

TheTruthAboutPLAs.com will be following the DOL Job Corps Center project closely in the coming weeks.

The United States Army Corps of Engineers (USACE) also issued a PLA survey for a project at Cannon Air Force Base in New Mexico.

All ABC members and construction professionals are encouraged to respond to the requests for information and tell the NAVFAC and USACE that government-mandated PLAs harm competition, increase costs, and impede economy and efficiency in government contracting.

Details on the three surveys along with submission dates are below but please review response instructions by clicking the links:

• Responses for the NAVFAC survey for Potable Water Conveyance Systems and Waste Water and Recycled Water Conveyance Systems at Camp Pendleton, Calif., must include a cover letter and be completed on the PLA Inquiry Form and submitted by 2:00 p.m. (PST) on Friday, Dec. 16, either by mail to NAVFAC or by email to Gregory.sies@navy.mil.
• Responses for the NAVFAC survey for the Rotary Aircraft Deport Maintenance Facility near San Diego must include a cover letter and be completed on the PLA Inquiry Form and submitted by 2:00 p.m. (PST) on Monday, Dec. 19, either by mail to NAVFAC or by email to georgina.perry@navy.mil.
• Responses for the NAVFAC survey for HVAC and Ductwork Repairs, Building 1H, Naval Medical Center San Diego must include a cover letter and be completed on the PLA Inquiry Form and submitted by 2:00 p.m. (PST) Jan. 3, 2012, either by mail to NAVFAC or by email to larry.romig@navy.mil.
• Responses to the USACE Market Survey in the Clovis Micropolitan Statistical Area near Cannon Air Force Base in New Mexico must be submitted by Friday, Dec. 23 to diana.m.martinez@usace.army.mil. There is no form to fill out for this survey.

NAVFAC, which manages construction of U.S. Navy shore facilities, recently issued surveys for four federal construction projects, exceeding $25 million in total costs, in Maryland and Virginia.

During the past several months, NAVFAC and other federal agencies like the USACE and Veterans Affairs have issued PLA surveys as a result of President Obama’s pro-PLA Executive Order 13502 and federal regulations implementing the discriminatory and costly order. The order and regulations encourage federal agencies to mandate anti-competitive and costly PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost. ABC has taken the opportunity to respond to all PLA surveys as they are issued and encourages its members to do the same.

If you need help responding, please contact us and we can provide you with some helpful tools and information.

Responding with accurate and timely information is critical and effective at removing federal agency PLA mandates. For example, in 2010, the USACE removed government-mandated PLAs from the Army Reserve Center in Los Alamitos, Calif. and the Patrick Air Force Base in Brevard County, Fla. after a strong grassroots response and survey participation from the contracting community. The USACE removed a PLA mandate on the Armed Forces Reserve Center in Camden, N.J. following a legal challenge and robust grassroots response from the construction stakeholders.

Thanks for taking the time to respond to these surveys. Your responses will help maintain an open and competitive environment that will allow all qualified contractors to fairly compete for contracts to build the best possible construction projects at the best possible price.

ABC members and construction professionals are encouraged to respond to the PLA surveys. Tell NAVFAC’s Washington District that government-mandated PLAs injure competition, increase costs, and will not advance the economy and efficiency in government contracting.

Below are links to the PLA surveys for the four projects along with the deadline and contact information for each.

• Construction of an Aircraft Prototype Facility, Patuxent River, Md. Responses are due to Dorothea Holley, dorothea.holley@navy.mil, and to Carolyn Sulla, carolyn.sulla@navy.mil, no later than 2:00 p.m. EST, Nov. 14. ABC National’s 11/14 response.
• Construction of an Ambulatory Care Center, Camp Springs, Md. Responses are due to Dorothea Holley, dorothea.holley@navy.mil, and to Carolyn Sulla, carolyn.sulla@navy.mil, no later than 2:00 p.m. EST, Nov. 14. ABC National’s 11/14 response.
• Construction of a Chemical Facility Naval Surface Warfare Center, Indian Head, Md. Responses are due to Stephen Astwood, stephen.astwood@navy.mil, and Carolyn Sulla, carolyn.sulla@navy.mil, by 2:00 p.m. EST, Nov. 14. ABC National’s 11/14 response.
• Construction of the Marine Corps Research Center, Quantico, Va. Responses are due to Dervin Diggs, dervin.diggs@navy.mil, and Allie Hernandez, altanelle.e.hernande@navy.mil, no later than 2:00 p.m. EST, Nov. 21. ABC National’s 11/21 response.

NAVFAC and other federal agencies like the USACE and Veterans Affairs have issued PLA surveys as a result of President Obama’s pro-PLA Executive Order 13502 and federal regulations implementing the discriminatory and costly order. The order and regulations encourage federal agencies to mandate anti-competitive and costly PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost.

In 2011 and 2010, a handful of NAVFAC districts across the country issued sources sought notices requesting information about the potential use of PLAs on large NAVFAC construction projects. ABC National has taken the opportunity to respond to surveys as they are issued and encourages the merit shop contracting community to do the same.

It is important to express opposition to government-mandated PLAs today before they are mandated or encouraged on future NAVFAC projects, as well as other federal and non-federal state and local projects in your community by other government officials if anti-competitive and costly PLA mandates take root in your community.

The survey results are an important source of information used to determine whether a PLA is appropriate for federal NAVFAC projects.

Here are ABC National’s notable responses to NAVFAC PLA surveys:

• Letter to NAVFAC Southeast concerning construction of the $25 million to $100 million B603 Saufley Field, Naval Air Station in Pensacola, Fla. (6/10/11) (ABC Newsline article)
• Letter to NAVFAC concerning use of PLAs on Guam base realignment. (10/5/10) (ABC Newsline article)

For contractors, taxpayers and construction professionals unfamiliar with the problems with federal PLAs and regulations implementing President Obama’s pro-PLA Executive Order 13502, please review the previous letters sent by ABC National to the NAVFAC, which may be helpful information for contractors to review before responding to these NAVFAC PLA surveys.

If you need help responding, please contact us and we can provide you with some helpful tools and information.

Responding with accurate and timely information is critical and effective at removing federal agency PLA mandates. For example, in 2010, the USACE removed government-mandated PLAs from the Army Reserve Center in Los Alamitos, Calif. and the Patrick Air Force Base in Brevard County, Fla. after a strong grassroots response and survey participation from the contracting community. The USACE removed a PLA mandate on the Armed Forces Reserve Center in Camden, N.J. following a legal challenge and robust grassroots response from the construction stakeholders. The

Thanks for taking the time to respond to these surveys. Your responses will help maintain an open and competitive environment that will allow all qualified contractors to fairly compete for contracts to build the best possible construction projects at the best possible price.

Additional helpful links:

• PLA Final Rule Takes Effect Today: Let the Waste, Cronyism and Discrimination Begin
• Project Labor Agreement Basics: What is a PLA?
• Get the Truth About PLAs
• ABC National’s Main Comments to the FAR Council’s Proposed Rule
• ABC Member Survey/Comment Supplement to Main Comments
• ABC National Comments Specifically Addressing the Regulatory Flexibility Act

ABC members and construction professionals are encouraged to respond to the PLA surveys. Tell the USACE that government-mandated PLAs injure competition, increase costs, and will not advance the economy and efficiency in government contracting.

Below is a link to each project’s survey, response deadline, and submission contact information:

• Construction of the Mobile Regional Contracting Center, Redstone Arsenal, Ala. Responses are due to carl.m.wade@usace.army.mil by Nov. 4.  
• Construction of an Unmanned Aerial Vehicle (UAV) Complex, in Ft. Campbell, Ky. Responses are due to crystal.m.may@usace.army.mil no later than 11:00 AM EST on Nov. 10.  
• Construction of commercial and institutional buildings at Fort Carson and the U.S. Air Force Academy in Colorado Springs, Colo. Responses are due to edward.j.jackson@usace.army.mil by close of business on Nov. 14.  

The USACE and other federal agencies have issued PLA surveys as a result of President Obama’s pro-PLA Executive Order 13502 and federal regulations implementing the discriminatory and costly order. The order and regulations encourage federal agencies to mandate anti-competitive and costly PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost.

In compliance with the USACE’s Oct. 15, 2010 policy memo on government-mandated PLAs, USACE district offices across the country have issued dozens of similar surveys requesting information about the potential use of PLAs on large USACE construction projects. ABC National has taken the opportunity to respond to surveys as they are issued and is encouraging ABC members and the merit shop contracting community to do the same.

It is important to express your opposition to government-mandated PLAs today before they are mandated or encouraged on future USACE projects, as well as non-federal state and local projects in your community by other government officials once anti-competitive and costly PLA mandates take root in your community.

The survey results are an important source of information used to determine whether a PLA is appropriate for federal projects.

During the Obama Administration, the USACE has issued dozens of similar surveys requesting information about the potential use of PLAs on construction projects in USACE districts nationwide. ABC National has responded to surveys as they are issued by the USACE and encourage ABC members to do the same.

Here are ABC National’s responses to the USACE’s recent PLA surveys:

• Letter to USACE Louisville District concerning construction of an MH-47 Aviation Maintenance Hangar at Ft. Campbell, Ky. (11/2/11)
• Letter to USACE Los Angeles District concerning construction of a new hospital and renovation of the Mary Walker Clinic at Ft. Irwin in San Bernardino County, Calif. (10/24/11)
• Letter to USACE Louisville District concerning construction of two tactical equipment maintenance facilities at Ft. Campbell, Ky. (10/24/11)
• Letter to USACE Louisville District concerning construction of an aircraft maintenance hangar and parking aprons at Ft. Campbell, Ky. (10/21/11)
• Letter to USACE Louisville District concerning design and construction of two four-story, 264-person unaccompanied enlisted personnel housing barracks at Ft. Campbell, Ky. (10/24/11)
• Letter to USACE Louisville District concerning an Army Reserve Center training Building at Ft. Benjamin Harrison near Indianapolis, Ind. (10/6/11)

For contractors, taxpayers and construction professionals unfamiliar with the problems with federal PLAs and regulations implementing President Obama’s pro-PLA Executive Order 13502, please review the previous letters sent by ABC National to the USACE, which may be helpful information for contractors to review before responding to the USACE PLA survey.  If you need help responding, please contact us and we can provide you with some helpful tools and information.

Responding with accurate and timely information is critical and effective. In 2010, the USACE removed government-mandated PLAs from the Army Reserve Center in Los Alamitos, Calif. and the Patrick Air Force Base in Brevard County, Fla. after a strong grassroots response and survey participation from the contracting community. The USACE removed a PLA mandate on the Armed Forces Reserve Center in Camden, N.J. following a legal challenge and robust grassroots response from the construction stakeholders.

Thanks for taking the time to respond to these surveys. Your responses will help maintain an open and competitive environment that will allow all qualified contractors to fairly compete for contracts to build the best possible construction projects at the best possible price.

Additional helpful links:

• PLA Final Rule Takes Effect Today: Let the Waste, Cronyism and Discrimination Begin
• Project Labor Agreement Basics: What is a PLA?
• Get the Truth About PLAs
• ABC National’s Main Comments to the FAR Council’s Proposed Rule
• ABC Member Survey/Comment Supplement to Main Comments
• ABC National Comments Specifically Addressing the Regulatory Flexibility Act

ABC members and construction professionals are encouraged to respond to the PLA surveys. Tell the USACE that government-mandated PLAs injure competition, increase costs, and will not advance the economy and efficiency in government contracting.

Below is a link to each project’s survey, response deadline, and submission contact information:

• Construction of a 105,000 SF MH-47 Aviation Maintenance Hangar. Responses are due to Crystal May, crystal.m.may@usace.army.mil, 1:00 p.m. (ET) on Nov. 2.
• Construction of two tactical equipment maintenance facilities. Responses are due to Stephanie Craig, stephanie.m.craig@usace.army.mil, 10:00 a.m. (ET) on Oct. 24.

• Construction of an aircraft maintenance hangar and parking aprons.Responses are due to Brenna Finkbeiner, Brenna.a.finkbeiner@usace.army.mil, 10:00 a.m. (ET) on Oct. 21.

• Design and construction of two four-story, 264-person unaccompanied enlisted personnel housing barracks. Responses are due to Crystal May, crystal.m.may@usace.army.mil, 1:00 p.m. (ET) on Oct. 20.

The USACE and other federal agencies have issued PLA surveys as a result of President Obama’s pro-PLA Executive Order 13502 and federal regulations implementing the discriminatory and costly order. The order and regulations encourage federal agencies to mandate anti-competitive and costly PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost.

In compliance with the USACE’s Oct. 15, 2010 policy memo on government-mandated PLAs, USACE district offices across the country have issued dozens of similar surveys requesting information about the potential use of PLAs on large USACE construction projects. ABC National has taken the opportunity to respond to surveys as they are issued and is encouraging ABC members and the merit shop contracting community to do the same.

It is important to express your opposition to government-mandated PLAs today before they are mandated or encouraged on future USACE projects, as well as non-federal state and local projects in your community by other government officials once anti-competitive and costly PLA mandates take root in your community.

The survey results are an important source of information used to determine whether a PLA is appropriate for federal projects.

During the Obama Administration, the USACE has issued dozens of similar surveys requesting information about the potential use of PLAs on construction projects in USACE districts nationwide. ABC National has responded to surveys as they are issued by the USACE and encourage ABC members to do the same.

Here are ABC National’s responses to the USACE’s recent PLA surveys:

• Letter to USACE Louisville District concerning MH-47 Aviation Maintenance Hangar at Ft. Campbell, Ky. (11/2/11)
• Letter to USACE Louisville District concerning construction of two tactical equipment maintenance facilities at Ft. Campbell, Ky. (10/24/11)
• Letter to USACE Louisville District concerning construction of an aircraft maintenance hangar and parking aprons at Ft. Campbell, Ky. (10/21/11)
• Letter to USACE Louisville District concerning design and construction of two four-story, 264-person unaccompanied enlisted personnel housing barracks at Ft. Campbell, Ky. (10/24/11)
• Letter to USACE Louisville District concerning an Army Reserve Center training Building at Ft. Benjamin Harrison near Indianapolis, Ind. (10/6/11)

For contractors, taxpayers and construction professionals unfamiliar with the problems with federal PLAs and regulations implementing President Obama’s pro-PLA Executive Order 13502, please review the previous letters sent by ABC National to the USACE, which may be helpful information for contractors to review before responding to the USACE PLA survey.

Responding with accurate and timely information is critical and effective. In 2010, the USACE removed government-mandated PLAs from the Army Reserve Center in Los Alamitos, Calif. and the Patrick Air Force Base in Brevard County, Fla. after a strong grassroots response and survey participation from the contracting community. The USACE removed a PLA mandate on the Armed Forces Reserve Center in Camden, N.J. following a legal challenge and robust grassroots response from the construction stakeholders.

Thanks for taking the time to respond to these surveys. Your responses will help maintain an open and competitive environment that will allow all qualified contractors to fairly compete for contracts to build the best possible construction projects at the best possible price.

Additional helpful links:

• PLA Final Rule Takes Effect Today: Let the Waste, Cronyism and Discrimination Begin
• Project Labor Agreement Basics: What is a PLA?
• Get the Truth About PLAs
• ABC National’s Main Comments to the FAR Council’s Proposed Rule
• ABC Member Survey/Comment Supplement to Main Comments
• ABC National Comments Specifically Addressing the Regulatory Flexibility Act

Please note that all links have been added by TheTruthAboutPLAs.com.

Dear Mr. Brubeck,

I would like to bring to your attention a matter of considerable importance to the question of mandatory Project Labor Agreements (PLAs). As you know I testified against mandatory PLAs at a hearing conducted June 3 before the Subcommittee on Technology, Information Policy, Intergovernmental Relations and Procurement Reform of the Committee on Oversight and Government Reform of the U.S. House of Representatives.

In my testimony, I reported the results of studies in which the Beacon Hill Institute showed that PLAs increased construction costs for samples of schools built in Massachusetts, Connecticut and New York.

Note: Tuerck’s tesitmony starts at 22:13 of this video

I argued that our studies provide compelling evidence that mandatory PLAs generally increase construction costs and are, on that basis, not in the public interest.

You will also recall that, before I could testify, Representative Elijah E. Cummings read a statement from Professor Peter Philips of the University of Utah in which Philips claimed that our work was nothing but “simple minded statistics” that, in his judgment, do “not pass muster.” Unaware, as I was at the time, that this statement had been submitted to the Subcommittee and given the circumstances in which it was read to me and everyone else at the hearing, I could not respond adequately to Philips’ accusations at that time. Following the hearing, however, and with a written copy of Philips’ statement in hand, I wrote my response, attached here, and sent it to Congressman Cummings.

As you can see, I find Philips’ criticisms to be based on an entirely fabricated characterization of the methodology that we followed in our studies. I need to be emphatic. It is not as if Philips just disagreed with our interpretation of our statistical results, as economists often do in examining each other’s work. This was not a complaint, say, that our results suffered from some problem connected with sample selection or that they failed some standard test for robustness. This was a false characterization of what we did in obtaining our results. It would be as if one chemist tried to debunk another chemist’s findings by falsely describing the laboratory procedures followed in getting those findings.

It has now been a month since I wrote to Congressman Cummings. I have received no reply from him about the questions I raise. If, as it appears, neither Congressman Cummings nor anyone on his staff has asked Philips to clarify his remarks, then anyone who read the record of that hearing would be permitted to believe that there was substance to those remarks, when in fact there was none. Anyone could infer that our findings about PLA costs were spurious and could be ignored when in fact there was nothing presented at that hearing (or anywhere else, by my reckoning) that would support any such conclusion.

I am therefore compelled to take my case to a broader public. To that end, I hoped that you might be able to bring my letter to the attention of readers who follow ABC and its efforts to inform the public about government-mandated PLAs. Your help in this regard would be much appreciated.

Sincerely,

David G. Tuerck
Executive Director, The Beacon Hill Institute
Professor and Chairman, Department of Economics
Suffolk University

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Here is more on the controversy from a post by BHI on the Red Mass Group blog, (BHI Weekly Dispatch: Taking on the D.C. union proxies on Project Labor Agreements,” 7/21/11).

Here is a key passage from Dr. Tuerck’s letter to Rep. Cummings in response to Dr. Phillips’ attacks:

In Phillips’ mindset, however, a project would never be more costly because it was conducted under a PLA.  The explanation would always lie elsewhere.  The project had a more complex roof.  Or it included an auditorium.  Or it had some other feature that increased the cost. Never mind if there were only a few bidders. Or if the contractor had to follow burdensome work rules.  Or if the contractor had to hire union workers instead of his own workers.  It just couldn’t be the PLA that was at fault.

Phillips’ approach to the PLA question reflects a compulsion, unhappily all too common among social scientists (and even some physical scientists), to hold stubbornly to one’s assumptions no matter what the data show.  That, in and of itself, is a bad enough fault to exhibit in criticizing someone else’s work.  In this instance, however, Phillips went beyond merely attempting to defend his assumptions against the data.  He made up an entirely fictitious story to discredit the work of someone whose data challenge those assumptions.

Be sure to give the full letter a read.