It would have been the first government-mandated project labor agreement within the Central Coast counties of Ventura, Santa Barbara, and San Luis Obispo counties.

Before the vote, county supervisors heard a lengthy presentation from county public works staff and county counsel about hundreds of hours of work on negotiations with various stakeholder groups – in particular the Tri-County Building and Construction Trades Council and the Southwest Regional Council of Carpenters – to come to an agreement on provisions concerning core workforce limitations, jurisdictional dispute resolution, and mandatory union initiation fees and dues paid by all workers under the PLA. The county was not able to resolve differences between the Building Trades and the Carpenters concerning jurisdictional dispute resolution.

Supervisor Peter Foy pointed out that the county had spent more than $1 million trying to develop a PLA and made a motion to move forward in bidding the hospital without a PLA, which he regarded as unnecessary and wasteful. He even dared to refer to “the free market” and “the taxpayers” in his statement. That motion failed to get a second.

Supervisor Linda Parks complained that she was being forced to vote on a 33-page contract she hadn’t been able to read because it was provided by staff after 6:00 p.m. on Monday, March 12. Parks asked if anyone on the board had read it, and Supervisors Kathy Long, John Zaragoza, and Steve Bennett said they had read it. Supervisor Steve Bennett said there were no compelling new things in the PLA and it was time to move forward.

Supervisor Kathy Long then made a motion for the board to vote on the staff recommendation to adopt a PLA with a “safe harbor” provision on core workforce and jurisdictional dispute resolution for the Carpenters union, provided all parties sign the PLA by Friday, March 16. Board chairman John Zaragoza instead moved for adoption of the version of the PLA supported by the Tri-Counties Building and Construction Trades Council. That motion failed 2-2-1.

There are three prequalified design-build entities for bidding on the project: Hensel-Phelps Construction, McCarthy Construction, and Clark Construction.

Staff reported that Clark did not object to a PLA because union contractors would perform all of its major trade work and at least 90% of the total work. Staff also reported that Hensel-Phelps noted that it employs its own workers under the jurisdiction of the Carpenters trade (which a Carpenters union official claimed to comprise 30% of the work).

McCarthy was planning to use a large Merit Shop electrical contractor that has Ventura County employees. A McCarthy representative declared that if the county approved a PLA as proposed, it would drop its plan to bid unless the county provided time to prequalify unionized electrical subcontractors. According to Public Works staff, prequalifying more electrical contractors would delay the project for up to 4-6 months at a cost of $400,000 per month. Showing a low priority for open competition and fiscal responsibility, the board chairman John Zaragoza declared that the county would still have two bidders if McCarthy dropped out.

See material provided by staff to the board here.

News Reports:

Board can’t pass labor agreement for county hospital – Ventura County Star – March 14, 2012

Now unions are gunning for their first government-mandated project labor agreement in the Central Coast region (Ventura, Santa Barbara, and San Luis Obispo counties), and the target is again a county hospital.

Ventura County (on the coast between Santa Barbara and Los Angeles) will build a $250 million Ventura County Medical Center Hospital Replacement Wing. Associated Builders and Contractors of California was tipped off in the summer of 2011 that unions were plotting through two members of the Ventura County Board of Supervisors to force contractors on this project to sign a project labor agreement under the guise of “local hire.” Confirmation came from this seemingly innocuous item on the August 2, 2011 board agenda:

27. Recommendation of Supervisors Bennett and Long to Direct the County Executive Office and County Counsel to Report Back to the Board Regarding Incorporating Local Hire Components in the Construction of the Ventura County Medical Center Replacement Hospital Project. (Supervisors Bennett and Long)

We’ve seen this exact same strategy used at other California local governments (such as the City of San Diego) to “innocently” sneak project labor agreements into the discussion. When Supervisor Steve Bennett subsequently announced he was running for the Democrat nomination for the 26th Congressional District seat being vacated by Elton Gallegly (R-Simi Valley), we knew that once again this axiom was fulfilled: behind every push for a project labor agreement is an elected official with ambition for higher office! Shortly afterward, the cat was out of the bag as union officials acknowledged publicly that they were scheming for a project labor agreement.

The controversy reached a feverish pitch on January 24, when the Board of Supervisors held a five-hour meeting with 29 public speakers and more than 200 attendees to discuss the proposed project labor agreement. The meeting concluded with a 4-1 vote to try to negotiate some sort of fair PLA. (Supervisor Peter Foy of Simi Valley was opposed to the whole charade and voted against the directive – thank him at supervisor.foy@ventura.org.)

On February 17, more than 40,000 Ventura County households received a mailer from the Coalition for Fair Employment in Construction (CFEC) warning them that Big Labor Bosses from Los Angeles were expanding their quest for government-mandated union monopolies to Ventura County.

(See: CFEC’s mailer)

On February 28, the Ventura County Board of Supervisors spent three more hours listening to 34 public speakers and discussing the proposed project labor agreement. They also learned from staff that each month’s delay of the hospital project to negotiate the PLA costs the county $400,000. But if you’re gunning for a policy that will increase the cost of the hospital by as much as $50 million, who cares about a silly $400,000 per month from the taxpayers?

The Board of Supervisors is expected to make a final decision at its March 13 meeting.

A question needs to be asked here: why does consideration of what unions claim is a mere “construction management tool” attract so many speakers and take so many hours of public deliberation? Could it be that project labor agreements are actually about UNION MONOPOLIES paid for by the TAXPAYERS?

The Ventura County Star newspaper has thoroughly reported on the PLA controversy for its readers over the past several months:

County board looks for ways to boost employment with hospital project – Ventura County Star – August 2, 2011

Local hiring for VCMC project looks promising despite dispute – Ventura County Star – November 28, 2011

Christen: Unions going for monopoly on new medical center – Ventura County Star – December 3, 2011 – op-ed

County to explore labor agreement to push local hiring for hospital work – Ventura County Star – January 24, 2012

Editorial: County’s push for local hiring requires caution – Ventura County Star – January 28, 2012 – editorial

Leonard: Weighing the options in trying to ensure local hiring – Ventura County Star – February 11, 2012 – columnist

VCMC Expansion – Ventura County Star – February 20, 2012 – letter to the editor against the proposed PLA

Morales: Diverse support for local hiring – Ventura County Star – February 25, 2011 – op-ed by Maricela P. Morales, acting executive director of the Central Coast Alliance United for a Sustainable Economy, also writing on behalf of the Black American Political Association of California (BAPAC) of Ventura County, the League of United Latin American Citizens (LULAC), and the Multicultural Consortium.

Union Monopoly – Ventura County Star – February 27, 2012 – letter to the editor against the PLA from Kevin Korenthal, former official with ABC

Board sets deadline for deal in hospital project – Ventura County Star – February 28, 2012

Construction Jobs – Ventura County Star – February 29, 2012 – letter to the editor in support of the PLA from Bob Balgenorth, head of the State Building and Construction Trades Council of California

Editorial: Ventura County labor agreement an elusive goal – Ventura County Star – March 3, 2011 – editorial

PLA is Good for Us – Ventura County Star – March 5, 2012 – letter to the editor in support of the PLA

After a long series of public comments from supporters and opponents of the project labor agreement, including many questionable “statistics” cited by union representatives, Los Angeles County Supervisor Mark Ridley-Thomas pushed for and won a 3-2 vote (the three Democrats in support; the two Republicans in opposition) to require contractors to sign a project labor agreement with the Los Angeles/Orange County Building and Construction Trades Council for the Multi-Service Ambulatory Care Center Project, a part of the larger Martin Luther King, Jr. Medical Center Replacement Project.

The county-approved. taxpayer-funded budget for the construction of this project is $95 million. The county will issue an addendum adding the government-mandated project labor agreement to the bid specifications provided to the three prequalified design-build companies (Clark Construction, Hensel Phelps Construction Company, and McCarthy Building Companies).

Supervisor Don Knabe expressed concerns about the cost of administering the project labor agreement and the negative impact of the agreement on small, minority, and women-owned businesses. Knabe noted that although the agreement had been renamed, it was still a project labor agreement. Supervisor Mike Antonovich asserted that the county staff did not fulfill conditions agreed to by the board in December 2010 when the board approved negotiations with the unions. Only Supervisor Ridley-Thomas spoke in support of the union agreement.

The staff report for the agenda item repeated its report from November that “the steps to implement the CWA could increase project costs due to the cost of negotiating the CWA ($95,000), construction delays ($300,000), and management of the CWA over the two-year duration of construction ($400,000).” The project was supposed to be awarded to the design-build firm by March 29, 2011.

This is the first project labor agreement approved for taxpayer-funded construction in the nation’s most populous county.

Please email a note of thanks to the two county supervisors who wisely voted against the project labor agreement:

Supervisor Don Knabe: Don@lacbos.org

Supervisor Mike Antonovich: fifthdistrict@lacbos.org

As we have reported in an earlier post, University of Iowa regents were under pressure from Gov. Chet Culver’s (D) administration to require a PLA on this project.  This is one of several state and local government-mandated PLAs  in Iowa since Gov. Culver issued Executive Order 22, which encouraged state agencies to consider using PLAs on state projects costing more than $25 million.

With recent polls showing Gov. Culver trailing former Governor – and PLA opponent – Terry Brandstad (R) by double digits, it is clear that Gov. Culver’s push for PLAs is part of a larger effort to entice Big Labor into putting money and manpower into the gubernatorial race on his behalf.

Here is an excerpt from the Iowa Chapter of Associated Builders and Contractors’ media statement on the Board of Regents decision to require the PLA on this project:

“We are very disappointed in the 5-3 partisan vote taken by the Regents on Thursday, August 5, 2010 to implement a PLA for the new outpatient clinic at Iowa River Landing in Coralville, IA. PLAs are blatantly discriminatory as the language prohibits merit shop contractors from being able to use all of their own workers, making it impossible to bid on such a project. PLAs, which are contract agreements written by union bosses, are designed to ensure that projects are awarded only to unionized contractors. In Iowa, 8 out of 10 construction workers have chosen not to join a construction labor union. A union negotiated contract, such as the one the five democrat members of the Board of Regents forced on the University of Iowa, specifically prevents such a large majority of Iowa’s construction workforce from working on a project. This is blatant discrimination and the Culver cronies on the Board of Regents took this partisan action under direct pressure from Governor Culver who signed an executive order earlier this year requiring state agencies to consider using these discriminatory agreements. Iowans deserve leaders who do not make decisions simply meant to reward political donors. In this case, Big Labor is the winner, at the expense of the majority of Iowa workers – - hard working, tax paying citizens who have chosen not to join a union.”

The Rapid City Gazette also covered this vote on August 9 (“Construction Association Disappointed in Regents Vote,” 8/9/10).

Gov. Culver is one of several embattled incumbent Democrats facing tough gubernatorial races that have turned to PLAs in an attempt to curry financial and organizational support in November.

Here at TheTruthAboutPLAs.com, we encourage taxpayers to see through the rhetoric and understand what this PLA means for the people of Iowa.  It is nothing more than a taxpayer funded handout to Big Labor in exchange for political support this fall.

This most recent letter, titled, “Provide Equal Opportunity,” was published February 2.

Provide Equal Opportunity

Thank you for the Jan. 24 article, “An ailing process?”, concerning the use of project labor agreements (PLAs) on construction projects. While the article was fair and accurate, I believe it missed a key point.

It referred several times to J.R. Gaylor’s assertion that PLAs drive up construction costs. While I agree that they do, that is only part of the issue. Taxpayer dollars from publicly funded projects should not be steered to a select group of contractors and tradesmen. Less than a quarter of the construction work force in Indiana is unionized. Yet almost all of the recent high-profile, publicly funded construction projects have been governed by PLAs, steering that work to union contractors and workers. That leaves almost 80 percent of the available construction work force ineligible to benefit from these projects.

The PLA benefits cited (locking in wage rates and work rules in one negotiation, and barring strikes and walkouts) can easily be written into a contract without a PLA, which unnecessarily requires nonunion contractors to make benefit payments to the union for benefits that their nonunion employees never receive.

All qualified contractors and tradesmen should have an equal opportunity to benefit from public works projects.

Paul Neukam

Huntingburg

This is the second letter to the editor that the Indianapolis Star has published in response to their January 24 story.  We covered the other letter here.

The bill (H.B. 1010) was introduced by Rep. Jerry Torr (R-Carmel) and referred to the House Labor and Employment Committee, where it is likely to die without getting serious consideration by the committee before the Indiana General Assembly adjourns in March.

Why would the committee fail to seriously consider legislation that would save the taxpayers money on state construction and ensure that the 80 percent of the Indiana construction workforce that decided not to join a labor union has the opportunity to compete for projects paid for by their own tax dollars, you ask?

Let’s check the Indianapolis News Channel 6 coverage of the bill’s introduction:

The bill, now in committee, is in the hands of Rep. David Niezgodski, D-South Bend, a plumber who records indicate received campaign contributions from unions.

“As labor and employment chair, on this one I can say, ‘Not on my watch,’” Niezgodski said. “I’ve never seen any evidence that a PLA hurts other workers’ chances or businesses’ chances of being involved in a project.”

Niezgodski said PLAs help keep jobs on time with fewer work-related injuries. He denied that the reason he won’t allow the bill to be heard has anything to do with union connections, but more about time.

Wait, really?  We also suspect Chairman Niezgodski doesn’t believe that PLAs increase construction costs either.

The PLA issue has come to the forefront in Indianapolis recently in response to a PLA on the $750 million Wishard Memorial Hospital project.  Indianapolis News Channel 6 reports on December 29 that hospital officials believe the PLA will help them complete the project on time and on budget.

But PLAs don’t exactly have the best track record in Indiana.

Here’s another except from News Channel 6′s December 29 coverage:

But contractors fired back on Tuesday, pointing to a number of major city projects that suffered notorious cost and time overruns, even with a PLA in place.

Conseco Fieldhouse came in $8 million over budget, while construction on the Indianapolis-Marion County Public Library was more than two years behind schedule and ran $50 million over budget.

“It’s mostly a political deal. The taxpayers are really not protected,” said JR Gaylor, president of the Associated Builders and Contractors, an organization that represents many non-union shops. “The facts don’t seem to support his (Matt Gutwein, CEO of Health and Hospital Corp., which operates Wishard) contention that this is good for the taxpayer.”

This PLA is a terrible deal for everyone except for Big Labor and their political allies.  Catch a full media overview on Wishard Memorial Hospital project here.

Additionally, please contact Chairman Niezgodski and tell him that Indiana’s taxpayers deserve the best construction product for the best price.  H.B. 1010 deserves a open hearing in the Indiana House Labor and Employment Committee.

The study found that PLAs would likely increase construction costs by as much as 9 percent on three of the five construction markets (Denver, New Orleans and Orlando) in which the VA is planning to build hospitals.

For the other two markets, San Francisco and New York City, the study predicted mixed results ranging from small project cost increases to small cost savings.

In San Francisco:

“…a PLA would be relatively cost neutral ranging from -1.5% to +1.5% in a poor economy.  In a stable economy we see that the effect of a PLA in San Francisco would have  a construction cost increase range from 0% to 3%.” 

In New York City:

“….a PLA could be used to negotiate construction cost savings of approximately 2% to 5% in a poor economy.  In a stable economy we see that the effect of a PLA in New York would be relatively cost neutral ranging form -1.5 to +1.5%.”

The study belies  Big Labor’s bogus claims that PLAs offer considerable cost savings to project owners.  At best, these special interest agreements offer a small amount of cost savings only in unique areas where union market share is strong (such as NYC) and “a PLA can offer concessions to normal union work rates and rules” that would otherwise be prevalent on a construction project absent a PLA.

The study’s conclusion highlights a main reason why nonunion contractors oppose government-mandated PLAs. PLAs shackle nonunion contractors with expensive and wasteful inefficiencies that are unique to a union contractors’ business model. These discriminatory and costly agreements prevent nonunion contractors from offering the best bid at the best price.  The report finds that PLAs increase production costs of nonunion contractors:

 ”Whether or not a project has a PLA should not affect productivity or schedule in terms of the rate of production per day – as a project will be manned accordingly by subcontractors to meet schedule.  However, there is strong evidence to suggest that the result of a PLA that dictates work rules, double benefits, team structure and activities on non-union type contractors will be that production costs will increase – given these union related requirements.”

What about Big Labor’s selling point that PLAs are necessary to avoid strikes?

“Strikes have become a rare event in U.S. construction and given the main original and advocated benefit of a PLA was to prevent strikes in isolated, non-union areas, the PLA adds very little value to the no-strike arguments as both PLA and non-PLA advocates cite many examples for projects where there have been strikes but also no strikes — unrelated to whether or not a PLA is in place.”

And finally, what about all of the other “kitchen sink” arguments PLA proponents push as compelling reasons to sign a PLA?

“Targeting safety, employment of minority and women owned businesses, meeting prevailing Davis-Bacon rates, ensuring 100% worker eligibility status for project workers and focusing on preventing strikes, can all be contract clauses and procurement approaches without a PLA.”

For a thorough and fair examination of the impact of government-mandated PLAs on federal construction projects, be sure to read “Project Labor Agreements – Impact Study for the Department of Veterans Affairs.”

Given the findings of this independent study, why is President Barack Obama encouraging government agencies to require the use of PLAs on federal construction projects exceeding $25 million via Executive Order 13502?

Letter: Project Labor Agreement Wrong for Aurora

By BOB ROTH

A disturbing thing is happening right under our noses, and I am willing to bet that most Aurora residents have never heard about it. It’s disturbing because it will affect the blue collar workforce in negative ways in an economic climate that has already seen way too much negativity.

Presidential Executive Order 13502 urges that all projects where the cost to the Federal Government exceeds $25 million implement a Project Labor Agreement, or PLA. A little background is in order.

A project that implements a PLA requires all contractors who want to work on that project, whether they have chosen to be represented by organized labor or not, be subject to the following:

•  Recognize the union as the representative of their employees on that project.

•  Exclusively use the union hiring hall to obtain workers for the project.

•  Obtain apprentices exclusively from union apprenticeship programs.

•  Pay into the union benefits plan (a double blow for a non-union contractor because they have to pay into a fund they have no control over, while still maintaining their own benefits package)

•  Conform their normal project processes and procedures to union work rules.

At a recent meeting for the Colorado contracting community discussing The Veteran’s Hospital that will be built on the Fitzsimons Campus in our city, the Veteran’s Administration Project Manager told a stunned crowd that this project (valued between $500 and $600 million) will almost certainly be subject to such an agreement because it fits the basic criteria for inclusion under this order.

Before you think this is union bashing, I firmly believe that every employee has the right to choose whether they want to be represented by organized labor or not. The NLRB ensures this, and I support it completely. And through the years, unions have done a lot to help the workforce, especially in the construction and manufacturing industries.

But the fact is that a vast majority of construction workers in this state have chosen not to have union representation.

About 92 percent of construction workers choose to work for merit shops rather than union shops. Local union construction companies will have to supplement their workforce with out-of-state workers or “travelers” if non-signatory construction companies are not willing to sign the PLA.

If you were a part of that 92 percent of the construction industry, how would you feel about being unemployed while a worker drives in from another state to collect a check working on one of the most high profile projects our city has ever been a part of?

If you think a PLA is the wrong choice for this project in these economic times, make your voice heard.

This letter to the editor is available online here.

• In Trumbull, CT subcontractors for the Trumbull High School renovation/reconstruction project have been selected.  The local construction unions’ are upset because they lobbied hard to make sure this was a PLA project.   Supporters of free enterprise fought hard to ensure this project would be bid based on open competition and not union favoritism.  Now the project is set to put hundreds of people to work, regardless of their labor affiliation.
• The Third District Court of Appeals in Sacramento, CA stepped in to stop union greenmail abuse against the proposed $600 million Sutter Midtown Medical Center, midtown campus.  The Sacramento Business Journal reports that “the midtown development plan includes a women’s and children’s center, renovation of Sutter General Hospital and the Sutter Cancer Center across the street. The project also includes housing, stores and a new theater complex for the Children’s Theatre of California.”  This project is sure to create hundreds of jobs and some important additions to the community.  This court decision is a big win for the people of Sacramento as it sends a clear message that union greenmail will not be tolerated. Unfortunately, Sutter signed a PLA early in the construction process to avoid project delays and increased costs as a result of greenmail threats from construction unions. The SEIU had their own labor-related agenda so they picked up where the building trades unions left off and engaged in greenmail.  Businesses and government entities need to stand up to Big Labor or else this extortion will continue. 
• Staying in California, construction trade unions continue their attempts to establish a foothold in San Diego.  This time, they are preemptively targeting potential developers for the proposed San Diego civic center to negotiate a PLA.  Although we expect this type of behavior from the San Diego construction unions, it takes a special kind of nerve for a developer to being negotiating a PLA before they have been awarded a project.  Just a note to the future developer of the San Diego civic center project and their potential union friends, I would expect a serious fight if you insist on a PLA.
• Finally, bowing to union demands has put the San Diego Unified School District (SDUSD)’s School Board in a bad situation – again.  Despite a significant budget shortfall, the School Board opted to utilize a PLA on school construction funded by Proposition S, a $2.1 billion bond.  Not surprisingly, the SDUSD School Board also takes orders from the teacher’s union.  Despite a significant surplus of teachers and unlike every other district in California, the SDUSD refused to lay off any teachers to address the district’s cash crisis.  Out of money, the SDUSD School Board is now proposing a $30 million tax increase on local residents and businesses to cover their shortfall.  Needless to say, this is not going well.

That’s all for this week.  Be sure to check back with www.thetruthaboutplas.com for the most updated news and information on wasteful and discriminatory PLAs.