Update 1/1/12: Sen. Mark Obenshain introduced companion legislation in the Virginia Senate, SB 242 (pdf). It is cosponsored by all 20 Senate GOP members. The Virginia Senate has 20 GOP and 20 Democrat Senators. Lieutenant Governor Bill Bolling (R) casts deciding votes. 

Click here to write your legislators and encourage them to support HB 33/SB 242.

HB 33/SB 242 ensures Virginia taxpayers get the best construction project at the best price and 96 percent of Virginia’s construction workforce (those who choose not to belong to a labor union) have a real shot at working on taxpayer funded projects.  It will also help stretch scarce tax dollars to meet Virginia’s transportation and infrastructure needs.

In 2011, Michigan, Maine, Tennessee, Arizona,  Louisiana, Iowa and Idaho enacted similar legislation and executive orders ensuring taxpayers get the best possible product at the best possible price. 

In July, 2011, the Wall Street Journal and the Boston Herald editorial boards applauded states for enacting fair and open competition measures that end “sweetheart deals with labor unions,” and “limit bids on construction projects to contractors that agree to union representation.”

State budget deficits and a 2009 President Obama executive order encouraging PLAs on federal projects and allowing their use on federally-assisted projects pushed states to take steps at preventing waste and discrimination in public contracting.

A total of 11 states have enacted legislation or executive orders prohibiting government-mandated PLAs on state and state-assisted projects to some degree.

This year, Democrats controlling Illinois and California state government enacted legislation encouraging the use of government-mandated PLAs. New Jersey and New York have existing laws enacted by Democrat legislatures and administrations encouraging anti-competitive and costly PLA mandates, while Washington has a pro-PLA executive order.  

If enacted, HB 33/SB 242 will prevent special interst handouts like the mandated PLA on Phase 2 of the $2.8 billion Dulles Metrorail Silver Line project Virginia is partially financing. TheTruthAboutPLAs.com covered this controversial project in great detail yesterday. It will increase competition, reduce costs and create job for Virginia’s construction industry.

The measure prevents the state and those procuring projects with state dollars from MANDATING PLAs.  Contractors would be free to voluntarily enter into PLAs, as is permitted by the National Labor Relations Act.

Update 12/15 and 12/19:
The Virginia Chamber of Commerce issued this press release Dec. 14 in support of HB 33.

Del. Comstock and Del. Hugo issued a Dec. 19 press release on HB 33.

Virginia Construction Industry Supports Legislation Ensuring Fair and Open Competition On Public Construction Contracts

Contact:      Angie Gutenson, Vice President, ABC-VA (703) 968-6205                     For Immediate Release
                     Ben Brubeck, PLA Expert, ABC National (703) 812-2042                        December 13, 2011

DULLES, VA – On behalf of its 660 Virginia merit shop employers, Associated Builders and Contractors (ABC-VA) supports the Fair and Open Competition in Government Contracting Act (HB 33) introduced on Monday by Virginia Delegate Barbara Comstock (R-34^th) and GOP Caucus Chairman Virginia Delegate Tim Hugo (R-40^th). HB 33 prohibits Virginia and recipients of state funding or assistance from requiring or prohibiting contractors to enter into union agreements, such as a project labor agreement (PLA), as a condition of winning state and state-assisted construction contracts. 

“This commonsense legislation will reduce costs, increase competition and create jobs for qualified Virginia businesses and their skilled local employees on state and state-funded construction projects,” said ABC-VA President Patrick Dean. “It will ensure Virginia’s infrastructure dollars are spent wisely and support projects subject to fair and open competition, which ultimately will benefit taxpayers by funding more construction projects and creating more jobs for Virginians.

“Unfortunately, unaccountable political appointees controlled by special interests have been steering taxpayer-funded construction contracts to their political supporters by mandating union-favoring PLAs on projects funded by the state,” said Dean. “This special interest favoritism has no place in Virginia.

“If enacted, this measure would prohibit state-assisted construction projects, such as Phase 2 of the multi-billion dollar Dulles Metrorail Silver line project, from mandating unwanted anti-competitive and costly PLAs on contractors,” said Dean. “Why should Virginia’s financial stakeholders pay for the majority of this project when the PLA mandated on the prime contractor by MWAA ensures discrimination against 96 percent of Virginia’s construction workforce – those who have freely decided not to join a union? Local workers will lose jobs to out-of-state union members given hiring priority via the PLA.”   

“HB 33 simply ensures the government remains neutral with respect to a qualified contractor’s relationship with labor unions and gets the government out of the business of picking winners and losers through cronyism,” said Ben Brubeck, ABC National’s Director of Labor and Federal Procurement. “To date, 11 states have enacted similar measures, resulting in reduced costs, increased job creation and a level playing field encouraging robust competition from qualified nonunion and union contractors.

“HB 33 allows contractors to voluntarily enter into union agreements like PLAs,” said Brubeck. “Unlike a government-mandated PLA, it gives contractors a real choice, which can only increase competition and help taxpayers get the best possible product at the best possible price.”

Learn more about anti-competitive and costly PLAs and the Silver Line Metrorail controversy at www.TheTruthAboutPLAs.com.

###

About ABC — Associated Builders and Contractors is a national association with 75 chapters representing more than 23,000 merit shop construction and construction-related firms with nearly two million employees. Founded in 1972, the ABC Virginia Chapter is the only association in Virginia dedicated to representing the interests of merit shop contractors. ABC VA represents all firms in the commercial construction industry equally. Membership represents the full range of contractors, from small family-owned subcontractors to global general contracting firms, as well as, materials suppliers and industry professionals. The ABC Virginia Chapter has offices in Chantilly, Richmond and Hampton Roads. 

On Sept. 7, a federal District Court judge in Iowa dismissed a lawsuit filed by the Central Iowa and and Cedar Rapids/Iowa City Building and Construction Trades Divisions of the AFL-CIO.  Their suit claimed that Gov. Terry Branstad’s Executive Order 69, which prohibited PLA mandates on state and state funded construction, was preempted by federal labor law.

While the 1993 Boston Harbor Supreme Court decision may have affirmed that government entities can require PLAs on public construction through their interest as a market participant – not a regulator of labor policy, this decision in Iowa is further evidence that government entities can also decide to prohibit themselves and even their subdivisions from requiring contractors to enter into a PLA as a condition of performing public work.

The key point is that the Iowa order does not prohibit a contractor from voluntarily entering into a PLA (which is authorized by the National Labor Relations Act), it simply ensures that government entities are neutral when it comes to PLA policy.  This gets government out of the business of picking winners and losers via politically motivated crony contracting.  By removing PLA favoritism towards Big Labor, taxpayers can get the best construction at the best price.

Here are the highlights from Gov. Branstad’s press release hailing the decision:

Judge Jarvey found “EO #69 establishes funding conditions that serve the State’s proprietary interest in projects. In prohibiting PLAs, the State of Iowa has made a decision that PLAs detract from a competitive bidding environment and that state funds and state projects will benefit from eliminating coercive union tactics. The State, as the proprietor of its construction projects, can make the decision not to pay union wages or operate under union conditions.”

“Dick Sapp, Frank Harty and Ryan Koopmans of the Nyemaster law firm worked tirelessly to get the case dismissed at the earliest point in time before going to trial, saving the state of Iowa tens of thousands of dollars in litigation costs that the state would have incurred due to the lawsuit brought by the unions,” said Jeff Boeyink, Gov. Branstad’s chief of staff.

Mr. Sapp and Mr. Koopmans are also lead counsel on the case brought by AFSCME and Democratic leadership challenging the governor’s line item veto authority.

The editorial board at The Wall Street Journal has again come out against wasteful and discriminatory government-mandated PLAs.  Here are the highlights from the editorial (“Project Labor Revolt: The states ban union political bid-rigging. Obama demurs,” 7/19/11):

One benefit of the squeeze on state and local budgets is that politicians are finally having to confront their sweetheart deals with labor unions. The latest reform movement is moving against project labor agreements, or PLAs, that limit bids on construction projects to contractors that agree to union representation.

Only about 13% of construction workers belong to unions, and PLAs are a union invention to use their political muscle to organize more companies. Proponents argue that PLAs ensure the speed and quality of construction plans. But PLAs are one of the reasons that Boston’s Big Dig was estimated at $2.8 billion but eventually cost $22 billion. Studies show that projects under PLA contracts on average cost 12% to 18% more than projects awarded by open, competitive bidding. Taxpayers pick up much of this tab.

[snip]

In response to this evidence, states have been pulling away from PLAs. Louisiana passed a law this month that prohibits state entities from mandating the use of PLAs. Tennessee, Arizona and Idaho passed similar legislation earlier this year, and Iowa’s Governor Terry Branstad, in one of his first acts after inauguration, signed an executive order ending a state PLA requirement. Legislatures in Maine and Michigan recently passed bills along these lines that governors are expected to sign. These states are joining Utah, Montana, Missouri and Arkansas, which enacted bans in recent years.

The new wave of Republican state officials is leading this reform, but the public seems to support the effort even in Democratic-leaning areas. Seven localities in California have passed ballot initiatives to end mandated PLAs in the last decade, including five since 2009. This includes places like Chula Vista, where President Obama received 61% of the vote. As Andy Conlin of Associated Business and Contractors notes, wherever PLAs are subject to popular referendum, they’re rejected.

You may not be surprised to learn that the Obama Administration is not part of this reform trend. In February 2009 Mr. Obama issued Executive Order 13502, which lifted President Bush’s ban on PLAs and explicitly “encourages” them in federal construction projects worth more than $25 million. As the 2012 election nears, the Administration will be tempted to extend the order to include projects that receive any federal funds.

That would raise construction costs across the country, and at all levels of government, because so many public works projects are jointly funded by states and the feds. It would also mean fewer construction jobs overall, though higher pay for those unionized workers lucky enough to get one.

PLAs are a form of political bid-rigging that robs taxpayers even in good economic times. Amid today’s limited fiscal resources, PLAs steal money from the likes of education and law enforcement to reward politically-connected companies and their unions. They deserve to be outlawed.

Here at TheTruthAboutPLAs.com, we couldn’t agree more.

This editorial touches on a couple of key points. In addition to detailing how PLAs increase construction costs and discriminate against the 87 percent of the construction workforce that chooses not to join a labor organization, it outlines what has become a national trend in the last 12 months. In state after state and community after community, Americans are standing up to demand the best construction at the best price for their hard-earned tax dollars. These demands are showing up at the ballot box in places like Chula Vista and San Diego County in California, where voters overwhelmingly approved ballot initiatives banning government-mandated PLAs on local projects. In places like Iowa, Maine and soon Michigan, taxpayers’ desire for fair and open competition is being expressed through their governors and state legislators. Regardless of the method, sensible taxpayers are taking important steps to guarantee value on public construction projects.

The Wall Street Journal also reminds us that the threat of Section 7 of Executive Order 13502 looms large as the 2012 presidential election approaches. Regular readers remember that Section 7 of the order requires: “The Director of 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 project labor agreements, with respect to both construction projects undertaken under Federal contracts and construction projects receiving Federal financial assistance.”

While we have clearly passed the 180-day deadline set by the order, there is still reason to believe that the Obama administration could take action on Section 7 in the next 18 months. It is clear that bid protests, other legal impediments and public pressure have kept the Obama administration from implementing as many government-mandated PLAs as they expected and section 7 of Executive Order 13502 allows the administration to provide a tasty handout just in time for Big Labor to support President Obama’s re-election campaign. We saw this same cycle occur at the state level where embattled incumbent governors in Iowa, Illinois and Massachusetts either issued executive orders encouraging state agencies to require PLAs or used other methods to encourage the use of government-mandated PLAs on high profile construction projects with the obvious intent of currying favor with the construction union bosses.

Corruption: This is how Big Labor Leverages Government-Mandated Project Labor Agreements

Back to the editorial, this is an outstanding read and really breaks down how government-mandated PLAs are bad for taxpayers and the construction industry workforce still struggling to come back from more than 15 percent unemployment.

It is clear that taxpayers from sea to shining sea are sick of their hard earned tax dollars funding special interest handouts in the form of wasteful and discriminatory project labor agreements (PLAs).

Last week, lawmakers in Idaho cleared legislation that will prohibit government-mandated or forced PLAs on state funded projects in the future. S.B. 1006 has now reached Gov. Butch Otter for his signature, which is expected within the next ten days.

This is a huge win for the people of Idaho, which will join six other states and ten local communities in banning PLAs on projects funded by their tax dollars. It will also be the second state since the November 2010 election to take a stand against Big Labor. In January, Iowa Governor Terry Branstad issued Executive Order 69 banning involuntary PLAs on state supported construction. The Branstad order is already paying dividends for Iowa taxpayers as it may preclude a proposed PLA requirement on the Cedar Rapids Convention Center project.

Arizona’s lawmakers have also gotten serious about ensuring that fair and open competition – and not Big Labor handouts – dictate how public construction projects are awarded in their state. Tired of Big Labor’s greenmail-style tactics in Arizona, the Senate has passed legislation to prohibit government-mandated PLAs on state and local projects. Similar legislation has been introduced in the House and received a positive reception from its committee of referral.

With legislators in Michigan and Ohio moving their bills through the process and new bills introduced in Georgia and Florida, it is clear that state lawmakers are sick of getting four buildings for the price of five.  Momentum is building, as taxpayers are calling out for the accountability they deserve on public construction.

Additionally, these executive and legislative actions show the genuine concern that state leaders have about section 7 of President Obama’s Executive Order 13502. Regular readers know that section 7 of the Obama order states the following:

Sec. 7. The Director of 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 project labor agreements, with respect to both construction projects undertaken under Federal contracts and construction projects receiving Federal financial assistance, would help to promote the economical, efficient, and timely completion of such projects.

Some taxpayer advocates, including those who write this blog, believe that this provision may ultimately be used by the federal government to attempt to require these union handouts on federally assisted construction in the future. While the administration has passed the 180 day threshold for a decision as required under the order, the specter of this provision still hangs over every potential federally assisted construction project in America.

This threat may become especially acute as the 2012 election approaches and President Obama works to lock down his support from construction union bosses, a game several incumbent governors tried to play in advance of the 2010 election last November.

Here at TheTruthAboutPLAs.com, we believe that the Obama administration is going to have a tough time requiring PLAs on projects funded jointly by the federal government and state/local government entities if the project is in a state that prohibits PLAs on state funded projects.

We urge state leaders throughout the country to be good stewards of their constituent’s hard earned tax dollars and say no to government-mandated PLAs on projects funded by their state money.

The Cedar Rapids City Council voted 5-4 on Tuesday, Feb. 8 to move forward with a PLA requirement for the construction of the city’s new $75 million convention center.  This decision runs contrary to Gov. Branstad’s executive order banning PLAs on state funded work and puts $15 million in state I-JOBS funding for the project in jeopardy, as the governor has publicly stated his intention make sure that his open competition executive order is enforced on this project.

Here are the highlights from The Gazette’s coverage of the issue:

Gov. Terry Branstad this morning fired back at Cedar Rapids Mayor Ron Corbett, with the governor saying that he intended to enforce his executive order that prohibits state funds to go to construction projects which come with project labor agreements.

“That is the law,” Branstad said in a comment at the Capitol on Wednesday morning. “That is the order I signed. We do intend to enforce it.

“… The fact of the matter is we have said we are not going to release state dollars if there is a project labor agreement because they are now prohibited.”

Here at TheTruthAboutPLAs.com, we encourage Gov. Branstad to stick to his guns on this issue.  We also do not believe that the construction process is too far along to remove the PLA requirements.

Additionally, we were also turned off by comments made by Council member and former Hawkeye Labor Council President Justin Shields, who was quoted as saying that the council shouldn’t give in to “fear and speculation.”

Gov. Branstad isn’t trying to scare anyone and there is little room for speculation.  The fact is that this project is not so far along that the PLA cannot be removed.  Additionally, it is highly likely that moving forward with a PLA mandate will result in significant delays, either because Cedar Rapids will be forced to make up the loss in state funding or endure litigation.  These are the facts, not threats or speculations.

None of these outcomes are good for the people of Iowa.  By removing this PLA mandate, the convention center project moves forward, taxpayers get the best product at the best price and the 85 percent of Iowa’s construction workforce that chooses not to join a labor organization will have the opportunity to build this project.

One other interesting note about this story is that this project is subject to federal Davis-Bacon Act prevailing wage requirements.  In addition to guaranteeing that workers on this project will receive hyper-inflated wages, it shows that there is more than $2,000 of federal funding for this project.  As a result, this PLA requirement would also have been prohibited by Executive Order 13202, issued by President George W. Bush in 2001, which prohibited PLAs on federal and federally-assisted construction.

With so much attention going to the sections of President Obama’s Executive Order 13502 that encourage PLAs on federal projects costing more than $25 million, it is also important to remember that President Obama’s order also allows Big Labor to push for PLAs on federally-assisted projects at the state and local level, like the Cedar Rapids Convention Center.

Note: The Chicago Tribune also covered this story.

Here is an excerpt from Gov. Branstad’s release:

Gov. Branstad: Signs two executive orders

1/14/2011

FOR IMMEDIATE RELEASE: Friday, January 14, 2011 Contact: Governor’s Office (515) 281-5211

(DES MOINES) – Gov. Terry E. Branstad today signed executive orders 69 and 70.

Executive Order 69 rescinded Gov. Culver’s executive order mandating the use of Project Labor Agreements and prohibits Project Labor Agreements to be used for projects involving state funds.

Executive Order 70 rescinded Gov. Vilsack’s executive order that established an automatic process that gave voting rights and right to hold public office to felons and those who committed aggravated misdemeanors. This was a major priority of Secretary of State Matt Schultz.

Visit here for our earlier post on former Gov. Culver’s efforts to provide handouts to the construction labor union bosses.

UPDATE: The Iowa Chapter of Associated Builders and Contractors has released a statement regarding Gov. Branstad’s order:

***MEDIA RELEASE***

ABC of Iowa Applauds Governor Branstad for Taking Action to Protect the Rights of Construction Workers

DES MOINES – ABC of Iowa released the following statement from Greg Spenner, ABC of Iowa President & CEO, regarding Governor Branstad’s signing of Executive Order #69:

“We applaud Governor Branstad for swiftly taking action to protect the rights of all construction workers in the state by issuing an executive order which prohibits the use of Project Labor Agreements on public projects with state funding. We believe that PLAs discriminate against workers who choose not to be a member of a union. The opportunity to work on state-funded projects should be open to all taxpayers. Again, we thank Governor Branstad for taking this action on the day of his inauguration.”

###

ABC of Iowa is a statewide association representing approximately 450 merit shop construction and construction related firms. Visit us at www.abciowa.org

UPDATE #2: Media outlets in the region are covering Gov. Branstad’s executive order banning PLAs on state funded projects.

• Sioux City Journal: Branstad Rescinds Labor, Voting Orders
• Chicago Tribune: Branstad Signs Labor Agreement Voting Rights Order
• Des Moines Register: Gov. Branstad Scraps Executive Orders from Culver, Vilsack Eras
• Omaha World-Herald: Branstad Vows Smaller Government
• Radio Iowa: Branstad Quickly Rescinds Orders on Project Work Agreements, Felon Voting
• KGAN (CBS2-Chicago): Branstad Signs Labor Agreement Voting Rights Order
• Eastern Iowa Government: Branstad Issues Executive Orders on Day 1 as Governor

The Merit Construction Alliance alleges that the union officials should have recused themselves when the UMass Building Authority voted in June to require the use of union workers on a massive overhaul of the Boston campus.

The complaint says Francis X. Callahan Jr., president of the Massachusetts Building Trades Council, and Edward W. Collins Jr. of the International Brotherhood of Electrical Workers, represent unions that could collect at least $5.2 million in dues from union workers on the campus project. The Merit Construction Alliance, which represents nonunion contractors and employees, warned after the board’s vote that it would file the ethics complaint against Callahan and Collins, both of whom are appointees of Governor Deval Patrick.

“The union board members were part of an election-year scheme by the Patrick-Murray administration to hand jobs to specials interests, despite the added costs to taxpayers and nonunion workers’’ Ronald N. Cogliano, president of the alliance, said in a statement yesterday.

Callahan told the Globe in June that his lawyers had reviewed his participation in the vote and advised that it would not be a conflict of interest because he will neither sign nor negotiate the contracts involved, nor receive any personal benefit.

In a letter to the Ethics Commission several days before the vote, Callahan asserted that his union’s interests in the project labor agreement were “remote, speculative, and not sufficiently identifiable to require my recusal.’’

“I’m confident there’s no ethical conflict, but I’m not going to comment on the complaint without seeing it,’’ Callahan said yesterday. “I’m not concerned about it.’’

Collins also denied any wrongdoing and called the complaint “a real reach.’’

“I believe I’m in full compliance and my actions as a board member were in full compliance’’ with state ethics laws, he said in an interview yesterday.

The allegation of ethical violations could resonate in the governor’s race because Patrick has strongly supported the union-only work agreement, drawing sharp criticism from his Republican challenger, Charles D. Baker.

Patrick contends that requiring union labor will guarantee a higher quality workforce and eliminate the risk of strikes, thus diminishing the potential for slowing down the complex overhaul and disrupting life on the campus. Baker argues that Patrick pushed the agreement as a favor for politically influential unions, even though it could drive up the cost of the project by $100 million.

The governor has angered many public-sector unions by cutting employee benefits during the economic downturn. He has had better relations with private-sector unions, particularly the construction trades.

In a speech to the Building Trades Council in March, Patrick announced that a labor agreement would be approved for the UMass campus project and that others were being considered for other large projects in the state.

Kyle Sullivan, a Patrick spokesman, declined to comment.

The $750 million in work at UMass Boston is a decadelong undertaking that includes, among other projects, the building of a new science center and the Edward M. Kennedy Institute for the United States Senate.

The 11-member UMass Building Authority, which has five Patrick appointees, approved the agreement on a 9-to-2 vote in mid-June, after Collins and Callahan spoke in favor of the pact.

TheTruthAboutPLAs.com has covered the controversy surrounding Gov. Patrick’s efforts to steer lucrative state construction contracts to his staunchest political supporters: Massachusetts construction trade unions. 

Today the Boston Herald editorial board blasted Gov. Patrick’s orchestration of this anti-competitive and “indefensible” crony contracting scheme. The editorial calls the participation of Big Labor bosses Collins and Callahan in the UMass Building Authority’s PLA vote “fishy” (“Challenging labor,” 8/11):

The Patrick administration’s decision to exclude non-union contractors from $750 million worth of construction projects at UMass-Boston over the next decade is, frankly, indefensible.

According to a group that represents non-union tradespeople, it’s also ethically suspect.

[snip]

It will be up to the Ethics Commission to determine whether a true conflict of interest exists, though on the surface it certainly seems fishy. A reversal of the authority’s vote would be the ideal outcome.

But if the complaint serves simply to renew focus on this horrendous policy decision – which amounts to a giveaway to organized labor that leaves thousands of out-of-work tradespeople still out of work and taxpayers on the hook for millions in unnecessary additional costs – then it will have served a useful purpose.

And if it prompts Gov. Deval Patrick to rethink his plan to expand the use of project labor agreements – which steer public construction work exclusively to unions in exchange for labor “harmony” – then all the better.

Unfortunately for taxpayers and unemployed tradespeople, that seems the unlikeliest of outcomes.

The ethics complaint was filed days after another incumbent Democrat governor’s administration became embroiled in an ethics scandal involving PLAs.

On Aug. 5, the Ohio Inspector General released a report blasting Gov. Ted Strickland’s (D) appointee to the Ohio School Facilities Commission (OSFC), Richard Murray — a former construction union advocate with the Laborers-Employers Cooperation and Education Trust (LECET) and union organizer with Local 423 of the Laborers’ International Union of North America (LIUNA) — who has been strong-arming school districts into using PLAs in order to receive OSFC money for school construction.

The investigation revealed that Gov. Strickland appointed Murray because the prior OSFC director wasn’t doing enough to ensure state contracts were awarded to unionized contractors. Murray was encouraged to steer contracts to union contractors so unions and their members would support Strickland in the upcoming election.

The report documents incredible examples of corruption and unethical behavior. For instance, Murray unilaterally instituted a PLA for Ohio blind and deaf schools that will be a $145,000 windfall for his union and the LECET.  Read all about this clear conflict of interest here and here.

The fascinating twist on this story is that the bids for the deaf and blind schools came in 41 percent - about $11 million – over budget with Murray’s PLA mandate. Ohio law says the schools must be rebid. Big Labor spin-doctors are attempting to convince stakeholders that the PLA was not responsible for the increased costs, but the public isn’t buying it.

There is a chance the schools will be rebid without a PLA, allowing the public to see another real-world experiment (see: case studies in Fall River, Mass. and City of Lynn, Mass. English and Classical schools) documenting the cost difference between schools bid with and without PLAs.

Three Ohio newspapers have published editorials that attack Strickland and call for Murray to step down as OSFC director. This likely will hurt Gov. Strickland in November.

Govs. Strickland and Patrick are two of  several incumbent Democrat gubernatorial candidates (see: Iowa and Illinois) who have resorted to funneling lucrative state construction contracts to unions via PLAs in order to secure Big Labor’s support in upcoming elections.

Additionally, President Obama was widely criticized for signing a pro-PLA Executive Order 13502 as part of a series of policy moves executed within his first month in office that benefitted Big Labor.  The order and related Federal Acquisition Regulatory (FAR) Council regulationsencourage federal agencies to require PLAs on federal construction projects exceeding $25 million in total cost.

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.

Of course, this is another myth promoted by special interests to convince lawmakers and taxpayers that there is a public benefit to anti-competitive and costly PLA schemes, which funnel lucrative public construction contracts to unionized contractors and their union employees. Research has found that a lack of competition and inefficient union work rules resulting from PLAs, even on projects subject to prevailing wage and benefit laws, increase the cost of construction. A series of studies by the Beacon Hill Institute found that PLAs increased the cost of school construction projects by 14 percent to 18 percent when compared to similar non-PLA schools.

An article in yesterday’s San Francisco Examiner demonstrates that PLAs can’t guarantee local hire because union hiring rules can’t guarantee local hire (“Union allocation is roadblock to local hiring,” 8/4):

SAN FRANCISCO — City residents are landing more construction jobs on San Francisco Redevelopment Agency projects, but union practices still keep some from working.

The City and the Redevelopment Agency, a state bureau that oversees massive building efforts, aim to provide half the work on construction projects to San Francisco residents.

But those goals are rarely achieved, prompting some activists and politicians to push for a law that would fine contractors when city residents perform less than half the work on a locally funded project.

Mayor Gavin Newsom would support such legislation if it’s achievable given the constraints of unions’ collective bargaining agreements and the poor economy, mayoral spokesman Tony Winnicker said.

Less than 25 percent of work on 29 San Francisco-funded construction projects went to locals, a city-funded research report published Monday showed.

[snip]

But with tens of billions of dollars worth of construction planned in San Francisco, including the building of new Hunters Point neighborhoods, city and agency officials said unions hold the key to achieving 50 percent local hiring rates.

“There’s no way we’re going to meet the goal without relationships with the building trades,” Redevelopment Agency Executive Director Fred Blackwell said at the bureau’s meeting Tuesday.

That’s because construction workers are generally assigned to jobs by unions, not contractors.

“We cannot legally determine our membership by where they live,” San Francisco Building and Construction Trades Council Secretary-Treasurer Michael Theriault said. “Hiring is generally done under the principle that the worker who has been out of work longest has first crack at the work.”

Theriault is involved with a city task force that’s exploring ways of boosting the local work force through labor agreements and other measures. The group next meets Thursday.

That quote from a Big Labor Boss is accurate. Union membership and hiring hall rules can’t guarantee a local workforce for public projects. PLA advocates claim special language within PLAs can help establish local hiring goals (not mandates) that can help with local hire.  But so can clauses in contracts without all of the discriminatory and costly baggage contained in typical PLAs.

It is not uncommon for a city or state to experience a lack of job creation for local residents when Big Labor has control of an urban or regional construction market with help from politicians beholden to Big Labor’s special interest agenda.

Philadelphia has a similar problem.

In 2008, an investigative journalist from the Philadelphia Inquirer, Tom Ferrick Jr., uncovered government data indicating that Philadelphia’s construction trade union members “remain all-male, nearly all-white, and the majority live in the suburbs” (“Why the Unions Won’t Share: Data on their membership here show they are mainly white, male and suburban,” 1/6/08).  Ferrick’s piece discovered that almost all cityfunded construction work was conducted under PLAs or built all-union, yet construction jobs weren’t being created for minority, women or Philadelphia residents.

Washington, D.C., Baltimore, Las Vegas and NYC have experienced similar local hire problems with construction unions and/or PLAs.

In Washington, D.C., recent reports found that Big Labor Bosses failed to meet local and minority hiring goals set by the PLA on the Washington Nationals ballpark. One of the unions signatory to the ballpark PLA, Roofers Local 30, is based in Philadelphia (see page 19 of the PLA).

In July, Ashley H. Brown, Baltimore’s assistant attorney solicitor, examined controversial legislation (Bill No. 10-0455) before the Baltimore City Council that would require the city to include government-mandated PLAs on all contracts for construction projects with a total cost of $5 million or more in which Baltimore has a certain financial role.  Brown’s legal opinion found that mandating the local hire provisions via a PLA is illegal.

And as this article from the Las Vegas Review-Journal explains, typically union collective bargaining agreements contained within PLAs give out-of-area “travelers” or “boomers” hiring preference over local union members — and of course, skilled and qualified local nonunion labor are locked out because of the PLA too.

In New York, the NY Daily News reported that the community benefits agreement containing a PLA on the new $1.3 billion Yankee Stadium has been a “joke” and a failure:

Then there are all those promises about contracts and construction jobs.

The team acknowledges that more than 3,900 people have applied for construction work at the stadium. More than 80% didn’t belong to any union. Since you must be a union member to work on the site, the Bronx residents most in need of a job have been shut out of the daily workforce of 1,200.

As for the union employees, a lot of the craft unions have been “checkerboarding,” according to one source who has worked on the stadium project from the start.

“They take members who live in the Bronx but work at some other site in Manhattan, then they transfer them to the stadium just to boost the numbers. That doesn’t add any new jobs for Bronx residents.”

So even when Big Labor bosses and PLA advocates claim a PLA has helped meet local hiring goals, investigate whether “checkerboarding” is a problem and ask for evidence that the PLA has actually delivered a net increase in local employment.

Don’t let Big Labor get away with false claims that PLAs guarantee a local workforce.

Use this information from TheTruthAboutPLAs.com to debunk yet another pro-PLA argument.

Update #1:

An article in The Des Moines Register  highlights another reason why PLAs can’t guarantee local hire (“Prison labor accord to use Illinois halls, 9/22/10).

Numerous unions signatory to a PLA for an Iowa prison project have hiring halls that are physically located in Illinois:

Several union leaders and a union lawyer said Tuesday said that it’s common for union halls to have cross-state jurisdiction…

“I think it will be predominantly Iowans, heavily Iowans,” said Bill Gerhard, president of the Iowa State Building and Construction Trades Council.

But because the prison will be built on Iowa’s border, it’s likely that some Illinois and Missouri construction workers will be employed on the project, he added.

That means Illinois union members who are dispatched out of union hiring halls (regardless of where the hiring hall is located) will have preference over union construction workers from Iowa as well as nonunion construction workers from Iowa. Union hiring hall rules and collective bargaining agreements typically specify that employees at the top of the hiring hall out-of-work list are dispatched to jobsites first, regardless of their place of residency. A PLA cannot change this fundamental rule of union hiring halls.

This is another example why PLAs can’t guarantee local hire.

Of course, the real goal of these special interest government-mandated PLA schemes is to discourage competition from nonunion employees and their employers and reward Big Labor bosses for their political patronage.

There are other effective mechanisms to encourage local hire without the favoritism, waste and discrimination inherent in PLAs.

Update #2, July, 2011

This blog post provides analysis on the San Diego Union Tribune’s report that the San Diego school district has failed to meet the hiring goals of its labor pact, which promised to employ local workers to build and repair campuses under its $2.1 billion construction bond measure.(“Labor Pact Hiring Goals Not Met,” July 8, 2011).

The Detroit Free Press reported July 15, 2011 that Detroit residents are getting 30% fewer construction-related jobs than promised by a PLA covering Detroit public school construction funded by $500.5 million for school capital improvement projects Detroit voters approved via Proposal S in Nov. 2009.

March 15, 2010, Iowa Gov. Chet Culver took a page out of President Obama’s “Big Labor favor” playbook and signed a state executive order similar to Executive Order 13502 that applies to state-funded construction projects exceeding $25 million in Iowa.

Culver’s Executive Order 22 is viewed by many as a sop to Big Labor in order to obtain Big Labor’s support during his re-election campaign this November. 

This controversial topic has also been grabbing headlines in recent months.

In June, the Iowa University Board of Regents voted 5-4, along party lines, in favor of requiring a PLAon the construction of the $73 million outpatient clinic for the University of Iowa Hospitals and Clinics in Coralville, IA after the Culver order pushed them towards using a PLA.

In July, Iowa gubernatorial candidate Terry Branstad spoke out against Culver’s anti-competitive and costly pro-PLA policy, which led to statements from both campaigns, labor and the business community about this divisive issue.

On the radio program, Laura Ingraham and Jeremy Price explain to listeners how Obama and Culver’s pro-PLA executive orders are harming small businesses, like Price Industrial Electric, and their skilled and qualified workforce, while taxpayers are likely to foot the bill for increased construction costs as a result of anti-competitive PLAs.

Listen to the radio interview.

At 3:40, Laura Ingraham summarizes this issue best:

“The project labor agreement executive order was signed into law on Feb. 6, 2009. The President, right after being sworn into office as President of the United States, set about to reward the cronies in the unions across this country, and labor bosses/union bosses have been sitting pretty and riding the Obama wave ever since.

That means you are spending more money. How? Your tax dollars are paying for these federal projects. So the taxpayers suffer. Small business owners like Jeremy Price of Price Industrial Electric…he suffers. He is being undercut despite the fact that he will charge less, he will get the job done faster, you will have less bureaucracy, less red tape.

But guess what? In land Obama, the unions are in control. The unions reign supreme. That means they are in control….

This is an absolute outrage. If you are listening to this show….these project labor agreements, you need to find out about them in your area. You need to start speaking about them to your friends. You need to continue to shine the light on these excesses of union enhancement by this Obama administration.”

We agree with Laura Ingraham. Go home tonight and spread the truth about PLAs in your community.  Taxpayers deserve the best possible construction product at the best possible price instead of crony contracting and corruption.