In October 2010, two construction trade groups affiliated with construction trade unions, the Building Industry Electrical Contractors Association (BIECA) and United Electrical Contractors Association (UECA), filed a complaint against the City of New York (NYC) because of their widespread use of government-mandated PLAs in The Building Industry Electrical Contractors Association et al v. City of New York, in the U.S. District Court for the Southern District of New York, No. 10-8002.

The plaintiffs maintained that NYC violated the National Labor Relations Act, Municipal Law and New York Labor Law because of PLAs mandated by NYC government. The complaint argued that instead of acting to secure the best deal for the taxpayers, the city was using PLAs to handpick favored unions and contractors to perform the vast majority of the work. The plaintiffs also argued the alleged cost savings of $300 million over four years PLA advocates claimed the PLA would deliver to the city were “speculative and illusory” and were calculated using flawed methodology based on erroneous assumptions by Hill International and other consultants paid by city agencies to prepare PLA feasibility studies for various NYC public works projects.

Unfortunately, on August 4, 2011, U.S. Southern District Judge Robert Patterson ruled in favor of the city and PLA opponents.

Reuters reports:

Alan Pollack, who represented the plaintiffs, said his clients will appeal. The ruling will hurt city taxpayers by driving up construction costs, he said.

As the case makes its way through the appeals process, the public, media and elected officials should recognize an important fact from this lawsuit: Union contractors and union employees are often harmed by government-mandated PLAs.

In fact, the union contractors and union employees aided by this suit are opposed to government-mandated PLAs for the same reasons nonunion contractors and nonunion employees loathe government-mandated PLAs. In this case, contractors belonging to the plaintiff associations, the BIECA and UECA, were effectively excluded from the competitive bidding process for NYC contracts subject to a government-mandated PLA because of their existing contracts and relationships with other unions that are not favored or part of the NYC PLAs. The case’s fact pattern is similar to common complaints from nonunion contractors that government-mandated PLAs discourage, if not effectively exclude, nonunion contractors from competing for contracts and deny qualified nonunion tradespeople the opportunity to build a taxpayer funded construction project because they are not affiliated with unions that drafted and promoted the PLA.

This is not an isolated incident. Union contractor associations, contractors and union members excluded from PLA negotiations and PLA contracts have opposed government-mandated PLAs for years.

For example, in 2009, New Jersey’s Bayonne Local Redevelopment Authority was sued by the International Steelworkers Union to get on the list of unions eligible to perform work on a PLA covering a Military Ocean Terminal site.

Associated General Contractors (AGC), a national construction trade association that often negotiates union collective bargaining agreements for its union members, explains how government-mandated PLAs negatively impact their union contractor members (and nonunion members too) in this document.

Finally, here is a link to other examples of union contractors and associations opposing PLA schemes.

Anti-Competitive Favoritism Inherent in NYC PLAs
The City of New York enacted a series of PLAs entered into by and between various NYC agencies procuring contracts to build public works projects and The Building Construction Trades Council of Greater New York and Vicinity and its affiliated Local Unions (known as the BCTC).  Pursuant to the BCTC’s negotiations with NYC, only those unions belonging to the BCTC were permitted to become participating signatory unions to each of NYC’s PLAs and benefit from being recognized as the collective bargaining representative for all persons who perform work on PLA projects.

Consisting of 27 contractors, the BIECA is a trade association that has entered into a collective bargaining agreement (CBA) with Local 363, United Electrical Workers of America, IUJAT.  Local 363 is not a member of the BCTC. Pursuant to Local 363’s CBA with the BIECA, the BIECA and its contractors have agreed to recognize Local 363 as the “sole and exclusive bargaining representative of all electrical workers…who are or may hereinafter become employed” by any BIECA contractor. Their CBA requires employees of BIECA contractors to become members of Local 363 and BIECA contractors must contribute to pension, benefit, welfare and education funds designated by and affiliated with Local 363.  The terms of the NYC PLAs conflict directly with BIECA CBAs.

The UECA has been engaged in ongoing collective bargaining negotiations with the International Brotherhood of Electrical Workers (IBEW) Local 3. Pursuant to a December 7, 1995 Settlement Agreement with the National Labor Relations Board, UECA contractors are required to contribute to Building Trades pensions and benefit funds. In contrast, the NYC PLAs require contractors to contribute to BCTC’s benefit funds, which violates the BIECA’s settlement agreement with IBEW Local 3.

The facts of the case demonstrate that the terms and conditions in the PLAs used in NYC effectively excluded union contractor members of the BIECA and UECA from winning contracts subject to the PLA.

For instance, the PLA prevented Local 363 journeymen and apprentices members and any existing journeymen and apprentices of BIECA contractors from working on PLA projects because they are not represented by the unions favored in the BCTC’s PLA.  The existing CBA between Local 363 and BIECA contractors forbids contractors from hiring tradespeople represented by other unions, which prevented the plaintiff from bidding on the contracts subject to the BCTC’s PLA.

In addition, the PLA would have forced BIECA and UECA contractors to pay fringe benefits into the plans affiliated and managed by BCTC unions favored in the NYC PLA. Since existing UECA and BIECA agreements require contractors to make benefit contributions into funds managed and affiliated with local unions not favored by the BCTC, these contractors must pay benefits to both the BCTC benefit funds identified in the PLA and the existing benefit funds designated in their current union agreements.

These double benefit expenses increase labor costs and put UECA and BIECA contractors at a severe disadvantage when submitting a competitive bid.  In addition, the union members employed by the plaintiffs would not receive any benefit contributions made to BCTC benefit plans unless they joined these BCTC unions and became vested in these BCTC favored plans. In short, the NYC PLAs would have resulted in a windfall for BCTC plans at the expense of many union members employed by UECA and BIECA contractors.

The fact that certain union members and signatory contractors are excluded and discriminated against by PLAs undermines the false claim that PLAs are needed to ensure a high quality project built by a safe, well-trained and efficient union workforce. Like their nonunion counterparts, the BIECA and UECA contractors and their employees are qualified and experienced, but they are being harmed by the anti-competitive intent of PLA schemes. The real purpose of these agreements is to create a monopoly for handpicked unions to supply labor to construction jobsites and deny qualified contractors and their skilled an employees the right to compete for these contracts and jobs.

Consultants’ Pro-PLA Studies Flawed, Says Complaint
The plaintiffs argue that the pro-PLA studies are flawed. Cost savings the studies say a PLA will deliver to NYC are illusory. According to the plaintiffs brief in opposition to the defendants’ motions to dismiss:

…each study concludes that by obtaining certain union concessions, including standardizing work hours, overtime hours, work shift rules and holidays for each of the various construction trades along with “no strike” provisions and common grievance procedures, the City would realize substantial cost savings on projects covered by these PLAs…However, as detailed in the accompanying Tuerck Affidavit, the PLA studies are based on the flawed and unsupported methodology that only BCTC contractors historically bid on and perform City work.  The PLA studies further conclude that by obtaining certain concessions from the BCTC unions under the City PLAs, the City saves money.

For example, the original complaint explains that the non-BCTC contractors like the BIECA and UECA already have cost saving labor practices promised by the PLA, so a PLA is not needed and the alleged cost savings are bogus:

By artificially limiting the universe of contractors who perform City work to BCTC contractors, the authors of the feasibility studies give false and unwarranted credit to the PLAs for concessionary cost savings that would have been realized in the absence of a PLA and through the competitive bidding process.

For example, when the Local 363 CBA is compared with the CBA of Local 3, which is a BCTC signatory union, it is evident that certain cost savings the City claims can only be accomplished by concessions negotiated by a PLA, are already built into Local 363’s CBA.

Since the signatory unions mandate a seven hour workday, the feasibility study assumes that by adopting a PLA which mandates an eight hour workday, the City is provided with cost savings benefits by saving an hour of overtime pay per day over the course of the project.  Thus, the PLA would reduce costs by 12.5% (1/8) of the total number of hours worked, multiplied by the difference between overtime and straight time pay.

However, this presumed cost savings ignores the fact that Local 363’s CBA, Article 6, Section A (a), stipulates that a “regular week’s work shall consist of forty (40) hours, divided into any five (5) consecutive days between Monday through Sunday inclusive, of eight (8) hours each, performed between the hours of 6:00 AM and 6:00 PM.”  Had the City considered local 363’s CBA as their baseline, or the work rules and practices of a UECA contractors, it would have already realized a savings that would have obviated the need for any cost savings through the enactment of a PLA.

Nonunion contractors are also not restricted by the BCTC’s inefficient CBA rules that the PLA would allegedly address, resulting in cost savings that the plaintiffs call illusory. The brief continues:

What each of the PLA studies fails to address is whether PLAs offer any real cost savings when compared to projects performed in the absence of a PLA, where the actual qualified bidding pool of contractors – including other union and nonunion contractors – is able to bid for City work through the competitive bidding process.

Unfortunately, this is not the first time Hill International and other consultants have produced a flawed study to justify a government-mandated PLA without considering that there is a skilled and experienced alternative to BCTC labor and contractors signatory to BCTC unions.

A number of the firms selected by government agencies to evaluate the feasibility of PLAs have clear conflicts of interest with Big Labor that prevent them from providing an honest and accurate assessment of the impact of government-mandated PLAs on cost, competition and quality.

For example, the in the summer of 2009 Pennsylvania Department of General Services relied on the questionable findings of the Keystone Research Center (KRC) to justify the use of PLAs on hundreds of millions of dollars worth of prison construction even though the KRC board was heavily dominated by construction union members and a portion of the KRC’s annual revenue came from construction trade unions (learn more about this scandal here).

Can the Appeals Process Deliver Justice?
Regardless of how this case plays out in the courts, it is clear that anti-competitive and costly provisions in NYC’s government-mandated PLAs have harmed the plaintiffs representing union contractors and their union employees just as much as these agreements have harmed nonunion firms and tradespeople in the NYC area.

It is also clear that the process used to justify these PLA schemes is rife with errors, corruption and deception.

Anti-competitive and costly government-mandated PLAs have no place in a fair and open market.

Why not let the best contractors and employees with the best skills and experience compete? NYC taxpayers can only best be served via fair and open competition.

Check back with www.TheTruthAboutPLAs.com for updates on this case.

Here are the highlights (Our emphasis and links added):

There is good reason to be concerned about the viability of Pennsylvania’s merit shop construction contractors and employees in this tough economic climate, where one in four construction workers is unemployed.

A few years ago, Gov. Ed Rendell promised his political supporters in the Pennsylvania construction unions that the Department of General Services would require contractors to sign project labor agreements (PLAs) that require the use of union labor in order to participate in more than $800 million of upcoming state correctional institution construction work.

This promise was a condition of a deal between DGS and the Pennsylvania Building and Construction Trade Council, in which the council promised to support the prison construction appropriation through the state Legislature in exchange for government-mandated PLAs on the prison work.

This “deal” contained a provision that for individual prisons over $15 million if the Keystone Research Center recommended that a project labor agreement be used, the Department of General Services would require one on the project.

A review of public records reveals the majority of the Keystone Research Center’s 20 board members work for labor unions and that the center received more than $350,000 from organized labor between 2005 and 2008. Of particular note is the fact Frank Sirriani, the Building Construction Trade Council president who signed the letter to the Department of General Services requiring PLAs was a board member of the center.

Even though initial bids on one of the first PLA prison projects were over budget by millions of dollars, Gov. Rendell’s administration keeps fighting to have the project labor agreements attached to these projects.

[snip]

PLAs hurt quality merit contractors and their loyal employees because they require jobs to be awarded only to contractors who agree to recognize unions as representatives of their employees — without a vote from their existing employees.

These schemes require contractors to hire all or most of their labor from union hiring halls, and the few nonunion employees who may be permitted to work on a PLA project would have to pay union dues.

In addition, contractors would have to pay health and pension benefits twice — once to existing benefit plans and once to the union-managed plans — because nonunion employees wouldn’t benefit from employer contributions to union plans unless they joined a union and became vested in its plan.

Other costs loom as well. Nonunion contractors and employees must follow inefficient union work rules, and nonunion contractors must hire unfamiliar union labor from union hiring halls rather than use their current employees.

Simply put, PLAs stifle competition and increase costs, not just for nonunion contractors and employees, but also for taxpayers. In fact, studies demonstrate that project labor agreements increase costs by up to 18 percent when compared with non-PLA projects, even when both types of projects are subject to prevailing wage laws.

Pennsylvania workers and businesses should demand that these special interest handouts on state construction be stopped. The Open Contracting Act (H.B. 2010), by state Rep. John Bear, R-Lancaster, would prohibit these union-favoring agreements on state and state-funded construction projects.

At the federal level, there is growing support for The Government Neutrality in Contracting Act (S.90/H.R. 983), which would ensure that union and nonunion firms have a level playing field, free from PLAs, to compete for federal and federally assisted construction contracts.

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

Visit here for more information about costly and discriminatory PLAs in Pennsylvania.

Matthew J. Brouillette, president and CEO of the Harrisburg-based Commonwealth Foundation, wrote an excellent Op-Ed in The Philadelphia Inquirerthat attacks the political doublespeak coming out of Governor Rendell’s administration when it comes to capping the influence of special interests (“Some Interests More Special Than the Rest,” 03/03/10).

In his eighth and final budget address last month, Gov. Rendell repeatedly criticized “special interests” for stymieing his legislative proposals. He said, ” … the time has come to put stricter controls not simply on what they report, but on what they do.” And he called for a cap on special-interest groups’ campaign contributions, implying that such limits would lower the hurdles for his policy proposals.

…Of course, Rendell hadn’t declared war on all special interests – only those that oppose his tax-borrow-and-spend agenda…

..So while job creators who are trying to keep the government from taking more of their money are labeled evil special interests by the governor, those that lobby for more of other people’s money are somehow considered virtuous.

Brouillette goes on to document examples of Gov. Rendell supporting special interests, including Big Labor’s effort to secure PLAs on public works projects. 

Other special interests that apparently have the governor’s blessing include teachers’ unions, which lobby for hundreds of millions of dollars more every year, and construction unions, which lobby for such special privileges as “project labor agreements.”

And according to a recent article in The Pennsylvania Independent, the Rendell Administration has even been caught red-handed in their feeble attempt to cover their corruption with a study that justifies the use of an anti-competitive PLA on several PA prison projects (“Department Commits to PLAs Prior to Studies,” 3/5/10).

Nearly a year before opening bids on several planned prison sites, Pennsylvania’s Department of General Services (DGS) signed a letter of commitment with the Building and Construction Trades Council (BCTC) which required DGS to award the bid to a member of the council, that is, a union contractor.

The letter states in the first paragraph, “DGS will retain the Keystone Research Center to conduct the necessary studies and investigations required for the development of a Project Labor Stabilization Agreement (PLSA) for each project meeting this criteria. IF such studies justify a PLSA, DGS will negotiate and enter into a PLSA with the regional building trades council affiliated with the Building Trades in each region of the Commonwealth of Pennsylvania where the project will be constructed” (emphasis added).

The DGS letter is dated April of 2008 and bears the signatures of James Creedon, Secretary of the DGS and Frank Sirianni, president of the Building and Construction Trades Council, which represents construction unions across Pennsylvania….

…Frank Sirianni also sits on the board of the Keystone Research Center (KRC), the organization which produced a report in 2009 recommending the use of project labor agreements (PLAs) for the construction of the prisons, specifically in Benner Township. Their report came after a study conducted by Kevin Moore for the same township. Mr. Moore’s report states “in this Region, at this time, there does not appear to be any data that would support the necessity for the PLA. The Regional construction market is incredibly slow, resulting in an overabundance of skilled labor throughout the Region, the Commonwealth and beyond. There is no competitor for DGS for skilled labor now, or on the 24-29 month horizon…under the present circumstances and wholly limited to the facts presented, a PLA is not necessary for DGS to complete this project as planned.”

…So before bidding even began on the prison sites, DGS had already committed to use a union-affiliated contractor through a PLA.

And after the first report failed to justify a PLA – the result the administration wanted – DGS took the corruption to a new level and used a study written by a Big Labor think tank to justify this PLA. TheTruthAboutPLAs.com independently exposed this corruption on July 9, 2009 and brought it to the attention of the media, PA lawmakers, interested stakeholders (“PA Government Cronyism Continues with Rockview Jail PLA“).

Where is the accountability in government? This PLA corruption has to end.

Despite predictions by politicians (specifically PA Senator Jake Corman), taxpayers and the local construction community that PLAs would increase the cost of construction and discriminate against more than eight out of 10 Pennsylvania construction workers (construction workers who do not belong to a labor union), the DGS initially required a PLA on this project. Now the DGS is rebidding SCI Benner Township without a PLA, yet local politicians are still not convinced a PLA is responsible for the unacceptably high costs. 

According to the article, Jon Eich (D), chairman of the Centre County Board of Commissioners, was surprised that bids were substantially higher than the allocated budget and isn’t sure a PLA is to blame.

“It’s not clear to me as to why the bids came in higher than expected,” he said. “It might be when the bids went out, typically there are good times to issue bids so that a contractor can put it into their regular work schedule. It might have been a very tight time frame to get the work done.”

Eich said other factors that may have driven the prices higher could have been the significant amount of skilled labor required and the design of the facility.

A project labor agreement was originally attached to the plan. Eich said the project labor agreement insures once the prison project starts, it will not be interrupted by work stoppages or labor disputes.

“Some people feel that’s the reason the prices came in higher,” Eich said. “I don’t think that is consistently what happens. That was some of the concern and when they re-bid, they’re going to adjust the terms somewhat.”

A bastardization of President Clinton’s 1992 political catch phrase is appropriate for this situation: “It’s the PLA, stupid!”

Politicians indebted to the political power of special interests such as Big Labor will not criticize PLAs. Or they just don’t get it. They have been misled into thinking that a PLA won’t cut competition and increase costs. PLA proponents argue that PLA projects are not closed to only union contractors and anyone can bid on these jobs. Therefore, a PLA does not impact competition and does not discriminate against non-union contractors and their workers.

While it is technically true that bidding is open to every contractor (regardless of labor affiliation), the fact remains that PLAs have a chilling impact on competition from non-union contractors. PLAs impose restrictive and inefficient union work rules and force contractors to contribute to union pension plans from which their employees will never benefit from unless they join a union.  Contractors have to factor double benefit costs into their bids to maintain existing benefits for their workforce.  All of these factors increase construction costs.

Maybe confused politicians need to read a PLA to understand how and why a PLA discourages non-union contractors and their skilled workforce from bidding on a PLA project.

TheTruthAboutPLAs.com dissected a sample PLA in a previous post (“Project Labor Agreement Basics: What is a PLA?” 4/24/09). We encourage curious minds to read that post and then apply those lessons to the SCI Benner Township PLA.

We’ve even gone through the trouble of highlighting the provisions offensive to non-signatory contractors and workers:

Paragraph 2.2: All subcontractors are bound to this PLA, yet they have no place at the table when negotiating these agreements.

Paragraph 3.1: “[Contractors] recognize the Trades Council and the Unions as sole and exclusvie barganing representatives of such employees within their respective jurisdictions working on the Project under the Agreement.”

PLAs take away workers’ rights.  Workers normally are permitted to choose union representation through a card check process or a federally supervised private ballot election.  With a PLA, unions are recognized as the exclusive bargaining representatives of non-union employees. The decision to elect union representation is made by the employer – when agreeing to participate in a PLA project – rather than the employees.

Paragraph 3.3:  “Other than the Project manager, Project superintendent and Project foreman, the remaining workforce shall be referred to the DBC in accordance with the job referral systems provided in the Collective Bargaining Agreements of the Unions…” 

PLAs require merit shop companies to obtain their workers from union hiring halls.  This means a merit shop company has to exclude their hard working employees from specific jobsites and exclusively use unfamiliar union workers.

Paragraph 3.6: Non-union workers have to pay “financial core” dues to the union in order to work on a PLA job. That’s right, they have to pay the union to work.

Paragraph 3.8 and 3.9: PLAs discriminate against local workers. In the event that a local union does not have enough members to fulfill the manpower requirements of the job, union workers from other local unions have preference over non-union local workers.

Paragraph 9.1(A): Contractors must pay contributions to the union-established employee benefit funds in the amounts designated in the appropriate craft/Local Union Collective Bargaining Agreement.  Workers will never receive these benefits unless they join a union and/or become vested. Thus, companies have to pay benefits twice: once to the union and once to the existing company plan to make sure their employees have benefits. There is no language that permits contractors to contribute to existing benefit plans instead of union plans.

These provisions are enough to discourage merit shop contractors from bidding on the SCI Benner Township project. If politicians still refuse to believe that a PLA is responsible for increased construction costs, perhaps they will see the light once the second round of bidding sans PLA produces more bidders and an on-budget project.

On May 19 and June 2, we reported that DGS hired Hill International – a PLA proponent in the Northeast- to oversee the construction of the two prisons that make up the Graterford project.  At DGS’ request, Hill International contracted with union-supported Keystone Research Center (KRC) to study the feasibility of a PLA on the Graterford project.

This study was a farce from the beginning.  As we have blogged about before, KRC is a mouthpeice of organized labor.  The President of the Pennsylvania Building and Construction Trade Division, AFL-CIO is on KRC’s Board of Directors.  In fact, Big Labor makes up about half of KRC’s Board.  This fact alone immediately calls KRC’s ability to study the feasibility of union-only project labor agreements objectively into question.  Additionally, Governor Ed Rendell (D) had already made it clear that he wants all six projects to be built with PLAs – essentially excluding the 80 percent of the commonwealth’s private construction workforce who decided not to join a labor union from working on the project.

It seems like DGS also believes the PLA feasibility study isn’t worth the paper KRC would print it on.  DGS decided not to wait for KRC to release their study and bowed to Governor Rendell’s pressure.  DGS’ July 14th Bulletin 3 shows that the Graterford prison project will be built with a PLA.

The Bulletin’s reporting also contained some very troubling information about DGS’ timeline for approving this PLA:

“There were assurances that there wasn’t going to be a PLA,” said Geoffrey Zeh, president of Associated Builders and Contractors’ (ABC) southeastern Pennsylvania chapter. “Then at the 11th hour, they come in.”

DGS’ decision in favor of union labor came to ABC’s attention only last week, but it was made in the spring of 2008. Another prison rebuilding project in Center County and another in Forest County also are designated as PLA-governed projects.

As Pennsylvania enters day 36 of a budget stalemate to close a $3 budget deficit, now is the time for good government – not political handouts to Big Labor.  In additional to discriminating against women, minorities and the 80 percent of the Pennsylvania workforce who decided not to join a union, PLAs increase construction costs by as much as 20 percent.  It is mind blowing that Governor Rendell is more than willing to propose the most significant income tax increase in Pennsylvania history to close the budget deficit, but he isn’t willing to curtail his own political handouts.

Here is one last excerpt from The Bulletin article on the Graterford PLA:

ABC, along with many of its affiliated companies and workers, has filed a lawsuit in Commonwealth Court alleging that DGS and the Department of Corrections violated procurement laws. DGS is expected to submit a response in short order.

Clearly, this fight is far from over.

We wrote about PA Senator Corman holding a protest alongside hundreds of local merit shop workers and contractors that will be shut out of building the SCI in Benner Township, Centre County, PA if a PLA is implemented by the DGS (“PA Senator Fights Rockview Prison PLA,” 6/24).

Well it looks like calls for fairness, efficiency and open competition have fallen on deaf ears as the PA DGS has issued a memo indicating that there will be a government mandated PLA on the Rockview prison project.

The decision to enter into a PLA for the Rockview prison comes under corrupt questionable circumstances, considering there are very few union members and union contractors operating in the Centre County region according to industry experts and government data.

The results of a a labor feasibility study, commissioned by PA DGS, to determine if a PLA is needed for for the Rockview prison project (“Labor Feasibility Study Re: Construction of a New 2,000 Cell L-3 Medium Security Prison SCI Benner Twp.,” June 2009) and ensuing political shenanigans, have raised the profile of corruption to a new level. The study, conducted by Kevin A. Moore, Esquire of Leisawitz Heller determined that:

…there does not appear to be any data that would support the necessity for the PLA.

…Accordingly, under the present circumstances and wholly limited to the facts presented, a PLA is not necessary for DGS to complete this project as planned.

You may recall that we blogged about The Pennsylvania Business Central article about PA Governor Ed Rendell’s (a huge supporter and beneificary of Big Labor’s political activities) desire for PLAs on state prison construction despite legitimate objections from advocates of local businesses and workers who want to build jails paid for by their tax dollars (“Big Labor’s Propaganda Machine to Decide Fate of Project Labor Agreements on PA Jail Construction,” 6/2).

Those familiar with the PLA debate know that politics almost always play a role in deciding whether or not PLAs should be mandated on government funded projects.

So it came as no surprise to learn that the DGS commissioned a second labor feasibility study for the Rockview prison project at taxpayer expense by Stephen Herzenberg and Mark Price of the Keystone Research Center (KRC), a union propaganda machine think tank that consistently produces papers and “studies” supporting pro-union policies.

We blogged about the KRC’s  stacked union board (“Fox in the Hen House,” 5/19):

“A majority of KRC’s 20 board members work for labor unions. Those members include Pennsylvania AFL-CIO Secretary-Treasurer Rick Bloomingdale, United Steelworkers principal Ike Gittlen and Pennsylvania State Building & Construction Trades Council President Frank Sirianni. At least 5 percent of KRC’s funding comes from organized labor.”

In addition, recent U.S. Department of Labor LM-2 reports document that the KRC has received at least $353,161 from organized labor from 2005 to 2008.

Predictably, the KRC paper, “Assessment of the Potential Need for a Project Labor Agreement Covering the SCI Benner Township Prison in Centre County, PA“ (June 2009), riddled with numerous inaccuracies and pro-union biased conclusions and assumptions worth dissecting at a later time, recommends a PLA.

Based on the analysis above, we find that a PLA would facilitate successful completion of the SCI Benner Township Prison in Centre County.

It is unclear if both studies were commissioned, written and released at the same time or if the KRC study was written after the Moore study results were released.

It is undeniable that the DGS decision to mandate a PLA on the Rockview prison project was politically motivated and partially “justified” by the KRC paper – a biased source.  The entire process  reeks of cronyism and corruption.

Let’s hope that other PA prison projects like the Graterford Prison in Skippack Township, Montgomery County, PA; the new prison in Fayette County; and four additional housing units in Crawford, Forest, Indiana and Northumberland counties are not subjected to a corrupt process and discriminatory PLA that will likely increase the cost of construction between 14 and 20 percent and eliminate opportunities for PA construction workers and their employers.

We wrote about the aburdity of the Pennsylvania’s Department of General Service (DGS) permitting Hill International to hire the union propaganda machine Keystone Research Centerto produce a PLA feasibility study on the Graterford State Prison Project (“Fox in the hen House,” 5/18).

We also blogged about The Pennsylvania Business Central report that PA Governor Ed Rendell wants PLAs on state prison construction (Big Labor’s Propaganda Machine to Decide Fate of Project Labor Agreements on PA Jail Construction , 6/2).

Yesterday The Lockhaven Express ran a story about a press conference held by State Senator Jake Corman in opposition to a proposed PLA on $200 million worth of construction for the State Correctional Institution at Benner Township, adjacent to the Rockview prison (Corman: Local contractors shut out of Rockview prison project,” 6/23).

Surrounded by contractors and hundreds of employees opposed to PLAs, Sen. Corman made a strong case against PLAs so the PA DGS and Governor Ed Rendel will not implement a PLA on this project.

Corman argued that use of PLAs on the job will deny many local companies the opportunity to bid and bring much-needed work to the county amid the nationwide economic downturn.

The Republican senator from Bellefonte said about 80 percent of the contractors and construction workers in Centre County have decided not to unionize, a right granted by the National Labor Relations Act.

Corman said the DGS, specifically its secretary, James Creedon, commissioned two surveys to determine if Centre County has a sufficient, nonunion workforce to build the prison, or if the project needs a PLA.

“Both the reports he commissioned say (a PLA) is not necessary in this area to complete this work in a timely fashion,” Corman said. “Was this done on a public policy perspective? Was this decision made on a business perspective? Or was this decision made on a political perspective?

“It is clear the use of a project labor agreement discriminates against 80 percent of the workforce and the workforce is simply asking for an opportunity to bid on a project,” he continued. “At a time when local businesses are sorely in need of new work to stimulate our local economy, it’s incomprehensible to me to shut them out of the process.”

Further, Corman said, giving more companies the opportunity to bid on a project naturally lowers prices.

Among the contractors on hand were Nancy Gibbons, president of R&R Construction, and Alison Kurtz, president of Ameron Construction.

Gibbons said the recession has left the entire construction industry “scrambling for contracts” to keep its employees working, and believes union affiliation should not be a determining factor in awarding publicly-funded construction contracts.

“Non-union companies have completed projects this size and magnitude on time and under budget,” she said. “All qualified contractors should be guaranteed equal opportunity for working on this project without discrimination.”

Kurtz said her business employs about 50 people, all non-union, and since the “collapse” of the housing market, it has become increasingly difficult for the firm to stay busy.

“I’m extremely disappointed in the governor’s decision to include a PLA on the Rockview prison job,” she said. “The use of a PLA virtually guarantees that my business and many of my competitors will be excluded from bidding on or working on this project.

“My workers will sit at home and watch as the state trucks in union workers from inside or outside the state to fill local construction jobs,” Kurtz continued. “The unintended result of the decision to use a PLA will be increased unemployment at home and increased construction costs for taxpayers. In this era of budget deficits, it’s unconscionable waste the taxpayers dollars.”

Will Governor Rendell and the PA DGS listen to constituents and promote the interests of all taxpayers by ensuring free and open competition on the Rockview prison project?  TheTruthAboutPLAs.com hopes that politics and narrow special interests won’t trump common sense and fairness.

NO PLA on Rockview.

Sen. Corman’s news release.

Sen. Corman on Rockview Prison PLA Proposal (wmv)

Centre Daily Times (6/23) report on Rockview prison PLA.

The Commonwealth of Pennsylvania’s Department of General Services (DGS) hired Hill International to oversee the construction of at least two of the prison facilities. (It should be noted the Hill International also has a storied history of recommending PLAs on projects in the Northeast via biased pro-PLA reports).

As if it wasn’t clear PA bureacrats will do everything in their power to implement PLAs and prevent qualified local workers and contractors from building PA jails, The Pennsylvania Business Central reports that PA Governor Ed Rendell wants PLAs on state prison construction despite legitimate objections from advocates of local businesses and workers who want to build jails paid for by their tax dollars.

“PLAs discriminate,” said Dave Remick, president of ABC Central PA. “Entering into a PLA significantly reduces the number of construction companies considering to bid and work on the project. More than 80 percent of the construction workforce in Pennsylvania is not signatory to a union.”

The Chamber of Business and Industry of Centre County (CBICC ) opposes PLAs, according to Dan Abruzzo, vice president for government affairs.

“The use of PLAs will knock out non-union companies that would like to bid on the work,” he said. “Companies will have to contribute to the union whether they have union employees or not.  In Centre County, we have 750 commercial construction companies that are within an 80-mile radius. There are 21,000 workers who are employed by those companies almost all are non-union.”

A new 2,000-bed prison is planned for the Rockview area, which makes the PLA decision an urgent issue, Abruzzo suggested.

“We are trying to create jobs in and near Centre County,” Abruzzo said. “With PLA’s in place, union contractors will come in from Philadelphia or Pittsburgh. That will take paychecks out of this county and region.”

Both Remick and Abruzzo agree that the taxpayer will suffer because PLAs do not encourage a competitive bidding process.

“Non-union companies are not going to want to bid on jobs that require them to hire from the union hall,” Abruzzo said.

Remick agreed. “Local merit shop contractors who are not signatory to a union have performed hundreds of millions of dollars of work on time and on budget with no Project Labor Agreements in place. They put local people to work. Why is the state doing a labor study when merit shop contractors already perform 80 percent of the construction work here in Pennsylvania?”

According to Remick, PLAs will lead to higher costs for the taxpayers.

“Things are happening so fast, it’s going to be difficult to stop,” said Abruzzo. “This flies in the face of what we are trying to do here in Centre County. It won’t help Centre County’s workers or economy. Based on my experiences in the industry, there won’t be many contractors who can do the work, unless they convert to union employees.”

TheTruthABoutPLAs.com agrees with the above arguments against PLAs and will be monitoring these jail projects closely.