The Franklin County Commission instituted a PLA mandate as a condition of performing work on the $45 million Hall of Justice renovation project in downtown Columbus. The Columbus Dispatch covered the dispute over the PLA in May. Here are the highlights:

Franklin County officials are defending an agreement with local labor unions that would require anyone working on a $45 million renovation project to pay union dues and pay into union benefit programs, whether or not they are union members.

Members of the Columbus/Central Ohio Building and Construction Trades Council brought the idea to commissioners.

In exchange for requiring all workers on the project to pay union fees, and for requiring successful bidders to recruit from local union halls if they need additional workers, the county gets a guarantee that union members will not strike or walk out and employers won’t lock out workers, to ensure that the project finishes on time.

<snip>

The agreement already has spurred one letter to The Dispatch, in which the writer, a nonunion construction worker, wrote: “Commission President John O’Grady and the rest of the commissioners should be ashamed of themselves for abusing our tax dollars and submitting to this kind of forced wasteful spending.”

Commissioners have faced criticism before for what some said was a too-cozy relationship with unionized labor.

Low-bidders who were passed over for contracts on the county’s dog shelter, baseball stadium and new courthouse said the county’s previous evaluation process disqualified them because of minor wage disputes, which made it harder for non-union shops to get the jobs.

The Ohio Supreme Court later ordered the county to refine and clarify its vetting process, which it has.

County Administrator Don Brown said the agreement in no way makes it harder for non-union companies to bid on and get contracts for the renovation of the now-vacant, 10-story former court building.

He said while the employees of nonunion businesses would have to pay into the unions, the employers could choose to make that contribution so it would not come out of workers’ pay.

In addition, Barton Hacker, president of the Central Ohio Chapter of Associated Builders and Contractors (ABC), laid out the problems with this unnecessary mandate in an editorial published by the Columbus Dispatch on May 23. Here are the highlights:

How many times must taxpayers be forced to waste 20 percent or more on these discriminatory contracting schemes?

What possible excuse can Commissioner John O’Grady give that would justify wasting $8 million on a $45 million renovation construction project? O’Grady says PLAs ensure the project will finish on time with a guarantee of no labor strikes. That makes no sense. Only union labor goes on strike.

The commissioners allege union workers construct projects better because they are better trained. But how have three recent project-labor agreement projects worked out in Ohio? Springfield High School in Summit County is the last school to be constructed under a mandatory PLA. The school just finished “on time” but can’t open, because the floor shakes throughout the building.

The casino parking decks in both Cleveland and Cincinnati were constructed with union-only PLAs. Both parking decks partially collapsed during construction. Is that what they mean by “quality”?

Truth be told, union and merit-shop apprenticeship programs are both certified and supervised by the U.S. Department of Labor, and more than 85 percent of all commercial construction in Ohio is done by merit shops (nonunion contractors). Project-labor agreements are a thinly veiled ploy used by elected officials to steer public-works contracts to their union allies. When they do, 85 percent of all contractors are effectively barred from bidding. This reduces the number of bidders and drives up cost.

The taxpayers lose by spending more and getting less. The city of Lorain recently recognized this to be the case. It repealed its project-labor-agreement ordinance because officials learned from three years of experience that PLAs drove up costs while dramatically reducing the amount of local bidders winning the bids.

How long, and how much of the taxpayers money, will it take for the Franklin County commissioners to learn the same lesson?

As mentioned in both the Dispatch’s coverage and Hacker’s editorial, this is not the first time Franklin County officials have tried to institute a PLA mandate. In 2006, county officials attempted to mandate a PLA on the $55 million Huntington Park project. County officials ultimately dropped the government-mandated PLA in 2007 in the face of mounting public pressure and work on the project was performed by merit shop and union contractors working side by side.

Additionally, the Franklin County Council attempted to institute a PLA mandate on $110 million courthouse project in 2006. The proposed mandate was tabled after only months of consideration due in large part to the ABC Central Ohio Chapter’s efforts to educate the public on the negative impact of wasteful and discriminatory PLA mandates.

These are not the only instances where merit shop contractors in Ohio were forced to confront PLA mandates. As we have chronicled on this blog, the Ohio School Facilities Commission (OSFC) aggressively promoted PLA mandates to local school districts during the Strickland administration. The tactics used by Richard Murray, head of the OSFC during the Strickland administration, were so unprofessional and over the top that he was rebuked in a scathing report by the Ohio Inspector General and numerous media outlets criticized his behavior and/or called for his resignation. Murray resigned just prior to Gov. Kasich’s inauguration. The OSFC, under new leaders appointed by Kasich, banned government-mandated PLAs on projects that receive OSFC funds.

There is no question that Ohio residents don’t like government-mandated PLAs, and the Ohio construction industry doesn’t need them to build projects on-time and on-budget. Here at TheTruthAboutPLAs.com, we strongly encourage the Franklin County Council to remove the PLA mandate from the Hall of Justice renovation project.

Learn more about the history of PLA mandate in Ohio from our earlier posts.

The post Central Ohio PLA Mandate Evokes Outcry and Opens Old Wounds appeared first on The Truth About PLAs.

To review and respond to the survey, click here.

All responses must be submitted to USACE contact Bjorn Hale (bjorn.t.hale@usace.army.mil) by 10 AM EST on Monday, April 29, 2013.

TheTruthAboutPLAs.com encourages the merit shop contracting community to respond to this PLA survey. Tell the USACE that government-mandated PLAs reduce competition, increase costs, and impede the economy and efficiency of government contracting.

For more information or assistance responding to the PLA survey, contact us here.

USACE and other federal agencies have issued similar surveys requesting information about the potential use of PLAs on construction projects across the country as a result of regulations and federal agency policies stemming from President Obama’s pro-government-mandated PLA Executive Order 13502, which encourages federal agencies to mandate PLAs on a case-by-case basis for federal construction projects exceeding $25 million in total cost.

TheTruthAboutPLAs.com has taken the opportunity to respond to all PLA surveys – more than 150 during President Obama’s first term – and encourages the merit shop contracting community to do the same. Responding with accurate and timely information is critical and effective at creating more work for qualified merit shop contractors and their skilled employees.

To stay up to date on future federal PLA survey alerts, “Like” our Facebook page at Facebook.com/thetruthaboutplas and follow us on Twitter at Twitter.com/truthaboutplas.

To help TheTruthAboutPLAs.com continue to ensure fair and open competition on federal, state and local construction projects funded by taxpayer dollars, make a donation here.

The post USACE PLA Survey For Ohio’s Wright-Patterson Air Force Base Museum Hangar Due April 29 appeared first on The Truth About PLAs.

In February 2000, Wyoming County, W.Va., voters approved a $7 million bond for $5 million worth of construction for Westside High School and $1 million for outdoor athletic fields at both Westside High School and Wycoming County East High School.

On May 8, 2000, the board of education mandated a union-favoring PLA on construction funded by the bond. Many speculated the PLA was mandated via a back room deal in exchange for construction trade unions’ assistance in getting the school bond measure passed by voters.

After months of opposition by contractors and taxpayers against the discriminatory PLA mandate, the county opened bids subject to a PLA mandate Dec. 12, 2000.

As expected, officials experienced weak competition and bids exceeded the project’s budget by roughly $1.5 million.

On Dec. 18, 2000, officials reconvened and voted to rebid the project without a PLA.

When PLA-free bids were opened, the results were not surprising. (See primary documents here).

Without a PLA mandate, the number of bids increased by 67 percent (15 bidders without a PLA vs. nine bidders with a PLA) and costs decreased by 11 percent ($12.889 million with a PLA vs. $11.482 million without a PLA).

It should be noted this project was covered by state prevailing wage laws so wage and benefit rates were the same with or without the PLA mandate and school construction plans were identical. The only difference was the PLA mandate.

Research Supports Anecdotal Evidence

Four subsequent studies researching the effect of PLA mandates on a large sample of public schools subject to state prevailing wage laws in California, New York, Connecticut and Massachusetts found results similar to this West Virginia anecdote: PLA mandates typically increased costs between 12 percent and 18 percent compared to similar non-PLA projects.

Likewise, research conducted by the New Jersey Department of Labor and Workforce Development found PLA mandates on New Jersey schools increased construction costs by an average of 30 percent and PLA projects took an average of 100 weeks to complete, in contrast to 78 weeks for non-PLA projects (learn more here).

Back to the Future: School Projects Bid With and Without PLA Mandates Prove PLAs Reduce Competition and Increase Costs

TheTruthAboutPLAs.com has collected more than a dozen other examples of federal, state, and local projects that were bid with and without PLAs. In every instance, either fewer bids were submitted under the PLA mandate than were submitted without it or the costs to the public entity went up—or both.

Here are recent notable examples involving school construction:

Connecticut

This spring, Middletown, Conn., may rebid the Maloney High School project after bids subjected to a PLA mandate busted budgets by 13 percent and reduced competition from qualified local firms and their skilled employees. Two school projects in Middletown, the Snow Elementary school in 1996 and the Middletown High School in 2005, benefited from increased competition and reduced costs once the projects were rebid without PLA mandates.

Kentucky

In Kentucky, the Carter County Board of Education rescinded a controversial PLA mandate on the Tygart Creek Elementary School after the school district failed for the second time to receive construction bids within the $12 million scope of the project. Bids opened in October 2010 exceeded estimates by about $1.1 million. When first advertised in late 2009, the project’s low bids were more than $2 million above budget. In addition, the PLA mandate was subject to a legal challenge.

In the face of the PLA-related lawsuit, increased costs and reduced competition resulting from the PLA mandate, the PLA was removed in time for the third and final round of bidding. PLA-free bidding resulted in an $11.6 million contract awarded within the project’s $12 million budget, for a net cost savings of $1.5 million.

Ohio

In 2010, the Ohio School Facilities Commission was forced to rebid a planned PLA project to replace the state’s schools for the deaf and blind after only two firms bid on the general trades contract work, with the lowest bid exceeding the estimated cost by 44 percent. After removing the PLA, 12 firms bid for the general trades work, with a low bid 20 percent under the commission’s estimate.

Massachussetts

In 2006 the City of Fall River, Mass., adopted a PLA on multile school construction projects.  As a result, fewer than half of the contractors who were prequalified by the city for the job ended up submitting bids. After bids for the projects came in millions of dollars over budget, Fall River mayor Edward Lambert was forced to abandon the PLA mandate and rebid the project without a PLA. Now that the project was truly open to competition from qualifed union and nonunion firms, the number of bids nearly doubled and the prices plummetted.  Fall River Councilor Joseph Camera wrote:

“With the first rebid, 64 bids came in, compared to 21 when the PLA was used.  Furthermore, the costs were cut by 17 percent, and every trade had multiple bidders, even electrical.”

Fall River taxpayers saved $8.5 million from a combination of lower bids and the need to borrow less money. A December 2006 report by the Beacon Hill Institute at Suffolk University, “Project Labor Agreements and Financing Public School Construction in Massachusetts,” reviews this real-world case study supporting BHI’s previous research on the effect of PLAs on school construction costs. This packet of articles provides additional information.

California

The Oakland Unified School District put out a call for bids on the Burkhalter Elementary School in 2002 and received a low bid of $1.8 million (out of seven bidders) for the construction work. Prior to contract award, however, the school district entered into a PLA for all of its school projects, resulting in rebidding the work with a PLA mandate. During the second round of bidding a week later, only three companies bid on the PLA project. The low bid exceeded $2.2 million, more than $437,000 (24 percent) higher than the original non-PLA bid of $1.8 million. In addition, the winning firm increased their bid by $167,000 from their first bid. (Learn more here).

In addition, there are similar examples of school projects bid with and without PLAs in the 90s from Massachusetts, Missouri and Ohio.

Finally, a total of 14 non-school projects bid with and without PLAs have experienced similarly reduced competition and increased costs.

When considering whether to mandate PLAs on taxpayer-funded projects, it is wise for lawmakers go back in time to consider evidence to predict the future.

Update 4/24/13: Here is an apples-to-apples comparison of a federal construction project, the U.S. Department of Labor’s Manchester, New Hampshire, Job Corps Center, bid with and without a PLA. Bid results prove PLA mandates reduce competition and increase costs.

The post Great Scott: Projects Bid With and Without PLA Mandates Show PLAs Increase Costs and Reduce Competition appeared first on The Truth About PLAs.

Ohio’s Lorain City Council voted March 7 to repeal a project labor agreement (PLA) mandate for all city construction projects. It was replaced by a measure requiring contractors to comply with a workforce participation plan that includes a local hire mandate of 25 percent.

Courtesy of Wikipedia

City leaders learned firsthand what the merit shop community already knows: PLA requirements reduce competition from qualified local contractors and harm their skilled local employees.

According to a Lorain Morning Journal editorial, this policy change was the right move (“EDITORIAL: Lorain makes another smart move toward a better future for itself,” 3/10/13):

Lorain is on a roll when it comes to acting like a smart city that is determined to improve its place in the world as a hometown and as a place to do business…

…The mayor’s plan helps Lorain by encouraging more companies — both union and non-union — to bid on city projects. That increases competition for the city’s work, and for using the local labor force. It will help Lorain to get the best price and to make the most of its tax dollars.

The Workforce Participation Plan replaced a 2011 Project Labor Agreement that one critic described as “forced unionism.” The PLA discouraged non-union companies from bidding on city projects by raising their costs. Restrictive PLA requirements included forcing non-union contractors pay a union for worker benefits that the workers wouldn’t be eligible to receive until after working 450 hours. Also, non-union workers would have to join a union after a week on a job. A PLA rule requiring 75 percent local labor on projects was tough for contractors to meet.

The mayor’s new Workforce Participation Plan sets the local labor share at 25 percent, and it removes other costly disincentives, making Lorain’s projects more attractive for bids from more companies…

…With approval of the mayor’s Workforce Participation Plan, Lorain presents a more-welcoming face toward all types of companies. Lorain also, once again, shows its new willingness to make smart choices that will help to bring residents a better future.

Here are the highlights from the Lorain Morning Journal‘s coverage of the new plan:

Mayor Chase Ritenauer has said the agreements have discouraged contractors from bidding on Lorain’s public jobs, which in turn drives up costs of those projects, such as road and waterline repairs.

Contractors including leading national builders of water tanks have told city officials they will not bid on a job to build a water tower on Lorain’s west side due to PLAs, said Safety-Service Director Robert Fowler.

Kokosing Construction Co. Inc. officials also have said the company will not bid on Lorain jobs, Fowler said. Westerville-based Kokosing Construction is Ohio’s largest contractor, according to its website.

So far three contractors have requested specifications to replace waterlines under West 21st Street and a major east-west thoroughfare in Lorain, Fowler said. Consultants working with the city claimed a similar project east of Cleveland drew 15 bidders, he said.

The loss of interest from potential bidders leaves Lorain at a competitive disadvantage because it is not in the best interest of the community to pay more tax dollars or utility fees for projects, Fowler said.

“Our construction is stymied,” he said.

<snip>

Despite the good intentions, Lorain’s PLAs have discouraged non-union contractors from bidding on public jobs, said John Falbo Jr., estimator for Terminal Ready-Mix Inc. of Lorain.

Non-union shops either skip the jobs or must inflate their prices to cover benefit costs paid to the union, Falbo said. The workers also must join the union or stop working on jobs after seven days, he said. The contractor also must pay the union to cover benefits such as health insurance for the workers, but the workers don’t qualify for benefits until after working with the union for 450 hours, he said.

“Straight up, that’s what this is all about,” Falbo said. “It’s forced unionism.”

When companies bid on municipal projects, the specifications and bid documents can run into hundreds of pages, Falbo said. Bidders, whether union or non-union shops, must offer supporting evidence and a bond ensuring they are qualified and can complete a job, he said.

“The PLA really is impactful to the companies by requiring them to be signatories to the union for the duration of that contract,” Falbo said.

This is a win for local taxpayers and the 73.8 percent of Ohio’s private construction workforce that chooses not to join a labor organization. The city already has accepted bids for upcoming projects from local contractors that were willing to comply with local hiring goals, but not Big Labor’s demands as included in the PLA.

Here at TheTruthAboutPLAs.com, we appreciate the willingness of city leaders to take a stand for open competition and taxpayer value on public construction projects.

The post Buckeye Taxpayer Victory: Lorain City Council Repeals PLA Mandate appeared first on The Truth About PLAs.

To review and respond to the survey, click here.

All responses must be submitted to USACE contact Bjorn Hale (bjorn.t.hale@usace.army.mil) by 10 AM EST on Friday, March 15, 2013.

TheTruthAboutPLAs.com encourages the merit shop contracting community to respond to this PLA survey. Tell the USACE that government-mandated PLAs reduce competition, increase costs, and impede the economy and efficiency of government contracting.

For more information or assistance responding to the PLA survey, contact us here.

USACE and other federal agencies have issued similar surveys requesting information about the potential use of PLAs on construction projects across the country as a result of regulations and federal agency policies stemming from President Obama’s pro-government-mandated PLA Executive Order 13502, which encourages federal agencies to mandate PLAs on a case-by-case basis for federal construction projects exceeding $25 million in total cost.

TheTruthAboutPLAs.com has taken the opportunity to respond to all PLA surveys – more than 150 during President Obama’s first term – and encourages the merit shop contracting community to do the same. Responding with accurate and timely information is critical and effective at creating more work for qualified merit shop contractors and their skilled employees.

To stay up to date on future federal PLA survey alerts, “Like” our Facebook page at Facebook.com/thetruthaboutplas and follow us on Twitter at Twitter.com/truthaboutplas.

To help TheTruthAboutPLAs.com continue to ensure fair and open competition on federal, state and local construction projects funded by taxpayer dollars, make a donation here.

The post USACE PLA Survey For Ohio’s Wright-Patterson Air Force Base Heating System Project Due March 15 appeared first on The Truth About PLAs.

The Lorain Morning Journal’s latest editorial opposing these PLA schemes makes the argument that the Lorain Council is so controlled Big Labor that they refuse to conduct an experiement that could save taxpayers millions of dollars and ensure fairness in local contracting on a $50 million wastewater project (OUR VIEW EDITORIAL: Lorain Council votes to ignore potential savings of millions,” 3/23/11):

The $50 million project to put in a wastewater conveyance tunnel along the Black River is vital for Lorain’s future.

The tunnel is the first step for allowing Lorain to construct a regional treatment plant. Since the money to pay off the state loan financing the project is coming from water and sewer fees paid by residents, city officials need to keep the costs as low as possible.

Unfortunately, City Council Monday night took action certain to increase those costs by millions of dollars when it decided to advertise for bids requiring project labor agreements. Supporters of PLAs say they provide work for local union workers. Opponents say the agreements drive up costs and decrease competition.

Councilman-at-large Dan Given wanted council to advertise for tunnel bids two ways — both with and without the PLA and see how the costs compare. With virtually no discussion, a majority of council rejected Given’s sensible suggestion and approved legislation requiring bidding with the PLA.

Given, who voted against the measure, was livid. “Even if they blow this by 10 percent,” he said, “that’s $5 million that’s wasted, which is totally unacceptable.” He added, “I never heard a taxpayer say, ‘Here, you should spend another million dollars.’ Instead they’re saying, “You better spend the money right.” How true.

With communities and counties around the state and nation desperately looking for ways to cut costs, Lorain city leaders are risking millions in overspending to kowtow to labor at the expense of Lorain citizens living on a tight budget.

Given wants to introduce new legislation that calls for seeking bids with and without the PLA on the tunnel project. He should. And City Council should approve it to make best use of Lorain taxpayers’ money.

Big Labor and their chums on the Lorain City Council are clearly afraid of competition.

They know that if the wastewater project were bid with and without a PLA at the same time, the results will definitively demonstrate that PLAs increase costs and reduce the pool of qualified local companies competing for public works contracts.

The results of this experiment will expose the Lorain Council’s blatant waste of taxpayer dollars, abuse of fiscal responsibility and unfortunate special interest favoritism.  Afterall, they know what happened with the Ohio School for the Deaf, the Ohio School for the Blind, and the Elyria City Hall projects when they were initially subject to a government-mandated PLA. These projects had to be rebid without a PLA after the first round of bids busted budgets and attracted few competitors.

In the face of clear evidence that PLAs increase costs on these three projects, Big Labor spin doctors attempted to claim that the PLA-free offers experienced reduced costs because of cheaper material prices, revised schedules and plans.  Even if that were true, those excuses fail to explain why the three projects received more competition from qualified contractors once the PLAs were removed.

It’s the PLA, stupid!

UPDATE: On Monday, 3/28, by a 6-3 vote, the Lorain City Council rejected legislation calling for tunnel bid specifications to permit bids without a PLA.

They Can’t Compete, So They Cheat. Info on Job Targeting.
Should the Lorain City Council come to their senses and bid the wastewater project with and without a government-mandated PLA, they should prohibit the use of union job targeting/market recovery funds in order to conduct an accurate experiment about the impact of PLAs on construction costs and competition.

What are union job targeting funds?

For example, as documented succinctly by the Cement Masons and Plasteres Union Local 528 (pdf), job targeting programs, also known as “market recovery” funds, collect fees from union members for the purpose of providing subsidies to union contractors on projects where they face competition from merit shop contractors.  Like PLAs, the subsidies are designed to give union contractors an unfair bidding advantage on projects.

The money collected from union workers is pooled into a Market Recovery Fund controlled by union bosses.  Typically, a union contractor reaches an agreement with the union bosses that says that the Market Recovery Fund will subsidize the contractor $X for a specific job to underbid a merit shop competitor.  If the contractor is successful and wins the job, the contractor receives job targeting money from the union, funded by past deductions from every union worker’s wages,  in exchange for using union labor and paying union rates. 

Obviously, job targeting money would skew the results of Lorain’s PLA experiment on the wastewater facility.

If you think job targeting isn’t happening in your community or isn’t a widespread problem, think again.

An April 2009 study published by George Mason University’s John M. Olin Institute for Employment Practice and Policy found that construction industry unions spent more than $1 billion since fiscal year 2000 in job targeting schemes.

In addition to this staggering number, according to this summary, the study also reported that:

• Job targeting programs needlessly increase public construction costs.
• Job targeting programs give unions and their subsidy recipients an unfair advantage in the bidding process.
• Job targeting programs are often unknowingly funded by taxpayers.

The Labor Management Reporting and Disclosure Act (LMRDA) requires unions to disclose job targeting expenditures on financial reports (known as LM-2s) filed with the U.S. Department of Labor’s Office of Labor Management Standards (OLMS).  You can review these disclosure forms at the OLMS Public Disclosure Page and find contractors that have received job targeting money during the reporting year. Unfortunately, you won’t be able to tell which jobs were subject to job targeting schemes in previous reporting years and you won’t be able to tell which contractors have received job targeting money in the current reporting year.

If Lorain City Council is wise enough to rebid the project with and without a PLA, they must forbid the use of job targeting funds. If it is discovered that a union contractor received job targeting funds on this experiment, they should be debarred from public contracting for a defined period of time, fined, and forced to pay restitution to all competing contractors and local employees.

ICYMI, here are the Lorain MJ’s previous stories on PLAs:

Looking at future of Lorain: Project labor agreements evaluate how to carry out city jobs, 12/7/10
Lorain Mayor Supports PLAs, 1/28/11
Lorain to resume talks on project labor agreements, 2/26/11
Sample PLA on page 33
Lorain Council approves PLAs, 3/8/11
Councilman Bret Schuster Defends PLAs, 3/26

The post Editorial: Why Not Bid Lorain Wasterwater Project With and Without a Government-Mandated Project Labor Agreement? appeared first on The Truth About PLAs.

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

It is important to express your opposition to government-mandated PLAs today before they are mandated or encouraged on future USACE and/or state and local projects in your community.

All survey responses regarding the Wright-Patterson AFB in Dayton, OH must be submitted to Tom Dickert no later than 1:00 PM Louisville Time (EDST) on March 22, 2011.

The USACE and other federal agencies have issued PLA surveys as a result of President Obama’s pro-PLA Executive Order 13502 and federal regulations implementing the discriminatory and costly order. The order and regulations encourage federal agencies to mandate anti-competitive and costly PLAs on a case-by-case basis on federal construction projects exceeding $25 million in total cost. The survey results are an important source of information used to determine whether a PLA is appropriate for federal projects.

In the past few months, the USACE has issued multiple surveys requesting information about the potential use of PLAs on construction projects in numerous USACE districts across the country.  ABC National and construction stakeholders and contractors responded to these surveys.

Update 3/22: Here is ABC National’s letter to USACE, Louisville, KY District concerning Wright-Patterson AFB PLA (survey) (3/22/11).

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

• Letter to USACE, Ft. Worth, TX District concerning Lackland AFB projects (survey) (3/7/11)
• Letter to USACE, New York District on multiple projects at West Point in Orange County, NY (2/18/11)
• Letter to USACE, Ft. Worth, TX District concerning Unaccompanied Enlisted Personnel Housing projects at White Sands Missile Range, NM (2/3/11)
• Letter to USACE, Ft. Worth, TX District concerning Brigade Combat Team Barracks at Fort Jackson, SC (2/3/11)
• Letter to USACE, Ft. Worth, TX  District concerning future projects in USACE Ft. Worth District boundaries (12/14/10)
• Letter to USACE Mobile, AL District concerning Ft. Rucker airport hangar and Mobile, AL projects (11/24/10)
• Letter to USACE Honolulu, HI District concerning four projects (11/23/10)
• Letter to USACE Louisville concerning Danbury, CT project (11/4/10)
• Letter to USACE Louisville concerning Ft. Campbell, KY area projects (11/1/10)
• Letter to USACE Savannah District (10/28/10)

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

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

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

Additional helpful links:

• PLA Final Rule Takes Effect Today: Let the Waste, Cronyism and Discrimination Begin (provides a helpful overview about the current state of federal PLAs and the Obama order.)
• Project Labor Agreement Basics: What is a PLA?
• Get the Truth About PLAs
• ABC National’s Main Comments to the FAR Council’s Proposed Rule
• ABC Member Survey/Comment Supplement to Main Comments
• ABC National Comments Specifically Addressing the Regulatory Flexibility Act

The post USACE Issues Project Labor Agreement Survey for Wright-Patterson Air Force Base Hospital appeared first on The Truth About PLAs.

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 post Open Competition Legislation on the Move! appeared first on The Truth About PLAs.

The OSFC also overturned a Strickland era policy encouraging school districts to require contractors to adhere to prevailing wage requirements on these projects as well.  Visit here for more information on the pricy impact of prevailing wage requirements on construction costs.

This is a HUGE win for Ohio taxpayers, as the majority of Ohio’s government-mandated PLAs have come on school construction projects.

Here are the highlights from the Columbus Dispatch’s coverage of the OSFC vote:

In another blow to organized labor and the legacy of former Gov. Ted Strickland, the Ohio School Facilities Commission yesterday repealed policies favoring unions for school-construction projects.

The commission, now controlled by appointees of GOP Gov. John Kasich, unanimously approved a resolution stating it no longer would approve contracts in which those bidding for projects were required to designate who would do the work, how much they would be paid or other mandates.

The move reverses policies enacted under the former Democratic administration that allowed districts to require the payment of prevailing wages and the use of project labor agreements mandating the employment of union workers.

“We hope to make our scarce tax dollars go farther,” said Ohio Budget Director Timothy S. Keen, who chairs the commission.

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“This returns us to how the commission operated for 10 years,” he said, adding that the move will allow “free and open competition” for school-construction work.

Ohio has spent nearly $9 billion to build hundreds of schools since the commission was launched in 1997.

In a letter to the commission supporting the move, state Auditor Dave Yost said “these agreements, however well intentioned, may increase construction costs for school districts at a time when they can least afford it.”

By the way, don’t think PLAs increase construction costs?  There are a couple great examples of the impact of PLAs in Ohio, where projects have been bid with and without PLAs.  Check out our posts on the Euclid schools and the Schools for the Blind and Deaf.

Here at TheTruthAboutPLAs.com, we commend the OSFC for standing up for taxpayers in Ohio.  By allowing fair and open competition to dictate how school construction is awarded guarantees that taxpayers get the best construction at the best price.

We also want to commend State Auditor David Yost for his work to defend taxpayers.  On Feb. 24, Auditor Yost sent a letter to the OSFC articulating his position that PLAs do not make fiscal sense.  In his letter, Auditor Yost called out the Springfield Local Schools in Summit County, who decided to go forward with a PLA requirement despite their fiscal emergency brought on by significant budget deficits since 2007.

The common sense exercised by the OSFC in prohibiting PLAs on school construction it funds will serve the people of Ohio well.  We urge the Ohio House of Representatives to use the same good fiscal sense when they hear H.B. 102, which will be heard by the House Commerce and Labor Committee on March 2.

The post Ohio Leaders Refuse to Build Four Schools for the Price of Five appeared first on The Truth About PLAs.

Here is the text from Rep. Young’s press release, issued February 11:

YOUNG SPONSORS LEGISLATION TO REDUCE THE COST OF PUBLIC CONSTRUCTION

Columbus – State Representative Ron Young (R-Leroy) today sponsored legislation to reform Ohio’s publicly funded construction rules.

“Government in Ohio needs to learn to do more with less. In order to balance the budget, it is important we find ways to deliver critical services while reducing costs. This legislation is designed to reduce the cost of public construction in Ohio by changing the way we award construction projects. Currently many public entities in Ohio require bidders for construction projects to include what is known as a Project Labor Agreement (PLA) as part of their bid,” Young said. “In general, PLA’s work against the free market system by limiting the number of bids and therefore reduce competition. Most PLA’s require the use of union labor and therefore the preponderance of bids are from union construction companies. Since almost 85% of Ohio’s construction workforce is non-union competition is severely limited by a PLA requirement. Public entities requiring a PLA for a project are in effect paying a very expensive and often unnecessary premium for construction services.”

Specifically this legislation would prohibit state agencies from requiring or prohibiting PLA’s as a condition of performing public works. The legislation would also prohibit the appropriation of state funds for public works when political subdivisions require or prohibit PLA’s.

Young cited an example from November 2010 when the Ohio School Facilities Commission bid a dormitory construction project for the Ohio State School for the Blind and Ohio School for the Deaf with and without a PLA.

First the project was bid with a PLA requirement. However, a small number of bids were received and the lowest bid exceeded the project budget. A new request for bids was released, this time without a PLA requirement.

The winner of the non-PLA bid was 22% lower and six times the number of competitive bids was received. According to Young, this result is in line both with numerous academic studies and with significant anecdotal data collected by various groups.

The amount of potential savings from this legislation is significant. Experts estimate that at least $400M was spent on PLA projects in Ohio over the last two years. If this is the case, Ohio could have saved over $100M during this period had this legislation had been in place.

The legislation is modeled on a George W. Bush-era rule that similarly regulated PLA’s at the Federal level and was found to be Constitutional by the courts.

Rep. Young said he and the bills 21 co-sponsors look forward to working with their legislative colleagues in the House as this bill is assigned to committee and hearings commence on the legislation.

We covered the Ohio School Facilities Commission (OSFC) controversy referenced by Rep. Young at length on this blog.  You can read our earlier posts for more in-depth information, although the press release above hit the highlights.

Although the resignation of former OSFC Executive Director and Laborers’ union boss Richard Murray was a positive development, Gov. John Kasich and legislative leaders must take further steps to ensure that these types of special interest handouts don’t rear their ugly heads on state funded work again.  Ohio’s budget deficit is hovering around $8 billion and state taxpayers simply cannot afford to buy four schools for the price of five.

The News-Herald in northern Ohio covered the introduction of Rep. Young’s bill.  Here are the highlights:

Young said these agreements require the use of union labor, which then require the bulk of construction bids to come from union construction companies.

This concept limits the number of companies that can bid on projects, which reduces competition and leads to higher costs, Young said.

“Public entities requiring a PLA for a project are in effect paying a very expensive and often unnecessary premium for construction services,” Young said. “In order to balance the budget, it is important we find ways to deliver critical services while reducing costs.”

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Young said his legislation had been passed into law during his previous tenure in the Ohio House of Representatives when Gov. Bob Taft was in office, but the law was challenged by union organizations and overturned by the Ohio Supreme Court.

This time, Young said, the legislation was modified to indicate that public entities could neither require nor prohibit a PLA. That means if a construction firm wants to include a PLA in their bid they are free to do so and an entity can award a contract to them.

Entities also could choose to include a PLA in bids, but then they would not be eligible for state funding to help pay for the project, Young said.

We commend Rep. Young for standing up for taxpayers and urge the General Assembly to take action on this bill as soon as possible.

We will continue to follow developments on this bill and all others moving through legislatures here on TheTruthAboutPLAs.com.

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