On Nov. 9, 2010, Solis made these remarks in support of PLAs and President Obama’s pro-PLA Executive Order 13502 to the United Association of Journeymen and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada at the Hollywood, Fla. Westin Diplomat Hotel and Resort:

…And while we are working with businesses to ensure employee safety, we are also working with them to strongly consider Project Labor Agreements.

We are glad to be working with you on the President’s Executive Order encouraging the use of PLA’s

We know PLA’s can contribute to economy and efficiency of large construction projects.

We are very interested in learning from your experience in the private sector and how we can get some of those advantages in federal construction.

We know that PLA’s are a win-win: good for workers and for contractors.

At a Feb. 2, 2010 House Education and Labor Committee hearing, Solis again confirmed her support of PLAs in response to a question by Rep. Glenn ‘GT’ Thompson (R-Pa.).

In September 2009, Solis addressed the AFL-CIO Convention in Pittsburgh and reaffirmed her support of these special interest schemes that will kill jobs, unfairly help unionized contractors win federal contracts and harm American taxpayers, workers and businesses:

“Not only do the President and I support Employee Free Choice Act, we are strong supporters of Project Labor Agreements.

We know that they are a win-win: good for workers and for contractors Project Labor Agreements improve the economy and efficiency of construction projects.

President Obama issued an executive order encouraging the use of PLA’s for large federally funded projects, and we have been working very hard at DOL with Vice President Biden and the Middle Class Task Force to ensure that Project Labor Agreements are really encouraged and used.

Project Labor Agreements help make Good Jobs!”

Taxpayers, qualified merit shop contractors and their skilled employees should be dismayed by this statement because it signals a possible expansion of President Obama’s Executive Order 13502, which encourages federal agencies to require discriminatory and anti-competitive PLAs on federal construction projects exceeding $25 million in total cost.

Section 7 of Executive Order 13502 instructs the director of the Office of Management and Budget, in consultation with Labor Secretary Solis and other White House officials, to make “recommendations about whether the 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.”

Expansion of Executive Order 13502 could translate into requirements or incentives for state and local governments to use PLAs on construction projects receiving federal assistance. (Federally-assisted projects are local, state or private construction projects that receive a federal grant, loan, tax-break or other form of financial assistance.)

Section 7 PLA Expansion’s Impact on Communities
States and local communities should take interest in the expansion of Executive Order 13502 via Section 7. Accepting federal assistance for construction projects with strings attached that favor Big Labor could bust strained budgets. Will states and local communities swallow the typical 18 percent PLA premium? Can they afford to build four schools, hospitals, bridges and courthouses for the price of five?

Section 7 PLA Expansion Is a Job Killer
PLAs on federally-assisted projects also will cost jobs. The impact of higher costs resulting from PLAs on finite state and local budgets translates into fewer construction projects. Less building means fewer jobs in an industry that faced an unemployment rate of 27.2 percent in February of this year – the highest level recorded since the federal government began making the data available in 1976.

Between August 2006 and August 2010, employment in the construction industry dropped 27.4 percent, as 2.1 million construction workers lost their jobs. To put the construction industry’s job losses in perspective, the 5.6 million people working in construction today is barely higher than the 5.59 million people who were working in construction in August 1996.

With the U.S. construction unemployment rate at 17.3 percent—nearly twice the overall national unemployment rate in all industries—expensive and job-killing government-mandated PLAs make little sense.

In addition, will local and state governments understand that PLAs give preference to out-of-state union members ahead of local and qualified nonunion employees? PLA projects in areas with low union density and market share often fall victim to this boneheaded fiscal policy, as local nonunion employees continue to rely on state unemployment and entitlement services and not pay into the local tax base while PLAs give preference to out-of-state union members obtaining work through local union hiring halls.

Finally, it is discriminatory and shortsighted public policy for states and communities to tell skilled nonunion labor they cannot work on these projects unless they agree to pay union dues and lose employer contributions to union benefit and pension plans for the life of a PLA project–typical negative consequences of PLAs on nonunion labor and key reasons why nonunion contractors rarely compete to work on PLA projects.

Big Labor’s Infamous Hotel Boondoggle
It is bizarre that Solis’ recent remarks in support of PLAs were given at a construction industry union conference held at the Hollywood, Fla. Westin Diplomat Hotel and Resort. The union-only construction of the Westin Diplomat Hotel is infamous for suffering from embarrassing delays and cost overruns that wiped out money invested by a construction union pension fund.

The Westin Diplomat Hotel was funded in part by an $800 million investment from the National Federation of Plumbers, Pipefitters and Journeymen’s pension fund–an amount that was nearly 20 percent of the pension fund’s total assets at the time.

The hotel opened in February 2001, almost 18 months late and at a cost almost $400 million above projections after two years of construction.

The pension fund fired the original developer and pension plan trustees were sued by the DOL under auspices of the Employee Retirement Income Security Act (ERISA), a conflict-of-interest statute designed to prevent the trustees of a multiemployer national pension fund from engaging in self-serving actions and to ensure fund investments are prudent.

According to reporting by Engineering News Record, the suit eventually led to an Aug. 2, 2004, settlement with the DOL where trustees Maddaloni and Patchell paid an $11-million civil fine. The settlement allowed union leaders Maddaloni and Patchell to keep their union posts, but they had to resign as trustees of seven pension funds.

The Westin Diplomat hotel is a curious place to be touting the benefits of anti-competitive and costly union-favoring PLAs as this boondoggle was a black eye for Big Labor and it should serve as an ominous warning to communities around the country about the problems with union-only construction and PLAs, should Section 7 of Executive Order 13502 expand and apply to federally-assisted projects.

After a protest was filed against the PLA with the Government Accountability Office (GAO) by ABC member North Branch Construction of Concord, N.H., with ABC support and representation, the U.S. DOL cancelled its solicitation to construct the project.

Here is more on the hearing from a press release on Rep. Thompson’s website (“U.S. Labor Secretary Dodges Thompson’s Questions on Project Labor Agreements,” 2/3/10).

Thompson described the New Hampshire ordeal in further detail, “Last September, DOL issued a solicitation for construction of a Job Corps Center in New Hampshire that the Department declared was `urgently needed.’ Without explanation, the Department attempted to impose a Project Labor Agreement. After a local small business filed a protest against the PLA, the Department cancelled the solicitation, and has not re-issued it.

Thompson asked Solis, “Why did the Department cancel the entire solicitation of an `urgently needed’ project in the face of the bid protest instead of simply removing the PLA?”

Solis answered that in many instances PLAs have actually helped to reduce costs and that it is appropriate that the Department look for ways to keep costs down. She did not answer the question about New Hampshire.

Committee Chairman Rep. George Miller (D-CA) asked that Solis answer Thompson’s question in writing at a later date. TheTruthAboutPLAs.com will be sure to cover Solis’ response. You can view the entire exchange at the 85 minute mark at the hearing’s archived webcast.

To date, the DOL has not taken any additional steps to construct this project, demonstrating that special interest politics trump sound public policy and badly-needed job creation. The DOL opted to cancel the project instead of proceeding without a PLA which will not create jobs for New Hampshire residents and will not help the 24.7 percent unemployment rate in the U.S. construction industry.

Rep. Thompson summarizes the situation best.

“This is not an ‘us vs. them’ scenario, this is about American jobs. Contract decisions for the federal government should not be based on politics,” said Thompson. “True competition will provide the lowest cost, union or not. In this economic crisis, we need to maximize the job creation in this country. And while I commend the Secretary for acknowledging the need to mitigate costs, the Secretary of Labor should be making sure jobs are maximized, rather than catering to unions.”

It is concerning that Solis couldn’t answer Thompson’s question and demonstrated a limited understanding of government-mandated PLAs when she stated that PLAs reduce construction costs. In reality, anti-competitive PLAs increase costs, funnel contracts to special interests and deny taxpayers the accountability they deserve from government. Solis’s position on PLAs is alarming, especially since Section 7 of President Obama’s Executive Order 13502 directs Solis to determine the expansion of the federal government’s PLA policy [Emphasis added]:

Section 7. The Director of the OMB, in consultation with the Secretary of Labor and with other officials as appropriate, shall provide the President within 180 days of this order, recommendations about whether broader use of PLAs, with respect to both construction projects undertaken under Federal contracts and construction projects receiving Federal financial assistance, would help to promote the economical, efficient, and timely completion of such projects. [Note: Order was issued Feb. 6, 180 days sets the deadline at Aug. 5 but an order hasn't been issued]

States and local communities should take interest in the expansion of Executive Order 13502 via Section 7. Accepting federal assistance for construction projects with attached PLA strings that favor Big Labor could bust strained budgets. Will states and local communities swallow the 18 percent PLA premium? Can they afford to build four schools, hospitals, bridges and courthouses for the price of five?

A PLA mandate on federally-assisted projects will also cost jobs. The impact of higher labor costs on finite budgets translates into fewer construction projects. Less building means less jobs which will harm local, state and federal revenue streams.

TheTruthAboutPLAs.com urges Secretary Solis and elected officials in favor of government-mandated PLAs to reconsider their support of these costly, corrupt and anti-competitive special interest agreements.

In addition, the order prohibited PLAs on hundreds of billions of dollars worth of federally-assisted construction projects across the country. Federally-assisted projects are local, state or private construction projects that receive a federal grant, loan, tax-break or other form of financial assistance.

Unfortunately, the practice of guaranteeing free and open competition on federal and federally-assisted construction projects ended when President Obama signed Executive Order 13502, which repealed Executive Order 13202 and encourages federal agencies to require PLAs on projects valued at more than $25 million.

While the construction industry waits for a final rule from the FAR Council implementing Executive Order 13502 into federal procurement standards, it is important to remember that the Obama Administration is evaluating ways to expand the executive order and government-mandated PLAs, which will open the door to waste and government corruption in federal contracting, as directed by Section 7 of Executive Order 13502.

Section 7. The Director of the OMB, in consultation with the Secretary of Labor and with other officials as appropriate, shall provide the President within 180 days of this order, recommendations about whether broader use of PLAs, with respect to both construction projects undertaken under Federal contracts and construction projects receiving Federal financial assistance, would help to promote the economical, efficient, and timely completion of such projects. [Note: Order was issued Feb. 6, 180 days sets the deadline at Aug. 5 but an order hasn't been issued]

It is clear that Secretary of Labor Hilda Solis is a proponent of PLAs. At the Sept. 14, 2009 AFL-CIO Convention in Pittsburgh, PA, she reaffirmed her support of these special interest giveaways that will kill jobs and exclusively benefit Big Labor while harming American taxpayers, workers and businesses.

“Not only do the President and I support Employee Free Choice Act, we are strong supporters of Project Labor Agreements.

We know that they are a win-win: good for workers and for contractors Project Labor Agreements improve the economy and efficiency of construction projects.

President Obama issued an executive order encouraging the use of PLA’s for large federally funded projects, and we have been working very hard at DOL with Vice President Biden and the Middle Class Task Force to ensure that Project Labor Agreements are really encouraged and used.

Project Labor Agreements help make Good Jobs!”

Office of Management and Budget (OMB) Director Peter Orszag is a fan of PLAs too. July 10 he signed an OMB memo encouraging federal agencies to require PLAs despite the fact that the FAR Council had only issued a proposed rule implementing Executive Order 13502:

“Accordingly, in light of the benefits that PLAs may offer to Federal agencies in construction projects, agencies are encouraged, during this interim period prior to the FAR Council’s issuance of its final rule, to consider the value of PLAs on a project-by-project basis, and to require the use of PLAs in appropriate circumstances and to the extent permitted by law.”

Despite their clear support for government-mandated PLAs, in May, senior Obama Administration officials graciously invited ABC National to a White House meeting to hear ABC’s contrasting perspective on the expansion of government-mandated PLAs and Executive Order 13502 via Section 7.   ABC National representatives made a strong case that expansion of Executive Order 13502 was not in the best interest of good government, taxpayers, construction procurement officials, or 84.6 percent of the U.S. construction workforce (citizens who do not belong to a construction union) and their employers.

States and local communities should take interest in the expansion of Executive Order 13502 via Section 7. Accepting federal assistance for construction projects with attached strings that favor Big Labor could bust strained budgets. Will states and local communities swallow the 18 percent PLA premium? Can they afford to build four schools, hospitals, bridges and courthouses for the price of five? 

A PLA mandate on federally-assisted projects will also cost jobs. The impact of higher labor costs on finite budgets translates into fewer construction projects. Less building means less jobs in an industry that has shed close to one million jobs in the last 12 months and has a national unemployment rate flirting with 20 percent.

In addition, will local and state government understand that PLAs give preference to out-of-state union members ahead of local and qualified nonunion employees? PLA projects in areas with low union density and market share often fall victim to this boneheaded fiscal policy, as local nonunion employees will continue to rely on state services and not pay into the local tax base while out-of-state union members raid jobs through local union hiring halls.

Finally, it is discriminatory and shortsighted public policy for states and communities to tell skilled nonunion labor they can’t work on these projects unless they agree to pay union dues and lose employer contributions to union benefit and pension plans for the life of a PLA project – typical real world consequences of PLAs on nonunion labor and key reasons why nonunion contractors rarely bid on PLA projects.

The public, elected officials, media and construction workforce must realize there is a lot at stake with the expansion of Executive Order 13502 via Section 7.

On 10/2, a discriminatory and costly PLA was officially included in the contract solicitation for the construction of a U.S. Department of Labor Job Corps Center in Manchester, New Hampshire.  The PLA is now the subject of a bid protest filed by a New Hampshire contractor with the Government Accountability Office (GAO). Below is a press release from ABC National.

ABC MEMBER FILES PROTEST AGAINST U.S. DEPARTMENT OF LABOR PROJECT LABOR AGREEMENT

CONTRACT DISCRIMINATES AGAINST MAJORITY OF NEW HAMPSHIRE’S CONSTRUCTION WORKFORCE

Contact: Gail Raiman, (703) 812-2073

Gerry Fritz, (703) 812-2062

WASHINGTON, D.C. – Associated Builders and Contractors (ABC) member company North Branch Construction, a Concord, N.H.-based general contractor, Oct. 5 filed a bid protest with the Government Accountability Office (GAO) against the U.S. Department of Labor (DOL). The complaint accuses the DOL of violating federal law by mandating the use of a project labor agreement (PLA) – a controversial contract that strongly favors union-signatory contractors, increases the cost of construction up to 18 percent, and restricts competition from nonunion contractors and their qualified workforce – in its bid specifications for the construction of a federal DOL Job Corps center in Manchester, N.H.

The complaint states that the DOL’s inclusion of the PLA, “unduly restricts competition, is wholly unsupported and violates the Competition in Contracting Act, Executive Order 13502, the Small Business Act, and numerous procurement regulations,” and requests that the GAO order the DOL to remove any PLA requirement from the solicitation.

“PLAs are special interest handouts that deny taxpayers the accountability they deserve from government contracts,” said Ken Holmes, president of North Branch Construction. “This DOL PLA discriminates against New Hampshire’s qualified and experienced nonunion employees and businesses, such as North Branch Construction, who all deserve a fair opportunity to provide the public with the best construction product at the best price.”

A PLA is a contract that discourages competition from nonunion contractors and their nonunion employees by requiring a construction project to be awarded only to contractors and subcontractors that agree to recognize unions as the representatives of their employees on that job; use the union hall to obtain workers; obey the union’s restrictive apprenticeship and work rules; and contribute to union pension plans and other funds in which their employees will never benefit unless they join a union.

“More than 91 percent of New Hampshire’s construction workforce does not belong to a labor union, and since August 2008, New Hampshire’s construction workforce has suffered an 18.6 percent increase in unemployment,” said Holmes. “A PLA on this project is bad economic policy, especially because a PLA will unnecessarily increase the cost of construction of this taxpayer-funded project, and it will prevent nonunion workers from competing – possibly increasing unemployment in our state.”

The legal challenge is expected to heighten tensions over the federal government’s recent shift in federal procurement policy concerning the use of discriminatory and costly PLAs. On Feb. 6, President Obama signed Executive Order 13502, which repealed a 2001-2008 prohibition on federal PLAs and encourages agencies to require PLAs on federal construction projects whose total costs exceed $25 million. The Federal Acquisition Regulatory (FAR) Council is in the process of reviewing public comments on its controversial July 14 proposed rule that would implement Executive Order 13502 into federal procurement code. The DOL PLA is believed to be the first government-mandated PLA on a federal construction project since Executive Order 13502 was issued, despite the fact that a final rule has not been implemented by the FAR Council.

North Branch Construction’s bid protest is supported by ABC’s Construction Legal Rights Foundation and the ABC New Hampshire/Vermont Chapter.

###

Associated Builders and Contractors (ABC) is a national association with 79 chapters representing 25,000 merit shop construction and construction-related firms with two million employees. Visit us at www.abc.org.

For more PLA-related information or to view the complaint, visit www.TheTruthAboutPLAs.com or www.abc.org/pla

With such a small union workforce available, it makes it virtually impossible for a New Hampshire contracting firm to have unionized employees to fill this requirement.  Furthermore, the Department of Labor requests that contractors exhibit three previous successful PLA projects, a request no New Hampshire contractors can meet.  And while the Department of Labor has designated this as a small business project, which would normally increase competitiveness for New Hampshire contractors, having the PLA requirement essentially prevents New Hampshire contractors from being able to successfully bid for this $35 million in-state construction project.

Senator Gregg stated, “The Administration’s decision to discriminate against successful and independent construction firms simply because New Hampshire employees choose to work in a union-free workplace and not bow down to the demands of big labor is extremely unfair to our state.  The request for bids issued by the Department of Labor requires that contractors employ a Project Labor Agreement (PLA) and requests they provide proof of completion of three prior PLA projects.  However, under these conditions there is not a single firm in our State that would be eligible to bid on this multimillion dollar construction project.  In a time of economic hardship, it is simply absurd to discriminate against local contractors and construction workers for the benefit of national labor unions.

“Further, this unfair practice could result in a lawsuit, which would only delay the beginning of construction for this critical project.  The Administration’s actions on this issue are completely backward.  Instead of expediting the construction of a Job Corps Center that will train and equip New Hampshire residents, while potentially creating New Hampshire construction jobs in the interim, the Administration has knowingly placed a roadblock on job training and increased economic activity in the Granite State. I urge the Administration to quickly reconsider this serious lack of judgment so we can get started on this essential project.”

The TruthAboutPLAs.com agrees with Senator Gregg’s sound evaluation of this discriminatory and costly PLA.

However, according to an article in the Manchester Union Leader, union officials disagree with Senator Gregg’s assessment of the PLA (“Gregg: Union rule threatens job center,” 9/18). The comments of Mark MacKenzie, president of the New Hampshire AFL-CIO, demonstrate an unrealistic and myopic point of view that represents narrow union special interests over those of qualified local non-union contractors and workers that deserve a fair shot at competing for work in their own state paid for by their own tax dollars.

“It may be an out-of-state contractor that bids the work, but it’s going to be New Hampshire people who work on the project,” MacKenzie said.

Unfortunately, MacKenzie ignores an inconvenient truth about PLAs: local union workers have preference over non-union local workers who are equally as qualified. In addition, typical PLAs give preference to non-local union members over quality local non-union workers.  These workers are called “travelers” and unless a PLA specifies that no travelers can be used, union workers from Boston will build this project instead of qualified New Hampshire contractors and their local workforce.

In other areas of the country, unions are quick to criticize the concept of out of state contractors winning local jobs, but in instances such as this, they conveniently amend their principles to suit their self-serving interests.

According to the article, PLA apologists such as Pat Long, former vice present of the New Hampshire Building Trades Council and a Democratic state representative, unwittingly makes an argument against PLAs:

“Under a PLA, a contractor would have to pay $37 an hour for ironworkers.

About $21 would go toward wages and the remainder toward retirement, health insurance and other benefits, he said. A non-union worker would get paid between $25 and $30 an hour, but get no benefits, Long said.”

Long is refering to a Basic Truth About PLAs that is offensive to non-union employees and their employers. If a non-union contractor signs a typical PLA, all employer contributions to an employee’s health, welfare and other benefit funds must be paid to union managed funds as stipulated in a PLA and applicable union collective bargaining agreements. 

Non-union employees will never benefit from employer contributions into union benefit funds unless they join a union and/or become vested in the benefit plans. Benefit plan vesting schedules are much longer than a typical construction project. In short, this scheme is a windfall for union plans because they don’t have to account for future liabilities and costs for the contributing non-union employee.  What’s worse is that PLAs prevent non-union employees from having benefits for the life of a project, unless their non-union employer continues to pay existing non-union benefit plans. This “double payment” of benefit costs is one of the reasons why taxpayers lose with PLAs -non-union contractors can’t give their best possible bid for a quality construction project.

PLA proponents often claim that without a PLA, non-union employees would not get health and reitrement benefits. That statement is absurd and is a misleading scare tactic. Non-union contractors offer attractive health and benefit packages. How else would they maintain a skilled and competent workforce to build the majority of public and private construction projects? And if non-union contractors didn’t offer competitive wages and benefits, wouldn’t more than  just 8.7 percent of New Hampshire’s construction workforce join a union?

In addition, because this is a federal construction job subject to Davis-Bacon wage rates, all contractors, regardless of their union affiliation, have to pay all construction workers in their specific trade (such as an ironworker) a set wage and benefit amount.

If you visit www.wdol.gov, you can look up the wage rates for a ”Building” Construction Type in Hillsborough County, New Hampshire and see that the last federal Davis-Bacon Wage determination for ironworkers in that county was made on 3/15/08 and it requires that ironworkers be paid $21.15 in wages and $16.75 in benefits. The total package is $37.90 per hour. All workers have to be paid that amount in cash if a contractor does not offer a benefit program, otherwise, a worker is paid $21.15 per hour in cash and $16.75 per hour in benefits goes into a contractor’s existing health, retirement and benefit programs.  If employers pay ironworkers less than a total wage and benefit package of $37.90 per hour, they are breaking the law. (An ironworker’s salary and benefit totals about $79K per year ($37.90 * 40 hours per week * 52 weeks per year) if there is full year-round employment on a federal construction project in this county.)

Arguments such as, “non-union workers don’t get paid a fair wage [even though there is a federal law that addresses this issue], therefore, PLAs are necessary” are fallacies that need to be challenged.

The bottom line is that a PLA on this project is a barrier to much needed jobs for qualified New Hampshire construction employees. Employees should not have to pay forced union dues, obey restrictive and inefficient union work rules and forfeit employer benefit contributions to union benefit and pension plans unless they join a union in order to work on a PLA construction project paid for by their own tax dollars.  A PLA will actually prevent a non-union employee from receiving benefits for the life of a construction project.

Senator Gregg is correct. A PLA has no business on this project.

Update: View the U.S. DOL’s “sources sought” notice for this project (Solicitation Number: DOL009RI20791) here.  You can view the presolicitation notice (Solicitation Number: DOL099RB20811) here. The soliciation is scheduled to be published on 10/1.

“Not only do the President and I support Employee Free Choice Act, we are strong supporters of Project Labor Agreements. 

We know that they are a win-win: good for workers and for contractors Project Labor Agreements improve the economy and efficiency of construction projects.

President Obama issued an executive order encouraging the use of PLA’s for large federally funded projects, and we have been working very hard at DOL with Vice President Biden and the Middle Class Task Force to ensure that Project Labor Agreements are really encouraged and used.

Project Labor Agreements help make Good Jobs!”

Taxpayers and non-union contractors and their workforce should be dismayed by this statement because it points to a likely expansion of Executive Order 13502. 

Section 7 of Executive Order 13502 directs the Office of Management and Budget, in consultation with Labor Secretary Solis and other White House officials, to make “recommendations about whether the 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.”

Expansion of Executive Order 13502 could translate into requirements or incentives to use PLAs for state and local construction projects receiving federal assistance, grants, loans or funding.

This federal mandate could force contractors in low construction union density states to import union labor and create a barrier to jobs for local qualified non-union workers and their employers.  In the event that non-union workers are allowed to participate in a PLA, this mandate will force workers to pay union dues and fees and forfeit retirement benefits earned on a PLA project in order to earn a living.  It would give Big Labor an unfair advantage when competing against quality local non-union businesses with highly skilled employees for public construction projects.

The reduced competition and inefficient union work rules in typical PLAs will also drive up the cost of construction.  This could impact local and state construction budgets that can’t afford to build four schools, roads and hospitals for the price of five.

Let’s hope the Secretary of Big Labor Hilda Solis puts the interests of ALL workers ahead of the discriminatory and costly special interests of Big Labor.

If you won’t take our word that Secretary Solis personally wants to advance Big Labor’s agenda, read the Secretary Solis interview in The Washington Post (“Solis Hopes to ‘Level the Playing Field’ for Unions,” 6/30). 

Read the interview transcript. 

Clearly, Secretary Solis is marching lockstep with construction unions’ legislative agenda ranging from support of the unfortunately named Employee Free Choice Act (EFCA) to limiting green jobs training funds only to entities that partner with labor organizations. 

Secretary Solis’ support of Big Labor’s agenda – including PLAs - is an area of concern for proponents of free and open competition on federal and federally funded construction projects because Section 7 of Executive Order 13502 requires Secretary Solis to make recommendations about whether broader use of PLAs will benefit federal and federally funded construction projects.

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 [Aug. 5], 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.

We’re hoping Secretary Solis has a change of heart, but the writing is on the wall -  previous statements suggest she is going to encourage the broader use of PLAs on federal and federally assisted construction projects.

Government mandated PLAs don’t “level the playing field for unions” – they give Big Labor a massive advantage, if not a complete monopoly, on all federal construction contracts – and that advantage could impact state and local construction contracts and budgets soon too.  

State and local construction “owners” that receive federal financial assistance – from school districts to energy and health care facilities - would benefit from a lack of government mandated PLAs.  They cannot afford the financial burden of PLAs that will impact local and state construction budgets negatively if broader use of PLAs are recommended.

In addition, qualified and local non-union workers and their employers should not be discouraged from bidding on construction contracts because of PLA requirements, especially when federal construction spending and infrastructure projects are designed to stimulate all sectors of the economy.  If PLAs are mandated in low construction union density states, out-of-state union workers called travelers will have preference over experienced and qualified local workers.

The OMB Director and other Obama administration officials must depart from Secretary Solis’ consistent support of Big Labor and limit the unfairness and favoritism inherent with PLAs to only projects over $25 million managed by the federal government on a case-by-case basis.

(A return to the President George W. Bush era of government neutrality in federal construction contracting is ideal, but that won’t happen while Democrats and Big Labor control Congress and the White House).

Taxpayers and the construction industry would benefit if common sense, fairness and fiscal responsibility prevailed over special interests.

Solis endorsed the use of project labor agreements, which she called “a win-win: good for workers and for contractors.”

Unfortunately, Secretary Solis doesn’t seem to understand PLAs are not a “win-win” for the contractors who are locked out of PLA projects or their employees, who represent a vast majority of U.S. construction workers.  PLAs are also not “win-win” for the taxpayers forced to pay 20 percent more for public construction when a PLA is utilized or the women and minorities that PLAs exclude from projects in their own communities.

PLAs are only a victory for her May 18 Big Labor audience.