The Truth About Project Labor Agreements

In a document circulating around the blogosphere (Hat tip to Baltimore Brew), the Maryland Transit Administration (MTA) listed the top 10 potential risks to cause cost overruns on the proposed Red Line light rail construction project.  This expansion of public transportation opportunities in Baltimore is much anticipated by many residents.

The only problem is MTA’s track record for completing Baltimore rail projects on budget leaves something to be desired.  The construction of the Phase I Rapid Transit project, completed in 1987, came in a staggering 60 percent over budget.

In an attempt to evaluate potential cost overruns, MTA commissioned a Risk Assessment Report.  To develop this report, risk assessors conducted a workshop to determine what risks existed for cost overruns, their severity and their likelihood to be a factor on the project.  The assessors then developed a list of top 10 potential risks.

Check out number seven:

The current assumption is that no project labor agreement (PLA) will be required for executed of the project.  If such an agreement is enforced this could impact project costs.

The individuals participating in this workshop clearly understand that PLAs have an inflationary impact on construction costs.

This report is also further evidence that mandating PLAs on public work is fueld by political favoritism instead of a desire to be fiscally responsible.

By the way, to put PLAs’ ranking into context, we thought it would be interesting to see what beat out PLAs for the number six on this list:

Potential for uncovering a significant archeological site on underground works.

So close…