Big Labor’s effort to impose a wasteful and discriminatory project labor agreement (PLA) mandate in Lorain, OH hit a roadblock this week when the City Council’s Streets and Sidewalks Committee refused to send the proposal to the full council on Monday, Dec. 6.
This was a big win for local taxpayers, but it might only be a temporary reprieve. Some members of the City Council are already discussing whether to bring the proposed ordinance up again in January.
Lorain has some experience with the negative impact of PLAs. Thanks to the Ohio School Facilities Commission (OSFC), a new school building in Lorain is being built with a PLA now.
The OSFC gave us an excellent case study on the effect of PLAs earlier this year. Thanks to disgraced OSFC Executive Director Richard Murray, PLAs have been forced on school projects in a number of communities, including Lorain. One such project is associated with the Ohio Schools for the Blind and Deaf, where PLA requirements resulted in the lowest bid for the project coming in at more than 41 percent over budget. The project was rebid several months later without the PLA mandate and the bid that was finally accepted was 22 percent lower than the lowest bid submitted with a PLA. This was a big win for taxpayers and clear evidence that PLAs increase construction costs.
Back in Lorain, several local newspaper editorial boards have taken notice of the effort to enact this PLA mandate and voiced their displeasure in print.
The Lorain Morning Journal’s editorial board voiced its thoughts (“City Council Should be in No Hurry to Enact Dubious Labor Measure,” 12/8/10) on Wednesday. Here are the highlights:
Now is not the time for the city to discourage non-union contractors from bidding on public works projects such as sewers, water lines, water and sewer treatment plants and roads. At Monday night’s Streets & Sidewalks Committee meeting, both supporters and opponents of Lorain’s proposed PLA ordinance had their say.
Supporters argued that PLAs ensure local workers the opportunity of getting jobs on Lorain’s public works projects. Opponents counter the agreements overly favor union shops, which reduces competition and ultimately drives up costs.
That was shown this summer by the Ohio School Facilities Commission, the agency which is requiring Lorain City Schools to use PLAs in the construction of the city’s new school buildings.
The commission had solicited bids with PLA stipulations to build new dormitories at the state schools for the blind and deaf in Columbus. But those bids came in 46 percent over projections. The second round of bids, without the PLA, not only came in 22 percent less, but more bids were submitted.
One can only guess how much the commission’s PLA requirement has increased the cost of building Lorain’s new schools.
That’s why City Council should be in no hurry to enact this dubious PLA ordinance that caters to labor unions at the expense of taxpayers. Council would be wise to either delay action until next year, or better yet, defeat it now.
The editorial board is correct. Enacting this dubious ordinance discourage contractors from bidding and will also lead to increased construction costs. Although Lorain’s city budget balanced this last year, imagine how difficult it will be to balance when the city starts buying four buildings for the price of five.
Luckily, the Lorain City Council doesn’t have to rely only on the OSFC debacle from earlier this year. PLAs have a checkered history in other local communities as well.
The editorial board at the Elyria Chronicle-Telegram is happy to share their experience (“Look locally for lessons: Elyria Case Might Lead Lorain to Think Twice about Giving Unions a Bidding Advantage“, 12/8/10):
A history lesson from Elyria is in order before Lorain City Council gives unionized contractors an advantage in bidding on city projects.
Not to be didactic about it, Elyria Mayor Bill Grace escaped a political pickle when a judge ruled in 2001 that City Council had acted illegally in adopting a so-called project labor agreement for reconstruction of City Hall.
The ruling allowed Grace to scrap the labor agreement and seek a second round of bids on the grounds that the city needed to save time and avoid further legal entanglements. That way, Grace and the city avoided having to single out for rejection the low bids of contractors that refused to go along with the agreement’s requirement that it use union labor. Its bids were more than $600,000 lower than bids submitted by union contractors, a savings to taxpayers that Grace would have had to justify forgoing.
Lorain is weighing an ordinance that would obligate its mayor to evaluate, for every public contract or construction project, whether he should negotiate a project labor agreement with the North Central Ohio Building and Construction Trades Council and its affiliated local unions.
Union supporters argue that such agreements help ensure that local workers get jobs and that the work is of high quality. They deny that the agreements drive up costs.
Elyria’s experience suggests otherwise.
Only one nonunion company submitted a first-round bid on the City Hall project. Three submitted bids in the second round. Two of those three were the low bids. In addition, every union contractor that submitted a first-round bid submitted a lower bid in the second round.
Yes, labor unions have lot of clout in Lorain, but the city can’t afford to stroke them if it means higher costs to taxpayers. Its first obligation is to provide services at a cost the community can bear.
Project labor agreements will not help Lorain meet that obligation.
This is just one more example of PLAs limiting the number of bidders and increasing costs for taxpayers. Here at TheTruthAboutPLAs.com, we strongly urge the Lorain City Council to respect the Streets and Sidewalks Committee’s opinion and not take up this PLA ordinance again.