The Truth About Project Labor Agreements

On Wednesday, Feb. 16, Congressman John Sullivan (R-Okla.) introduced the Government Neutrality in Contracting Act (H.R. 735) (pdf). The legislation will protect taxpayers and ensure fair and open competition on government construction contracts by prohibiting the government from mandating anti-competitive and costly project labor agreements (PLAs) on federal and federally assisted construction projects.

The Government Neutrality in Contracting Act (H.R. 735) is supported by the following employer and construction industry groups:

Associated Builders and Contractors (ABC)
Associated General Contractors (AGC)
Construction Industry Roundtable (CIRT)
Independent Electrical Contractors Association (IEC)
Electronic Security Association (ESA)
Merit Elevator Contractors Association of America (MECAA)
National Association of Minority Contractors (NAMC) – Philadelphia Chapter
National Association of Government Contractors (NAGC)
National Association of Women in Construction (NAWIC)
National Black Chamber of Commerce (NBCC)
National Federation of Independent Business (NFIB)
National Ready Mixed Concrete Association (NRMA)
National Stone, Sand & Gravel Association (NSSGA)
National Utility Contractors Association (NUCA)
Small Business and Entrepreneurship Council (SBEC)
U.S. Chamber of Commerce
Women Construction Owners and Executives, USA (WCOE)

Here is a quote from Congressman Sullivan on the bill from his press release:

“American tax payers deserve to know that federal contracts are being awarded based on sound, credible criteria such as quality of work, experience and most importantly cost. My legislation will ensure open and honest bidding, and will save American taxpayers money” Sullivan said. “It is simply unacceptable to allow the federal government to discriminate against 87 percent of the U.S. private construction workforce – and the 98 percent in Oklahoma – who seek federal contracts. Studies show that PLAs can drive up the cost of construction projects as much as 18 percent. My bill is just good government plain and simple. We owe it to Oklahoma businesses whose livelihood depends on their ability to bid on construction projects in a fair and open process.”

The construction community can contact their elected officials in Washington and urge them to costponsor the Government Neutrality in Contracting Act through our grassroots action center here.

If you are a member of Congress and would like to cosponsor this legislation, please see this Dear Colleague letter from Congressman Sullivan’s office.

ABC National issued this press release today in support of The Government Neutrality in Contracting Act.

NEW LEGISLATION WILL GUARANTEE FAIR AND OPEN COMPETITION ON FEDERAL CONSTRUCTION PROJECTS

Washington, D.C. – Associated Builders and Contractors (ABC) today voiced its strong support for the Government Neutrality in Contracting Act (H.R. 735), a measure introduced by Rep. John Sullivan (R-Okla.) that will “promote and ensure open competition on federal and federally funded construction projects.”

“It’s a matter of fairness,” said 2011 ABC National Chairman Michael J. Uremovich, president of Great Lakes Energy Consultants, LLC, Manhattan, Ill. “This legislation will guarantee that all qualified contractors and skilled workers, regardless of labor affiliation, have an equal opportunity to bid on and construct federal and federally assisted construction projects. In the end, this bill will help taxpayers get the best possible construction project at the best possible price by increasing competition, reducing waste and eliminating favoritism in federal contracting.”

“Almost two years ago, President Obama signed Executive Order 13502 which encourages federal agencies to require PLAs on federal construction projects exceeding $25 million,” said Uremovich. “The executive order was designed to steer lucrative federal contracts to union construction contractors that employ only 13 percent of the construction workforce.”

A government-mandated PLA is a contract that requires construction projects to be awarded only to companies that agree to recognize unions as the representatives of their employees on that job; use the union hiring hall to obtain workers; obtain apprentices through union apprenticeship programs; follow archaic and inefficient union work rules; and pay into union benefit and multi-employer pension plans.

Studies indicate that government-mandated PLAs increase the cost of construction projects in numerous markets up to 18 percent compared to similar non-PLA projects.

“Government-mandated PLAs unfairly discourage competition from merit shop contractors and their employees. Today, 87 percent of the U.S. private construction workforce chooses not to belong to a labor union,” Uremovich said. “This legislation puts an end to these special interest handouts and will result in more federal contracting opportunities for small businesses and more construction jobs for an industry suffering from an unemployment rate of 22.5 percent – more than twice the national average.”

The Government Neutrality in Contracting Act is identical to legislation (S. 119) (pdf) introduced Jan. 25 by Sen. David Vitter (R-La.) that now awaits action in the Senate Committee on Homeland Security and Governmental Affairs.

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Associated Builders and Contractors (ABC) is a national association with 75 chapters representing more than 23,000 merit shop construction and construction-related firms with nearly two million employees. Visit us at www..

Contact: Gail Raiman, (703) 812-2073 or Gerry Fritz, (703) 812-2062