Op-Ed: Project Labor Agreements Build Nothing But Unions

0 January 19, 2012  State & Local Construction, Uncategorized

Eric Christen from the Coalition for Fair Employment in Construction penned a new op-ed for the Los Angeles Business Journal in which he calls out Los Angeles area leaders for their love affair with project labor agreement (PLA) mandates.

Here are the highlights:

Project Labor Agreements Build Nothing but Unions

OPED By ERIC CHRISTEN

January 16, 2012

Los Angeles is ground zero in a war raging over exclusionary and monopolistic project labor agreements, commonly called PLAs. Since these “agreements” started popping up 15 years ago, Los Angeles has had more implemented than any other city in America. The almost canine affection elected officials in this region have for doing the bidding of those who put them into power (Big Labor special interests) is quite striking and unmatched anywhere we have been fighting PLAs.

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Project labor agreements are associated with fiscal irresponsibility and mismanagement, internal corruption and lack of accountability to the people who pay taxes for the government to provide services. Citizens in Los Angeles have abdicated their responsibility to oversee their local governments. As a result, unions fill the resulting political vacuum and attract ambitious people who see unions as a vehicle to attain personal power and position.

Arguments based on reason and common sense have no power in this kind of environment, where only scandals earn public attention. The problem with Los Angeles is that fidelity to Big Labor is so pervasive that the resulting corruption is hard to keep up with. From the hundreds of millions of dollars wasted under the Los Angeles Unified School District and Los Angeles International Airport PLAs to the broken promises of the Port of Los Angeles and the city of Long Beach PLAs, where does one even begin?

Let’s just pick two.

The city of San Fernando was the first municipality in California to require a PLA for all public works projects. On Sept. 19, 2005, the San Fernando City Council voted 5-0 to require all construction contractors to sign a PLA Agreement with unions for prime contracts worth $150,000 or more, and specialty contracts worth $25,000 or more. These project cost thresholds are unusually low, indicating that representatives of the city made little effort to engage in credible negotiations with union leaders to develop the project labor agreement.

Voting for the PLA in 2005 were council members Julie Ruelas, Nury Martinez, Steven Veres, José Hernández, and Maribel De La Torre. So what happened to them?

San Fernando voters recalled Hernández and Ruelas on Jan. 13, 2009.

Martinez was elected in 2009 to the board of the LAUSD, with endorsements from the Los Angeles/Orange Counties Building & Construction Trades Council and the Los Angeles County Federation of Labor.

Veres was elected in 2011 to the board of the Los Angeles Community College District, with endorsements from the construction trades council and the county labor federation.

Only De La Torre remains on the San Fernando City Council. At its Nov. 21 meeting, she was entangled in a spectacle that is bizarre, even by California standards, involving her relationship with the mayor.

Meanwhile, the city continues to require its contractors to sign a PLA to work on taxpayer-funded city construction. Business as usual.

Then we have the Los Angeles Community College District, subject of a multipart series in the Los Angeles Times highlighting the waste, fraud and poor quality of work that took place under the district’s multibillion-dollar PLA.

The latest scandal involves an inquiry that targets two contractors who worked extensively under that PLA. “The D.A.’s probe centers on Los Angeles Community College District allegations that the firms submitted fraudulent billings for Mission College work, part of a $5.7 billion construction program,” reported the Times.

Coincidence? Hardly. These instances are all quite predictable for any entity that purses something as immoral as a PLA. Sadly, it is the taxpayers, school children and the average citizen who continue to pay the price for the status quo in this region that places the interests of union bosses over that of everyone else.

In the end, the voters have no one left to blame but themselves for placing such morally illiterate people into office.

A number of projects in the L.A. area have been constructed with PLA mandates.  Their track record is well documented in the 2011 edition of Government-Mandated PLAs: A Public Record of Poor Performance.  Here are some examples with their page number for citation purposes:

Cost Overruns:

  • The Eastside Reservoir project east of Los Angeles, built under a government-mandated PLA, was the nation’s largest earth moving project in the late 1990s. In October 1998, the project reported a $220 million (11 percent) cost overrun. The increase was attributed to payment of overtime wages under circumstances mandated by the PLA. (p. 9)

Project Delays:

  • In 2006, four Los Angeles Unified School District campuses built under a PLA were forced to open their schools one month late because contractors could not find enough skilled labor to complete the project on time. (p. 23)

Discrimination Against Women and Minorities in the Construction Industry:

  • In 2010, a private audit found violations by 55 contractors working on a $150 million high school under a PLA mandated by the Los Angeles Unified School District. The violations included inadequate supervision of workers and performing work under expired or suspended licenses. (p. 30)
  • The biggest contractor on the union-only San Francisco International Airport PLA project was sued by a Los Angeles transit agency alleging that it used bogus minority subcontractors to get millions in unionized subway work.127 Similar allegations were investigated by the FBI in connection with the San Francisco Airport project. The Los Angeles lawsuit and San Francisco investigation both alleged that white-owned unionized firms set up companies that “either were not qualified or in whom the union companies owned an undisclosed interest.” The lawsuit also alleged that the union joint venture joined with its sham minority subcontractors to present false claims on subway work to obtain millions of dollars in additional payments. (p. 31) 

This is a sample, not a comprehensive list, of the various problems associated with PLA mandates on projects in the L.A. area.

In addition to the examples of problems above, government-mandated PLAs discriminate against the 84 percent of the L.A. area construction workforce that chooses not to join a union and are essentially locked out of construction funded by their own tax dollars.

Mandating PLAs on taxpayer funded work is clearly bad public policy.

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