The Truth About Project Labor Agreements

Big Labor’s latest attempt to secure a wasteful and discriminatory project labor agreement (PLA) mandate on a public construction project has opened some old wounds in the Columbus, Ohio, area.

The Franklin County Commission instituted a PLA mandate as a condition of performing work on the $45 million Hall of Justice renovation project in downtown Columbus. The Columbus Dispatch covered the dispute over the PLA in May. Here are the highlights:

Franklin County officials are defending an agreement with local labor unions that would require anyone working on a $45 million renovation project to pay union dues and pay into union benefit programs, whether or not they are union members.

Members of the Columbus/Central Ohio Building and Construction Trades Council brought the idea to commissioners.

In exchange for requiring all workers on the project to pay union fees, and for requiring successful bidders to recruit from local union halls if they need additional workers, the county gets a guarantee that union members will not strike or walk out and employers won’t lock out workers, to ensure that the project finishes on time.

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The agreement already has spurred one letter to The Dispatch, in which the writer, a nonunion construction worker, wrote: “Commission President John O’Grady and the rest of the commissioners should be ashamed of themselves for abusing our tax dollars and submitting to this kind of forced wasteful spending.”

Commissioners have faced criticism before for what some said was a too-cozy relationship with unionized labor.

Low-bidders who were passed over for contracts on the county’s dog shelter, baseball stadium and new courthouse said the county’s previous evaluation process disqualified them because of minor wage disputes, which made it harder for non-union shops to get the jobs.

The Ohio Supreme Court later ordered the county to refine and clarify its vetting process, which it has.

County Administrator Don Brown said the agreement in no way makes it harder for non-union companies to bid on and get contracts for the renovation of the now-vacant, 10-story former court building.

He said while the employees of nonunion businesses would have to pay into the unions, the employers could choose to make that contribution so it would not come out of workers’ pay.

In addition, Barton Hacker, president of the Central Ohio Chapter of Associated Builders and Contractors (ABC), laid out the problems with this unnecessary mandate in an editorial published by the Columbus Dispatch on May 23. Here are the highlights:

How many times must taxpayers be forced to waste 20 percent or more on these discriminatory contracting schemes?

What possible excuse can Commissioner John O’Grady give that would justify wasting $8 million on a $45 million renovation construction project? O’Grady says PLAs ensure the project will finish on time with a guarantee of no labor strikes. That makes no sense. Only union labor goes on strike.

The commissioners allege union workers construct projects better because they are better trained. But how have three recent project-labor agreement projects worked out in Ohio? Springfield High School in Summit County is the last school to be constructed under a mandatory PLA. The school just finished “on time” but can’t open, because the floor shakes throughout the building.

The casino parking decks in both Cleveland and Cincinnati were constructed with union-only PLAs. Both parking decks partially collapsed during construction. Is that what they mean by “quality”?

Truth be told, union and merit-shop apprenticeship programs are both certified and supervised by the U.S. Department of Labor, and more than 85 percent of all commercial construction in Ohio is done by merit shops (nonunion contractors). Project-labor agreements are a thinly veiled ploy used by elected officials to steer public-works contracts to their union allies. When they do, 85 percent of all contractors are effectively barred from bidding. This reduces the number of bidders and drives up cost.

The taxpayers lose by spending more and getting less. The city of Lorain recently recognized this to be the case. It repealed its project-labor-agreement ordinance because officials learned from three years of experience that PLAs drove up costs while dramatically reducing the amount of local bidders winning the bids.

How long, and how much of the taxpayers money, will it take for the Franklin County commissioners to learn the same lesson?

As mentioned in both the Dispatch’s coverage and Hacker’s editorial, this is not the first time Franklin County officials have tried to institute a PLA mandate. In 2006, county officials attempted to mandate a PLA on the $55 million Huntington Park project. County officials ultimately dropped the government-mandated PLA in 2007 in the face of mounting public pressure and work on the project was performed by merit shop and union contractors working side by side.

Additionally, the Franklin County Council attempted to institute a PLA mandate on $110 million courthouse project in 2006. The proposed mandate was tabled after only months of consideration due in large part to the ABC Central Ohio Chapter’s efforts to educate the public on the negative impact of wasteful and discriminatory PLA mandates.

These are not the only instances where merit shop contractors in Ohio were forced to confront PLA mandates. As we have chronicled on this blog, the Ohio School Facilities Commission (OSFC) aggressively promoted PLA mandates to local school districts during the Strickland administration. The tactics used by Richard Murray, head of the OSFC during the Strickland administration, were so unprofessional and over the top that he was rebuked in a scathing report by the Ohio Inspector General and numerous media outlets criticized his behavior and/or called for his resignation. Murray resigned just prior to Gov. Kasich’s inauguration. The OSFC, under new leaders appointed by Kasich, banned government-mandated PLAs on projects that receive OSFC funds.

There is no question that Ohio residents don’t like government-mandated PLAs, and the Ohio construction industry doesn’t need them to build projects on-time and on-budget. Here at TheTruthAboutPLAs.com, we strongly encourage the Franklin County Council to remove the PLA mandate from the Hall of Justice renovation project.

Learn more about the history of PLA mandate in Ohio from our earlier posts.