WPRI 12 News Covers Rhode Island Project Labor Agreement Controversy

0 February 27, 2014  Featured, State & Local Construction

Just 18.6 percent of Rhode Island’s construction workforce belongs to a union, yet many large-scale state-funded projects have been subjected to anti-competitive government-mandated project labor agreements (PLAs).

Last week, WPRI 12 News aired an in-depth look at PLAs in The Ocean State:

Do PLA Requirements Increase Construction Costs?

Greg Mancini, Director of BuildRI, a group funded by unionized contractors, trade associations and unions that negotiates PLAs on major Rhode Island projects and lobbies Rhode Island lawmakers to support PLAs on taxpayer-funded projects, claims in the broadcast there is no evidence suggesting PLAs increase the cost of construction. He says, “[PLA] opponents have never backed that [claims that PLAs increase costs] up with any fact.”

RI News Story Clip

But research has found less competition and archaic and inefficient union rules increase the cost of construction projects subject to PLAs. Three studies conducted in New York and neighboring Connecticut and Massachusetts by the Beacon Hill Institute (BHI) of Suffolk University in Boston studied schools built with and without PLAs. Research found PLA mandates increase the cost of construction between 12 percent and 18 percent, on average, even when pay rates are controlled by state prevailing wage laws requiring unionized rates.

The Worcester Municipal Research Bureau’s May 2001 report, Project Labor Agreements on Public Construction Projects: The Case For and Against, concluded “PLAs tend to constrict the number of bidders on a project compared to those without PLAs, and are likely to reduce the savings to the public that would accrue if nonunion contractors who are employed were allowed to follow their customary methods.”

Even the Supreme Court of Rhode Island said in Associated Builders & Contractors of Rhode Island, Inc. v. Department of Admin. that, “PLAs deter a particular class of bidders, namely, nonunion bidders, from participating in the bid process for reasons essentially unrelated to their ability to competently complete the substantive work of the project.”

Research specific to Rhode Island is limited, but recent projects in the region, such as the Fall River, Mass. schools case study, the Route 9 Burns Bridge, and the lack of local hire on the New Bedford, Mass. dredging project, anecdotally illustrate the benefits of fair and open competition free from PLA mandates. These projects, in addition to the Big Dig debacle (the most infamous PLA project in New England), document how PLAs can fail to deliver on promises made by PLA advocates.

Finally, a 2010 poll by BHI found the majority of Mass. voters don’t support the principles of PLAs.

The fact that PLA advocates have spent a great deal of time and money disputing research on this topic proves it is dishonest for BuildRI personnel to claim there is a lack of evidence. If anything, there is no evidence supporting claims made by pro-PLA lobbyists that PLAs save money.

Check out examples countering attacks by the pro-PLA lobby on PLA research here.

What’s a PLA Requirement?

Anti-competitive government-mandated PLAs are special interest kickback schemes that end open, fair and competitive bidding on construction projects and steer contracts and jobs to well-connected unionized contractors and unionized construction workers.

PLAs typically force contractors to hire most or all of their craft professionals from union hiring halls; follow inefficient union work rules; hire apprentices exclusively from union apprenticeship programs; and pay into union benefit plans on behalf of employees, even if they have their own qualified benefit programs. PLAs force nonunion employees to pay union dues, accept unwanted union representation, and forfeit benefits earned during the life of a PLA project unless they join a union and become vested in union benefit plans.

In short, PLAs discourage or eliminate merit shop contractors from competing for and winning contracts on construction projects because they are almost always awarded exclusively to unionized contractors and their all-union workforces. When mandated by lawmakers, PLAs are a bad deal for taxpayers and the local construction community.

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