The Truth About Project Labor Agreements

Associated Builders and Contractors June 27, 2024, testified before the U.S. House of Representatives Committee on Oversight and Accountability Subcommittee on Cybersecurity, Information Technology, and Government Innovation, calling on Congress to pass the Fair and Open Competition Act (H.R. 1209/S. 537) and reject the Biden/Harris administration’s controversial policies pushing government-mandated project labor agreements for federal and federally assisted construction projects funded by taxpayers.

“When mandated by government agencies and lawmakers, PLAs exacerbate the U.S. construction industry’s estimated skilled labor shortage of more than half a million workers by unfairly discouraging competition from quality nonunion contractors and their employees, who comprise 89.3% of the private U.S. construction industry workforce,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs. “The Biden administration’s aggressive pro-PLA policies needlessly increase costs, chill competition and steer hundreds of billions of dollars’ worth of federal and federally assisted construction contracts funded by taxpayers to well-connected special interests—construction unions and contractors signatory to specific construction unions party to a PLA—and raise construction costs by 12%-20%.

“Taxpayers deserve the best product at the best price from the best contractors,” said Brubeck. “But that can only happen if Congress exercises appropriate oversight and creates the conditions to let all Americans and all companies fairly compete to rebuild their communities, regardless of their willingness to sign controversial agreements with labor unions.

“I am giving a voice to the thousands of quality large and small contractors and millions of their employees who want nothing more than to compete to deliver taxpayer-funded projects safely, on time and on budget for their private and government customers,” said Brubeck. “But they are effectively being boxed out from doing so via government protectionism benefiting special interests that is the foundation of President Joe Biden’s harmful pro-PLA policies and his goal of being the most pro-union presidency in American history.”

An ABC member injured by PLA mandates also testified at the hearing, “Cutting Competition in Contracting: The Administration’s Pricey Project Labor Agreement Mandate.” Aric Dreher, vice president and general manager of Cianbro Corp., one of America’s largest, 100% employee-owned, open shop contractors delivering industry-leading construction services for complex civil infrastructure projects in 40 states, called this administration’s PLA mandate overreaching, unfair and illegal.

The 75-year-old firm has completed some of the of the nation’s most innovative and challenging infrastructure projects, including the U.S. Air Force Memorial overlooking the Pentagon in Arlington, Virginia. “Cianbro has bid on and been awarded numerous federal projects since 2020 that exceeded $35 million,” said Dreher. “Due to the PLA mandate, we have been disqualified from pursuing opportunities to secure work on federal projects, such as the recently advertised U.S. Navy Pier 31 Extension at Naval Submarine Base New London in Groton, Connecticut. Cianbro maintains a robust catalog of upcoming federal and federally assisted construction projects and would continue to pursue similar opportunities if not for the new PLA mandate policy that went into effect at the end of January.”

ABC members won 54% of the $205.56 billion in federal contracts worth $35 million or more during fiscal years 2009-2023 and built award-winning projects safely, on time and on budget, without unnecessary government-mandated PLAs. ABC estimates the Biden pro-PLA policy will affect at least 180 federal construction contracts valued at $16 billion across America on an annual basis.

Glenn Ledet, executive director of the Louisiana Coastal Protection Restoration Authority, discussed the impact of the Biden PLA rule on federal contracts with respect to U.S. Army Corps of Engineers contracts where Louisiana is a cost-sharing partner covering 35% of the federal project costs. His exceptional opening remarks and written testimony explain how PLAs mandated by the USACE as a result of the Biden PLA rule add risk, increase costs, reduce competition from local bidders and harm the local construction workforce and contractor base that the CPRA works with to restore coasts and protect citizens from hurricanes. The Biden rule has “a significant impact on our ability to protect Louisiana’s coastal communities and ecosystems, as well as the nation’s water resources infrastructure,” said Ledet. “The application of PLAs could raise the cost of one $3.7 billion project by $444 – $740 million. It is vital that we avoid unnecessary additional costs.”

On March 28, ABC and its Florida First Coast chapter filed suit in federal court in Jacksonville, Florida, to block the Biden administration’s PLA final rule on construction contracts procured by federal agencies, asserting it is beyond the scope of executive authority and violates the Constitution, the First Amendment and the Administrative Procedure Act, among others. The litigation is ongoing, with ABC filing a motion for preliminary injunction against the rule on April 26.

In July 2023, ABC applauded passage of the Fair and Open Competition Act out of the House Committee on Oversight and Accountability, which would protect federal and federally assisted construction contracts from PLA mandates and allow merit shop contractors and their skilled employees to have a fair chance at competing to build taxpayer-funded construction projects. ABC issued a new action alert that members can use to urge members of Congress to cosponsor the Fair and Open Competition Act to help fight the final rule and Biden/Harris policies infecting federally assisted projects with PLA schemes.

Check out this hearing recap for links to key video moments of the hearing.

Watch the hearing and read Brubeck’s full testimony.

ABC continues to fight for fair and open competition on taxpayer-funded construction projects. Find more information at the ABC-led federal coalition website, BuildAmericaLocal.com, and get details on the Biden administration’s PLA mandate policy on federal construction projects at abc.org/BidenPLAFAQs.