Contractors Backs Bill to Increase Competition on Taxpayer-Funded Construction Contracts
Associated Builders and Contractors (ABC) today voiced its strong support for the Fair and Open Competition Act (S. 622). The bill, introduced by Sen. Jeff Flake (R-Ariz.), will reduce costs for taxpayers by encouraging all qualified construction companies to compete for federal and federally funded construction projects. S. 622 prevents federal agencies and recipients of federal funding from requiring contractors to sign controversial project labor agreements (PLAs) as a condition of winning federal or federally assisted construction contracts.
“The Fair and Open Competition Act will create more construction jobs and help taxpayers get the best possible construction project at the best possible price by increasing competition, reducing waste, and eliminating favoritism in the procurement process,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “This important bill will create a level playing field where more qualified contractors will compete for public construction contracts because the government can neither encourage nor prohibit project labor agreements.”
“When mandated by the government, PLAs discriminate against the 86.1 percent of the private U.S. construction workforce that chooses not to join a labor union and drive up the cost of taxpayer-funded construction by 12 percent to 18 percent compared to projects not subject to PLA mandates,” said Brubeck. “ABC supports this bill because it will create jobs for veterans, minorities, women and local workers not affiliated with unions, and will create opportunities for small businesses and qualified contractors hurt by PLA requirements. We urge Congress to immediately pass this common-sense legislation and put an end to these anti-competitive and costly contracting schemes.”
An ABC-led a coalition of 14 construction industry and business associations sent a letter to the Senate today in support of the bill.
When mandated by a government agency on a taxpayer-funded project, a PLA typically ensures construction contracts are 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 at the expense of existing qualified employees; obtain apprentices through union apprenticeship programs; follow inefficient union work rules; pay into union benefit and multi-employer pension plans workers will never benefit from unless they meet vesting requirements; and force workers to pay union dues and/or join a union as a condition of employment.
In 2009, President Obama signed Executive Order 13502, which strongly encourages the use of government-mandated PLAs on federal and federally funded construction projects. In January 2017, letters sent by ABC and a coalition of construction and industry stakeholders asked President Trump to rescind Obama’s pro-PLA policy and replace it with Executive Orders 13202 and 13208, which prohibited government-mandated PLAs on $147.1 billion worth of federal construction contracts and hundreds of billions of dollars’ worth of federally assisted projects from 2001 until it was rescinded by President Obama in 2009.
In the 114th Congress, a similar bill, the Government Neutrality in Contracting Act (H.R. 1671), introduced by Rep. Mick Mulvaney (R-S.C.), had more than 100 cosponsors and was passed out of the House Oversight and Government Reform Committee. In 2015, the U.S. Senate passed Sen. Flake’s Amendment 665 to the Senate’s budget resolution (S. Con. Res. 11), which expressed the sense of the Senate that construction contracts should be awarded without discrimination based on contractors’ agreements with labor organizations.
A total of 22 states— 20 since 2010— have passed similar measures ensuring fair and open competition on state and local projects. This year, a number of states are deliberating similar bills, such as Wisconsin’s SB3/AB24, which was sent to Gov. Scott Walker’s desk on March 9. In 2015, West Virginia became the 22nd state to ban PLA mandates when Gov. Earl Ray Tomblin (D-W.Va.) signed the bipartisan Establishing Fair and Open Competition in Governmental Construction Act. Gov. Tomblin is the first Democratic governor to sign a bill prohibiting PLA mandates. Also in 2015, Arkansas Gov. Asa Hutchinson (R-Ark.) signed into law a bipartisan bill prohibiting PLA mandates that had previously passed both the State Senate and House of Representatives in unanimous votes.