News from associated
builders and contractors

On Dec. 22, 2023, the Biden administration published a final rule that implements an executive order making federal construction contracts of $35 million or more subject to controversial project labor agreements. PLAs require project-specific collective bargaining agreements that grant union-backed contractors a virtual monopoly to build public works projects.

This final rule comes at a time when over a trillion dollars’ worth of federal investment and tax incentives are slated for critical infrastructure projects throughout the country—including roads, bridges, clean-energy projects and domestic manufacturing facilities built by private developers. With such a high demand for qualified contractors and skilled workers to complete these projects, and the construction industry’s skilled-labor shortage of more than half a million people, this new PLA mandate will result in unnecessary restraints and significant workforce challenges to complete these projects on time and on budget.

LESS THAN 12%

A historically high 88.3% of the U.S. construction industry freely chooses not to join a union, and these open-shop contractors have built more than half of the federal government’s large-scale construction projects since 2009. Additionally, many of these contractors are more likely to be small businesses and to be owned and operated by women and minorities.

The Biden administration’s plan to eliminate competition from the majority of experienced local contractors and construction workers is sure to create procurement and construction delays. It is impossible for construction unions—which represent less than 12% of the workforce—to supply enough workers to build America’s substantial federal investment in infrastructure.

Not surprisingly, taxpayers also lose with reduced competition and overly burdensome federal requirements. Research has found that PLA mandates increase construction costs by anywhere from 2 to 20%, which means voters can expect fewer improvements to transportation, utility, school, affordable housing, manufacturing and clean-energy projects—and fewer jobs.

LEVEL PLAYING FIELD

ABC and other organizations are prepared to file lawsuits against the illegal final rule and contracts subject to PLAs, because Americans deserve long-lasting federal construction projects built safely, on time and on budget by the best contractors and workers, regardless of labor affiliation.

Outside of the legal system, some in Congress are working to ensure that participation in building these critical projects is open to all Americans, regardless of labor affiliation. Sen. Todd Young, R-Ind., and Rep. James Comer, R-Ky., have introduced the Fair and Open Competition Act, with 117 Republican cosponsors in the House and 27 in the Senate. FOCA would prevent federal agencies and recipients of federal assistance from requiring or encouraging contractors to sign a PLA as a condition of winning a federal or federally assisted, taxpayer-funded construction contract and make the Biden administration’s rule null and void.

With strong support for a level playing field from Republicans in both chambers, should power shift after November’s election, a new administration could repeal this ill-advised final rule and reinstate a position of neutrality when it comes to PLAs on federal construction projects. This would ensure full and fair competition from our nation’s most qualified and skilled contractors and a better way forward to modernizing our nation’s most vital infrastructure.