AGC Continues to Educate Federal Agencies About the Perils of Mandating PLAs

The latest of AGC of America's ongoing efforts to educate federal agencies about the complications inherent in government mandates for project labor agreements (PLAs) includes an October 1 letter to the U.S. Naval Facilities Engineering Command (NAVFAC) and a September 8 letter to the Federal Highway Administration (FHWA).  As explained in the letters, while AGC neither supports nor opposes PLAs in general, AGC strongly opposes government mandates for PLAs on publicly funded construction projects. AGC is committed to free and open competition in all public construction markets and believes that publicly funded contracts should be awarded without regard to contractors' lawful labor relations policies and practices.  The letters urge the agencies to defer to contractors' judgment as to whether a PLA is appropriate for a given project and to their expertise in negotiating a PLA should they deem one appropriate. AGC sent the letter to the FHWA in follow-up to previous communications with the agency regarding PLAs and in response to FHWA-issued Interim Guidance on the Use of Project Labor Agreements.  In the Interim Guidance, the agency advises state departments of transportation (DOTs) that it will approve PLA mandates on federal-aid highway projects if the DOTs meet certain conditions spelled out in the document.  FHWA has reported that it has approved PLAs on six projects thus far, five in Illinois and one in New York. AGC encouraged FHWA to exercise the broad latitude granted by the executive order to reject any state DOT request to impose a PLA mandate and direct them to use PLAs only at the contractor's discretion.  In the event that FHWA refuses to follow this recommendation, the letter continued, then it should approve such requests only after the state DOT has produced a record demonstrating that it has conducted a thorough analysis of uniform, fact-based criteria to determine that such a mandate is appropriate for the project.  The six-page letter sets out a number of specific issues that FHWA should require state DOTs to consider in such an analysis.  It also points out the pitfalls of various options for the required timing and execution of a PLA, and recommends requiring state DOTs to give bidders and contractors maximum flexibility on such matters.  The letter to NAVFAC covered many of the same issues.  It was sent in response to the agency's request for input into its consideration of whether or not to the require the use of PLAs on Guam realignment construction projects.  AGC provided specific comments about whether PLA requirements on the projects would advance each of the government interests set forth in President Obama's executive order on PLAs as conditions for such mandates.  The nine-page letter explains how PLA mandates in Guam could be particularly impractical and problematic.  The letter was also hand-delivered by an AGC representative at a stakeholders meeting with NAVFAC's PLA Team on October 6. AGC will continue to monitor the PLA activities of FHWA, NAVFAC, and other federal agencies.  If you become aware of any new federal PLA mandates, please advise AGC by sending information to Denise Gold at (703) 837-5326 or goldd@agc.org, or Marco Giamberardino at (703) 837-5325 or giamberm@agc.org. For more information on PLAs, go to AGC's Labor & HR Topical Resources Web page, then select the category "Collective Bargaining" and subcategory "Project Labor Agreements."