Opposition Growing to Biden Proposal to Expand Union Power in Federal Project Contracting

The General Services Administration building in Washington on Nov. 21, 2016. SAUL LOEB/AFP via Getty Images

Fifty Republican Members of Congress and 18 Republican governors are urging President Joe Biden to withdraw the Federal Acquisition Regulatory Council’s (FARC) proposal to require unionized workforces on most government-funded construction projects.

The FARC proposal implements Biden’s Executive Order (EO) 14063 that requires Project Labor Agreements (PLA) on all “major” federal construction projects. Use of a PLA in a federal contract means that only companies with unionized employees are eligible to bid and be selected for a federal project.

Biden’s EO was signed in February 2022, but the Department of Defense (DOD), National Aeronautics and Space Administration (NASA) and the General Services Administration (GSA), which oversees most non-defense federal acquisitions, only proposed the implementing rule in August 2022.

The GOP congressmen and governors, however, contend that PLAs are inefficient, discriminate against the vast majority of construction industry employees who are not members of labor unions, and increase costs to taxpayers.

“The proposed rule will undermine taxpayer investment in public works projects financed by the American Rescue Plan Act, the Infrastructure Investment and Jobs Act, and other recent infrastructure legislation passed by Congress,” the 50 GOP senators and representatives told William Clark in an Oct. 18 letter.

Clark is Director of the Office of Government-Wide Acquisition Policy for the GSA.

“None of these laws included language requiring or encouraging the use of PLAs. Further, the proposed rule will have a disproportionately negative effect on small and diverse contractors that both the federal government and our states have worked hard to grow and include in the competitive bidding process to build construction projects directly for federal agencies,” the representatives continued.

The governors also noted in their separate letter that PLAs inject excessive constraints on publicly funded construction projects that are critically needed in rebuilding the nation’s infrastructure.

“As governors, we support policies that ensure robust competition for taxpayer-funded construction projects that welcome all of America’s construction industry to compete to rebuild our nation’s infrastructure on an even playing field,” the governors told Clark.

“We aim to provide value to taxpayers as we partner with the federal government to deliver roads, bridges, communications, water, energy, and transportation systems safely, on time, and on budget, but we cannot deliver the best results with onerous and unnecessary constraints ...

“When mandated by government agencies, PLAs can interfere with existing union collective bargaining agreements and needlessly discourage competition from quality nonunion contractors and their employees who comprise 87.4 percent of the private U.S. construction industry workforce according to the U.S. Bureau of Labor Statistics. Reducing competition from some of the best union and nonunion construction firms and workers will exacerbate the construction industry’s skilled labor shortage, delay projects, and increase construction costs by estimates of 12 percent to 20 percent per project, which will result in fewer infrastructure improvements, less construction industry job creation, and higher taxes.”

Among the congressional letter signers are senators Richard Burr of North Carolina, Jim Inhofe of Oklahoma and Ted Cruz of Texas, while the House Republican signers include, among others, representatives Ted Budd of North Carolina, who is seeking the retiring Burr’s Senate seat, James Comer of Kentucky, who is likely to take over as chairman of the House Committee on Government Oversight and Reform, and Greg Steube of Florida.

Republicans signing the governors letter include, among other, Doug Ducey of Arizona, Brian Kemp of Georgia, Kim Reynolds of Iowa, Kevin Stitt of Oklahoma, Pete Ricketts of Nebraska, Greg Abbott of Texas and Kristi Noem of South Dakota.

Biden’s proposal is also drawing opposition from a host of taxpayer advocate groups, including Americans for Tax Reform (ATR), the National Taxpayers Union (NTU), Citizens Against Government Waste (CAGW), Taxpayers Protection Alliance (TPA), the 60 Plus Association seniors group, and Americans for Prosperity.

“PLAs require contractors to sign a collective bargaining agreement with various construction trade unions as a requirement to win contracts to build applicable government construction projects,” the taxpayer advocates said in comments submitted to FARC.

“These agreements typically force contractors to adhere to union wage scales, hire union labor, follow union work rules, and pay into union benefit plans that other nonunion employees will be unlikely to tap into. As a result, contractors who use nonunion workers—and often make lower-cost bids—are effectively locked out of the process,” the comments said.

The taxpayer advocates pointed to a 2021 RAND Corporation study that concluded construction costs on projects required by the city of Los Angeles to have PLAs were at least 14.5 percent higher than they would otherwise have been.

A FARC spokesman could not be reached for comment.

As previously reported by The Epoch Times, the Biden PLA proposal is also opposed by the National Right to Work Legal Defense Foundation and the Associated Builders & Contractors, which represents construction industry companies.