President Obama’s Project Labor Agreement Executive Order Continues Assault on Small Business

ICYMI, an April 14 Wall Street Journal editorial blasts President Obama’s Feb. 6, 2009 pro-project labor agreement (PLA) Executive Order 13502 that was implemented into federal procurement regulations via a final rule issued April 13 (“Crony Contracts. Want federal business? Better be a union shop“).

Anti-competitive government-mandated PLAs are special interest schemes that end open, fair and competitive bidding on public construction projects.  It’s another way Big Labor and its handpicked cronies in government assault small businesses and nonunion employees in the construction industry, which is already suffering from 25 percent unemployment.

In short,  government-mandated PLAs discourage competition from qualified contractors and deny jobs to their skilled employees because they do not belong to a union.

The Wall Street Journal editorial says PLAs are a “rotten deal for taxpayers” as studies have demonstrated that PLAs increase the cost of construction by as much as 20 percent as a result of reduced competition and inefficient union work rules forced on contractors through PLAs.

That means that the public will pay more and get less. That’s one less school, hospital and bridge for every four that are built with PLAs. And the increased costs haven’t translated into better quality construction projects. The WSJ points out the well documented public record of poor performance of PLAs. 

“Boston’s Big Dig, Seattle’s Safeco field, Los Angeles’s Eastside Reservoir project, the San Francisco airport, Detroit’s Comerica Park—all were built under PLAs marked by embarrassing cost overruns. We’d list more, but newsprint is expensive.

The White House went out of its way to note that the Supreme Court has upheld such agreements in the past, suggesting it has a guilty conscience. In fact, the High Court has never ruled on the legality of these agreements under federal competitive bidding laws. Industry groups are now threatening legal action to defend the rights of workers who will be denied employment for the crime of not sporting Obama-Biden bumper stickers. It’s a fight worth having.”

ABC and a coalition of construction industry groups will pick this fight on behalf of small businesses and challenge in the courts this black eye to America’s nonunion contractors and employees – who compose more than 85 percent of the U.S. private construction workforce.

Last week, this coalition sent a letter to U.S. Senate and House offices that criticized the final rule pushing government-mandated PLAs and encouraged members of Congress to co-sponsor the Government Neutrality in Contracting Act (S. 90/H.R. 983), which would:

 ”…curb waste and favoritism in federal construction contracting and ensure that taxpayer-funded construction contracts are awarded on sound principles that will deliver to taxpayers the best possible product at the best possible price….  [and] …puts good policy over politics and ensures fairness and full competition in the federal contracting market.”

The White House and Congress should be doing all that it can to deliver to taxpayers  the best possible product at the best possible price, not inflating costs while funneling new jobs and lucrative federal contracts to their most prolific political donors.

Visit to learn more about government-mandated PLAs at the local, state and federal level.  Join the fight against crony contracting through government-mandated PLAs by becoming a fan of’s Facebook page.

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One Comment

  1. Bob Kilgore
    Posted April 29, 2010 at 1:10 pm | Permalink

    This is just the tip of the iceberg. The feds are also “encouraging” use of PLAs in determining whether to guarantee loans on projects that aren’t directly financed by federal tax dollars. Case in point: nuclear energy construction and loan guarantees issued by DOE. It’s happened in South Texas and other parts of the country, and all it does is drive up the cost of projects that will be passed along to rate payers.

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