Put Freedom to Work

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Put Freedom to Work

• Support Open Competition for Construction Jobs on
  Syracuse Schools.
• Say NO to a Union-Only Project Labor Agreement.

Rebecca Meinking President, Empire State Chapter
of Associated Builders Contractors (ABC) Joint
School Construction Board August 24, 2006
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What is a Union-Only PLA?

• An agreement between a construction owner (in
  this case, the JSCB) and the building trades
  unions which requires construction contracts to
  be awarded ONLY to contractors and subcontractors
  who agree to
• Recognize unions as the representatives of their
  employees on that job.
• Use the union hiring hall to obtain workers.
• Obey the unions restrictive work rules, job
  classifications and arbitration procedures.

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Union-Only PLAs Reduce Competition
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Union-Only PLAs Reduce Competition

• FACT
• Union-Only PLAs restrict competition which in
  turn drives up costs. Why?
• Typical provisions in a union-only PLA prevent
  MOST merit shop contractors from bidding for a
  number of reasons.

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Union-Only PLAs Reduce Competition

• Typical PLA requirements that harm non-union
  contractors and discourage them from bidding PLA
  projects
• Recognize unions as the representatives of their
  employees on that job.
• Without a vote from the contractors existing
  workforce. Takes away their employees freedom
  to choose for themselves whether or not a union
  can best represent their interests.

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Union-Only PLAs Reduce Competition

• Use the union hiring hall to obtain workers.
• Few, if any, existing employees can be used
• Those existing employees must pay union dues or
  pay an agency fee to the union for the right to
  work on the project
• Workers come from the very union looking to put
  the nonunion contractor out of business. Union
  workers will try to organize non-union
  contractors workers, or union will send lowest
  quality workers.

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Union-Only PLAs Reduce Competition

• Pay into union benefit plans for existing
  workforce.
• Even though a contractor may already be paying
  into an existing bona fide benefit plan for their
  employee.
• Non-union employee will never see their pension
  contributions to union fund unless they join the
  union and fully vest.

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Union-Only PLAs Reduce Competition

• Obey the unions restrictive work rules and job
  classifications
• Prevents multiskilling and increases costs due to
  lost labor productivity because of union work
  rules. For example, to pour a concrete pad, a
  nonunion contractor has one crew who builds the
  forms, lays the rebar, pours the concrete,
  finishes the concrete, and removes the forms. A
  union contractor must get carpenters to build the
  forms, iron workers to lay the rebar, cement
  finishers to do the cement work, and carpenters
  to remove the forms. It doesnt take a rocket
  scientist to figure out which is the more
  efficient way to work.

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Union-Only PLAs Reduce Competition

• FACT
• Union-Only PLAs restrict competition from
  non-union contractors and subcontractors.
• Why?
• Typical provisions in a union-only PLA discourage
  MOST merit shop contractors from bidding for a
  variety of reasons.
• Result
• Increased construction costs because of lost
  competition from a large portion of the
  construction workforce.

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Union-Only PLAs Increase Costs

• An April 2006 study by the Beacon Hill Institute
  (BHI) at Suffolk University in Boston, Mass.,
  found that the use of PLAs on school construction
  projects in New York increased the cost of the
  projects by 20 percent or nearly 27 per square
  foot relative to non union-only PLAs.
• Source Project Labor Agreements and Public
  Construction Costs in New York State Paul
  Bachmanand David G. Tuerck, Beacon Hill Institute
  at Suffolk University (April 2006)

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Union-Only PLAs Increase Costs

• Construction projects are more expensive when a
  PLA is in effect because the competitive pressure
  that holds down prices in other industries is
  eroded. Merit shop construction firms, facing
  the huge obstacles required by PLAs, are often
  discouraged from bidding when a PLA is in effect.

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Union-Only PLAs waste taxpayer dollars.
Union-Only PLAs Increase Costs
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Union-Only PLAs Shut Out a Large Percentage of
Local Workers

• Union Membership in 2005 New York Private
  Construction Workforce

Source Professor Barry T. Hirsch (Trinity
University) and David A. Macpherson (Florida
State University). "Union Membership and
Coverage Database from the Current Population
Survey. August 23, 2006. www.unionstats.com
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Union-Only PLAs Shut Out a Large Percentage of
Local Workers

• Unions claim that PLAs are the only way to ensure
  the use of local labor on the job.
• If over 75 of the local construction workforce
  is nonunion, and a PLA mandates union labor on
  the project, how does that give ALL local
  construction workers an opportunity to work on
  the project???

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Union-Only PLAs Shut Out a Large Percentage of
Local Workers

• Union Locals are anything but
• IBEW Local 43 hiring hall serves members in
  Cortland, Herkimer, Madison, Oneida, Onondaga,
  Oswego counties and parts of Cayuga, Chenango,
  and Otsego Counties
• Plumbers Steamfitters Local 267 hiring hall
  serves members in Onondaga, Cortland, Cayuga,
  Schuyler, and Tompkins Counties
• Laborers Local 754 hiring hall serves members
  in Cayuga, Cortland, Onondaga, Oswego, Fulton,
  Herkimer, and Madison Counties
• When no more workers are available in the
  signatory local hiring halls, union members
  from other locals within the state will be
  brought in.

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Union-Only PLAs Shut Out a Large Percentage of
Local Workers

• Onondaga Lake PLA Project
• Certified payrolls for the prime contractors on
  the Hiawatha Metro Plant Project, one of the
  largest projects in the Lake Cleanup, document
  that a total of 946 workers were employed on the
  project. Of the 946 workers
• 160 (17) were residents of the City of Syracuse
• 467 (49) are residents of counties outside of
  Onondaga County
• 83 that are not residents of the City came from
  areas as far away as Eveleth, MN, Pataskala, OH,
  Seattle, WA, and Mifflinville, PA

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Union-Only PLAs discriminate against minority-
and women-owned businesses and their diverse
workforce.
Union-Only PLAs Discriminate
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Union-Only PLAs Discriminate
Minority and Womens Business Groups Oppose
Discriminatory Union-only PLAs.

• PLAs amount to de facto segregation
  African-American workers are significantly
  underrepresented in all crafts of construction
  union shops ... this problem has been persistent
  during past decades and there appears to be no
  type of improvement coming ... PLAs are
  anti-free-market, non-competitive, and, most of
  all, discriminatory.
• National Black Chamber of Commerce
• WCOE opposed federally mandated project labor
  agreements PLAs will disproportionately impact
  small business, particularly those owned by women
  and minorities.
• Women Construction Owners Executives, USA
• We believe PLAs make it more difficult for
  minority-owned contractors to compete they
  effectively work against the goals of increasing
  the number of projects awarded to minority-owned
  businesses by placing roadblocks in our way.
• Latin Builders Association, Inc.
• (PLAs) are bad for business, especially small
  businesses which constitute most of our
  membership. They impose undue restrictions on our
  ability to compete, increase the cost of doing
  business, reduce employee benefits, and interfere
  with the free negotiation process between
  employee and employer. They are patently unfair
  to small businesses who do not have the resources
  to comply with yet another government mandate.
• United States Pan-Asian-American Chamber of
  Commerce
• (PLAs) are not good business for small business
  in general, and particularly for women and
  minorities in business the impact on women and
  minorities trying to compete in federal
  procurement would be devastating.
• National Association of Women Business Owners

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Union-Only PLAs Discriminate

• Minority/Women Participation On Onondaga Lake
  Project
• Hiawatha Metro Plant Project 946 workers.
• 105 (11) were minorities and 33 (3) were women.
• 43 of the 105 minorities were residents of the
  City of Syracuse.

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Open Competition Works

• Local projects built with free and open
  competition, without a PLA
• West Genesee School District Capital Improvement
  Project done on time, on budget, with more than
  80 local contractor participation
• Jamesville Dewitt School District Capital
  Improvement Project done on time, on budget,
  with more than 70 local contractor participation

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Open Competition Works

• National projects built with free and open
  competition, without a PLA
• Woodrow Wilson Bridge VA/DC/MD
• Jack Kent Cooke Stadium Andover, MD
• Camden Yards Baltimore, MD
• Fall River School District Fall River, MA
  (underway)

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NY State PLA Projects Gone Bad

• Albany School District
• 185.2 million renovation project individual
  school renovation costs are projected in some
  cases to be more than double the original
  estimate. They only have 31 million of the 185
  million left and still have more than half the
  schools slated for renovation in the original
  plan left to do.
• Buffalo School District
• Overbudget with regard to the local share
  required and not meeting minority participation
  goals

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NY State PLA Projects Gone Bad

• Onondaga Lake Cleanup Project
• PLA was implemented based on cost benefit
  analysis that showed that the County would save
  over 11 million with a PLA. Heres where those
  savings stand today
• Alternative Dispute Resolution (ADR) projected
  to save 1.7 million over life of the project in
  CDM study. According to contractors working on
  the project, the ADR program was never
  implemented, so no savings are being realized
• CDM study for school renovation project projects
  7.7 million in saving through ADR will those
  savings be realized??

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NY State PLA Projects Gone Bad

• Management Rights the ability of individual
  contractors working on the project to control the
  level of staffing/scheduling was to save 2.1
  million over the life of the project according to
  CDM study
• According to contractors working on the project,
  there are NO management rights on issues that
  arent specifically dealt with in the PLA. Will
  the 1.5 million in savings that CDM says will be
  realized on the school project come to fruition??

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NY State PLA Projects Gone Bad

• Productivity the ability for workers to work
  four 10-hour days at a regular rate was to save
  four hours per worker per month in
  productivity, a total savings of 2.5 million
  over the life of the project
• A review of certified payrolls and discussions
  with contractors working on project shows
  virtually NO utilization of this concept. Will
  the 5.7 million that CDM says will be saved on
  the school project incorporating this provision
  ever be realized???

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NY State PLA Projects Gone Bad

• The Onondaga County Legislature recently approved
  an additional 50 million to cover increased
  costs on the Midland Avenue Sewage Treatment
  Plant (part of the Lake Cleanup project) which is
  currently under construction.
• The original projected cost was 75 million, so
  thats a 65 increase in costs.

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National PLA Projects Gone Bad

• Bostons Big Dig
• 12 billion over budget.
• Fatalities, design flaws, safety violations.
• Missed numerous construction deadlines with no
  project completion date in sight.
• San Francisco International Airport Expansion
• 500 million over budget (30) and completed over
  a year behind schedule.
• Two separate strikes.
• Subject to an FBI investigation and a lawsuit
  over minority participation.
• Los Angeles Unified School District
• 2 billion school construction bond (Prop. BB)
  passed in 1998.
• As of June 2003 the district was 600 million
  over budget with only half of the projects
  completed. All work is covered by a PLA.
• Safeco Field - Seattle, WA
• Original estimate was 320 million. Final cost
  for new Seattle Mariners ballpark was in excess
  of 517 million, a 60 increase.
• Miller Park Milwaukee, WI
• Missed scheduled opening season for Milwaukee
  Brewers. Opened in 2001 instead of 2000
• Experienced three worker fatalities.
• Over-budget.

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Support Local Taxpayers and Local Working Families

• P.L.A.
• Public Loses Again
• PLAs increase costs of school construction by 20
  - so the 225 million for the first phase of he
  school renovation project will only buy 180
  million worth of construction - 45 million in
  taxpayer money WASTED
• PLAs discriminate against 75 of the local
  construction workforce that freely chooses to not
  belong to a union. ALL local workers, whether
  union or nonunion, should have the opportunity to
  work on this project

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A Summary of Union-Only PLAs

• PLAs reduce competition and increase costs
• PLAs discriminate against local workers and their
  families
• PLAs have a record of failure
• PLA proponents fail to prove their claims
• PLAs
• Anti-Worker, Anti-Competitive, Anti-American

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Open Competition Is The Way To Go
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Support Open Competition for All Construction Jobs