Ross Introduces Fair and Open Competition Act
WASHINGTON, D.C., Mar. 16, 2017 – U.S. Rep. Dennis A. Ross (R-FL-15), Senior Deputy Majority Whip, this week introduced the Fair and Open Competition Act, which will reduce costs for taxpayers by encouraging all qualified construction companies to compete for federal and federally-funded construction projects. The bill further prevents federal agencies and recipients of federal funding from requiring contractors to sign controversial project labor agreements (PLAs) as a condition of winning federal or federally-assisted construction contracts.
“Government-mandated PLAs discriminate against more than 86 percent of the private construction workforce in America that chooses not to join a labor union,” said Rep. Ross. “They further drive up the cost of taxpayer-funded construction by 12 percent to 18 percent compared to projects not subject to PLA mandates. We must create a level playing field where more qualified contractors are able to compete for public construction contracts, allowing taxpayers to receive the best possible construction projects at the best possible price. This is why I introduced the Fair and Open Competition Act.
“This common-sense legislation will create more construction jobs, and therefore, help increase competition, reduce waste, and eliminate favoritism in the procurement process. This bill will also create jobs for veterans, minorities, women and local workers not affiliated with unions, and will create opportunities for small businesses and qualified contractors hurt by PLA requirements. I urge my colleges to immediately pass the Fair and Open Competition Act and put an end to these anti-competitive and costly contracting schemes.”
PLAs are union bargaining agreements that all contractors must sign in order to work on a construction project. Under PLAs, non-unionized firms are forced to subject their employees to union control. These non-union employees are required to pay union dues and contribute to union pension and health care funds, despite the fact that they will never benefit from these mandatory contributions unless they join and vest in a union.
Starting in 2001, federal policy prevented agencies from requiring or prohibiting the use of PLAs on federal construction projects to prevent this kind of unfair treatment of non-union firms, which represent about 86 percent of the construction workforce. However, in 2009, President Barack Obama signed an executive order encouraging the use of PLAs by federal agencies.
While this executive order did not require federal agencies to use PLAs, subsequent implementing guidance and regulatory changes led some agencies to interpret the order as requiring consideration of PLAs as a condition of awarding federal contracts. Studies have found that this agency preference for PLAs has had a chilling effect on the bidding process for non-union firms, which in turn has empowered politically-connected unions to drive up construction costs due to the lack of competition. The non-partisan Government Accountability Office (GAO) determined that it is impossible to show any cost savings or increase quality derived from government-mandated PLAs.