General Services Administration
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To Whom It May Concern,
The Economic Policy Institute (EPI) is a nonprofit, nonpartisan think tank created in 1986 to include the needs of low- and middle-income workers in economic policy discussions. EPI conducts research and analysis on the economic status of working America, proposes public policies that protect and improve the economic conditions of low- and middle-income workers, and assesses policies with respect to how well they further those goals. EPI submits these comments on the Department of Defense, General Service Administration, and National Aeronautics and Space Administration’s proposal to amend the Federal Acquisition Regulation to implement an Executive Order pertaining to project labor agreements (PLAs) in Federal construction projects. EPI strongly supports the proposed rule.
Under the proposed rule, the use of project labor agreements will be required in large-scale Federal construction projects that exceed over $35 million. The rule also allows agencies to use their discretion to require project labor agreements for Federal construction projects that are less than the $35 million threshold. The implementation of the Executive Order 14063, Use of Project Labor Agreements for Federal Construction Projects, demonstrates a strong commitment to improving efficiency, reducing costs, promoting workers’ well-being, and engaging local communities in large-scale government projects.
Project labor agreements are effective mechanisms for controlling construction costs, ensuring efficient completion of projects, and establishing fair wages and benefits for all workers. For example, New York City embarked on a $5.3 billion project in 2009, and the use of four PLAs was estimated to lead to 1,800 new jobs while saving the city approximately $300 million.1 In fact, PLAs have been used in large construction projects since the 1930s. PLAs have been extensively used in the private sector, including in the construction of Disney World in 1967, the Kennedy Space Center, and Yankee Stadium.2 Further, corporations including Toyota, Walmart, and Delta Airlines have used PLAs in manufacturing products. Local governments have also used PLAs successfully for decades, such as in school construction projects in Los Angeles as well renovation projects in New York City.3 Additionally, the City of Boston completed the largest public housing energy efficiency project in the nation’s history using a PLA in 2014.4 Upon completion, the city noted that the three-year, green construction project cost $66.7 million and renovated 13 public housing properties serving residents of 4,300 units.5 Boston estimated a 13,000-ton reduction in annual carbon dioxide emissions in addition to $4.8 million annual savings in energy and water costs. Boston expects to save $100 million over the next 20 years as a result of the renovations.
The project labor agreement process also includes a competitive bidding process that eliminates the risk of increased costs. A study from the University of Berkeley Labor Center found that projects with PLAs attracted a “similar number of bidders” and “came in at a slightly lower price” when compared to projects without PLAs in place.6 Another 2015 paper from University of Utah compared nine PLA affordable housing projects with 121 affordable housing projects built without PLAs and found that the PLA projects were not more expensive to build.7
Research shows that project labor agreements help ensure construction projects are cost effective, completed in a timely manner, and provide workers with fair wages and benefits. The proposed rule would require the use of PLAs—a tool that has been effectively used in the private and public sector for decades—for large-scale Federal construction projects. As the Biden administration implements the Infrastructure Investment and Jobs Act and the Inflation Reduction Act, it’s imperative that the federal government use funds from these historic bills in an efficient and cost-effective way. For these reasons EPI strongly supports the swift implementation of the executive order.
Policy Analyst and Government Affairs Specialist
Economic Policy Institute
Director of Policy and Government Affairs | General Counsel
Economic Policy Institute
1. Fred B. Kotler, Project Labor Agreements in New York State II: In the Public Interest and of Proven Value, Cornell University School of Industrial and Labor Relations, May 2011.
4. Ameresco, “City Celebrates Largest Public Housing Energy Efficiency Project In Nation’s History” (press release), May 19, 2014.
5. Secretary Shaun Donovan, “Remarks at the White House-Emerald Cities Collaborative Briefing” (speech, The White House Old Executive Office Building, Washington D.C., January 18, 2011).
6. Peter Philips and Emma Waitzman, Project Labor Agreements and Bidding Outcomes: The Case of Community College Construction in California, UC Berkeley Labor Center, January 2017.
7. Peter Philips and Scott Littlehale, Did PLAs on LA Affordable Housing Projects Raise Construction Costs?, University of Utah, September 2015.