Wasting money with project labor agreements


Two trade groups -- the Nevada Business Coalition and the state chapter of the Association of Builders and Contractors -- are challenging the county's effort to require union labor on a $27 million jail renovation, arguing the proposal will boost costs to taxpayers.

In response, the state Supreme Court has ordered the county to submit a 36-point brief to District Court explaining how it would benefit taxpayers for the county to require contractors to sign an agreement requiring that some union labor be used.

Good luck.

The county, governed by an all-Democratic County Commission whose usual response to any union demands is "Yes sir, how high?" will argue the proposed "project labor agreement" will prevent strikes, ensure local workers are used and give contractors access to cheaper labor such as union apprentices -- all supposedly benefits to taxpayers.

And the moon is made of green cheese.

In fact, the county has failed to show there's a shortage of available workers, one of the high court's criteria for requiring any such labor agreement, argues Warren Hardy, a representative for the builders and contractors association.

"I don't think anyone in this economy would argue there's a shortage of labor," Mr. Hardy says.

In fact, such agreements are a thinly disguised form of legal blackmail. In exchange for higher wages -- and a requirement that victim contractors pay into a union health care fund, even if they already provide benefits to their workers -- the unions agree not to strike. But as Mr. Hardy implies, striking workers could be replaced in mere hours, given the idle skilled labor pool in this economy.

Around the country, even jurisdictions that went overwhelmingly for Barack Obama in 2008 are going the other way.

"One benefit of the squeeze on state and local budgets is that politicians are finally having to confront their sweetheart deals with labor unions," The Wall Street Journal editorialized Tuesday. "The latest reform movement is moving against project labor agreements, or PLAs, that limit bids on construction projects to contractors that agree to union representation."

Only about 13 percent of construction workers belong to unions, and "PLAs are a union invention to use their political muscle to organize more companies," the Journal reports. "Proponents argue that PLAs ensure the speed and quality of construction plans. But PLAs are one of the reasons that Boston's Big Dig was estimated at $2.8 billion but eventually cost $22 billion" -- while raining concrete on innocent drivers. "Studies show that projects under PLA contracts on average cost 12 percent to 18 percent more than projects awarded by open, competitive bidding," the Journal continues. "Taxpayers pick up much of this tab."

Under the PLA put in place for Frank Gehry's 76-story Beekman Tower in New York City, costs have skyrocketed. Contractors say strict union job classifications mean they have to employ superfluous workers.

In response to such evidence, Louisiana passed a law this month that prohibits state entities from mandating the use of PLAs. Tennessee, Arizona and Idaho passed similar legislation earlier this year, and Iowa Gov. Terry Branstad, immediately upon his inauguration, signed an executive order ending a state PLA requirement. These states join Utah, Montana, Missouri and Arkansas, which enacted bans in recent years. Even Michigan is poised to follow suit.

"PLAs are a form of political bid-rigging that robs taxpayers even in good economic times. Amid today's limited fiscal resources, PLAs steal money from the likes of education and law enforcement to reward politically-connected companies and their unions. They deserve to be outlawed," the Journal concludes.

Yet the all-Democratic Clark County Commission clings to the withered fig leaf that requiring PLAs saves the taxpayers money by "preventing strikes."

Sure. And paying Big Guido his protection money helps keep your store from burning down.

 

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