PROTECTING SMALL BUSINESS, PROMOTING ENTREPRENEURSHIP

Coalition Letter: The Problem with PLAs and the Harm to Competition in Government Contracting

By at 27 June, 2024, 2:56 pm

On June 27, the House Committee on Oversight and Accountability, Subcommittee on Cybersecurity, IT and Government Innovation hosted the hearing: “Cutting Competition in Contracting: The Administration’s Pricey Project Labor Agreement (PLA) Mandate.”

The hearing explored the challenges and big problems with PLAs. Specifically, the Biden administration published a final rule, Federal Acquisition Regulation: Use of Project Labor Agreements for Federal Construction Projects, in December 2023 that implements President Biden’s Executive Order 14063, which requires federal construction contracts of $35 million or more to be subjected to PLAs. SBE Council joined a diverse coalition of groups in a letter to the Chairwoman and Ranking Member of the Subcommittee that expressed opposition to the anti-competitive and inflationary PLA mandate. As they note in the letter:

PLA mandates artificially exacerbate a shortage of construction industry skilled labor; discourage competition from quality large, small and disadvantaged construction businesses; and needlessly increase construction costs at the expense of significant recent taxpayer investments in infrastructure, clean energy and domestic manufacturing construction.

The letter also points out that the coalition supports a resolution of disapproval (H.J. Res. 132) under the Congressional Review Act, introduced by Rep. Clay Higgins, R-La., nullifying the Biden administration’s PLA final rule on federal construction projects. Furthermore, the groups also support the Fair and Open Competition Act (H.R. 1209/S. 537) that would, according to the letter, “counteract special-interest favoritism by prohibiting federal agencies and recipients of federal assistance from mandating PLAs and implementing PLA preferences. However, this legislation would allow federal agencies to award contracts to businesses that voluntarily utilize PLAs before or after a fair and open competitive bidding process––a common industry practice permitted by the National Labor Relations Act. This commonsense measure passed out of the full Oversight Committee on July 12, 2023.”

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