Study: Mandatory PLAs have increased OH school construction costs by 13%

Dive Brief:

A study from the Beacon Hill Institute found that mandated project labor agreements (PLAs) have increased the cost of school construction in Ohio by 13%.
The conservative Boston think tank analyzed Ohio school construction data back to 2000 and determined that projects built under PLAs cost $23.12 more per square foot than their non-PLA counterparts.
The study did not apply their findings to the construction industry at large, but the Associated Builders and Contractors — a major opponent of mandated PLAs — said the results are consistent with past research that shows PLAs can increase construction costs by 12%-18%.

Dive Insight:

The ABC called on Ohio lawmakers to pursue what the organization characterized as anti-competition legislation and ban mandatory PLAs. Last month, Iowa and Wisconsin became the latest states, now totaling 23, to prohibit state-mandated PLAs.

Opponents of PLA requirements argue that they undermine free and open competition and prevent nonunion workers from being able to enjoy the same level of benefits that union workers do.

PLA proponents, however, maintain that the agreements don't preclude nonunion participation and that PLAs are integral to the provision of a steady supply of workers with advanced skills and safety training, as well as higher wages for all workers on a project.

ABC officials told Construction Dive in January that even though PLAs technically allow the employment of nonunion workers, the terms contained in the agreements make it hard for nonunion contractors to take part.

PLAs are not the only work-related measures to come under attack by advocates of open shop-style workplaces. Also under fire from the ABC and other organizations are requirements that nonunion workers pay union dues on projects, even if the unions negotiated the wage rates and benefits.

The ABC has once again called on President Donald Trump to roll back Obama-era Executive Order 13502, which encourages government agencies to use PLAs on projects that cost more than $25 million. Trump has not taken any action against the order yet.