Project labor agreements (PLAs) eliminate competition by shutting out qualified nonunion contractors, thus driving up the cost of public projects at the expense of taxpayers! Find out how your legislators voted on this legislation!
Assembly Vote
Senate Vote
Both Houses of the New Jersey Legislature in late June approved A-1926 (Egan, Malone)/S-1044 (Sweeney, Cafiero), which grants union-only firms a virtual monopoly on state and local public building contracts. The Assembly passed the bill in a 55-12 vote, the Senate in a 26-8 vote. Governor James E. McGreevey, who in January signed an executive order authorizing project labor agreements on state construction projects, signed the bill on July 25.
The New Jersey Business & Industry Association led a diverse coalition of municipalities, school boards, taxpayers and contractors that bitterly fought the legislation.
We wish to thank all of our member companies who took the time to call or write their legislators in opposition to A-1926/S-1044. Your efforts made approval of the legislation a much more difficult task than its sponsors had anticipated! In all, legislators received more than 5,000 faxes and many hundreds of phone calls from our members.
Although the legislation was expected to win easy approval in the Assembly, passage in the Senate, which is split 20-20 between Democrats and Republicans, was less certain. S-1044 had been held up in the Senate Labor Committee by the panel's three Republican members-Joseph Palaia, Leonard Lance and Robert Littell-who consistently opposed it. The Senate committee passage came only after Senator James Cafiero, the bill's sponsor, was substituted for Littell.
The legislation provides that state, county and local governments can require project labor agreements on construction contracts for schools, libraries and other public buildings. Under project labor agreements, unions are basically given the exclusive right to work on a project, effectively barring nonunion contractors from participating.
Project labor agreements are sweetheart deals for unions that increase the cost of public construction projects to taxpayers!
Amendments to the final legislation excluded transportation and utility projects and set a $5 million minimum for projects on which project labor agreements can be required. These amendments, while beneficial, did not address the fundamental flaw in the bill-discrimination against nonunion contractors, especially small and minority contractors.
NJBIA and the Coalition for Competitive Bidding Laws told legislators that PLA legislation is wrong because it:
- Ends the competitive bidding process, which is unfair to everyone. Many contractors currently involved in bidding on public projects would be shut out. Every business should have a chance to compete.
- Says it doesn't matter whether a bidder is competitive in price and quality of workmanship. The only thing that matters is hiring union labor!
- Eliminates competition. Limiting public contracts to unions only will force public entities to accept higher bids for projects rather than being able to choose from all bidders for the lowest responsible bid. This will result in increased costs for the taxpayers. This is a sweetheart deal for unions at the expense of taxpayers and employers.
- This bill overturns two New Jersey Supreme Court decisions declaring that project labor agreements are anticompetitive, are in conflict with the state's open-bidding laws and are not in the public's best interest.
If you have any questions, contact Jeff Stoller at jeffstoller@njbia.org.
