The Truth About Project Labor Agreements

Some call it blackmail, but contractors and public utility commissions in California familiar with Big Labor’s underhanded tactic that forces developers to utilitze discriminatory and costly project labor agreements (PLAs) call it greenmail.

It is why the Northern California Power Agency (NCPA) staff and commission chairman (Lodi Mayor Larry Hansen) are desperate to have a PLA and 30-year maintenance labor agreement for the construction and maintenance of the Lodi Energy Center power plant.

You can learn more about greenmail by reading James Spencer’s piece at PublicCEO.com, which provides some interesting commentary on the latest example of Big Labor’s use of greenmail to advance their special interest agenda (“Unions Blackmail Agency Over Project Labor Agreements,” 10/29). 

Highlights of the article include an NCPA Commissioner’s explanation of the greenmail “shakedown”:

Doug Crane, who is in his fifth year as the City of Ukiah’s NCPA Commissioner, voted against the agreement last week but expects the NCPA will get the outcome it’s seeking.

So why would any organization choose to shorten its list of potential bidders when the goal should be to find the highest quality of work at the lowest bid?

Well, it’s more about what the unions want.

“Its not about what’s right or what’s fair,” Crane said. “It’s about who has the most power and who can extort the most. It’s a simple shakedown in my opinion.”

Crane characterizes greenmail as “essentially legalized racketeering”: 

“Looking at it from the standpoint of small community, I’m not thrilled,” Crane said, “We get saddled with additional costs based upon this essentially legalized racketeering.”

Finally the author sheds light on the economic impact of greenmail and PLAs on taxpayers:

With a total project price tag of $432 million, and an estimated $60 million dedicated to labor, it would seem there might be a closer eye on spending ratepayer money most efficiently. The increased costs of this project due to the Project Labor Agreement will result in higher than necessary utility rates for customers. So as taxpayers, they’re being forced to pay more to fund the project and their rates will be higher as well.

It’s this lack of public accountability that has given government a black eye. And with local agencies already mired in red ink, how can an organization explain not opening up the bidding process to potential lower bids?

The fact is that all the alleged benefits within the Project Labor Agreement can be accomplished through a fair and open process that results in a binding contract. Businesses, union and non-union, do it everyday.

But that doesn’t appear to matter to the staff at the NCPA. Maybe it’s because they’re not accountable to voters and they’ve worked hard to keep this out of the public eye.

It will be offensive to hard-working taxpayers and an embarrassment to commissioners if this second chance vote is in favor of this agreement.