MEDIA COVERAGE

JSCB Provides Theater of the Absurd
by Norman Poltenson, Publisher

10/27/06: The “Theater of the Absurd” describes the work of several playwrights, who wrote mostly in the 1950s and 1960s. The themes all revolved around man’s inability to understand or decipher his role in the universe. The plays were surreal, often illogical, and without plot. The dialogue consisted of gobbledygook filled with clichés and technical jargon. Unlike conventional theater in which language is critical, Theater of the Absurd used language as just another component of imagery.

Welcome to the world of the Joint Schools Construction Board (JSCB). The board is responsible for providing oversight to the district-wide, school-reconstruction project about to be launched by the city of Syracuse. The city plans to spend in excess of $900 million over the next 10 years. Before launching the phase-1 portion, estimated to cost $225 million, the JSCB is considering whether to utilize a project labor agreement (PLA). The board voted Oct. 19 to pursue a PLA.

A PLA is a “pre-hire,” collective-bargaining agreement between the owner of a project or his appointed contractor and labor unions. The concept is unique to the construction industry and pertains to a specific project or work location. The agreement generally recognizes the participating unions as the sole bargaining agent for all employees covered, regardless of any union affiliation. Workers are typically hired through a union-hall referral system, which guarantees participation by a large percentage of union members even though they represent a minority of laborers. Non-union workers pay the union an agency fee for the “privilege” of being represented. A PLA covers workers’ wages (which are prescribed by the New York State Department of Labor as prevailing wages), working hours, job classifications, the dispute-resolution process, and other work rules.

On Feb. 17, 2001, President George W. Bush issued an executive order prohibiting “union-only requirements” from being imposed on any federally funded or federally assisted project. New York’s public projects are currently guided by Gov. George E. Pataki’s executive-order issue in 1997, which permits PLAs if it is in the best interests of the people of New York. Translation: PLAs must have a proper business purpose, such as the timely completion of a project or limiting costs. They must also prevent “favoritism” and advance the state’s competitive-bidding process.

To comply with the governor’s executive order, every PLA starts out with a benefits analysis. The city relied on Camp Dresser McKee (CDM), which produced a two-pound document in June 2005 claiming that a PLA would deliver millions of dollars in cost savings, avoid costly delays, ensure a reliable source of experienced labor, maximize project safety, enhance small-business and minority- and women-owned business representation, and provide a mechanism for settling disputes. The study was revised in October 2006 to reflect changes in the project.

Bear in mind that the study is not based on actual negotiations in which definitive results can be projected. It’s based on assumptions. In the 2005 PLA study, which projected a cost savings of more than $21 million on a $665-million project, CDM found 35 percent of the savings in a line item called “workers-comp/ADR.” The basis for the savings was an “estimate” by an insurance agency, which presumed that the “Program Manager would provide a safe work place so that claims can be minimized.” The agency cautioned that the estimate was not a quotation. Sixteen months later, this savings disappeared from the revised study because the “State Worker’s Compensation Board [thought that the] applicability of this program to the JSCB project may be limited.”

Undeterred, CDM found nearly $4.5 million in savings on the revised phase-1. It assumed the unions would go along with four 10-hour days rather than five, 8-hour days. It also assumed that half the savings would come from a “rolling 40-hour work week” in which the unions agreed to different start times. CDM also assumed substantial savings in a “management-rights” concept.

What was missing from the JSCB deliberations was strong evidence that these savings actually materialize on PLA agreements, because too often there is either no attempt to measure the results or it’s too difficult to determine. The $500 million Onondaga County Lake Improvement Project is a case in point. Joe C. Mareane, Onondaga County’s chief fiscal officer, says the project is on-time and on-budget, but he has no idea whether this is attributable to the PLA the county adopted for the project. There is simply no requirement or mechanism to determine this.

Also missing from the CDM study was any critical analysis of the savings attributed to apprentices substituting for journeymen. CDM assumed a savings without considering any lost productivity attributable to an apprentice’s lack of experience or from supervisory oversight.

Watching the JSCB in action is like watching the Theater of the Absurd. There is a large cast of characters, plenty of motion, and countless studies filled with technical jargon. But where is the questioning, the critical thinking? The board must determine that a PLA will serve a proper business purpose, such as the project’s timely completion or a cost savings. Other than a “potential” union threat to disrupt the project, there is no history of construction disruptions in our region. As to the cost savings, there is little evidence that PLAs generate any savings unless measured against a hypothetical project in which most of the work was governed by union agreements. And is the bidding process really enhanced when non-union construction companies often decline to bid to keep the fox out of the henhouse? Is it favoritism by default?

The composition of the board is itself problematic. The 10 members are either politicians, city employees, or professional educators, except for the CEO of one not-for-profit corporation. It’s clear that the Syracuse mayor [Matthew Driscoll] controls the votes. At the meeting of Oct. 19, hizzoner allocated a half hour to hear CDM’s revised report, which was not available to study prior to the meeting nor has a final copy been published. The JSCB voted unanimously to pursue a PLA. The only concern expressed was whether the board- members’ decision was covered by insurance.

The citizenry is relying on the JSCB to exercise sound judgment in deciding whether a PLA is beneficial to the school-reconstruction project. The board members are currently not fulfilling their responsibility either in rushing to judgment or in not analyzing critically the PLA proposal. There is still time to change the surreal nature of the process and logically decipher the best direction either by awakening the JSCB to its responsibility or by reconstituting the board with members unafraid to exercise independent judgment. Without this change, the process smacks of merely providing cover for a political payback to the unions.

Reprinted with permission of the Central New York Business Journal

Joint board moves closer to using labor agreement
by Kevin Tampone, Journal Staff

10/27/06: SYRACUSE — Rebecca Meinking, head of a non-union contractors’ group, is not naïve about her chances of convincing Syracuse’s Joint Schools Construction Board that she’s right.

Meinking has spent months trying to prevent the board from adopting a project-labor agreement (PLA) to govern the city’s massive school-renovation project. The board, which is overseeing the project, dealt her and her constituents a blow at its Oct. 19 meeting when it took the first step toward using a PLA by voting to pursue one.

“Let’s face it, the reality is this is a political issue,” says Meinking, who has argued PLAs are little more than payback from elected officials for union political support. “Politics is going to play a big part in this decision. It shouldn’t, but that’s the reality of this situation.”

Meinking is president of the Empire State Chapter of Associated Builders and Contractors.

PLAs are a type of labor contract that applies to a specific, individual construction project. Generally, unions favor the agreements, which they describe as tools that can help keep a project running smoothly.

Non-union contractors are usually against PLAs, arguing they unfairly favor unions and raise project costs.

“We’re very pleased they voted to pursue it,” says William Towsley, president of the Central and Northern New York Building Trades Council. “All the information has been presented. Now we should enter into negotiations. We’re prepared to sit down anytime.”

Towsley argues PLAs save money and keep projects on schedule. A board study found a PLA could save more than $16 million through all four phases of the Syracuse project and nearly $4.5 million in the first phase alone.

Meinking says she will keep trying to convince board members that using a PLA is a mistake. She also says she has not ruled out legal action should the board ultimately adopt a PLA.

“We believe there is still time to continue to educate the board members,” she says. “When it comes down to it, I’m hopeful that they’re going to do what’s in the best interests of everybody.”

The city and the school district first announced the renovation project in 2003. It will include work on 35 schools and cost some $926 million. The first phase involves seven schools and will cost about $225 million.

The board’s attorneys and advisers will now start work on a draft PLA with unions, Colleen Deacon, a spokeswoman for Mayor Matthew Driscoll, said in an e-mail. Driscoll is chairman of the joint board.

The board will have to vote again on the final agreement after negotiations, Deacon added.

According to Towsley and the board’s study on a PLA, the agreements cull savings from numerous sources. They include standardizing work hours, schedules, holidays, and overtime rules across the numerous unions that would be involved in a complex project like the schools renovation.

Once in place, the agreements take precedence over existing labor contracts and also help prevent strikes for the duration of the projects they govern. Preventing work stoppages is particularly important in a multi-year project with sensitive deadlines, Towsley argues.

Meinking’s group funded a study that found using PLAs raises the cost of school-construction projects by $27 per square foot. With some 4 million square feet of space involved in all four phases of the Syracuse project, using a PLA would cost the district an extra $108 million, Meinking says.

The Beacon Hill Institute at Suffolk University in Boston, a free-market think tank, completed the study.

PLAs raise costs by discouraging competition, Meinking explains. PLAs do not forbid non-union shops from bidding on projects, but require them to hire a certain percentage of union labor for the jobs.

Those requirements are more than enough to keep non-union companies away from PLA work, Meinking says. The fear is that unions would only send non-union contractors their worst workers in an effort to shut down their competition.

Reprinted with permission of the Central New York Business Journal

Labor pact sought in schools project
It would set rules for manager, labor for Syracuse schools' renovation.
The Post-Standard, Friday, October 20, 2006

School Project
The Post-Standard, Thursday, October 19, 2006

Lobbyists drawn to big school renovation
Once-sleepy meetings are filled with companies seeking a piece
of the $225M action.
The Post-Standard, Wednesday, October 18, 2006

Renovation project labor battle
Updated: 9/27/2006 11:35:32 PM
By: Heather Ly

It's not a question of when the first phase will start, but whether or not there will be a project-labor agreement...a construction contract typically favored by unions and something non-unions are usually against.

"Seventy-five percent of construction workers in Central New York are non-union. To make sure they all have an opportunity to work on this job it needs to be bid without a PLA. Now the unions will say that a PLA is the only way to ensure that local labor is used on the job. If 75% of the local construction workers are non-union how does a PLA ensure that the work will go go local construction workers?” said Rebecca Meinking, president of the Empire State Chapter of Associated Builders and Contractors.

The New York Building Trades Council said in this particular case, a PLA is the way to go because it would control start and quitting times, overtime, and holidays among other things.

"It's a long-term project that has time constraints. Schools have to be open on time, so students can get in. You can't afford any disruptions by work stoppages, and if the potential is there to save money, which a feasibility study has been done to prove, there is a potential to save $20 million,” said Bill Towsley, president of the Central and Northern New York Building Trades Council.

The Empire State Chapter of Associated Builders and Contractors argues PLAs do quite the opposite. The ABC also says PLAs mandate a certain portion of work goes to union laborers and doesn't guarantee the work will be bid in an open and competitive market. Of course, the Building Trades Council disagrees.

"ABC doesn't represent employees. It represents employers, and employers may not like it, but that isn't the reason it should be rejected. It should be rejected if they're going to because it doesn't save money, it goes against public bidding laws or some legal. The court system will have to determine whether it's legal or illegal,” said Towsley.

One thing both sides can agree on...getting a move on the project as soon as possible and making sure taxpayers get the most bang for their buck...no matter who ends up of doing the work. But only one of the organizations will get its way.

A benefit analysis will be presented to the joint board next week. They will review it, and at that point make a decision.

Copyright © 2006 TWEAN d.b.a. News 10 Now

News Channel 9 Covers Union-Only PLA Issue for Renovation of City Schools
Empire State Chapter President Provides Insight on the Benefits of Rejecting a Union-Only PLA

On Monday, September 25, WSYR, News Channel 9 in Syracuse, aired a story which detailed the issue of whether or not the Joint School Construction Board should allow open competition for the bidding on the renovation of the Syracuse City Schools.

Empire State Chapter president, Rebecca Meinking, was interviewed and provided solid arguments as to why the Construction Board should reject a union-only PLA for the extensive school renovation project.

To view video of the news story, click on the link below:
News Channel 9 WSYR: Will Non-Union Workers Renovate Syracuse Schools?

The Post-Standard
September 19, 2006

Open shop beats unions in many important ways

To the Editor:

After more than 40 years in the construction business, I am still amazed as to the dialogue between open shop anti-union propositions.

Quality of construction is certainly not the issue. Open shop contractors have for many years repeatedly been awarded citations for workmanship bringing projects in below budget, innovated techniques, etc.

Donations to worthy causes are not the dilemma. Open shop organizations, along with associate firms, are among the front-runners in donating time and money to worthy causes.

Civic duties cannot be it. Open shop contractors have been and are, the supporters of many of our local and regional not-for-profit organizations again putting back to our communities.

Safety records speak for themselves. What can we say about unions?

They constitute less than 20 percent of the construction market, yet we hear them the most ; we hear a lot about mismanagement, prison terms, killings, not education, safety issue and the like; we hear more about their leaders court cases than worthy civic causes; and we hear more about embezzlement from their officers than we do about their support for local non for profits.

They seem to concentrate most of their energy on a few shady politicians for status quo, in lieu of trying to upgrade the system for a better tomorrow.

Roger A. LaPierre

The Post-Standard
September 19, 2006

Let true bidding process guide school projects

To the Editor:

I am writing about an issue that could ultimately threaten my company's ability to participate in an upcoming construction project in the city of Syracuse, along with many other companies like ours.

As many may know, the Syracuse City School District is preparing to spend more than $225 million in thc first phase of a major school renovation project The total of the entire project will he nearly $925 million.

The state-approved funding includes a provision that requires a local construction board (comprised of city and school district officials) to decide whether to implement a project labor agreement (PLA). PLAs typically favor, or even mandate, that all work is done by union workers. PLAs which mandate that workers on the job come from the union hall do not allow for competitive bidding by qualified contractors in our local community.

Union-only PLAs discriminate against 75 percent of the local construction workforce because they do not belong to a construction union. All local workers, whether union or non-union, should have the opportunity to work on this project.

In other communities where school projects have mandated union labor, this has driven costs up by 20 percent or more. In Syracuse, that would mean that up to $45 million of the $225 million would be wasted. We are not anti-union. We believe a competitively bid project, open to both union and non-union contractors will provide the best use of public tax money.

The Joint School Construction Board should allow a true, competitive bidding process to ensure that all local working families have an opportunity to benefit from this project keep Syracuse competitive.

Mark D. Kinney, vice president, Monroe Mechanical Services, Inc.

Marcellus

$900M Syracuse school project faces labor debate

by Kevin Tampone, Central New York Business Journal
Published 9/15/06

SYRACUSE — As the city and school district prepare to spend $900 million to renovate Syracuse’s schools, union and non-union leaders are pressing officials on an issue they say is critical to the project’s success.

Their concerns surround the question of whether the work will be performed using a project-labor agreement (PLA), a type of labor contract that applies to a specific, individual construction project.

Generally, unions favor the agreements and non-union contractors deplore them.
Whether to use an agreement is one of the major decisions facing the Joint Schools Construction Board, the committee of city and school-district leaders overseeing the 10-year renovation project. The group has heard from both union and non-union representatives on the topic in recent weeks.

“School projects have strict budgets and timelines,” said William Towsley, president of the Central and Northern New York Building Trades Council at the joint board’s Sept. 7 meeting. “This is where the real value of a PLA comes in.”

“We believe union-only PLAs restrict competition,” said Rebecca Meinking, president of the Empire State Chapter of Associated Builders and Contractors (ABC), a non-union contractors’ group, at the joint board’s Aug. 24 meeting. “If we want to leave it open to all local employees, then let’s leave it open to all contractors and let them all bid on it.”

Mayor Matthew Driscoll, chairman of the joint board, says the group will not make a decision on a PLA until after public hearings on the project. The hearings are set for 6:30 to 7:30 p.m. Sept. 18 at Henninger High School, Sept. 19 at Nottingham High School, and Sept. 21 at Corcoran High School. One was also held Sept. 14.

Even after the hearings, Driscoll says there are numerous other project issues the board must handle in addition to the PLA.

Both Meinking and Towsley presented a PLA as an issue that could save or cost the district much-needed time and money. To them, it’s a matter of making sure taxpayers get the most for their dollar — and ensuring their constituents get a piece of the project’s construction work.

The city and the school district first announced the renovation project in 2003. In all, the four-phase effort will include work on 35 schools and cost some $926 million.

The first phase includes work on seven schools at a cost of about $225 million. There is no estimated date for work to begin yet, according to the city.

PLAs control numerous areas of a project including work practices, hours, holidays, grievance disputes, and arbitration procedures. The agreements also prohibit strikes and other work stoppages for the duration of the projects they govern. If used, PLAs take priority over other existing labor agreements and all those involved in the construction project must agree to its conditions.

Non-union view

At their core, however, they discriminate against non-union contractors, Meinking says. Their requirements mandate that if non-union contractors work PLA jobs, they must hire a certain portion of their workers from unions.

Meinking says most non-union contractors won’t bid on PLA work for that reason. The exact percentage of union workers they are required to hire is negotiated in individual PLAs.

“…You have to hire people that are looking to put you out of business because you’re non-union,” Meinking says. “It’s like inviting the fox into the henhouse. Who in their right mind from a business standpoint is going to do that?

“Sure [non-union contractors] can bid, but they won’t bid under that scenario and who can blame them?”

That discrimination also directly affects a construction project’s bottom line, Meinking says. By discouraging a portion of the area’s available contractors from the bidding process, competition drops and costs rise, she explains.

ABC funded a study by the Beacon Hill Institute at Suffolk University in Boston that found using PLAs raises the cost of school-construction projects by $27 per square foot. The institute is a think tank that advances the principles of free markets and limited government.

The group based its study on 117 school-construction projects in New York.
With some 4 million square feet of space involved in all four phases of the Syracuse project, using a PLA would cost the district an extra $108 million, Meinking argues. The study calculated the savings by examining how limiting competition during the bidding process affects project costs, she says.

Other arguments in favor of PLAs, such as preventing work stoppages, also hold little weight, she adds.

“The whole labor-peace argument is ridiculous,” Meinking says. “Obviously, in a non-union environment, there are no strikes. People just don’t walk off the job. That sort of pokes a hole in the whole labor-peace argument.

“Their philosophy is if we’re the ones working on a job site, then we’re not going to create problems on the job site. From an economic standpoint … is that anything less than extortion to say you give me all the work and I’ll make sure I don’t cause problems for you?”

Meinking wants the joint construction board to forgo a PLA and simply give the work to the lowest qualified bidder — whether it is a union or a non-union shop. She emphasizes she is not looking to get all the work for her members, but instead wants an open, competitive process for all contractors interested in the work.

Towsley, the building trades council president, has a different view of PLAs.

Union view

The agreements hardly limit competition, he says, because laws governing public-works projects prevent union-only bidding. Anyone can bid a PLA project and many non-union contractors choose to do so, Towsley says. In fact, by requiring non-union contractors to use union hiring halls for a certain portion of their work force, PLAs can actually be a boon to them, he adds.

“I know one local, non-union contractor who said, ‘This is a great deal for me. I win win. I can hire workers from the union hall to work on the PLA project. And then the rest of my employees I can put on other projects. I can even take them out of town,” he says.

As for the cost issue, Towsley pointed to the school district’s own study on using a PLA for the renovation project. The study, completed in June 2005 by Syracuse–based consulting-firm CDM, found a PLA could save more than $21 million. The agreement would force savings from numerous sources, including preventing delays and standardizing work, wage, and overtime rules across the various unions that would be involved in the project.

The CDM study also projected that 65 percent to 80 percent of successful bidders on the project would be unionized even without a PLA.

“It’s not favoritism,” Towsley said. “[The unions are] going to get the majority of the work anyway. That’s verified by the study.”

Towsley says groups like ABC have different motivations for opposing PLAs than saving the public money and promoting competitive bidding. He believes non-union contractors don’t want their employees exposed to a union environment. Workers from non-union shops on a PLA project would see the benefits of union membership firsthand and their employers may face efforts to organize as a result, he explains.

In addition to saving time and money, the agreements allow for special considerations to be included, Towsley says. The joint construction board has indicated interest in encouraging involvement of minority and women employees and employers in the project. The board wants to encourage local workers to be used as well.

A PLA can help in both those areas by setting goals for involvement of minorities and women and emphasizing certain areas for hiring, Towsley says.

“Absent a PLA, anybody in this country could be awarded that work and bring in their work force,” he says. “It’s a reality. It happens in public-work projects in Central New York.

“If you open it to a normal bidding process, you risk the chance of some or all of that work going to an out-of-town employer.”

Using as many local workers and contractors as possible is definitely a priority for the joint board, Mayor Driscoll says. Giving preference to local companies, however, is something that could be done without a PLA through the board’s policy decisions, he adds.

Regardless of any of those decisions, the project is a publicly funded effort and the board must use the lowest, qualified bidder, says Daniel Lowengard, city schools superintendent and a member of the joint board.

“You can make a lot of policies …, but it is not the same as a private company that could say, ‘Listen, I’m only going to take people from Syracuse,’ ” he says. “At the end of the day, when the bids come in, that’s where we’ve got to go.”

The most important part of the project is that the work be done well and that it be finished on time and within the budget, Lowengard adds. Other considerations take a back seat to those concerns.

That means with or without a PLA, if bids come in too high, the process starts over.

“Our dollar amount if fixed,” Lowengard says. “If the bids come in higher and we can’t do what we want, then bids go back out. I don’t want to be the one to go to the public and say “Guess what?  We can’t replace the windows because the bids came in too high.”

Reprinted with permission of the Central New York Business Journal

The Post-Standard
February 5, 2006

A [Union-Only] Project Labor Agreement Is The Worst Thing For Syracuse's School Renovation Plan.
 Rebecca A. Meinking Associated Builders & Contractors

Gov. Pataki was right to veto the legislation authorizing the first phase of the Syracuse school renovation project last fall. It was unfortunate that he had to do it, but as Governor he is charged with acting in the best interests of the citizens of New York State. Signing legislation that clearly contained provisions that would prove detrimental to taxpayers, and to students, would have been in direct conflict with that responsibility.
No doubt the "technical flaws" in the legislation needed to be addressed. But more importantly, the virtual mandate to implement the project under the terms of a Project Labor Agreement (PLA) was, in my opinion, the biggest flaw. The only ones who benefit from this provision are the politicians who are using their support of this as political payback to those who contributed financially to their re-election campaigns (namely the labor unions). You see, contrary to The Post-Standard's Jan. 21 article, "School Renovation Talks Advance," PLAs do much more than negotiate certain pay scales and standards in exchange for union concessions and "no strike" clauses - PLAs restrict employment on public works projects to union members.

In Syracuse, that means 75 percent of the local construction workforce could not work on this job simply because they are not union members. That's right - for no other reason than the fact that they have freely chosen to not be represented by a union, they are "ineligible" to work on a project funded by their very own tax dollars. That's discrimination in its ugliest form.
 
The labor unions, the biggest proponents of PLAs (and the only real benefactors of PLAs) claim that PLAs reduce costs. However, they base that statement on comparing the cost of doing the job under the terms of the PLA or doing the same job using union labor without the PLA. There is absolutely no attempt to compare what the costs would be if union and nonunion contractors were allowed to compete in an open and free market. Such open and fair competition would strip PLAs of the pretense of saving the public money and expose them for what they are - agreements between politicians and their supporters to rig the bidding on public works construction projects to ensure that the work will be done by a favored class of bidders.
 
Recent studies on the impact of PLAs on school construction costs in our neighboring states of Connecticut and Massachusetts confirm that PLAs increase costs by 15 to 25 percent. So, without a PLA, $600 million of our hard-earned tax dollars will buy us $600 million worth of construction. But with a PLA, that same $600 million will only get us $480 million worth of construction.
 
Think of how many teachers we could hire, equipment we could purchase, programs we could fund, with that $120 million we will waste if the construction is done under the terms of a PLA. As taxpayers, we deserve better, and the children served by the Syracuse school system certainly deserve better.
 
As the Post-Standard article correctly pointed out, the other piece of a PLA is a "no strike" clause. The unions agree not to strike a project in exchange for the concession that all labor will be obtained through union hiring halls. This, they contend, saves the public money by avoiding costly delays in construction. However, the real meaning of "labor peace" in a PLA is that, since only union labor is being used on the project, unions will not engage in acts intended to disrupt work.

Think about it - in any other realm, an agreement not to disrupt business in return for an economic concession would be clearly identified as a protection racket - as extortion. Calling it a "Project Labor Agreement" and wrapping it in the window dressing of pretended cost savings and the motherhood and apple pie mythology of unionism doesn't make it any less a protection racket.
 
Plain and simple, PLAs drive up the cost of public construction projects at great expense to all hard-working taxpayers while discriminating in hiring against 75 percent of construction workers who freely choose not to be represented by a union. They are bad public policy and should be rejected as the bid-rigging and protection racket schemes that they are. This school renovation project should go forward without a PLA, because that's the only way that taxpayers and students will directly benefit. Any other scenario is simply unacceptable.

© 2006, The Herald Company