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GOP Governors Push Back on Union Favoritism in Biden Administration Infrastructure Funding Policies

February 2, 2022

Republican governors are pushing back on Biden administration actions steering federal dollars for infrastructure projects to state and local governments prioritizing pro-labor policies.

The $1.2 trillion Infrastructure Investment and Jobs Act, signed into law on Nov. 15, 2021, provides $550 billion in new funding to invest in America’s roads, bridges, utilities and other needs on top of baseline government infrastructure spending via existing programs and annual appropriations. Much of this funding will be distributed to states and localities and other stakeholders through discretionary grant programs that GOP governors fear will disproportionately send federal money to governments that embrace and promote progressive policy goals.

“Excessive consideration of equity, union memberships or climate as lenses to view suitable projects would be counterproductive,” 16 Republican governors wrote in a letter to President Biden on Jan. 19. “Your administration should not attempt to push a social agenda through hard infrastructure investments and instead should consider economically sound principles that align with state priorities.”

Of note, while the infrastructure bill does expand the application of Davis-Bacon regulations onto new projects, it does not explicitly require the use of union labor or stipulate that taxpayer-funded contracts to build infrastructure projects must be awarded to contractors via project labor agreement mandates championed by construction unions.

“ABC’s government affairs team worked extremely hard to successfully defeat efforts to include government-mandated PLA schemes and other anti-competitive and costly policies unions wanted in the infrastructure bill’s legislative text,” said ABC Vice President of Regulatory, Labor and State Affairs Ben Brubeck. “However, we have always been concerned that federal agencies would find creative ways to push states and localities competing for federal dollars to require PLAs and steer work to unionized contractors and union labor, given their consistent rhetoric in support of the union agenda.”

The White House has repeatedly touted the infrastructure package as an opportunity to “create good-paying union jobs repairing our roads and bridges, replacing lead pipes, and building energy transmission lines.”

A White House guidebook on the infrastructure law for state and local funding partners recently published in coordination with the launch of a new Biden administration website, build.gov, touts similar sentiments.

A grant application issued by the U.S. Department of Transportation on Jan. 28 gives greater consideration and additional credit to state and local grant applicants who commit to building infrastructure projects with PLAs and other policies promoted by labor.

At a recent National Governors Association meeting in Washington, D.C., Republican governors expressed concerns to Transportation Secretary Pete Buttigieg about the administration’s efforts to attach liberal strings to infrastructure dollars available to state and local governments.

Secretary Buttigieg defended the administration’s use of infrastructure dollars to advance a number of progressive policy goals, calling the administration “very proudly pro-worker” and active in “advancing policies within the parameters set forth by the law.”

“One of the reasons ABC took a neutral position on the IIJA is because there were no strong legislative guardrails put in place to ensure federal infrastructure dollars would go to projects procured by states and localities via fair and open competition,” said Brubeck. “GOP governors have good cause to be concerned with the Biden administration’s actions so far.”

The administration’s promotion of pro-labor policies tied to IIJA dollars comes on the heels of controversial regulations recently issued by the U.S. Department of the Treasury tied to $350 billion worth of federal funding for state and local fiscal recovery via the March 11, 2021, American Rescue Plan Act. The Department of the Treasury is encouraging states and localities competing for money to fund certain water, sewer and broadband infrastructure projects to “use strong labor standards, including project labor agreements and community benefits agreements that offer wages at or above the prevailing rate and include local hire provisions, not only to promote effective and efficient delivery of high-quality infrastructure projects but also to support the economic recovery through strong employment opportunities for workers.”

In addition, on Feb. 17, 2021, the DOT announced that applications for the FY2021 Infrastructure for Rebuilding America (INFRA) discretionary grant program via the Build America Bureau would be treated favorably if they include plans “related to PLAs and inclusive local participation goals.”

ABC members and chapters concerned about strings attached to federal investments in infrastructure in their communities should be prepared to monitor government grant applications and related contracting opportunities for anti-competitive language and notify appropriate stakeholders.

“The 24 states that have pro-taxpayer Fair and Open Competition Act laws prohibiting government-mandated PLAs and preferences on state and local construction projects are likely to have some level of protection against PLA encouragements or mandates tied to federal dollars when projects are funded by multiple government sources,” said Brubeck. “However, states that have not passed FOCA, or have laws encouraging the use of PLAs and other anti-competitive policies, may see more quality local contractors and workers being discouraged from competing for federally funded infrastructure projects than normal.”

As the Biden administration begins to implement the IIJA, ABC will continue to support H.R. 1284/S. 403, the Fair and Open Competition Act, which would prevent the federal government from mandating PLAs as a condition of winning federal or federally assisted construction contracts. ABC members are encouraged to visit the ABC Action Center and urge their members of Congress to support FOCA.

ABC members should continue to monitor these developments in Newsline and the Beltway Blueprint.

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