Opinion: Competitive Bidding Reduces Costs

Opinion: Competitive Bidding Reduces Costs

Introducing Fair and Open Competition in Government Contracting Act.

— Recently, I introduced the Fair and Open Competition in Government Contracting Act (HB33). HB 33 prohibits Virginia and recipients of state funding from requiring or prohibiting contractors to enter into union agreements, such as a project labor agreement (PLA), as a condition of winning any state-assisted construction contracts.

HB 33 will keep the government neutral with respect to a qualified contractor's relationship with labor unions in all projects. Companies can still voluntarily enter these agreements, but they cannot be forced upon them. This will increase the creation of Virginia jobs, increase competition, and provide our taxpayers with more miles of transportation and infrastructure solutions for every dollar we spend.

This commonsense legislation will stretch our tax dollars on infrastructure projects and will guarantee that free enterprise and full and open competition will determine how public construction contracts are awarded. Mandated project labor agreements have been estimated to raise costs by 10 to 20 percent or more with the most egregious example being Boston's "Big Dig" debacle.

Legislation similar to HB 33 already has been passed in 11 states as diverse as Louisiana and Michigan. This bill will ensure that the 96 percent of the Virginia private construction workforce that chooses not to join a labor union has a fair opportunity to compete for projects funded with our tax dollars.

There is broad opposition to PLA mandates. The attempts to mandate PLAs on Phase 2 of the Dulles Rail Project has generated broad bipartisan opposition which includes eight of the 11 members of our congressional delegation including U.S. Rep. Frank Wolf and Majority Leader Eric Cantor; the Loudoun County Board of Supervisors; the Fairfax County Board of Supervisors; the Virginia Chamber of Commerce; the Fairfax Chamber of Commerce; the Dulles Regional Chamber of Commerce; the Purcellville Business and Professional Association; a coalition of 13 of Northern Virginia's leading business groups and associations; the Virginia Chapter of the Associated Builders and Contractors; Women Construction Owners and Executives; and many of our local, state and elected officials.

A reduction of two or three bidders because of Metropolitan Washington Airports Authority's PLA mandate could increase costs by hundreds of millions of dollars, depending on the final Phase 2 construction costs and put incredible burdens on our state and local budgets.

The Silver Line PLA controversy is not the first time that there have been attempts to force PLAs on Virginia workers. The Wilson Bridge project was temporarily subjected to a union-favoring PLA requirement by the Maryland Governor in 2000. After the PLA was imposed, only one bidder responded to the RFP for the bridge superstructure contract, at a bid price more than $370 million above the state's engineering estimates — a 78 percent cost overrun. Eventually, the Wilson Bridge contract was broken up and rebid into three smaller contracts free from mandated PLAs. Multiple bids were then received and the winning bids came in significantly below the estimates and resulted in on-time and on-budget construction by both union and merit shop firms.

If those proponents of PLAs truly believe what they say when they claim that PLAs make the project better and can reduce costs, then those bidders who engage in free and open competition can prove that point by submitting a winning proposal. Since HB 33 provides neutrality, the market will determine who provides the best deal for taxpayers.