The Veterans Administration (VA) has again rejected the use of Project Labor Agreements (PLAs) on its new wave of construction across the nation, according to a press release from the Building and Construction Trades Department (BCTD) of the AFL-CIO.
As a result, the VA is experiencing cost overruns, scheduling delays and rampant use of illegal and undocumented workers. This unscrupulous behavior is unfortunately being funded with taxpayer money. Not only are taxpayers not experiencing the stimulus effect of bringing work and revenue to local economies via large-scale construction, they are seeing money and time wasted. Moreover, the fact that PLAs come with built-in veteran hiring standards through the Helmets to Hardats program, should provide ample motivation for the VA to do the right thing.
A prime example of the VA’s construction failure is the Lake Nona, FL hospital project that we posted about in June. A Congressional field hearing earlier this month shows the project is now $100 million over budget.
For those who argue that PLAs drive up cost, this instance proves the opposite: that PLAs actually lower costs by ensuring efficiency, and that no matter how low a bid comes in from a company whose aim is to underpay low-skill workers, there is no cost gain when overruns come down the mountain:
From our Orlando piece:
The general contractor responsible for the project, Brasfield and Gorrie (B&G), is a member of the Associated Builders and Contractors (ABC) a notorious anti-union contracting group that fiercely defends and promotes a business model predicated upon the use of a low-wage, low-skill, easily exploitable workforce. In addition to the cost overruns and scheduling issues, the field hearing uncovered the fact that there are numerous quality issues arising from this project, including rust and mold issues that will almost certainly add to the final, escalating cost of this project.
Even more disheartening was the fact that, in early 2011, federal and state agencies twice raided the Lake Nona project and found the rampant use of undocumented workers. One subcontractor was found to have hidden some of those workers in the heating and ventilation ducts during the raid.
This is not a lone case. Of the four VA hospitals currently under construction, three are more than a year behind schedule. Since 1998, Congress has authorized 55 VA medical clinics. Currently, 38 are behind schedule and a third of those by over three years. The BCTD hopes a lesson has been learned for future projects:
“In 2010, we specifically warned Veterans Affairs Secretary Eric Shinseki that each and every one of these issues would arise if the VA embraced a ‘low road’ approach to its construction procurement policies,” said Sean McGarvey, President of the Building and Construction Trades Department. “It’s sad that taxpayer dollars are being wasted while the VA learns an inconvenient truth that was conceived by Ben Franklin over 200 years ago: ‘The bitterness of poor quality lasts long after the cheap price is forgotten.’”