Do Project Labor Agreements Reduce the Number of Bidders on Public Projects? The Case of Community Colleges in California

Abstract

Project labor agreements (PLAs) are commonly found on larger California public works in urban areas. Nonetheless, they remain a controversial public procurement practice. One issue not examined in the literature is whether as some critics suggest, PLAs reduce the number of bidders on public projects. Analyzing 263 bid openings for community college construction in California over the period 2007 to 2016, this first-ever study of PLA effects on the number of bids finds that controlling for the location where the project occurred, the size of projects, the business cycle and the season when the project was let, the number of bidders on a project was not altered by the presence or absence of project of PLAs. This study also finds that relative to engineer’s estimates available on 99 of these projects, the lowest bids on prevailing wage projects were not higher than the lowest bids on projects without PLA agreements.

Keywords

project management construction management contracting human resources legislation policy regulatory issues

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