HIBBING — St. Louis County commissioners are being forced to choose between supporting local union workers or receiving millions in federal dollars for road and bridge construction.
Administrator Kevin Gray described it as a "rock and a hard spot" at the Board's March 24 meeting. Because the federal government has yet to approve the county's use of labor agreements in projects that use federal dollars, county staff are asking the commissioners to waive the longstanding practice for five projects this year.
The story was first reported by the Minnesota Star Tribune.
The Federal Highway Administration told the county that if it moves forward on PLAs without approval, the projects will not be eligible for federal funds.
The commissioners and county staff discussed the issue extensively at the County Board and Committee of the Whole meetings last week.
For over a decade, the county has used project labor agreements, or PLAs, in construction projects over $150,000, unless prohibited by law, explained Public Works Director Jim Foldesi.
PLAs are pre-hire collective bargaining agreements that typically establish wages, benefits, holidays and other labor protections, according to the Minnesota Building Trades and Construction Council.
The county has to get permission to require PLAs in projects that use federal dollars. Foldesi said that usually means submitting a request to the government the August before the construction is planned, with an approval usually coming in October.
“This time around, we did our normal process last August, and October, November, December — we haven’t gotten our normal go-ahead, and so we started asking questions," he said. " ... We just haven’t gotten an answer. And so administratively, today we still sit in this limbo land.”
The county has made multiple inquiries with federal officials, elected officials and lobbyists, according to a presentation Foldesi gave to the Board.
The delay means the county is already behind on getting bids for five projects set for this summer, totaling $14.3 million: resurfacing County Road 21 in Pike and Embarrass townships, a County Road 84 culvert replacement, a County Road 88 repair and culvert replacement in Morse Township, 40th Avenue West reconstruction and a roundabout in Duluth, and overlaying Canosia Road.
If the County Board doesn't waive the PLA requirement, the county stands to lose $6.5 million in funding this year and the projects will be delayed, according to the presentation.
Foldesi said sending the money back will also hurt the county’s reputation, which may impact its ability to get funds in the future.
He also noted that over the last five years similar projects have always gone to local contractors, and trades can still sign a PLA outside of the county contract.
This isn't the first time PLAs have been impacted by federal decisions. President George W. Bush issued an executive order prohibiting PLAs on federal projects not long after St. Louis County first adopted its policy. President Barack Obama rescinded the order, and St. Louis County became the first in the state to use a PLA on a federal road project in 2014.
Steelworker and Board Chair Mike Jugovich represents southeastern St. Louis County. He told the room full of laborers at the March 24 meeting that this is union-busting 101.
“If we don't stand up to this, this is the tip of the spear, and the spear will drive in, and it will put the wedge in, and it will break," he said. "I'm not willing to do this. ... We don’t want to lose that money. But I don’t want to lose my soul along the way.”
Keith Nelson represents the south-central part of the county and became emotional as he discussed the issue.
“I never thought I’d live to see this day, where PLAs are costing us money. They’re not supposed to cost us money. They’re supposed to keep work local," he said.
" ... We can't give away money, and I hope labor understands that I can't give up money this year and next year and the year after that."
The County Board is expected to vote on a resolution that would waive the PLA requirement for five projects this year at its Tuesday, April 7, meeting.
