A bill allowing New York City agencies to construct projects using the “design-build” procurement method would come with a big string attached.
Under design-build, designers and builders team up and bid on projects in one step instead of two, giving builders a greater stake in the design process and reducing the likelihood of costly delays or disputes. Now awaiting Governor Andrew Cuomo’s signature, the “New York City Public Works Investment Act” (S6293/A7636) would let certain city agencies as well as the city School Construction Authority, Health and Hospitals Corporation and Housing Authority (NYCHA) award construction contracts worth more than $10 million using design-build.
But there’s a catch: the measure, sponsored by Sen. Leroy Comrie (D-Queens) and Assemblyman Edward Braunstein (D-Queens), allows design-build only on projects “undertaken pursuant to a project labor agreement [PLA] in accordance with section 222 of the labor law.”
In other words, build-design teams hoping to bid on city projects will first need to cut a PLA deal with New York City construction unions in which they will agree to hire from union hiring halls and abide by union work rules.
Unions claim PLAs save money by getting different construction unions to synchronize their hours and days off. However, a mandatory PLA also shrinks the pool of eligible bidders, leaving the public with fewer choices.
While section 220 of the state Labor Law already forces would-be bidders to pay union rates, non-union contractors can at least deploy skilled workers more efficiently—for instance, having someone perform both carpentry and electrical work. Boxing out these non-union contractors from bidding on public works has been shown to drive up construction costs.
The Cuomo administration has pushed mandatory PLAs in a bid to boost the building trade unions that backed the governor’s 2018 re-election bid as the trades’ share of construction industry work continues a decades-long slide—and as some of their pension funds teeter toward insolvency.
Design-build, on its own, has the potential to let New York get more bang for its infrastructure bucks. But this bill, as written, risks neutralizing some, if not most, of the savings proponents envision.
Cuomo has until January 1 to decide whether to veto the bill.