Judge pauses Kotek's executive order requiring labor agreements for state construction

PORTLAND, Ore. (KOIN) – An executive order issued by Governor Tina Kotek in December was paused by a Marion County judge on Monday, halting the governor's demands for project labor agreements on state construction projects.

In a Monday press release, several groups representing union and non-union contractors that filed a lawsuit challenging the order -- including The Associated General Contractors, Oregon-Columbia Chapter, and Associated Builders and Contractors, Pacific Northwest Chapter -- lauded Marion County Circuit Court Judge Thomas Hart's decision to pause the order as a "major victory" amid the ongoing lawsuit.

“The judge’s ruling reinforces what our local contractors have been saying since the order was issued last December,” stated Mike Salsgiver, CEO of the Associated General Contractors, Oregon-Columbia Chapter. “The governor lacks the authority to unilaterally alter Oregon’s system of competitive bidding and open and fair competition.”

Gov. Kotek announced Executive Order 24-31 in December, in an effort to improve timeliness, lower costs, invest in high-skilled workers and boost the quality of state construction projects through project labor agreements, or PLAs, the governor’s office previously said.

The executive order requires PLAs to be negotiated and executed on state-funded projects where onsite labor costs account for 15% or more of the total construction, reconstruction, or renovation costs.

Some projects are exempt from the executive order, including projects that are shorter in duration or projects where construction lacks the complexity to make a PLA beneficial. Other exemptions include projects that are in development, along with maintenance, emergency repair, or minor projects for existing facilities.

The governor’s office explained that any PLA that is negotiated under the order must guarantee against strikes or lockouts and will create mutually binding protocols for resolving labor disputes without delay. Kotek’s order also requires state agencies to set goals and track the use of Certification Office for Business Inclusion and Diversity certified firms in order to advance gender and racial equality.

However, Jenny Dixson -- the executive director of the Northwest Utility Contractors Association -- argues, “PLAs inflate the cost of taxpayer-funded construction projects by artificially reducing the number of companies, including locally owned family businesses, who are able to do the work,” adding, “Worse, they prevent the vast majority of Oregon construction workers from working on projects financed with their own tax dollars.”

In a statement to KOIN 6 News on Tuesday, a spokesperson for Governor Kotek’s office said, “The Governor respects the court’s ruling,” but declined to comment further on the pending litigation.