As a public agency that spends hundreds of millions of dollars annually to procure construction services from external contractors, the City of New York (NYC) Department of Parks and Recreation (DPR) is a significant contributor to economic activity in the NYC building trades landscape. Project Labor Agreements (PLAs) are a mechanism often used by public sector agencies to ensure that large, complex, and multi-trade construction projects run smoothly, are completed efficiently with few disruptions, follow high work quality and safety standards, and put upward pressure on wages and benefits in regional construction industries. PLAs are “job site constitutions” that set terms for an entire project rather than taking a piecemeal, trade-by-trade approach to contracting and negotiation.
The Buffalo Co-Lab and the Worker Institute, in partnership with Laborers Local Union Local 1010 Laborers-Employers Cooperation and Education Trust (1010 LECET), conducted a feasibility study on the use of PLAs in New York City Department of Parks and Recreation street-tree-planting contracts. As detailed in this report, the PLA design not only appears to be feasible for NYC street tree planting contracts; it has the potential to be net beneficial for the Department of Parks and Recreation, for the public, for firms that successfully bid on planting contracts, and for the workers performing the labor on those contracts.
Research Highlights
At present, NYC DPR does not utilize a PLA for the street tree-planting construction contracts it issues as part of its NYC Parks’ Neighborhood Tree Planting Program, despite the City’s rapidly expanding PLA initiative. Given the consistency with which PLAs are found to “provide broad social and economic benefits” to the public, there is value in investigating whether the PLA design is feasible for use in NYC DPR’s tree planting. The current report, authored by researchers at the Cornell University School of Industrial and Labor Relations (ILR School), Buffalo Co-Lab and Worker Institute, takes up the case for feasibility with particular focus on:
Obtaining savings on workers’ compensation insurance premiums through the use of group benefit funds, which are common mechanisms included in most PLAs
- Accounting for the consistently higher safety standards observed on union and PLA project sites relative to non-union, non-PLA projects
- Analyzing data on recent street tree planting to quantify differences in contract duration and performance between union and non-union contractors;
- Accounting for the role that higher safety and quality standards can play in reducing payouts made to plaintiffs who file tort claims against the Department of Parks and Recreation after injuring themselves on defective (tree-damaged) sidewalks; and
- Evaluating the capacity for PLAs to better deliver on citywide Minority- and Women-Owned Business Enterprise (“M/WBE”) goals relative to the status quo. Whereas all DPR construction projects, combined, come close to meeting this goal (24–25%), Capital Forestry's tree-planting contracts often fall short, with many non-union vendors applying for and receiving waivers.
Findings
The results produced in this report suggest that not only is a PLA for street planting work in NYC feasible, but the mechanism would likely yield the following positive benefits:
- Substantive cost savings from standardizing work crew compositions and making use of the relatively new “Green Infrastructure” pay rate;
- Nontrivial cost savings from establishing a joint-trustee group benefit fund for all workers on the PLA project;
- Upward pressure on safety standards, resulting in greater immediate cost savings on insurance premiums and potential long-term savings in the form of reduced tort claims;
- Upward pressure on quality standards;
- Faster contract execution and quicker tree planting;
- Faster dispute resolution; and
- Improved capacity to meet or exceed M/WBE goals and suspension of M/WBE waivers, thereby increasing the usage of and dollars flowing to M/WBE subcontractors.
For these reasons, the City of New York Department of Parks and Recreation is well-positioned to generate even greater “social and economic benefits” 28 for the people, workers, and neighborhoods of NYC by using PLAs in its tree-planting and site-work contracts.