Maryland Finds PLA Requirement Violates Fair Procurement Practices

Maryland appeals board finds PLA mandate violated procurement law and restricted competition.

Read the decision here.

Another government-mandated Project Labor Agreement (PLA) has run headfirst into a familiar obstacle: the rules of fair and open procurement.

In an August 5 decision, the Maryland State Board of Contract Appeals sustained a protest filed by Allan Myers MD, Inc. challenging the Maryland Transportation Authority’s mandatory PLA on the I-95/I-695 Interchange Express Toll Lanes Ramps project in Baltimore County. The Board found that MDTA’s decision to impose the PLA was “arbitrary, capricious, and unreasonable” and that the requirement was written in a manner that violated Maryland Procurement Law.

The challenge revealed that, contrary to its public statements, MDTA’s own internal analysis, which it sought to keep hidden, validated what opponents of government-mandated PLAs have warned about for years: PLAs restrict competition, drive up taxpayer costs, and put merit-shop and minority-owned contractors at a disadvantage.

‍ ‍Gov. Wes Moore’s 2024 executive order does not give Maryland agencies a blank check to impose PLAs. The order requires any such decision to be made on a case-by-case basis and supported by written findings demonstrating how a PLA would advance the State’s interests in areas including cost-effectiveness, efficiency, quality, safety and timeliness. MDTA imposed the mandate anyway, but the Board found that the agency never produced the required project-specific findings to justify it. Worse, the evidence MDTA was forced to produce as part of the protest pointed in the opposite direction.

‍ ‍The warnings in MDTA’s own analysis were not subtle. The agency’s screening process acknowledged that a PLA could discourage non-union contractors from bidding, that there was not a large supply of union highway contractors in Maryland, and that the agency might need to look outside the region to generate sufficient competition. It also warned that the PLA could make it more difficult to meet the State’s minority-business participation goals. When asked whether a PLA would advance the State’s interest in cost-effectiveness, the agency’s own screening form answered simply: “No.” It warned that reduced participation by open-shop contractors would reduce competition and increase bid prices.

The Board rejected MDTA’s defense of the PLA requirement. It found that the PLA was not actually a construction “specification,” but an additional contract requirement obligating contractors to use union workers. Even if it were treated as a specification, the Board found:

“…all evidence points to the fact that a PLA would increase bid prices and, consequently, the cost of services to the State. Moreover, it was written ‘in such a manner as to favor’ one group of vendors (union contractors) over other vendors (non-union contractors), and therefore it restricts competition.”

The Board also found that MDTA lacked the required justification for imposing the mandate in the first place. The consultant report prepared by AECOM and relied upon by MDTA contained no project-specific conclusion or recommendation supporting a PLA, and much of its language had simply been copied from a generic template. Most remarkably, the “Findings” section included in AECOM’s template was omitted entirely from the final report. The Board ultimately concluded that the record contained no written findings demonstrating that a PLA would benefit taxpayers or the project.

The decision is not a blanket ban on PLAs in Maryland, but it is a victory for those seeking transparency around the issue. The lengths that MDTA was willing to go in order to keep it’s analysis hidden from public view were highly concerning. This case should be a warning for public officials and departments that proponents of free and open bid competition will be watching to see if the evidence matches the rhetoric on government-mandated PLAs in the future.