Case study Fresno, Palm Springs, San Leandro: PLA's raise project costs dramatically
San Jose and other Silicon Valley cities have long agreed to Project Labor Agreements, which privilege union recognition, compulsory union dues, and mandatory use of union hiring halls prior to the hiring of any employees for large construction projects. Other cities' experiences with PLA's suggest they lead to soaring costs and gross inefficiencies. The Coalition for Fair Employment in Construction reports.
Palm Springs
A project that was supposed to cost $5 million received one bid that cost $8 million!
From city staff:
The Airport Floor Replacement project is part of the restoration efforts to preserve the Airport. To ensure the restoration is delivered at the best possible value, Staff recommends rejecting the sole bid received, revising the project specifications, and readvertising to encourage broader contractor participation.
RECOMMENDATION:
1) Reject the bid received on March 5, 2025 for the Airport Floor Replacement Project, Airport Project PSP-03 (the “Project”); and 2) Authorize Staff to rebid the Project.
Two bids were received on March 5, 2025. After reviewing the low bid, it was determined that Pro Installations, Inc.’s bid package was non-responsive as they failed to submit the required bid bond. As such, Loghami & Associates, Inc. of Playa del Rey, CA was considered the apparent low bidder with a bid amount of $4,998,540. However, this amount exceeded the Airport’s funding amount of $3,000,000. The results of the bid were scheduled to be presented to the Airlines in April. Unfortunately, the meeting was pushed back to June 9, 2025. At the June meeting, the Airlines in conjunction with Airport staff decided to postpone the project to next fiscal year.
San Leandro
This City's Annual Sealing project was supposed to cost $3.6 mllion but the lowest bid came in at $5.1 million, or 41% over the estimate!
$3,625,110.04 - estimate
$5,098,856.00 - bid 1 (41% over estimate)
$6,582,000.00 - bid 2
RESOLUTION TO REJECT ALL BIDS FOR THE ANNUAL SEALING 2021-2023 PROJECT, PROJECT NO. 2023.0070
WHEREAS, the City of San Leandro did, on May 7, 2025, publicly open, examine and declare all sealed proposals or bids for doing the work described in the bid documents for the subject project;
WHEREAS, the Public Works Director recommends that the proposals for said work be rejected.
Fresno
American Paving was the lowest bidder in the City's first bid, with a base bid at $9,718,256.10. There were two bidders, both responsible.
The Engineer's Estimate for the Base Bid was $7,015,758.37. The low bid was 38.52% above the Engineer's Estimate.
On the re-bid American Paving was the low bidder (again), with a base bid of $9,699,826.There were six bidders and three withdrew their bids, including the two lowest bidders. Why did the three bidders withdraw? The PLA.
Read the whole thing here.
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