Legislation would Raise Costs, Harm Minority Businesses, and Restrict Fair Access to Public Work

TRENTON, NJ — A broad coalition of contractors, small businesses, union representatives, minority- and women-owned businesses, and community leaders are calling on New Jersey lawmakers to oppose legislation that would dramatically expand the use of costly Project Labor Agreements (PLAs) on local public projects. 

The legislation, A-5967/S-4864, disproportionately harms workers, employers, and minority and women-owned businesses and will increase the cost of taxpayer-funded public works projects.

Under current law, PLAs are reserved for large-scale, complex public projects where they may be justified. But A-5967/S-4864 would allow PLAs on virtually any local project, regardless of size or complexity, covering everything from modest school repairs to routine municipal building renovations. Critics warn this would make public work less competitive, less inclusive, and less accessible to New Jersey’s diverse small-business community.

Conducted by the Murphy Administration, New Jersey’s 2024 Disparity Study makes clear that minority- and women-owned construction firms already face severe underrepresentation in public contracting:

• Black-owned firms make up 9% of the market but receive just 0.014% of contract dollars

• Hispanic-owned firms represent 11.6% of the market but receive 1.5%

• Asian-owned firms represent 6.4% of the market but receive 2.0%

• 98% of minority-owned contractors are non-union, meaning they would face significant barriers under expanded PLA mandates

“When New Jersey’s own data shows that minority- and women-owned contractors are already being left behind, the absolute last thing the Legislature should do is expand policies that restrict opportunity even further,” said Samantha Roman, President of Associated Builders and Contractors New Jersey (ABC-NJ). “PLAs on small public projects would effectively shut out 98 percent of minority-owned firms. It’s a huge step backward for equity, diversity, and fair access to public work.”

African American Chamber of Commerce of New Jersey (AACNJ) President John Harmon echoed those concerns. “New Jersey leaders talk often about closing racial and economic disparities, yet this bill would deepen them. By limiting who can bid on public projects, A-5967/S-4864 would disproportionately harm Black-owned businesses and workers who deserve a fair chance to compete. Our state should be opening doors for women and minority-owned businesses. We are trying to make the state more competitive and this bill slams the door shut.”

A growing number of employers and union representatives also oppose the initiative

"I would ask that New Jersey Legislature reject S-4864/A-5967 as it excludes United Steel Worker members and signatory contractors from inclusion in PLA projects,” said John Seckrettar, President USW 318. 

“Sadly a last minute lame duck maneuver to allow municipalities to enter into PLA’s for public work projects under 5 million dollars is scheduled to be voted on by the legislature on the last day of the session.  This bill is unfair to general and specialty contractors who currently are hired by their  communities for smaller projects,” stated Eileen Kean, State Director NFIB.  “There is a reason the current law is in place because it supports small and  minority businesses and allows towns to hire  local tradespeople.  Under this bill electrical, plumbing, roofing, HVAC, fencing, framing,  painting and other small projects will become more expensive for tax payers, and the little guy will be crushed.”

Eric DeGesero, spokesman, NJ Independent Electrical Contractors Association stated:

 “The terms ‘affordability’ and ‘fairness’ are bandied about in Trenton on a daily basis. Unfortunately, these words are nothing more than political platitudes. If politicians cared about affordability and fairness they would not exclude 84% of the construction industry from working on projects we all fund as taxpayers. Over 8 in 10 NJ construction workers in NJ have exercised their right not to join a union. PLAs are only fair to the 16% ‘majority’ of the construction industry that politicians deem worthy to do the work 100% of taxpayers fund.”

“This bill is being rushed through and is not fully thought out it prohibits some unions from bidding on work and favors others. A bill this important should not be rushed through during the lame duck session,” said Lori Ames, President, United Service Workers Union.

Roman also warned that the legislation will drive up project costs, reduce competition, and burden small municipalities least equipped to absorb increased expenses. With fewer qualified bidders permitted to participate, taxpayers could face:

• Higher construction costs;

• Reduced project scope or delayed timelines;

• Potential tax increases or cuts to essential services.

“Let’s call this bill out for what it is -- a taxpayer funded surcharge on public construction projects,” said Roman.  “PLAs increase costs, limit competition, and deliver no measurable benefit for local communities. The only ones who benefit from PLAs are the politically-connected labor unions.  Every single legislator who ran on a platform of making New Jersey more affordable should be against this bill, because it does the exact opposite.”

The proposal also contradicts the intent of New Jersey’s original 2002 PLA law, which limited PLAs to large, complex projects where such agreements could be justified, not routine maintenance or smaller-scale public projects. The current law requires a study to be performed yearly to analyze the efficiencies of project labor agreements. Tax payer funded budget line items to perform the study have even been passed in recent years. The study was performed only one time in the 24 years of the laws existence, and the results were not favorable to PLAs. Why should the law be amended when the original law isn’t being followed?

The coalition is encouraging business owners, community organizations, and local leaders to contact their legislators and urge a “NO” vote on A-5967/S-4864 to protect fairness, competition, affordability and economic opportunity across New Jersey’s construction sector.