On December 18, 2024, Oregon Governor Tina Kotek issued Executive Order No. 24-31 (the “PLA Executive Order”). Under the order, Governor Kotek directed state agencies to require Project Labor Agreements (“PLAs”) for nearly all state construction projects. More recently, Governor Kotek published responses to a set of “Frequently Asked Questions” that address the implementation and scope of the order.
At the top of the FAQ sheet, Governor Kotek clarified the nature of a PLA. Under the PLA Executive Order, a PLA is a “pre-hire collective bargaining agreement negotiated between construction unions and construction contractors that establish the terms and conditions of employment for construction projects.” The FAQ sheet does not provide any further information about the required terms, other than what was set forth in the initial order.
Though the wording of the order suggested it may apply broadly, not only to projects for which a state agency awarded the contract but also those in which any state funds were used, the governor explained this would not be the case. Instead, Governor Kotek stated the PLA Executive Order was limited to projects where the state “is the contracting authority and the constructed improvement is owned by the state.” The FAQs clarified that the PLA Executive Order will not apply to local projects that utilize state funding or affordable housing projects owned by non-state entities. Nor will higher education institutions and broadband projects when the state does not own the constructed asset be subject to the order.
The PLA Executive Order mandates PLAs on all state construction projects whenever labor costs represent 15% or more of total project costs. In the FAQ sheet, Governor Kotek confirmed that construction labor means “onsite construction labor, which includes all of the work done at the physical location of a construction project.” In other words, offsite labor costs are not to be considered in determining whether the 15% threshold has been met.
Finally, Governor Kotek stated that her office will conduct biannual reviews to assess the state’s performance against the stated goals of the order, and provide recommendations for corrective measures if needed.
A copy of Governor Kotek’s published FAQ Sheet can be found here.
