go right down the row mister gordon you are up first mister gordon thank you mister chairman mister chairman other members of the subcommittee i appreciate the opportunity to appear before you today to discuss the regulatory implementation of executive order  and two which governs the use of project labor agreements plas in federal construction contracts i was pleased to sit in and listen to the first panel with the diverse views that were expressed there and to hear the members questions i will be happy to follow up with any questions you want to raise with me as administrator for federal procurement policy i am responsible for overseeing the development of government wide contracting rules and policies and ensuring that those rules and policies promote economy and efficiency this afternoon i would like to briefly describe the steps my office has taken to shape the federal acquisition regulation or the far as we usually call it rule implementing the executive order let me first though address a misperception or a misconception about what the far rule says about  gives each contracting agency the discretion to decide for itself on a project by project basis whether use of a pla will in fact promote economy and efficiency on a specific construction contract the far rule calls plas and i am quoting from the rule a tool that agencies may use to promote economy and efficiency in federal in offering plas as a tool to the contracting agency the far rule on plas is similar to many other provisions of the federal acquisition regulation for example the far lets contracting agencies decide based on the specifics of their needs and their circumstances whether they should purchase through the federal supply schedule or on the open market whether they should seek bids with price as the only evaluation criterion or rather run a competitive procurement with other selection factors such as past performance or technical excellence in addition to price the far does not dictate to our acquisition professionals which choices to make it gives them the tools to make the choices so that they can tailor a procurement to an individual agencys specific requirement that tool kit approach and the flexibility that comes with it lie at the very heart of our ability to get the best value for every taxpayer dollar that we spend whether we are buying lawnmower services or war planes for the air force our approach to plas is no different we have structured the far rule to create a process where decisions are made on a case by case basis the far rule sets out factors that an agency may decide to consider but it doesnt dictate the factors it doesnt prohibit agencies from considering other factors among the factors that are named in the far are whether the project will require multiple construction contractors andor subcontractors employing workers in multiple crafts or trades and whether completion of the project will require an extended period of time as with other far rules though the pla rule sets boundaries most significantly the agency may require a pla for a specific project only only if it decides that doing that will advance the government economy and efficiency in federal procurement but equally importantly with respect to the content of any pla created pursuant to the far rule and this is particularly relevant in light of what the subcommittee heard from the first panel the far rule requires that any pla allow all firms to compete for contracts and subcontracts without regard to whether they are otherwise parties to collective bargaining agreement this mandate ensures that if an agency decides that they should be using a pla it is done consistent with the principle of open competition a bedrock of our federal procurement system so that all interested  are given an opportunity to have their offers considered by the government we appreciate that taxpayers would not benefit from a rule that requires the use of plas regardless of circumstances but we also dont think taxpayers would benefit if agencies were prohibited from taking advantage of opportunities where a pla could help them achieve or increase efficiency and timeliness with these thoughts in mind my office intends to continue working with the agency with the agencies across the executive branch to facilitate the sharing of experiences and best practices for the consideration and appropriate use of project labor agreements in the federal marketplace i will be delighted afterwards to answer any questions the subcommittee members have thank you labor agreements on our construction contracts we share with you an interest in seeing that our construction projects are finished as expeditiously as possible and with the best value and cost to the american taxpayer a pla is a proven the state and local levels for a wide array of construction projects varying in size and scope plas have been used in all fifty states and the district of columbia they can help reduce risks associated with wage stability avoidance of work stoppages increase labor availability and project specific coordination of work rules plas can also include provisions that promote career development through valuable job training for construction workers gsa uses plas when they promote economy and efficiency in federal  but encourages the consideration of plas our procurement process provides for the consideration of plas we allow contractors to submit a proposal with a pla without a pla or both we evaluate these proposals on a project by project basis if we accept a pla proposal the awardee is required to execute a pla in accordance with the executive order and the far in gsas contracts the pla is an agreement between the contractor and the labor organization rather than between gsa and the labor organization as we typically do on our major construction projects gsa selects the proposal with the best value to the government by weighing a number of technical factors against cost pla recently has been included as one of those technical factors i should note that the other technical factors for many more points are past performance key personnel and a management plan which often includes the requirement of the being a plan to include small business proposals with a pla receive ten percent ten of the possible one hundred points for technical evaluation if you consider that then the technical factors as a whole are balanced against price on the other hand you will see that the pla in and of itself is far less than ten percent more like probably five or six percent of total award and we dont really quantify them that way which i will be happy to explain we award to contractors who usually work with labor organizations and we also award to contractors who do not usually work with labor organizations shortly after the executive order was signed gsa received five dollars fifty cents billion through the american recovery and reinvestment act of two thousand and nine these funds which were used principally to help modernize and green our federally owned inventory provided gsa the opportunity to conduct a pla pilot program i am proud to tell you today that in our spending on the recovery act so far we estimate we have created sixteen thousand jobs in the american construction industry for the pilot pla program gsa selected ten projects with budgets of more than one hundred dollars million the selected projects cover seven states and the district of columbia of the ten seven ended up with and three did not from our comparisons in most instances it appears that there has been little to no cost differences although i will be the first to tell you in some cases that is hard to tell our experience in this pilot program has shown us that  bidding process has not hindered competition in all of our projects we received sufficient bids to ensure adequate competition and the best value to the american taxpayer we typically receive between three and eight offers for our projects for the pilot projects through the construction of these projects gsa plans to assess the use of plas for future implementation of best practices and updates to our policies this pilot program has enabled gsa to obtain real market data regarding the impact of plas on competition we have recently reached out to contractors and union officials to hear their feedback on our pilot projects in order to develop ways to further improve our pla procurement process mister chairman and members of the sub testify about the important work of the occupational safety and health administration and to listen to your suggestions about how we can improve the approaches we take to fulfill the important mission given to us by congress protecting the lives and health of american workers in the sixty seven percent since one thousand nine hundred and seventy three but far too many preventable injuries and fatalities continue to occur i am also glad that you chose the important issue of construction safety the safety of construction workers is one of oshas top concerns construction is among the most dangerous industries in the country and construction inspections comprise sixty percent of oshas total inspections in two thousand and nine preliminary data from the bureau of labor statistics indicated that there were eight hundred and sixteen fatal on the job injuries to construction workers more than in any other single industry sector and nearly one out of every five work related deaths but we are talking about much more than just statistics here we hear about these tragedies almost every day in the news almost every construction worker that dies lea behind a family whose lives are devastated a breadwinners serious injury can throw a family permanently out of the middle class it is clear that osha enforcement and regulations save lives that many workers are alive today because of oshas activity since its creation forty years ago osha has relied on the same basic strategies to ensure the safety of american workers for those many employers who want to do the right thing we offer compliance assistance and cooperative programs for those employers who endanger workers by cutting corners on safety we believe in strong enforcement the ultimate goal of oshas enforcement is deterrence using penalties is one way to change employer behavior with a goal of preventing injuries illnesses and deaths before they occur strong enforcement not only benefits workers it also levels the playing field for the vast majority of employers who play by the rules and who make the health and safety of their employees a priority failing to prevent injuries illnesses and fatalities is a major burden on the american economy every year the most disabling injuries cost american employers more than fifty three dollars billion over one dollar billion a week in workers compensation costs alone indirect costs to employers workers and their families can double these costs one of the that congress gave osha was to issue standards to protect workers from these costly injuries and deaths osha goes through an extensive public consultation process before issuing new standards we conduct sophisticated reviews of the economic impact of proposed regulations at that point osha was working on a new crane standard started in two thousand and only last year in november two thousand and ten did our new crane standard finally go into effect after all those multiple opportunities for public input we now have a strong crane standard which we know like that from occurring osha is a full service organization our strong compliance assistance programs operate under the belief that every employer should have access to the knowledge he or she needs to provide a safe workplace and every employee should be award of their basic rights under the law and the hazards they face in addition to the numerous fact sheets guidance documents and online tutorials that can be found on oshas website our onsite consultation program provides free workplace safety and health evaluations and advice to small businesses th cannot afford to hire their own safety and health experts this program is completely separate and independent from oshas enforcement program last year the consultation program conducted over thirty thousand consultation visits more than nine thousand in small construction companies preventing work related hearing loss in brief these actions stand as an example of this administrations willingness to respond to public concern about our programs i will be glad to answer any questions about these actions or any other osha initiatives thank you  much money congress gives us in our capital program we are somewhere between usually a billion and a billion and a half if you include new construction and major alterations mister jordan mister gordon in his testimony talked about the flexibility that the far  actually run a pilot program on ten of the projects that we had under the recovery act that were over twenty five dollars million that is ten out of fifty seven projects that were only over twenty five dollars million as i said we are using them as a on the one that was awarded the first is a little over a year under construction so we have not completed the project yet so it is hard to make a determination there what we can tell you is that on all of our pla bids we got adequate competition the market tell us how it values the use of a sounds good hardly any of us buy things that way and the government when we used to do what we called low bid we would often find ourselves with a low bidder who couldnt carry out the project for that low bid and we ended up often not getting that value and we would end up having to take the project to someone else or they would file delay mister jordan well let me ask it this way then someone who was not willing to enter into a pla how can they make up for the ten percent you weight for those who are willing to enter into a pla mister peck well in fact on ten of the firm did they get prejudiced in the bid process because now obviously the one who said he was going to do it and is not doing it still has the contract that is probably an important question that the taxpayers want to know the answer to mister peck that is a fair question and i would e happy to provide for you in the record an analysis of that involve unions and some that are not unions linda figg who was a witness on the previous panel i guess was somehow involved in creating this  beautiful brochure about the new i thirty five bridge and as i asked her in the questions she responded that this was a project labor agreement mister peck yes mister kucinich i didnt ask her if it was union or not just said it was a project labor agreement she said contractor for award gsa uses the best value method of award which takes into consideration both cost and technical qualifications can you elaborate on the best value method this allows us to do is that we have a panel of government experts who take a look at the submissions that contractors make and they are required to submit such technical factors as their past performance on government and other projects the key personnel they are putting on a project their plan for performance on the project which as i said could include a small business plan and we then decide who on technical factors is the best then we we have heard witnesses here today say that plas drive up the cost premiums of public projects and in your experience have you seen that plas have a significant impact on the cost premium of a specific project  a bids that were exactly the same on two of our projects we paid more the bid with the pla was more than the bid without but on at least but i have but i say again some of the selections are made not just on whether there is a pla or not but as near as we can tell isolating it we can tell on two products we paid some kind of we paid more for the pla and our panel decided in essence or we decided that there was a value to have plas that you might say are awarded to a non union contract there are trade crafts in which people who work for the non union contractor are members of unions and so it is useful on a lot of projects to have an agreement with all the labor unions about how they are going to coordinate vacation time hours overtime all those sorts of issues and on those projects as i said we found that there was value mister kucinich i want to go over one other point here mister chairman mister peck some of the witnesses on  first panel expressed concern that the use of plas inhibits members of the construction industry from competing for government contracting opportunities now in your written testimony mister peck you state by using our optional bidding process  a does not discriminate against contractors gsa awards to contractors who work with labor organizations as well as contractors who work without such organizations have you found that plas limit competition for government contracts mister peck not that we large construction projects because we cant have mom and pop firms as our general contractors we certainly have small firms as subcontractors to those but that is about the competition that we typically get on our construction projects  chairmans question you mentioned in your opening statement that some contracts are awarded to union shops and some are not now just to clarify if my question is the same as the chairmans can you give us a number as to how many go to the committee has noted the vast majority of major of general contractors in this country are not union shops ms buerkle the next question is to mister michaels and welcome i must say  i interview and talk to a lot of the small businesses and businesses in my district osha tends to be one of the impediments and one of the obstacles that they are always trying to get around so i hope that we can flesh out some compliance and the compliance assistance that osha offers to businesses now my understanding is that osha just recently cut the budget for the voluntary protection program and it seems to me that would indicate that you are moving away from compliance and more to something punitive when it comes to enforcement mister michaels that is actually not true there was a proposal to do that but  administration proposal is to maintain the vpp at the same funding levels and i have made a commitment to the program in fact i think if you look at my particular record i have a real commitment to the  that vpp program when i was at the energy department some years ago so i am doing what i can to make sure that program thrives but beyond vpp because a relatively small number of companies and very few small companies we are trying to push those the basic concepts that the vpp has embraced down to all employers especially the small employers so we have tremendous amount of compliance assistance materials we have a website that gets one hundred and eighty three million hits a year we information for employers and we have this program that we fund through the states an onsite free consultation program we find that many small employers dont know about it so for example in new york state it is run by the new york state labor department but it is independent from o thank you mister peck my last question is for you in the time that i have left has gsa ever conducted a study that looks at these pla agreements and determines the impact whether it is price wise or any other wise started to look market by market at the pilot areas that we were looking at for example we were doing a project in cleveland we were doing a project in denver and we did have a contractor look at those labor markets to see if they could come up with a formula that would tell us how we yes congress limited our fines the maximum level for a fine for a serious violation is seven thousand dollars we have some discretion within that seven thousand dollars to reduce the level of the fine which we do on the basis of being a small employer history of lack or presence of osha violations and good faith but that seven thousand dollars maximum is not inflation adjusted and hasnt been changed in almost twenty years actually in twenty years world would anybody even get up there and they said that is not the problem there is enough space between the top of your paint room and the ceiling that somebody could get up there and possibly fall so i think the intention of all this is to do a good job it is the speier submitted for the record a letter from a woman named tammy miser i would like to use my time to make sure that her voice is heard i would like to read excerpts from a statement says my brother shawn boone worked at the hayes lemmertz plant in huntington indiana where they made aluminum wheels the plant had a history of fires but workers were told not to call the fire department my brother and a couple of co workers went in to relight a chip melt furnace they decided to stick around a few minutes to make sure everything was okay and then went back to gather tools back was toward the furnace when the first explosion occurred someone said that shawn got up and started walking toward the doors when there was a second and more intense blast the heat from the blas was hot enough to melt copper piping shawn did not die instantly he lay on the floor smoldering while the aluminum dust continued to burn through his flesh and muscle tissue the breaths that he took burned his internal organs and the blast took his eyesight shawn was still conscious and asking for help when the ambulance took him away we drove five hours to indiana wondering if it really was shawn hoping and praying that it wasnt this still brings about guilt because i would not wish this feeling on anyone we arrived only to be told that shawn was being kept alive for us the onsite pastor stopped us and told us to prepare ourselves adding that he had not seen anything like this since the war the doctors refused to treat shawn saying even if they took his limbs his internal organs were burned repair this was apparent by the black sludge they were pumping from his body i went into the burn unit to see my brother maybe someone who didnt know shawn wouldnt have recognized him but he was still my brother you cant spend a lifetime with someone and not know who they are shawns face had been cleaned up it was very swollen and splitting but he was still my bub my family immediately started talking about taking shawn off the life support if we did all agree i would be ultimately giving up on shawn i would have taken his last breath even if there was no hope and we werent to blame i still had to make that decision to watch them stop the machines and watch my brother die before my eyes but we did take him off and we did stay to see his last breath the two things i remember most are shawns last words im in a world of hurt he said and then he took his last breath the united states chemical safety and hazard investigation board said that the explosion that killed s probably originated in a dust collector that was not adequately collected or cleaned the dust collector was also too close to the aluminum scrap processing area hayes lemmertz management allowed dust to accumulate when overhead beams and structures which caused a second more massive explosion the csb concluded that had the company adhered to the national fire protection association standard for combustible metal dust the explosion would have been minimized or prevented altogether the csb warned osha in two thousand and six about combustible dust hazards had the national fire protection association standard been implemented as a mandatory regulation instead of a voluntary consensus code my brother shawn and many others would still be here today a one sided look at the cost of osha rules but excluding the benefits does a disservice to workers responsible employers and families and communities mister michaels do you think that we can have a productive discussion today about the impact of osha regulations without involving people like tammy mister michaels i think it is very important to hear from people like  hear from his family we unfortunately hear from the people who had employers who didnt follow osha standards and there are far too many of those so what we are trying to do is make sure that we can get out there we can have stronger standards to ensure that  recently in west virginia or virginia two different things generally the violation of numerous osha housekeeping standards what osha is now doing is try to essential put out standards that makes much more clear what they have to do but in new cases of hearing loss reported every year and that is a vast underestimate we know that most construction workers develop hearing loss by the time they are retired from work it is very clear and we want construction workers we want all workers to be able to hear their grandchildren when they  old enough to have grandchildren so we have to do something what we did was we said we are going to enforce our noise standard like we enforce every other standard we proposed that and we heard from many constituents like yours so we said okay miser that was discussed earlier through testimony ms miser states that osha regulations not only save lives but they save businesses too she gives the example of the two thousand and nine conagra plant explosion in north carolina the workers were killed seventy one workers were injured now before the explosion seven hundred people worked at the factory today the factor is shutting down seven hundred lost jobs because of a workplace disaster seven hundred people would be working and three families who would not have been torn apart had there been more regulation ms miser also gives the sample of the two thousand and seven explosion of a jacksonville florida gasoline additive factory the explosion killed four injured thirty two including twenty eight at surrounding businesses pieces of the building were found a mile away a subsequent investigation revealed that the explosion could have been prevented if oshas process safety management standard covered reactive hazards so three businesses that were adjacent to the factory were forced to relocate a fourth was completely shut down we talk about lives that would have been saved and jobs that would have been preserved  studied eight osha regulations in one thousand nine hundred and ninety five the study is very valid there have been very few osha regulations since then they went back and they looked and they found for the most part there was one exception that was questionable but the other seven the companies were able to meet osha went ahead they issued a standard saying they essentially had to fully control exposure in these major facilities the industry very quickly figured out how to do that not a single job was lost as far as i can tell the headlines in the business papers were  industry celebrates in triumph they were able to enclose the materials save money and move forward so we always hear and it is understandable every industry says it is going to cost us too much money because they dont try so we want to work with industry to try to say we can save you money we can save jobs look at the clean energy explosion last super bowl sunday which killed six workers injured fifty it destroyed a billion dollar natural gas power plant that has to be rebuilt from scratch  gentlelady from new york ms buerkle thank you mister chairman i think that the goal here for this hearing today is really we want a win win situation where we have safety in the workplace and we don years in the george w bush administration where osha really had no interest in putting out any regulations so the only health standard that osha put out during that period was on another carcinogen hexavalent chromium that the federal court said you must put it develops a detailed and specific safety plan for each project we perform we expect that of all employers to figure out what your hazards are if it is not a serious hazard then do whatever is appropriate but if you have a serious hazard then you have to address it so this approach which is actually what  is essentially says you have to think about your hazards in a systematic way now we are very early in the process we are still considering it we havent started the small business regulatory enforcement fairness act process so there will be lots of opportunity for people to have  input and talk to us about it but we think this will be more effective than trying to do standards on every specific hazard because we cant have a standard on every hazard there are so many different things out there so this is telling employers you figure it out we trust you you know more about it than anybody else but you have to figure it out you have to think about it and we hope you will support that and ask us more about it later on ms buerkle when we see it we will consider it with ip what are the penalties that sure we are not trying to make this an onerous requirement we want to work with employers to make sure they see the purpose of this and they see it is really separate we still have all of our rules that issue penalties for violations of different standards or just not providing a tell i know that a couple of big trade organizations that oppose everything osha ever does they came out and they opposed it but i think that is to raise money from their constituents because i hear from employers every day who say this is obvious of course we do this assistance and more to the punitive or do you think it is going to be more user friendly mister michaels we do both that is the thing for employers who want to do the right thing who want to do this we will give them all the help we can but there are always going to be some who dont we are going to do both it is not one or the other ms buerkle how do you know what is right though some of these like what we heard earlier these are subjective subjective criteria that when you have someone going into the work site he may have a different standard or a different vision  almost twenty years and employers there are very comfortable with it we actually are having conversations with stakeholders around the country we have had five big meetings but also talking directly to the osha offices in california saying how do you do this how do you make sure you have that right  application of the law is so very important and i will tell my story until i die as a young boy in high school working at bethlehem steel and after you would blow your nose after being on the property for an hour when you blew your nose the mucus was black a lot of the men who worked with me died early i just worked there for a summer some of them worked there for years and they would breathe it deterrence we have to do everything we can to make sure employers do the right thing the laws about employers they have to apply the right standards they have to protect workers so we do enforcement and when we do enforcement and it is a significant case we also try to publicize it and we try to reach out to the industry and say look you can do the right thing you can get the compliance assistance program but at the same time if we go there and we find a hazard we are going to give you a fine and in many cases we are going to put it in a press release so people so it  we know that we want to do everything we can to encourage the right behavior we are a small agency so we do as much enforcement as we can we have about two thousand two hundred inspectors for the whole country to cover one hundred and thirty million workplaces  about is march th of this year he talks about how we are doing all this cutting cutting cutting but it is a issue of whether you are doing a lot of damage in the process and what you are talking about there  if this congress continues to cut cut cut all of our enforcement people and our inspectors you dont have to worry about the regulations because you take the guts out of the regulations by doing that am i right  know the thing that drives compliance assistance the reason employers go and get the free consultation a big reason is they fear an osha inspection that is reality it is unfortunate a lot will do it because they want to do the right thing but they also think well i had better do this because i dont want to get a fine so if our inspections disappear it would have a big impact i dont think people would use compliance assistance much either frankly mister cummings there is another thing that kind of bothered me about this whole idea of c s regulations that might cost jobs job killing regulations or whatever you call it and this is my statement this is not you this is me nothing guarantees that even if they got rid of the regulations and even if they saved the money that that would relate to new jobs it might just you dont have to comment on this it might just be more profit and so i just think i just hope that we keep sight of this  of their employees mister michaels i think so i dont have evidence but that is my feeling as well mister jordan particularly in the high tech world we live in today where there is so much investment in their employees they put so much money at stake and they want their employees there because that is what keeps their business profitable in this high tech international market said that there is a compliance cost with that regulation and if you remember the first panel that was in front of the full committee that chairman issa had he had witnesses he had small business owners here and the question was asked by a freshman member if you knew then what you know now would you have started  how big of an influence he is in this community that he comes from so that is what we are also trying to get at mister michaels i think what we said before is we are looking for the right balance between enforcement because we have to be at armco steel i have friends that worked at pullman standard i have people that work in my shop you know the biggest problem employers have is workers that wont use the safety when i go out in the shop my guys are supposed to wear a hard hat when they have a car up in the are supposed to wear goggles when they have a car up in the air they are supposed to wear goggles when they use a grinding wheel what people are supposed to do whether there is a regulation or not is kind of secondary i know this is purely anecdotal but everything in these hearings is anecdotal because we all know a guy who knows a guy who knew a guy but the question of the hearings were at some point is the cost of regulation reaching a level where we cant legislative complete safety it is just impossible because peoples nature is to take the easy way out of everything i am talking about people that work in the job i have friends that are hurt every day in the steel mills because they dont follow the safety standards so are we going to get to a regulation where we have to have somebody who walks with these guys to make sure they do the right thing all the time and i think the question becomes where is the end game with regulation because you say we need more regulations the cha coming up with new regulations every day to protect people from doing dumb things that they do themselves i wish there was an answer to all this i do appreciate your coming here today but i have to tell you from a guy who has lived it who has paid more in training  and i see the same things being done by the same people who just got hurt the week before and say what are you thinking about so i am not putting down what you do by gosh we all want everybody to come to work and get through the day healthy and go back home i wan see everybody get to be a grandfather i am a grandfather i also want to see my business survive and i dont want it to get to the point where i am regulated out of business because of something that i cant possibly watch twenty four hour a day it just is impossible