September 6, 2013
LANSING - Attorney General Bill Schuette today announced the U.S. Court of Appeals for the Sixth Circuit upheld Public Act 98, the Michigan Fair and Open Competition and in Governmental Construction Act. The law increases competition and lowers costs to taxpayers by allowing all contractors, regardless of union or non-union affiliation, to have equal access to competitively bid for public construction project contracts.
"The public contract bidding process should be open and fair for all of Michigan's builders and contractors," said Schuette. "Encouraging robust competition and free enterprise will improve efficiency and save hard-earned taxpayer dollars."
The U.S. Court of Appeals for the Sixth Circuit ruled 2-1 the Open Competition Act is not pre-empted by the federal National Labor Relations Act (NLRA):
…the act furthers Michigan's proprietary goal of improving efficiency in public construction projects, and the act is no broader than is necessary to meet those goals. Thus, the law is not preempted by the NLRA. (p. 2)
The Open Competition Act protects taxpayers by allowing all qualified contractors to bid for public construction projects and not be otherwise prohibited from doing so under special bidding provisions requiring or prohibiting pre-hiring or project labor agreements (PLAs). This would include state, local government, school district, community college and public university construction projects using state, federal or private funds.
Eighteen other states have similar public contracting laws or executive orders in place.