By Nick Goldstein, vice president of regulatory affairs, ARTBA
In what would be a major regulatory victory for the transportation construction industry, the United States Department of Transportation (U.S. DOT) appears poised to withdraw the Obama Administration’s proposed rule allowing geographic-based and other preferences on federal-aid transportation construction projects. According to the department’s “August 2017 Significant Rulemakings Report,” the regulation was set to be withdrawn on August 25. The proposal, which ARTBA has vigorously opposed, would allow state and local transportation agencies to implement preferential hiring on federal-aid projects based on where potential employees reside, their income level, or other factors, subject to U.S. DOT approval. As ARTBA has stressed to both U.S. DOT and the White House Office of Management and Budget (OMB), these hiring preferences can add to the cost of projects, as contractors must account in their bids for the increased risk of hiring untrained or unnecessary workers under these mandates. They also raise serious safety concerns, in that contractors will likely need to hire individuals with inadequate training or self-awareness to safely function in a work zone. It is also likely that, if the rule were to be enacted, contractors would have to displace existing workers or break up work crews in favor of new workers qualified solely because of their place of residence.
It should be noted however, that as of press time, there has been no notice in the Federal Register officially formally withdrawing the local-hire rule. Still, its inclusion in the latest U.S. DOT Significant Rulemakings Report indicates the administration fully intends to proceed with the withdrawal. Also, it should be noted that as it left office, the Obama Administration extended the U.S. DOT pilot program allowing hiring preferences until March of 2022. ARTBA has formally asked the department to end this program as well. ARTBA will continue to advocate for fully returning to U.S. DOT’s longtime policy and ending all forms of these hiring preferences, while monitoring the Federal Register for notice of the official withdrawal of the local hire rule and any additional developments regarding the pilot program.