[Federal Register Volume 74, Number 166 (Friday, August 28, 2009)]
[Rules and Regulations]
[Pages 44284-44285]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-20831]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 5
[Docket No. FR-5331-F-01]
RIN 2501-AD47
Use of Project Labor Agreements for Federal Construction Projects
AGENCY: Office of the Secretary, HUD.
ACTION: Final rule.
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SUMMARY: This final rule removes a HUD regulation that prohibits the
use of project labor agreements in HUD-assisted construction contracts.
Executive Order 13502, entitled ``Use of Project Labor Agreements for
Federal Construction Projects,'' and signed by President Obama on
February 6, 2009, revoked Executive Order 13202, which had prohibited
federal agencies from requiring or prohibiting project labor agreements
as a condition for award of any federally funded contract or
subcontract for construction. Executive Order 13502, which applies to
direct federal procurement of construction, encourages federal agencies
to consider requiring the use of project labor agreements in connection
with federally procured large-scale construction projects. The
Executive Order also allows the use of project labor agreements in
circumstances not covered by the Order, including projects receiving
federal financial assistance.
In a previously published Federal Register notice pertaining to
HUD's Fiscal Year 2009 (FY 2009) funding, participants in HUD programs
and prospective recipients of HUD funds were notified of the issuance
of Executive Order 13502, of its removal of the restrictions on the use
of project labor agreements, and of the invalidity of the HUD
regulation promulgated to enforce the earlier Executive Order. With the
revocation of Executive Order 13202, there is no longer a legal basis
for HUD's regulation that implemented that executive order with respect
to HUD-assisted projects. Therefore, this rule removes the regulation
from the Code of Federal Regulations.
DATES: Effective Date: September 28, 2009.
FOR FURTHER INFORMATION CONTACT: Camille E. Acevedo, Associate General
Counsel for Legislation and Regulations, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street, SW., Room
10282, Washington, DC 20410; telephone number 202-402-5132 (this is not
a toll-free number). Persons with hearing or speech impairments may
access this number through TTY by calling the toll-free Federal
Information Relay Service at 800-877-8339.
SUPPLEMENTARY INFORMATION:
I. Background--Executive Order 13502, ``Use of Project Labor Agreements
for Federal Construction Projects''
Executive Order 13502, entitled ``Use of Project Labor Agreements
for Federal Construction Projects,'' and signed by President Barack
Obama on February 6, 2009, while directed to federal agency procurement
of construction, also allows federal agencies to consider requiring the
use of project labor agreements in connection with large-scale
federally assisted construction projects. (Executive Order 13502 was
subsequently published in the Federal Register on February 11, 2009 (74
FR 6985).) The Executive Order revokes Executive Order 13202,
``Preservation of Open Competition and Government Neutrality towards
Government Contractors' Labor Relations on Federal and Federally Funded
Construction Projects,'' which prohibited federal agencies from
requiring or prohibiting project labor agreements as a condition for
award of any federally funded contract or subcontract for
construction.\1\ In order to bind participants in HUD programs to the
provisions of Executive Order 13202, HUD established regulations at 24
CFR 5.108 that barred recipients of HUD funds from requiring or
prohibiting project labor agreements in their procurements using HUD
funds. The HUD regulations applied to HUD-assisted construction
contracts. Construction contracts awarded directly by HUD were covered
separately by provisions in the government-wide Federal Acquisition
Regulation (FAR).
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\1\ (Executive Order 13202 was signed by President George W.
Bush on February 17, 2001 (published in the Federal Register on
February 22, 2001 (66 FR 11225)) and later amended by Executive
Order 13208, signed by President Bush on April 6, 2001 (published in
the Federal Register on April 11, 2001 (66 FR 18717)).
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Executive Order 13502 restores to federal agencies the discretion
to determine when project labor agreements may be appropriate and
beneficial in federally assisted construction projects, through the
revocation of Executive Order 13202. As a result of the revocation,
Executive Order 13502 also removes the prohibition on recipients of HUD
funds from requiring the use of project labor agreements in their
procurements. Because the foundation for HUD's regulation in 24 CFR
5.108 was the prior Executive Order, which has been revoked, the rule
no longer has effect. Accordingly, in an update of requirements
applicable to HUD funding for FY 2009, published in the Federal
Register on April 16, 2009 (74 FR 17685), HUD notified prospective
recipients and participants in HUD programs that the new Executive
Order revoked Executive Order 13202 and that the regulation in 24 CFR
5.108 was no longer in effect.
Executive Order 13502 was issued to address the challenges to
efficient and timely procurement presented to the federal government by
large-scale construction projects. Because construction employers often
do not have a permanent workforce, it can be difficult for them to
predict labor costs when bidding on contracts and to ensure a steady
stream of labor on contracts being performed. Often, multiple employers
are involved at a single location, and a labor dispute concerning even
one employer can delay an entire project. A lack of coordination
between employers or uncertainties about the terms and conditions of
employment of various groups of workers can create friction and
disputes in the absence of an agreed-upon resolution mechanism. Project
labor agreements can present a means for addressing these problems by
providing structure and stability to large-scale construction projects,
thereby promoting the efficient and expeditious completion of federal
construction contracts.
Executive Order 13502 declares that it is the policy of the federal
government to encourage the executive agencies to consider requiring
the use of project labor agreements in connection with large-scale
construction projects in order to promote economy and efficiency in
federal procurement. The Executive Order, however, does not require an
executive agency to use a project labor agreement on any construction
project, nor does it preclude the use of a project labor agreement in
circumstances not covered by the Order, including leasehold
arrangements and projects receiving federal financial assistance. The
Executive Order also does not require contractors or subcontractors to
enter into a project labor agreement with any particular labor
organization.
[[Page 44285]]
II. This Final Rule
In addition to removing the prohibition on the use of project labor
agreements in federal and federally assisted construction contracts,
Executive Order 13502 directs agencies to revoke any regulations based
on the prior Executive Order 13202. Consistent with those directions
and the lack of a legal foundation for HUD's regulation in 24 CFR
5.108, this rule removes that regulatory section from the Code of
Federal Regulations.
Executive Order 13502 further directs the Director of the Office of
Management and Budget (OMB), in consultation with the Secretary of
Labor and with other officials, as appropriate, to provide
recommendations to the President, within 180 days of the signing of
Executive Order 13502, on whether broader use of project labor
agreements with respect to both construction projects undertaken under
federal contracts and construction projects receiving federal financial
assistance would help to promote the economical, efficient, and timely
completion of such projects. HUD is therefore deferring any rulemaking
to implement Executive Order 13502 in HUD-assisted construction
contracts, pending OMB's recommendations on this issue.
III. Justification for Final Rulemaking
Generally, HUD publishes a rule for public comment before
publishing a rule for effect, in accordance with HUD's regulations on
rulemaking at 24 CFR part 10. Part 10, however, allows in Sec. 10.1
for exceptions from that general rule where the Department finds good
cause to omit advance notice and public participation. The good cause
requirement is satisfied when the prior public procedure is
``impracticable, unnecessary, or contrary to the public interest.'' In
this case, HUD has determined that prior public comment is unnecessary.
Because this final rule removes a rule for which the legal basis has
been revoked, HUD is left with no discretion on which public comment
could be considered on the subject of removal of the regulation.
IV. Findings and Certifications
Executive Order 12866, Regulatory Planning and Review
The Office of Management and Budget (OMB) reviewed this rule under
Executive Order 12866 (entitled, ``Regulatory Planning and Review'').
This rule was determined to be a ``significant regulatory action'' as
defined in section 3(f) of the Order (although not an economically
significant regulatory action, as provided under section 3(f)(1) of the
Order). The docket file is available for public inspection between the
hours of 8 a.m. and 5 p.m. weekdays in the Regulations Division, Office
of General Counsel, Room 10276, Department of Housing and Urban
Development, 451 7th Street, SW., Washington, DC 20410-0500. Due to
security measures at the HUD Headquarters building, please schedule an
appointment to review the docket file by calling the Regulations
Division at (202) 708-3055 (this is not a toll-free number). Persons
with hearing or speech impairments may access the above telephone
number via TTY by calling the toll-free Federal Information Relay
Service at 800-877-8339.
Environmental Impact
This final rule does not direct, provide for assistance or loan and
mortgage insurance for, or otherwise govern or regulate, real property
acquisition, disposition, leasing, rehabilitation, alteration,
demolition, or new construction, nor does it establish, revise, or
provide for standards for construction or construction materials,
manufactured housing, or occupancy. Accordingly, under 24 CFR
50.19(c)(1), this final rule is categorically excluded from
environmental review under the National Environmental Policy Act of
1969 (42 U.S.C. 4321 et seq.).
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits an agency
from publishing any rule that has federalism implications, if the rule
either imposes substantial direct compliance costs on state and local
governments and is not required by statute, or the rule preempts state
law, unless the agency meets the consultation and funding requirements
of section 6 of the Executive Order. This final rule does not have
federalism implications and does not impose substantial direct
compliance costs on state and local governments nor preempt state law
within the meaning of the Executive Order.
Unfunded Mandates Reform Act
Title II of the Unfunded Mandates Reform Act of 1995 (2 U.S.C.
1531-1538) (UMRA) establishes requirements for federal agencies to
assess the effects of their regulatory actions on state, local, and
tribal governments and the private sector. This final rule does not
impose any federal mandates on any state, local, or tribal governments
or the private sector within the meaning of UMRA.
List of Subjects in 24 CFR Part 5
Administrative practice and procedure, Aged, Claims, Crime,
Government contracts, Grant programs--housing and community
development, Individuals with disabilities, Intergovernmental
relations, Loan programs--housing and community development, Low and
moderate income housing, Mortgage insurance, Penalties, Pets, Public
housing, Rent subsidies, Reporting and recordkeeping requirements,
Social Security, Unemployment compensation, Wages.
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Accordingly, for the reasons described in the preamble, 24 CFR part 5
is amended as follows:
PART 5--GENERAL HUD PROGRAM REQUIREMENTS; WAIVERS
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1. The authority citation for part 5 continues to read as follows:
Authority: 42 U.S.C. 1437a, 1437c, 1437d, 1437f, 1437n, 3535(d).
Sec. 5.108 [Removed]
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2. Remove Sec. 5.108.
Dated: August 24, 2009.
Shaun Donovan,
Secretary.
[FR Doc. E9-20831 Filed 8-27-09; 8:45 am]
BILLING CODE 4210-67-P