Texas has room to improve its appeal as a state for contractors to do business according to a scorecard launched by Associated Builders and Contractors (ABC).
“Building America: The Merit Shop Scorecard” reviews and grades state-specific information significant to the success of the commercial and industrial construction industry. The scorecard website, meritshopscorecard.org, identifies states, such as Texas where strategic improvements need to be made to create an environment where merit-shop contractors are well positioned to succeed and states that have created contractor-friendly business environments.
The Merit Shop Scorecard grades states on their policies related to project labor agreement (PLA) and prevailing wage mandates, right-to-work status as well as their construction job growth rate, commitment to developing a well-trained workforce, level of flexibility in career and technical education curricula and use of public-private partnerships (P3s).
Texas policymakers have enacted some merit-shop friendly policies and have been receptive to further improving the business environment so contractors can excel. “An extra $4.5 billion in construction spending and a 25 percent reduction in the business franchise tax has certainly helped Texas contractors,” Jon Fisher, ABC of Texas President, said. “During the 84th Texas Legislature, approximately $1.4 billion was appropriated for construction spending, and another $3.1 billion in tuition revenue bonds was appropriated for higher education.”
The merit shop philosophy is the belief that people and companies succeed based on free enterprise principles within the free market system, which is characterized by open and fair competition and diverse participants. Those who adhere to the philosophy believe employees and employers have the right to determine wages and working conditions through either individual or collective bargaining, as they choose, within the boundaries of the law. They oppose violence, coercion, intimidation and the denial of the rights of employees and employers. Furthermore, they believe it is incumbent upon all branches of government to be responsible stewards of taxpayer dollars and that government should award contracts based solely on merit to the lowest responsible bidder, regardless of labor affiliation.
“One disappointment this legislative session was the outcome of the Neutrality in State Government Contracting Bill. This simply should have passed,” Russell Hamley, ABC Greater Houston President, said. “A high priority of ABC is to protect merit shop contractors by preventing governmental entities from requiring the use of project labor agreements for projects using state resources. It is our position that all contractors should be allowed to bid on public projects.”
High-performing states such as Arizona, Louisiana and Virginia received top marks for their right-to-work policies and opposition to PLA and prevailing wage mandates.
The Merit Shop Scorecard was developed with input from ABC chapters and industry stakeholders across the country. States were evaluated based on their policies and records on seven key issues:
- Project Labor Agreements (PLAs)
- Prevailing Wage
- Right to Work
- Public-Private Partnerships (P3s)
- Workforce Development
- Career and Technical Education
- Job Growth Rate
Criteria and definitions are available on meritshopscorecard.org. The scorecard will be updated with exclusive state construction unemployment rate estimates from economist Bernard Markstein, Ph.D.