Impacts of Oregon Governor’s Directive 24-31 for State-Funded Projects
Oregon Governor Tina Kotek signed Executive Order 24-31 on December 19, 2024, which calls for project labor agreements (PLAs) for state-funded projects that have onsite labor costs of 15% or more of the total construction, reconstruction, or renovation costs. This order also mandates cooperation with labor organizations, dispute resolution mechanisms, and guarantees against strikes or lockouts.
In addition to requiring PLAs on state projects, this order also includes requirements related to the utilization of Certification Office for Business Inclusion and Diversity (COBID) certified firms. The order also requires the Governor’s office to conduct a biannual review of all relevant data to assess how the state is performing against the stated goals and to make any necessary changes.
There are exceptions for some types of contracts, including emergency work, short duration, and ones that involve only one trade. Solicitations and contracts that are planned for advertisement but haven’t been awarded may also be exempt through March 31, 2025.
A structured risk management process helps you anticipate potential challenges, take action to minimize their impact and position your business for steady, long-term growth. By planning for specific scenarios, leaders can safeguard their bottom line and seize opportunities to thrive in a rapidly changing landscape.
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Construction company owners should keep the following in mind when considering Oregon state projects:
- Understand Compliance: For construction leaders, understanding these requirements is essential for public project eligibility. Understanding state requirements and required documentation will be an important part of success in working on Oregon projects.
- Focus on Profitability: It’s critical to understand how these agreements may affect budgets, bids, and overall profitability. Consider updating your pricing strategies to reflect compliance efforts.
- Cooperation with COBID firms and Labor Organizations: Each Company will need to determine how they move forward under the new requirements. Familiarize your team with PLA negotiation processes and consider proactively building relationships with COBID firms.
- Build Peer to Peer Relationships: Building peer-to-peer relationships with other contractors can provide additional insight on how to navigate these new regulations. Whether that’s through associations such as AGC Oregon-Columbia Chapter or other avenues, consider building peer networks to determine how to best navigate forward.
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