Plaintiff Delaware River Joint Toll Bridge Commission (Commission) is a bi-state entity created by an interstate compact between the State of New Jersey and the Commonwealth of Pennsylvania and approved by the United States Congress. In this matter, arising out of a construction project to replace the Scudder Falls Bridge that connects the two states, the court considered whether the Commission was authorized to approve, use, and enforce a project labor agreement (PLA) as a mandatory requirement in its bid specifications.
This mandate required all bidding contractors and subcontractors to enter into a PLA with certain named unions affiliated with the local building and construction trades councils, recognizing those unions as the sole and exclusive bargaining representatives of the bidder's project workforce.
Defendant George Harms Construction Co. was prevented from bidding on the project because it was a party to a collective bargaining agreement with United Steel Workers (USW), which was excluded from the PLA. Harms threatened to seek an injunction if the Commission did not add USW as a signatory union to the PLA.
Only one company bid on the project, submitting a bid $69 million over the projected cost of the project and $71 million more than Harms' projected bid.
The Commission sought a declaratory judgment permitting it to award the contract, including the PLA, to the successful bidder. Harms answered and asserted numerous counterclaims, including a violation of competitive bidding laws. The trial court dismissed the complaint as moot (the project was completed during the litigation) and granted summary judgment to the Commission on the counterclaims.
The court preliminarily determined the issue was not moot because of the importance of interstate compacts and the high likelihood that the Commission would use a PLA in a future contract.
The issue, then, was whether the Commission had the authority under its compact to approve and use a PLA in its bidding process. The compact itself is silent on PLAs. Therefore, the panel looked to the two states' treatment of PLAs.
The court engaged in an extensive analysis of the case law and legislative history in New Jersey and Pennsylvania regarding PLAs. Currently New Jersey has a statute governing PLAs, N.J.S.A. 52:38-1 to -7. Pennsylvania does not have any legislation. The case law, emanating from the Commonwealth Court disfavors PLAs unless the project involves "extraordinary circumstances" and the PLA treats union and nonunion contractors evenly. Therefore, New Jersey and Pennsylvania do not have parallel or substantially similar state legislation or common law regarding the use of PLAs.
The court concluded the Commission did not have the power to create and authorize use of the mandatory PLA for its project because: (1) there is no express authority for unilateral action in the compact; (2) New Jersey and Pennsylvania have not enacted complementary or parallel legislation and do not have similar common law on PLAs; and (3) the Commission has not consented to exercise of single-state jurisdiction.
The court affirmed the dismissal of the declaratory judgment complaint, albeit for different reasons than articulated by the trial court. The court reversed the dismissal of the counterclaims and remanded to the trial court.