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Construction

 

Construction Program Guide

Special Experimental Project No. 14 - Local Labor Hiring Pilot Program

In the March 6, 2015 edition of the Federal Register, the U.S. Department of Transportation (DOT) published the Notice: Contracting Initiative (.pdf). The Notice announced DOT's decision to carry out a pilot program that will enable the FHWA or FTA grantees, including states and local recipients and subrecipients, to utilize social and/or economic contracting requirements in order to evaluate the impacts to the competitive bidding process. The pilot program will focus on local or other geographic labor hiring preferences, economic-based labor hiring preferences (i.e., low-income workers), and labor hiring preferences for veterans.

Also on March 6, 2015, DOT issued the Notice of Proposed Rule Making (NPRM) Geographic-Based Hiring Preferences in Administering Federal Awards (.pdf); proposing to amend its regulations at 2 CFR part 1201 to permit recipients and subrecipients to impose geographic-based hiring preferences whenever not otherwise prohibited by Federal statute. Comments on the NPRM must be received on or before April 6, 2015.

Pilot Program

This pilot program will enable the FHWA or FTA grantees, including states and local recipients and subrecipients, to utilize social and/or economic contracting requirements to evaluate the impacts to the competitive bidding process. The pilot program will focus on local or other geographic labor hiring preferences, economic-based labor hiring preferences (i.e., low-income workers), and labor hiring preferences for veterans.

Any project funded by FHWA or FTA can be considered for the pilot program. This includes construction projects, as well as rolling stock procurements. This one-year period is for contracts that will be advertised during this period.

This initiative will be carried out as a pilot program for a period of 1 year (unless extended). To be eligible for this pilot program, contracts with these requirements must be advertised within this 1-year period. Contracts awarded under the pilot program may continue to utilize any approved contract requirements throughout the life of the project. After the conclusion of the pilot program, DOT will evaluate the impacts of any approved contract requirement and provide additional guidance on their potential use in the future.

President Obama signed the Consolidated Appropriations Act, 2016 on December 18, 2015. Section 192 of Title I, Division L of the Consolidated Appropriations Act, 2016, "the FY 2016 Appropriations Act" provides a new requirement for projects using local labor hire provisions (see below). Any pilot project which has not received construction authorization by FHWA before December 18, 2015, is subject to the certification requirements in Section 192. Recipients need to provide a conforming project-specific certification with their SEP-14 workplan approval request (or with each construction authorization request under a programmatic workplan).

In the March 17, 2016, edition of the Federal Register, the DOT published the Notice Contracting Initiative (https://www.gpo.gov/fdsys/pkg/FR-2016-03-17/pdf/2016-06012.pdf) which extended the contracting initiative pilot program for a period of 1 year until March 6, 2017.

Authority/Legal Basis

Authority/Legal Basis

Laws
  • Division L, Section 192 of the Consolidated Appropriations Act (01/01/2016)
    • "(1) that except with respect to apprentices or trainees, a pool of readily available but unemployed individuals possessing the knowledge, skill, and ability to perform the work that the contract requires resides in the jurisdiction;
    • (2) that the grant recipient will include appropriate provisions in its bid document ensuring that the contractor does not displace any of its existing employees in order to satisfy such hiring preference; and
    • (3) that any increase in the cost of labor, training, or delays resulting from the use of such hiring preference does not delay or displace any transportation project in the applicable Statewide Transportation Improvement Program or Transportation Improvement Program."
Regulations
  • None
Policy
Other

Guidance

General Information
Other Information
Training
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Updated: 09/06/2016
Federal Highway Administration | 1200 New Jersey Avenue, SE | Washington, DC 20590 | 202-366-4000