A controversial order by Gov. Tina Kotek requiring union labor on many state construction projects is unconstitutional, a Marion County judge found Thursday.

Ruling from the bench, Marion County Judge Thomas Hart found that Kotek had overstepped her authority when issuing EO 24-31, which critics argued would hike the cost of state projects.

An attorney for plaintiffs in the case, a coalition of construction firms, told OPB a formal order would land in coming weeks. It was unclear Thursday afternoon whether the governor would appeal the ruling. The Oregon Department of Justice, which represented the governor, said it was considering its options.

Issued in December 2024, Kotek’s executive order said state agencies are required to use tools known as “project labor agreements” in many state construction projects where onsite labor costs make up at least 15% of the expenses.

PLAs, as they are known, are agreements between a project owner – like the state – and one or more labor unions that will be providing workers. They typically lay out the working conditions for the entire project, including provisions on hourly pay and benefits.

Opponents of PLAs argue they reduce competition by discouraging bids from construction firms that don’t typically use union labor. They point to studies that have found PLAs lead to higher costs.

Kotek’s order caught Oregon construction firms by surprise and was instantly panned by Republican lawmakers, who said it was a gift from a liberal politician to her allies in labor.

The governor dismissed the criticisms, insisting PLAs would bring more certainty to state projects and strengthen apprenticeship programs run by trade unions.

But the order has never been in force.

A coalition led by Oregon’s chapter of the Association of General Contractors filed suit in February 2025, and by the following month, Hart had blocked the order from taking effect while the case played out.

Thursday’s ruling makes that decision final.

The lawsuit against Kotek’s order hinged on whether the governor could lawfully issue the PLA order.

Plaintiffs in the suit said she had gone too far, issuing a decree that crossed the bounds of her executive power into the law-making power of the Legislature.

“It unilaterally imposes new legal requirements on state contracting, effectively creating law—an act reserved for the Legislature,” the plaintiffs wrote in a motion asking Hart to invalidate the order.

The Oregon DOJ said the plaintiffs were off base. State attorneys argued that Kotek’s order was merely a policy directive that was within her purview.

“The Court should not read the executive order to be a proclamation of law or an attempt at legislation,” lawyers for the state wrote, adding that Kotek viewed the order as “a constitutional expression of her role as the chief executive and not an attempt to usurp the authority of the legislative branch.”

The order’s demise comes at a notable time for the Oregon Department of Transportation.

Facing a structural funding deficiency – and with proposed gas tax and fee increases waiting for a public vote – the agency needed to close a roughly $300 million budget hole in the recently concluded legislative session.

While the true impact of PLAs on project costs is often disputed, ODOT’s own internal analyses suggest the agreements reduce competition for jobs, and can add 10-20% onto the price of construction.

News Source : https://www.opb.org/article/2026/03/12/oregon-gov-kotek-order-union-work-projects-ruling-illegal/