Marion County Circuit Court Judge Thomas M. Hart on March 16, 2026 rejected Governor Tina Kotek’s executive order that would have required project-labor agreements on many state-funded construction projects. The ruling pauses the administration’s push to make union-style contracts routine on large state jobs and leaves contractors and agencies staring at fresh uncertainty about bids and schedules.
Kotek signed Executive Order 24-31 on Dec. 19, 2024, directing state agencies to negotiate and execute project-labor agreements on state-funded projects where onsite labor constitutes at least 15% of total construction costs. The order also set targets for Certification Office for Business Inclusion and Diversity (COBID) certified firms and included exemptions for short-duration, emergency and maintenance work, according to the Governor's Office.
A coalition led by the AGC Oregon-Columbia Chapter and the Associated Builders and Contractors Pacific Northwest chapter sued the state in early 2025, arguing the governor exceeded her authority and upended Oregon’s competitive-bidding rules. The groups asked the Marion County court to halt implementation while the legal challenge moves forward.
Hart sided with the contractors, concluding that the executive order could be read as more than a policy directive and risked altering procurement rules normally set by the Legislature. OPB reported on the judge’s bench ruling and the resulting temporary pause.
Trade groups quickly praised the decision as a defense of open competition. "The judge’s ruling reinforces what our local contractors have been saying since the order was issued last December," AGC Oregon-Columbia CEO Mike Salsviger told OPB.
Labor leaders pushed back just as quickly. Robert Camarillo, executive secretary of the Oregon State Building and Construction Trades Council, called the ruling "disappointing" and said the executive order would have provided tools to deliver projects on time and create opportunities for under-utilized workers. Gov. Kotek said she was evaluating the court’s oral ruling and remained committed to finding ways to encourage fair, living-wage jobs, according to reporting by KOIN.
What this means for state projects
The pause leaves large projects, including highways, bridges and campus construction, in a holding pattern. An Oregon Department of Transportation analysis obtained by reporters found PLAs can discourage nonunion firms from bidding and, in some studies, add roughly 10–20% to project costs, a point opponents have emphasized, as reported by Source Weekly. Agencies that had been preparing PLA clauses may seek narrow exemptions or delay procurement until the courts or the Legislature provide clarity.
What's next in court and at the Capitol
The legal fight is likely to continue. Plaintiffs argue the executive order is an unconstitutional attempt to make law, while the state contends it falls within executive authority. Legal analysis points to separation-of-powers and administrative-rulemaking questions as central to the dispute, and commentators say the case could move to the Oregon Supreme Court or prompt lawmakers to set procurement rules directly, as outlined by JD Supra.
For now, contractors, unions and state agencies are waiting for a written order and the next procedural steps in Marion County. The ruling keeps the debate over who controls public-contracting rules front and center as Oregon lines up billions in infrastructure work.
