The $2 trillion in infrastructure funding that will flow to communities from the federal government over the next decade will build and repair more than the nation’s roads and bridges, thanks to new guidelines announced by the Biden administration on April 4, 2024. The language in the Office of Management and Budget’s new “uniform grants guidance” ensures “that a variety of pro-community, pro-equity, and pro-worker policy tools are not prohibited by the guidance.”

We asked a few questions of staff members from Jobs to Move America, which was part of that coalition, to help understand why the changes matter.

What is the OMB Uniform Guidance and why is it important?

The Uniform Guidance is a set of federal guidelines housed at the Office of Management and Budget that determines how states and localities can spend federal grant money, including how they award federally-funded contracts to private companies.  

The updates to the Uniform Guidance are critical as billions in federal funds flow to cities and states from the Inflation Reduction Act (IRA), CHIPS & Science Act, and Infrastructure Investment and Jobs Act (IIJA). Local and state governments will now be able to attach policies to this funding to maximize benefits for communities, workers, and small businesses.

What updates were made to the Uniform Guidance and why are they important? 

The updated guidance incorporates language clarifying that a variety of pro-community, pro-equity, and pro-worker policy tools are not prohibited by the guidance, thus allowing states and localities to utilize practices in their contracting that had previously been prohibited or unclear. Key areas in the updated guidance illustrate how local and state governments now have the ability to attach strong worker and community benefits to their federally-funded projects. 

Since the 1980s, the Uniform Guidance has impeded cities and states from using community and worker-centered policies in their procurement of goods and services because of a legal interpretation that doing so might impede fair and open competition. For example, prior to these recent updates, the Uniform Guidance prohibited federal grant recipients from incorporating local hire and local sourcing policies into their projects. Yet, a 2021 study from Jobs to Move America of the U.S. Department of Transit’s Local Labor Hiring Pilot demonstrated that such policies positively impact workers and local economies without adversely impacting the number of bidders or bid price. 

Cities and states are no longer hindered from using federal funds to create quality jobs and advance economic opportunities in their communities. As historic federal investments flow to our cities and states, local and state governments can now attach strong worker and community benefits to their federally funded projects to create more resilient, sustainable, and equitable communities that can combat the climate crisis and address critical infrastructure needs. 

Can you also tell us a little bit about both JMA and the coalition that JMA worked with on making these changes?

The Local Opportunities Coalition (LOC) is a national coalition of partners that has been leading the charge to update a set of decades-old federal grant guidance–known as the Uniform Guidance. The overall goal of the LOC was to update the Uniform Guidance to ensure that pro-worker and pro-community policies can be used when cities enter into contracts on federally-funded projects. Over the past three years, the LOC has been advocating for several changes to the OMB’s Uniform Guidance as a way to ensure cities and states have the tools they need to create good-paying, family-sustaining jobs and community benefits when they receive federal funding. 

Jobs to Move America (JMA) is a strategic policy center that works to transform public spending and corporate behavior using a comprehensive approach that is rooted in racial and economic justice and community organizing. We seek to advance a fair and prosperous economy with good jobs and healthier communities for all. JMA envisions a nation where all levels of government use the power of public funds to create public good—fostering the conditions for an inclusive democracy, equitable economy, and healthy environment that works for all communities.

In what ways do communities benefit from the update?

In April, the OMB released final updates to the Uniform Guidance which clarifies that cities and states can incorporate worker, community-benefits, and equity standards in federally-funded projects. The updates also promote environmental justice, community involvement in contracting, and the use of a preference for sustainable green materials in contracts funded with federal monies.  

The updates incorporate language clarifying that a variety of community benefit measures are not prohibited by the guidance, allowing states and localities to incorporate language into their contracting that they had previously been unsure was permitted. This new guidance includes many of the Local Opportunities Coalition’s (LOC) recommendations, including:  

• Returning decisions about local contracting criteria to state and local governments receiving federal funds;
• Allowing for targeted hiring in disadvantaged communities, including workers who have been historically left out of higher-wage infrastructure, service, and other jobs created by public contracting;
• Lifting the ban on geographic preference so states and localities can prioritize workers and small businesses in their communities;
• Promoting job quality and equity by allowing recipients of federal funds to reward bidders for job quality metrics such as wages and benefits, including using scoring mechanisms like Jobs to Move America’s U.S. Employment Plan framework; and
• Permitting recipients to require or encourage community benefits for federally-funded projects.

How can our readers find out more about these updates? 

There are several resources to help further detail these updates, including: 

• Uniform Guidance fact sheet from Local Opportunities Coalition – Overview memo on the pro-worker, pro-equity, and pro-community policies that are now permitted under the Uniform Guidance.
• Recording of Webinar with the LOC & Rutgers Workplace Justice Lab on Uniform Guidance Updates 
  • Webinar Slides 
• The Federal Register Link to the final OMB Uniform Guidance 

Now that the coalition worked hard to make this happen, are there next steps that should be taken, and if so, by whom?

These updates are a huge opportunity for advocates around the country to organize and push for more and better opportunities for communities and workers when it comes to federal investments coming to our states and communities. State, city, and local agencies can incorporate these policies in their federally-funded opportunities and labor, community, and civil right advocates are an integral part of ensuring that agencies utilize these now permitted policies.

Depending on state and local contract law, policy tools can be implemented through various mechanisms including to enforce these policies. Some of these policies include city wide ordinances, agency policies, community benefit agreements, and individual contracts between contracting agencies and prime contractors. All of these policies can be done together or separately but it is critical that they be done in partnership with community stakeholders.

Rutgers Workplace Justice Lab’s 5 Steps to Take Advantage of New Enforceable Job Quality Guidelines outlines what steps advocates can take to take advantage of the updated guidance and attach enforceable policies to benefit workers and communities in their states, cities, and localities.