ABC - Farm Bill Conference Report Approved with Davis-Bacon Expansion

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FARM BILL CONFERENCE REPORT APPROVED WITH DAVIS-BACON EXPANSION (05/14/2008)

The Farm, Nutrition and Bioenergy Act of 2007 (H.R. 2419) conference report, which expands Davis-Bacon prevailing wage requirements, was approved May 8 by conferees from both the House and the Senate, and passed by the House May 14 by a vote of 318-106. The proposed legislation would expand Davis-Bacon from federal construction contracts to the bio-refinery loan guarantee program and subject local entities and private employers to federal micromanagement of how they can best provide for their own needs.

In a letter sent May 13 to both the Senate and House, ABC urged members of congress to oppose the conference report pointing out that Davis-Bacon wage determinations are susceptible to fraud and that a 2004 report released by the U.S. Department of Labor’s Office of Inspector General found errors in 100 percent of the wage surveys. The letter also stated that the Davis-Bacon Act is a strain on small businesses and minority workers.

“Davis Bacon has a negative impact on equal access to work opportunities. It prevents many qualified small and nonunion businesses from even bidding on publicly funded projects, because the complexities and inefficiencies in the Act make it nearly impossible for them to compete,” ABC stated. “This has a disproportionate impact on minority-owned businesses, which tend to be smaller and nonunion companies. The toll is real: one study estimates Davis-Bacon reduces the number of minority works in the construction industry by 25,000 each year.”

Included in the letter is a Congressional Budget Office estimate that the Davis-Bacon Act “already costs taxpayers more than $9.5 billion over the 2002 to 2011 period relative to the 2001 appropriations and $10.5 billion relative to 2001 appropriations adjusted for inflation. A more recent estimate, from the Beacon Hill Institute at Suffolk University in January, suggests Davis-Bacon costs taxpayers $8.6 billion per year.”

President Bush has indicated that he will veto the bill if it contains Davis-Bacon prevailing wage requirements, among other issues.

For more information, contact Brewster Bevis at ABC, bevis@abc.org.