Rep. Paul Gosar (R-Ariz.) Feb. 1 introduced the Responsibility in Federal Contracting Act (H.R. 448), which would require prevailing wage rates to be scientifically determined by the Department of Labor’s (DOL) Bureau of Labor Statistics (BLS).
In a Feb. 7 letter to Gosar
, ABC supported the bill, pointing out its long-standing efforts to repeal or reform the Davis-Bacon Act, citing the notoriously inaccurate results produced under the Wage and Hour Division’s current procedures for determining prevailing wages.
One of the main reasons there are such frequent discrepancies in market v. prevailing wage rates is the flawed, unscientific wage survey process WHD uses to calculate the prevailing wage rates. This process often sets rates at or above the union scale, despite only 13.2 percent of the construction industry being unionized nationwide; however, using out-of-date surveys also can result in wage determinations under current market rate, which is equally problematic, especially for local contractors.
ABC noted that despite repeated criticisms from the Government Accountability Office (GAO) and DOL’s Inspector General, the agency has failed to implement meaningful reforms in its wage determination process. A GAO report found widespread errors and noted that the process suffers from a serious lack of transparency.
In addition, the letter cited a Congressional Budget Office estimation that the Davis-Bacon Act will raise federal construction costs by $15.7 billion over the next 10 years – proving that the current Davis-Bacon wage determination process isn’t just bad for construction, it’s bad for taxpayers, as well.
“H.R. 448 is much-needed legislation that would greatly benefit our national economy in general, and the construction industry in particular – home to traditionally low net profit margins and a current unemployment rate of more than 16 percent,” ABC wrote. “It seeks to implement long-awaited reforms in a fair and common sense manner.”