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On Nov. 15, Rep. Lloyd Smucker, R-Pa., introduced a resolution (H.J. Res.103) under the Congressional Review Act providing for congressional disapproval of the U.S. Department of Labor’s final rule, Updating Davis-Bacon and Related Acts Regulations. This controversial final rule largely disregards the feedback of ABC, construction industry stakeholders and thousands of small businesses urging the withdrawal of––and/or improvements to––this unnecessary, costly and burdensome regulation.

Smucker’s Nov. 20 press release promoting the CRA highlights opposition from lawmakers, taxpayer watchdogs and dozens of construction industry groups to the Biden administration’s final rule, which makes radical revisions to regulations implementing the Davis-Bacon Act and Related Acts that apply to federal and federally assisted construction projects funded by taxpayers and procured by government and private owners.

“The Wage and Hour Division’s Davis-Bacon rule is a complete giveaway to union bosses,” said Education and the Workforce Committee Chairwoman Virginia Foxx, R-N.C. “This rule dims America’s infrastructure outlook by increasing costs for federal construction projects and imposing a massive financial burden on taxpayers. I commend Rep. Smucker for leading a CRA resolution to block this harmful rule and the Biden administration’s bureaucratic overreach.”

An ABC-led construction industry coalition letter expressed support for Rep. Smucker’s CRA, because “onerous new requirements and artificial inflation of construction costs imposed by this new Davis-Bacon Act rule will only exacerbate [economic headwinds facing the construction industry] and undermine taxpayer investments in much-needed infrastructure.”

Instead, the DOL is moving forward with dramatic changes to Davis-Bacon Act regulations, reversing much-needed reforms that were established by the Reagan administration and unlawfully increasing the regulatory burden on small businesses, new industries and critical public works projects. 

The final rule was published in the Federal Register on Aug. 23, 2023, and became effective on Oct. 23, 2023. Therefore, construction contracts executed after this date are subject to the new rule. In addition, the DOL will begin implementing the final rule’s ill-advised changes to its broken and convoluted wage determination process that are likely to make government-determined wages inaccurate and less reflective of a local prevailing wage.

On Nov. 7, ABC and the ABC Southeast Texas chapter filed a lawsuit in the U.S. District Court for the Eastern District of Texas challenging numerous aspects of the DOL’s inflationary and anti-competitive final rule.

As outlined in ABC’s Aug. 31 op-ed published in The Hill opposing the Biden DOL rule, litigation appears to be the best short-term strategy to defeat or delay some or all aspects of the rule until a pro-free enterprise White House can reverse this policy.

Unfortunately, a Sept. 6 letter to Acting DOL Secretary Julie Su signed by 13 House Republicans expressed support for the DOL’s new regulation.

ABC has issued a targeted grassroots alert asking ABC members to contact lawmakers in support of Rep. Smucker’s CRA and in opposition to the DOL’s final rule as it is unclear if lawmakers understand the radical changes in the final rule.

The CRA requires agencies to report the issuance of “rules” to Congress and provides Congress with special procedures, in the form of a joint resolution of disapproval, under which to consider legislation to overturn rules. If a CRA joint resolution of disapproval is approved by both houses of Congress and signed by the president, or if Congress successfully overrides a presidential veto, the rule at issue cannot go into effect or continue in effect. Rep. Smucker’s CRA is not likely to succeed in the current Congress.

Background on the Davis-Bacon Act

The 1931 Davis-Bacon Act and related regulations require contractors and subcontractors that perform work on federal and federally funded construction projects to pay a government-determined prevailing wage and benefit rate on an hourly basis to on-site construction workers.

According to the DOL rulemaking, the Davis-Bacon Act and 71 active Related Acts collectively apply to an estimated $217 billion in federal and federally assisted construction spending per year—about 63% of all government construction put in place—and provide government-determined wage rates for an estimated 1.2 million U.S. construction workers.

The Biden administration and Congress have recently expanded the application of Davis-Bacon Act prevail wage and benefit requirements onto hundreds of billions of dollars’ worth of private sector clean energy and microchip manufacturing projects that have never been covered by Davis-Bacon regulations. In addition, the rule is expected to inflate costs on hundreds of billions of dollars of new government-financed infrastructure projects funded in part by the Infrastructure Investment and Jobs Act.

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