Reforms are needed for New York state's methodologies used to determine and establish prevailing wage rates on public works projects
ABC has long called for reforms to New York state's methodologies used to determine and establish prevailing wage rates on public works projects. A study released by Columbia University's Center for Urban Real Estate (CURE) revealed the state's methods for establishing prevailing wage rates are costing New York taxpayers millions of dollars a year. This study is the first hard look at the methodology used to set
prevailing wage rates and it revealed that our government's methods are broken.
CURE's study exposed New York State's
flawed system of using collective bargaining agreements to establish wage rates
is likely invalid given NYS law requires the agreements to cover 30% of a local
workforce and union membership is presently lower than that. Unions now
represent only 24% of the state's construction workforce, yet New York State
still utilizes union collective bargaining agreements.
New Yorkers want their government to
jumpstart the economy, fix crumbling infrastructure and do a better job of
spending their tax dollars at the same time.
As a supporter of the study, ABC has called on state leaders to review
and consider its recommendations to reduce the costs imposed by prevailing
According to the study, prevailing wage
rates in the state are up to twice the market wage. The study recommended many reforms, such as
indexing prevailing wage with the use of US Bureau of Labor Statistics mean
wages with conventional benefit rate of 25-40%, not the current 70% prevailing
wage fringe pack.
By Joshua Reap
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