ABC Urges Withdrawal of Davis Bacon Rule
In a comment letter filed on May 17, Associated Builders and Contractors urged President Biden’s U.S. Department of Labor to withdraw an inflationary and flawed proposed rule revising Davis-Bacon Act and Related Acts regulations that apply to federal and federally assisted construction projects funded by taxpayers.
“The DOL’s proposed rule does little to improve or modernize Davis-Bacon Act regulations in the face of decades of complaints by government officials, taxpayer watchdogs and industry stakeholders critical of this regulatory boondoggle well-known for increasing the cost of construction, discouraging competition from small businesses and diminishing the value of taxpayer investment in government infrastructure projects,” said Ben Brubeck, ABC vice president of regulatory, labor and state affairs.
In nearly 70 pages of comments on the DOL’s proposed rule, Updating the Davis-Bacon and Related Acts Regulations, ABC opposed and provided feedback on many of the more than 50 significant changes in the proposed rule.
A new study released by the Beacon Hill Institute found the DBA costs taxpayers an extra $21 billion a year and increases the price tag of construction projects by at least 7.2% compared to the cost of construction if the DOL calculated prevailing wages using modern and scientific methodology via the U.S. Bureau of Labor Statistics.
In a recent survey, 94% of ABC members said that the DBA increases the overall cost of construction and creates more administrative burdens and costs than non-DBA projects. ABC members won 57% of the $128.73 billion in direct prime construction contracts exceeding $25 million awarded by federal agencies during fiscal years 2009-2021 and built hundreds of billions of dollars of construction procured by state and local government, funded in part by federal dollars.
In the absence of meaningful reforms, ABC has called for full repeal of the DBA and has opposed legislative and regulatory efforts to expand the scope of the DBA––and its costly regulatory burdens––onto public and private construction projects in which it has not been previously required. Likewise, ABC has called for reforms to and repeal of state and local prevailing wage regulations suffering from similar flaws as the federal DBA.