February 13, 2013 Print

Changes to the Prevailing Wage Act debated

Racism and economic protectionism are the origins of "prevailing wage" policies. Washington's Prevailing Wage Act continues to serve those who benefit from economic protectionism. It requires the Department of Labor & Industries to collect wage surveys and publish mandatory wage rates (by region and kind of work) for state-funded projects.

The original prevailing wage law, a federal act called "Davis-Bacon," was passed in response to poor black workers moving from the American South into the North. These workers sought work on major federal infrastructure projects, and they were willing to work for less than the established, white-dominated workforce. Labor unions convinced Congress to protect the existing workforce from competition, and some states followed suit.

In detailed analysis last year, the Freedom Foundation showed how the wage rates published by L&I are not true "prevailing wages," but rather highly inflated wage rates. In some cases, workers on state-funded projects are required to be paid double the market wage rate. This drives up the labor costs on state-funded projects and discriminates against workers on projects not funded by the state.

Today's Senate Commerce & Labor Committee is hearing nine bills offering changes--expansions as well as limits--to the state's current prevailing wage law. Some of these measures offer opportunities to explain to lawmakers the distortions and discrimination created by the current law. One of these is SB 5619, which would exempt from prevailing wage some repairs made to buildings damaged by recent wildfires. Another is SB 5107, to split out residential construction work from commercial construction to bring wage rates on state-funded residential construction closer to actual market wage rates. Since this work is generally on projects where the stated goal is to create "affordable housing," it makes no sense to inflate project building costs.

SB 5395, the companion bill to Rep. Jim Moeller's HB 1025, would expand prevailing wage requirements to some state-subsidized private projects. The Senate bill is sponsored by Rep. Steve Conway, who spent most of his legislative career as a paid voice for labor unions recently retiring from the United Food and Commercial Worker’s Union. Members of a Woodland rotary club provided some of the most salient testimony, explaining how SB 5395 would kill their local park project and calling for an exemption from prevailing wage for non-profits.

Sen. Brian Hatfield offered SB 5508 to exempt small school districts from prevailing wage mandates. He argued that while he's a "big fan of Davis-Bacon ... one-size doesn't fit all." Apparently the Senator supports government mandates that inflate costs for taxpayers so long as it's not the taxpayers in his own district. (And I'll give the Senator the benefit of the doubt and assume he is simply ignorant of the racist origins of the Davis-Bacon Act.)

"Prevailing wage" policies force citizens to pay more and get less on public works projects. Because of Washington's Prevailing Wage Act, there are fewer new school buildings in our state; there are fewer bridges and overpasses retrofitted to survive earthquakes; and part of our gas taxes and road tolls go simply to pay above-market labor costs on transportation projects. These policies provide a financial benefit to a relatively small group of workers while hurting every taxpayer. These policies empower politicians supported by labor union contributions and support while hurting every user of public infrastructure.


Trent England

Executive Vice President

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