An Illinois state legislator suggests a proposed amendment to the Prevailing Wage Act could drive up costs for taxpayers.
House Bill 1189 says if there is a federally-funded construction project that is run by the state or a unit of local government that the higher of the federal prevailing wage or the state prevailing wage will apply to that project.
Sean Stott, the director of governmental affairs at the Laborers’ International Union of North America, said the bill ensures Illinois workers protection from action on the federal level in regards to wage setting.
“The Illinois prevailing wage rates are set by collective bargaining agreements, and the federal rates are as well. But there is a ‘lag time’ and that could be as long as two, three or even seven years,” Stott said during the House Labor and Commerce Committee Wednesday. “In terms of enforcement … they must go to the US Department of Labor as opposed to the more localized Illinois Department of Labor if they are to seek any redress or compensation that they are due. This legislation would address both of those issues.”
The federal minimum wage for government-funded construction projects is governed by the Davis-Bacon Act.
State Rep. Tom Weber, R-Fox Lake, voted against the bill’s advancement.
“When we are talking about the wage for a carpenter or an electrician, maybe Illinois’ prevailing wage is $93 and the Davis-Bacon wage is $90, with total benefits. This seems like a way to nickel and dime a little more out of the taxpayers,” said Weber. “We’re not talking $25 an hour jobs, we’re talking about jobs that are probably up in the $70, $80 and $90 range.”
State Rep. Jay Hoffman, D-Swansea, sponsored the bill.
“Several other states follow this method including: Minnesota, California, Nevada, Oregon, Washington and even Missouri’s Department of Transportation follows this method,” said Hoffman. “As you know, the prevailing wage in Illinois is set by what is in a collective bargaining agreement. That agreement is sent to the Illinois Department of Labor and they will change and update the prevailing wage in a given area and for a given trade. Unfortunately the federal government has not changed the prevailing wage to reflect the most recent collective bargaining agreement.”
Concerns were also raised Wednesday about whether or not the new legislation, if enacted, would result in federally-funded construction projects not being completed.
State Rep. Will Davis, D-Hazel Crest, asked, “If more money has to be paid out on wages for a project, is there going to be enough money to complete the project?”
Stott said contractors and bidders should be aware of what the wage rates would be for any particular project.
“Labor costs on a typical construction project are going to represent a smaller fraction of the total cost,” Stott said. “Materials are going to be overwhelmingly the biggest cost-driver on a project. The labor-side of things, I’m not going to say it won’t move the needle, but it won’t move the needle that much.”
HB 1189 passed out of committee 18 to nine.
###
Working for Illinois Caucus 