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Compromise bill addresses prevailing wage concerns

Compromise bill addresses prevailing wage concerns

February 1st, 2018 by Philip Joens in Local News

This May 2017 photo shows Jason Kellogg, on platform at left, adhering tile to the wall while Donny Carter, at right, cuts another piece for the shower wall while constructing the Lincoln University Blue Tigers football locker room at The LINC. They both work for Richardet Floor Covering in Perryville, Mo.

Photo by Julie Smith /Fulton Sun.

One week after considering four bills that would overhaul Missouri's prevailing wage law, a Missouri Senate committee considered an alternative proposal that some in the construction industry consider a compromise.

Last week, the committee heard from more than a dozen supporters and opponents of a repeal of Missouri's prevailing wage law, which requires construction workers be paid state-set minimum wages on taxpayer-funded projects.

State Sen. Gary Romine, R-Farmington, said his bill compromises by overhauling the prevailing wage law but still makes drastic changes. Construction industry officials at Wednesday's hearing said they also consider the bill a compromise.

Last week, state Sen. Dan Brown, R-Rolla, and other proponents of a full repeal said current law disproportionately affects rural areas, in part because municipalities must pay prevailing wage on simple maintenance projects. Romine's bill would address this by requiring projects to cost at least $25,000 before prevailing wage requirements kick in.

"There's a lot of maintenance issues that need to be taken care of that we feel like should not have to go through the exercises of the bidding process or prevailing wage process," Romine said.

Currently, workers on state and local public works projects are required to be paid a minimum wage set by the state. The law is similar to the federal Davis-Bacon Act, which requires workers be paid minimum wages on federal construction projects.

Each year, all contractors, both union and non-union, turn in the hours they work to the Missouri Department of Labor and Industrial Relations. Wages differ by occupation and county. Because local unions collectively bargain wages in each county, all union contractors are lumped into the same pool.

To determine the prevailing wage in each county, the state compares the number of hours worked in each county at the collectively bargained rate and the rate non-union contractors pay. The rate with the most hours worked each year prevails and becomes the wage for each occupation in each county.

In all, more than a dozen bills proposed in the House and Senate aim to repeal or make changes of varying levels to the 59-year-old law. Romine said he wants to make sure contractors have a voice, too.

"The contractors want to have a say in this process," Romine said. "This is about the prevailing wage and paying their employees a fair wage."

A small coalition of construction industry groups and companies worked with Romine to craft the bill. Tim Weis, who owns TJ Weis Contracting in St. Louis, said most contractors don't endorse Romine's legislation, but he said they realize the need for it, given other efforts to repeal the law.

"This is a contractor solution to this situation," Weis said. "We've got 3,500 contractors who have not necessarily glowingly endorsed this legislation but agreed that it is a good situation for everybody involved."

Weis echoed Romine's sentiment the $25,000 requirement will spare rural areas from most prevailing wage projects.

"A high majority of the counties will have zero prevailing wage set up in those counties," Weis said. "The threshold will go into effect in the larger metropolitan areas, where we have to protect our smaller contractors as well."

In all, Romine's bill contains five main points. It stipulates only contractors may report hours worked to the state and prohibits unions and other trade associations from reporting hours. The bill also would decrease the number of workers being paid the prevailing wage rate while training apprentices from three to one.

Finally, Romine's bill would require contractors in each county to report at least 300 hours per year to the state, or prevailing wage requirements would not apply in a given county.

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Terry Briggs, executive director of St. Charles construction group the SITE Improvement Association, said this requirement would make contractors more accountable. Reporting hours would still be voluntary, but contractors would have an incentive to report their hours, Briggs said.

"If they want to do it, they can do it," he said. "But if not enough of them turn it in, too bad — you lose it."

Last week, the committee heard proposals from state Sens. Dave Schatz, R-Sullivan, and Dave Sater, R-Cassville, for bills that would keep portions of the existing prevailing wage law intact.

Schatz's bill would eliminate the requirement that separate average wages be created for different occupations. Instead, the prevailing wage would be set by the average hourly wages for each county calculated by the Missouri Department of Economic Development and Missouri Economic and Information Center. Schatz's proposal also would exempt projects costing less than $500,000 from the prevailing wage law.

Sater's bill would exempt maintenance from the prevailing wage requirement.

The Senate Committee on General Laws, which conducted both hearings, voted Wednesday to advance Schatz's bill to the Senate floor. A bill authored by Brown for a straight repeal of the prevailing wage law also advanced out of the committee.

Ed Twehous, vice president of Jefferson City-based Frank Twehous Excavating, said last week he supports Romine's bill. Mike Louis, president of the Jefferson City-based labor union Missouri AFL-CIO, said the union doesn't support Romine's bill yet because bill keeps changing and the union has not had time to study it yet.