The PA Prevailing Wage Act mandates that workers on public construction projects costing over $25,000 be paid the local "prevailing minimum wage".  The problem is the set wage is typically tied to the local union wage and therefore grossly inflated, burdening local governments and taxpayers with higher costs while providing no real public benefit.  The Chamber opposes this law because it forces employers to pay in excess of what workers might voluntarily accept; imposes extensive paperwork and administrative costs; and generally hinders job creation and economic growth.

The harmful effects of the Act are numerous: construction projects scuttled or delayed; significant project cost increases; higher property taxes, among others.  Local governments and school districts are operating under increasingly restrictive budgets and the prevailing wage mandate is one more obstacle impeding efforts to balance local budgets and improve communities through vital construction projects and infrastructure improvements. We support abolishing the PA Prevailing Wage Act.  Short of full repeal, we support bills that aim to help mitigate the adverse impact of an archaic and increasingly harmful mandate, including those which passed the House Labor and Industry Committee on October 3:

·   HB 1271: Exempts certain road maintenance work, which until a recent court decision, had usually not been subject to the Act.  This decision has forced municipalities to curtail regular roadwork;

·   HB 1685:  Directs the PA Department of Labor and Industry to adopt classifications and definitions for jobs subject to the Act.  No such guidance currently exists, which creates confusion for contractors who face stiff penalties for even accidental violations;

·   HB 1329: Raises the threshold for a project to be subject to the Act to $185,000; up from the current threshold of $25,000 that was established nearly 50 years ago;

·   HB 1541: Stipulates that the Act will be imposed only on projects in which 51% of the funding is public.  Currently, the Act is enforced even if projects are minimally financed with public funding; 

·   HB 709:  Provides that school districts are not subject to the Act unless they elect to opt in;

·   HB 1191: Provides that local governments are not subject to the Act unless they elect to opt in.

HCBI and the Chamber will send a joint letter of support to Representative Fleck for the bills listed above and we thank him for cosponsoring these bills.