Legislation to lower the prevailing wage threshold for school construction projects has passed both the full Maryland Senate and House of Delegates ensuring its way to final passage. With this change, all school construction projects that are funded with 25% or more State funds would be subject to the State’s prevailing wage law.
As introduced, SB 232 and HB 727 would have lowered the threshold to require prevailing wage rates to be paid for a local project receiving any amount of State funds. During the hearing on these bills, MACo expressed concerns that lowering the threshold would increase project costs and affect the number of projects budgeted each year. MACo also referenced information provided to the Task Force to Study the Applicability of the Maryland Prevailing Wage Law that suggested that school construction projects bid with prevailing wage have an average cost increase ranging from 3% to 30% depending on the type of project. When you look at all projects as a whole, the average cost increase when comparing bid day data for projects bid with and without prevailing wage is 10.6%.
Following committee deliberations, the bills were amended to only apply to school construction projects and instead of eliminating the threshold, it was lowered to 25%.
After substantial floor debate, the bills passed in both the Senate and House Chambers. A MarylandReporter.com article summarizes the concerns and issues raised during the debate on the Senate floor.
Additional coverage can be found on Conduit Street.