Counties Oppose Expanding Prevailing Wage Application

MACo Executive Director Michael Sanderson testified before the House Economic Matters Committee on February 11, 2020 to oppose HB 582 – Procurement – Prevailing Wage – Applicability

This bill would extend the application of the State’s prevailing wage law to projects where any amount, even the smallest share, of funds are provided by the State. Prevailing wage rates – which include basic hourly and fringe benefits payments – are set by the Maryland Department of Labor according to worker classifications and project locations. Imposing such a mandate could prove costly and burdensome, and ignores regional market variations.

From the MACo Testimony:

The bill requires county work projects that are funded using any State funds to pay workers the prevailing wage. Currently, the State’s sensible rule is that the “majority partner” of a project applies such rules. Therefore, projects are subject to the prevailing wage rate when at least 50% of the money used for construction is State money.

. . . While various studies contest the exact differential, project costs rise under prevailing wage – especially when the statewide system is enforced. Jurisdictions requesting parallel bids on borderline projects where the state law’s application was unclear have demonstrated a meaningful differential – frequently 10-20%. The HB 582 fiscal note advises that there has been a dramatic rise in projects subject to prevailing wage over recent years, with over 1,100 projects in Fiscal Year 2019.

Follow MACo’s advocacy efforts during the 2020 legislative session on MACo’s Legislative Tracking Database.