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Repeal of prevailing wage law passes House panel

Concerns workers on public works construction projects

FRANKFORT, Ky. (Jan. 4, 2017) — A bill that would repeal a state law requiring payment of an hourly base wage—or prevailing wage—to workers on public works construction projects has passed a House committee.

House Bill 3, sponsored by House Speaker Jeff Hoover (R-Jamestown) and Rep. Adam Koenig (R-Erlanger) would apply to projects for which bids have not yet been awarded at the time the bill, should it pass, takes effect. An emergency clause included in HB 3 would ensure the bill takes effect immediately upon being signed into law by the governor.

Koenig, who presented HB 3 to the House Economic Development and Workforce Investment Committee before the committee approved the bill today, said prevailing wage laws are “unlikely to yield rates that are representative of market wages.” They are also a financial strain on local governments and school districts, Koenig said, emphasizing that saving money was the motivation for filing HB 3.

The bill has the support of Boone County Schools Superintendent Dr. Randy Poe who testified alongside Koenig. Poe told the committee that higher construction fees on prevailing wage projects have cost his school district as much as $50 million over the last 19 years.

“The higher fees we pay through prevailing wage keeps us from improving upon traditional space versus portable space (for) our students,” said Poe. “This is about creating more space for our students.”

Speaking against the bill was Bill Finn, the state director of the Kentucky State Building and Construction Trades Council. Finn said that nine out of 11 economic studies since 2001 have showed no increase in overall construction costs due to prevailing wage. “Twenty three percent is the entire pie that prevailing wage affects,” said Finn.

HB 3 now goes to the full House for consideration.