Commonwealth Court Affirms Dismissal Of Late-Filed Claim With The Board Of Claims

In a recent, unreported decision, the Commonwealth Court of Pennsylvania affirmed the dismissal by the Board of Claims (Board) of a late-filed contractor claim.  Under the Board's jurisdictional statute, 62 Pa. C.S. § 1712.1(e), a formal statement of claim must Read more

Oral Promise To Pay Subcontractor Ruled Enforceable Against School District

In a departure from the usual rule, but not surprising given the facts of the case, the Commonwealth Court of Pennsylvania recently enforced a subcontractor's claim for payment against a public owner. In 2009, West Allegheny School District terminated Flaherty Mechanical Read more

No-Bid Busing Contracts Cost School Districts An Extra $53.7 Million Over State Reimbursement

According to recent audits conducted by the Pa. Department of the Auditor General, Pennsylvania school districts spent at least $53.7 million in excess of the state's transportation reimbursement formula through the use of no-bid busing contracts. The conclusion of the Auditor General was based on audits of Read more

Executive Order Prohibits Discrimination On The Basis Of Sexual Orientation Or Gender Identity Or Expression By Contractors Doing Business With State

On April 7, 2016, Pa. Governor Tom Wolf signed a new Executive Order establishing that future Commonwealth of Pennsylvania contracts must ensure that contractors doing business with the state will not discriminate in the award of subcontracts or supply contracts, or in hiring, Read more

Procurement Code Protest Allowed Where Late Filing Was Due To Extraordinary Circumstances

Under the Pa. Procurement Code, a protest must be filed within seven days after the protestant knew or should have known of the facts giving rise to the protest.  If the protest is untimely, it will be rejected. Recently, in a Read more

Prevailing Wage

Intentional Violation Of Pa. Prevailing Wage Act Will Result In Debarment

Thinking of avoiding the Pa. Prevailing Wage Act?  Think again! An intentional violation of the Wage Act can and will result in a debarment for three years.

Section 11(e) of the Wage Act provides:

(e) In the event that the secretary shall determine, after notice and hearing as required by this section, that any person or firm has failed to pay the prevailing wages and that such failure was intentional, he shall thereupon notify all public bodies of the name or names of such persons or firms and no contract shall be awarded to such persons or firms or to any firm, corporation or partnership in which such persons or firms have an interest until three years have elapsed from the date of the notice to the public bodies aforesaid. The secretary may in addition thereto request the Attorney General to proceed to recover the penalties for the Commonwealth of Pennsylvania which are payable under subsection (f) of this section.

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Posted on by Christopher I. McCabe, Esq. in Prevailing Wage Leave a comment

Pa. Transportation Bill Increases Prevailing Wage Threshold To $100K For Locally Funded Highway And Bridge Projects

On November 21, 2013, the House and Senate of the Pennsylvania General Assembly finally passed a $2.3 billion transportation bill.  Governor Corbett is expected to sign the transportation bill on Monday, November 25, in State College, Pa.

The transportation bill includes a provision that increases the threshold for prevailing wages to $100,000, but only for “locally funded” highway and bridge projects. The increase is effective with contracts entered on or after January 1, 2014.

A “locally funded” highway or bridge project is defined as one that is “funded entirely by funds”:

1) paid to counties from the Liquid Fuels Tax Fund;

2) allocated to municipalities under Liquid Fuels Tax Municipal Allocation Law;

3) made available to municipalities from the Highway Bridge Improvement Restricted Account within the Motor License Fund for expenditure on bridge rehabilitation, replacement and removal projects;

4) awarded to municipalities as transportation enhancement grants (under red light enforcement systems);

5) allocated from municipal budgetary sources using revenues derived through municipal taxes or fees; and

6) allocated to municipalities under 58 Pa.C.S.(relating to oil and gas).

For all other public projects, the prevailing wages threshold remains at $25,000.

The full transportation bill can be found here.

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Amendments to Prevailing Wage Act Proposed

It’s that time of year again, when Republican legislators in the Pennsylvania General Assembly seek to amend the Pa. Prevailing Wage Act.  There are now several proposals to do just that, and two bills are farther along in the process than the many others that have been proposed. In April, the House Labor and Industry Committee voted along straight party lines to report out of committee two bills proposing changes to the Prevailing Wage Act.

The first bill, HB796, will raise the threshold amount from $25,000 to $100,000.

The second bill, HB665, will exempt routine road maintenance contracts.

In addition to these two bills, still more bills have been proposed. Here is a small sampling of some of the other bills pending in the General Assembly:

HB1095 would impose a 3-year moratorium on the Prevailing Wage Act.

HB999 would exempt KOZs from requirements of the Prevailing Wage Act.

HB1257 would require at least 51% of a project to be paid with public monies before the Prevailing Wage Act would apply.

It seems likely that this year will see some changes to the Prevailing Wage Act. What those exact changes will be still remains to be seen.  Of course, these newest proposed amendments may lead nowhere, as the amendments proposed last year never came to pass.

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Free Training for Prevailing Wage Requirements on Federal Contracts

The U.S. Department of Labor will offer a free training session in Philadelphia on prevailing wage requirements for federal contracts. The training will be conducted on July 10-12.

This training is not just for federal government contractors. For example, federal agencies must ensure that recipients of assistance funded by federal stimulus funds require contractors and subcontractors to pay laborers and mechanics at least the Davis-Bacon prevailing wages.  Thus, this training will also be useful for contractors performing work on federally-funded public contracts.

The press release with details on the training and how to sign up can be found here.

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Should The Prevailing Wage Act Be Amended?

The Pa. Prevailing Wage Act mandates the payment of specified wages for publicly-funded public works contracts of $25,000 or more.  The wages are typically tied to the wages established by area collective bargaining agreements.

Currently, there are a number of proposed amendments to the Act which would alter application of the Act to different public contracts.

House Bill 709, or the “School Construction Cost Reduction Act,” would exempt school districts as a public entity required to pay prevailing wages, unless the school board votes to be subject to prevailing wage.

House Bill 1329 would raise the contract monetary limit from $25,000 to $185,000.  The $25,000 limit was set in 1961.

There are opposing viewpoints on the various proposed amendments to the Act as well as to the general concept of payment of prevailing wages on public contracts.  Viewpoints in favor of the amendments and against the Act can be found here and here.  Viewpoints in favor of the Act and opposing the proposed amendments can be found here and here.

For a non-partisan viewpoint from an economist with the nonpartisan Keystone Research Center, click here.

Needless to say, the proposed amendments would radically alter the landscape of public contracting in Pennsylvania.  Whether such an altered landscape would actually result in lower construction costs for public entities and taxpayers, without a reduction in decent, middle class wages for workers on public works projects, is an open question.  In all likelihood, the possibility of significantly lower costs on public contracts is probably just an illusion, and something touted by politicians looking for votes.

 

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