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House of Representatives
Session of 2013 - 2014 Regular Session

MEMORANDUM

Posted:	December 27, 2012 09:53 AM
From:	Representative Fred Keller
To:	All House members
Subject:	Amending the act of August 15, 1961, known as the Pennsylvania Prevailing Wage Act, raising the threshold for applicability

In the near future, I plan to reintroduce legislation from last session (HB 1329) to update the threshold of the Prevailing Wage Act for the effects of inflation. The legislation will raise the current threshold of $25,000 to $190,000, and establish an annual inflation adjustment to ensure the threshold remains current. Prevailing wage became Pennsylvania law for public works projects in 1961. In 1963 it was recognized that certain projects should be exempt from the bureaucracy of prevailing wage bidding, and the threshold for exemption was established at $25,000. Projects exempt from this unfunded mandate in 1963 should still be exempt in 2012. This is commonsense reform, realizing that projects of similar scope and size cannot be constructed in 2012 for the same cost as they were in 1963. Pennsylvania’s Prevailing Wage Act establishes “prevailing” minimum wage rates that must be paid on public construction projects. Studies from several different states have consistently indicated that requirements of prevailing wage laws elevate the costs of public construction projects anywhere from 10 percent to 20 percent. Adjusting the threshold for inflation will relieve our municipalities/school districts from Prevailing Wage Act mandates for work on small projects. This legislation is strongly supported by the Pennsylvania State Association of Township Supervisors, Pennsylvania State Association of Boroughs, Pennsylvania School Boards Association, and other local government organizations.

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