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Considering the Davis-Bacon Act in light of Hurricane Katrina

Date: 10/31/2005

Hurricane Katrina stirred up more than just the muddy waters of the Mighty Mississippi. It dredged up, too, the Davis-Bacon Act, a vestige of an earlier time when dust bowls, rather than the flood waters of Lake Pontchartrain ruled the earth.

Enacted in 1931, the Davis-Bacon Act (named for its sponsors, for Senator James "Puddler Jim" Davis of Pennsylvania and Representative Robert L. Bacon of Long Island, New York), the Act mandates that "prevailing wages" be paid to workers employed on all federal public works projects. "Prevailing wage," in the context of the Act means, essentially, the "going rate" for labor of a particular kind or involving certain skill sets in the area in which the project is located. All federal government construction contracts and, importantly in the wake of Katrina, most contracts for federally-assisted construction in an amount greater than $2,000, must include provisions for paying workers on-site no less than the "locally prevailing wages" (though critics charge this essentially means "union wages") and fringe benefits paid on similar projects.

Interestingly, in the aftermath of Katrina, where a disproportionate number of those affected were African-Americans, the Act arose, not in insignificant part, because of Representative Bacon's pet issue of protecting America's racial "homogeneity." Rep. Bacon initially introduced what became the Davis-Bacon Act in 1927 after a contractor employed African-American workers from Alabama to build a Veterans Bureau hospital in Rep. Bacon's district. The "neighboring community," Bacon angrily reported, was "very upset," as were local unions. The legislative history of Davis-Bacon reflects a desire by Congress at the time of its enactment to reserve jobs on federal projects for local union workers at the expense, especially, of itinerant black workers.

The Act has been twice amended: first in 1935 and then again in 1964. The 1935 amendment was to ensure that contractors bidding on public works projects would not lower wages so as to be sure to submit the lowest bid, and to permit government agencies (which were required to accept the lowest bids), to employ contractors who paid a "fair" wage rather than those who competed by hiring cheaper labor (such as underpaid minority workers). The 1964 amendment included fringe benefits in the calculation of "prevailing wage."

Several times throughout its history, various Republican legislators have tried to repeal the Act, articulating that the regulations are outdated, expensive and unnecessarily bureaucratic. In 1993 Representative Cliff Stearns (R- Fla) urged repeal of the Act. Representative Sue Wilkins Myrick (R -N.Car) tried to repeal it outright in the budget battles of 1995. Weakening the Act was adopted as part of the Republican Party platform in 1996 and 2000. In February 1999 Representative Ron Paul (R - Tex) attempted to repeal it and in 2004, Colorado's own, Representative Marilyn Musgrave tried again.

Under Section 6 of the Act, the President is authorized to suspend the provisions of the Act in the event of "national emergency" and, several times, the Act has been suspended. In 1934 President Franklin Roosevelt suspended the Act for less than a month in order to affect administrative adjustments to accommodate his New Deal programs. In February 1971, President Nixon suspended the Act again for less than a month to reduce inflation pressures. President George H.W. Bush indefinitely suspended the Act during the recovery from Hurricane Andrew in 1992. After Bill Clinton was elected president, he re-instated the Act, in March of 1993.

Immediately following Katrina, House Representatives Jeff Flake (R-Az), Tom Feeney (R - Pa), Marilyn Musgrave (R-Colo), and other members of the House Republican Study Committee urged President Bush to temporarily suspend the Davis-Bacon Act in order to expedite reconstruction of the Gulf Coast. On September 8, 2005, President Bush issued proclamation 7924 to indefinitely suspend the Act in designated areas in the States of Alabama, Florida, Louisiana, and Mississippi, the areas most heavily hit by the hurricane.

Critics immediately protested, asserting that suspending the Act would further perpetuate poverty in the area, in that substandard wages will be paid to among others workers trying to rebuild their lives. On October 20th, Representative George Miller (D-Calif) introduced a joint resolution to "reinstate the application of the wage requirements of the Davis-Bacon Act to federal contracts in areas affected by Hurricane Katrina," invoking, among other arguments that in suspending the Act, President Bush had violated the National Emergencies Act of 1976 (which provides that the president must formally declare a national emergency and specify which standby legal authorities he would activate to permit congressional restraint of emergency powers). In the more than 30 years the National Emergencies Act has been in existence, it is the first time it has been invoked.

On October 27th, under considerable pressure not insubstantially from American's labor movement and some in the religious community President Bush reversed himself and agreed to restore the Act, effective November 8th.

Born in the Great Depression and incubated, at least in part, in racism and economic protectionism, the Davis-Bacon Act has survived three quarters of a century of scrutiny and attack. While in the context of our less racially-charged time, the Act's main goal of fairness to American workers often benefits the very minorities it was, at its birth, intended to exclude and fosters well-deserved dignity to the working man and woman, there can be little doubt, too, that the Act has also increased the burden to American taxpayers in completing public works and government-assisted construction. Like many things in life and government, these competing interest must strive towards equilibrium.

In the massive undertaking that will constitute the restoration and rebuilding of the devastated Gulf Coast, the Davis-Bacon Act will exert considerable social and economic impacts. The goal of the Act, is, of course, fairness but the question will undoubtedly arise, "to whom?" and what is, at the end of the day, in America's best interests.

Rohn K. Robbins is an attorney licensed before the Bars of Colorado and California who practices in the Vail Valley. He is a member of the Colorado State Bar Association Legal Ethics Committee and is a former adjunct professor of law. Robbins lectures for Continuing Legal Education for attorneys in the areas of real estate, business law and legal ethics. He can be heard on Wednesdays at 7 p.m. on KZYR radio (97.7 FM) as host of "Community Focus." Mr. Robbins can be reached at 926-4461 or at robbins@colorado.net.