Concrete Products

MAR 2017

Concrete Products covers the issues that attract producers of ready mixed and manufactured concrete focusing on equipment and material technology, market development and management topics.

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Budget hawks on Capitol Hill are scrutinizing wasteful mechanisms in surface transportation construction against the backdrop of President Donald Trump's infrastructure investment plant. One of the easiest targets for stretching dollars from an expanded highway and bridge funding pool was noted here last month: A lifting of Barack Obama's executive order fostering the use of wage-inflating proj- ect labor agreements on higher ticket federal construction contracts. A second target surfaced days after the inauguration. Sen- ator Mike Lee (R-Utah) introduced the Davis-Bacon Repeal Act—nixing the prevailing wage requirements in federally funded highway con- struction—alongside companion House legislation from Rep. Steve King (R-Iowa). "Davis-Bacon is an 80-year-old wage subsidy law that requires all federally funded projects worth more than $2,000 to pay workers a so-called 'prevailing wage,'" said Sen. Lee. "The 'prevailing wage' is determined not by market forces operating in reality, but by federal bureaucrats in Washington, D.C. As a result, federal contractors are charged, on average, a 22 percent premium on their labor costs above what private companies pay for the same project. Repealing the outdated, costly Davis-Bacon Act will give federal contractors the ability to hire more workers of all skill level, while lowering the overall costs of federal trans- portation construction projects." "I first dealt with Davis-Bacon wage scales when I started my construction company in 1975. The federal government dictated wage scale to all of my employees on federally funded projects," recalls Rep. King. "Micromanaging and disrupting the efficiencies in our businesses has ultimately resulted in higher costs to taxpayers. We are bleeding red ink in the federal government. Rather than increasing costs by billions of dollars and restricting our free market, all that should be required is for the employer and the employee to agree on salary and benefits." Davis-Bacon discourages small contractors from bidding on federal con- struction projects due to enormous compliance burdens, Associated Builders & Contractors observes, and stifles contractor productivity by raising project costs and imposing rigid craft work rules that ignore skill differences. ABC has "long supported full repeal of the archaic 85-year old Davis-Bacon Act," characterizing the U.S. Department of Labor (DOL) survey process behind prevailing wage cal- culation as "unscientific and fundamentally flawed." DOL never developed an effective process for determining market-rate wages, and relies on complex contractor surveys that feature disproportionate partici- pation from well-connected unions, contends Senator Jeff Flake (R-AZ), whose Transportation Investment Recalibration to Equality Act (TIRE) suspends prevail- ing wage provisions on all federal highway construction contracts, and preceded the Lee and King bills. The Government Accountability Office determined that DOL cannot even verify whether its own wage calculations accurately reflect local market rates, adds Sen. Flake, who told colleagues from the Senate podium: "While it may be well-in- tentioned, Davis-Bacon ends up eliminating decent-paying construction jobs and hampering infrastructure spending. And as many of us in this body look for issues to bridge the partisan divide, it turns out one of those issues is bridges, roads, dams, and other infrastructure projects. Fixing our nation's crumbling infrastructure is a top priority for many in Congress, and the new administration has touted a large infrastructure package as one of its major agenda items … With a projected price tag north of $800 billion for highways and bridges alone, every federal dollar needs to be spent as efficiently as possible. The TIRE Act will return wage determinations for federal transportation projects where they belong—the market." Davis-Bacon's wage distortions typically stop at the construction gate or site barrier, confining direct costs more to contractors than their concrete suppliers. The law nevertheless adds what ABC and the Congressional Budget Office esti- mate are billions in costs to federally funded infrastructure projects. Every dollar consumed in inflated wage scales adds up to fewer yards of ready mixed or tons of precast delivered to highway or bridge sites. EDITORIAL BY DON MARSH MINING MEDIA INTERNATIONAL EDITORIAL OFFICE 11655 Central Parkway, Suite 306 Jacksonville, Florida 32224 U.S.A. P: +1.904.721.2925 F: +1.904.721.2930 EDITOR Don Marsh, ASSOCIATE EDITOR Josephine Smith, GRAPHIC DESIGNER Michael Florman, EDITORIAL DIRECTOR Steve Fiscor, MINING MEDIA INTERNATIONAL CORPORATE OFFICE 8751 East Hampden Avenue, Suite B-1 Denver, Colorado 80231 U.S.A. P: +1.303.283.0640 F: +1.303.283.0641 PRESIDENT/PUBLISHER Peter Johnson, U.S., CANADA SALES Bill Green, GERMAN SALES Gerd Strasman, LATIN AMERICA SALES Sylvia Palma, SHOW MANAGER Tanna Holzer, PRODUCTION MANAGER Dan Fitts, Concrete Products, Volume 120, Issue 3, (ISSN 0010-5368, USPS 128-180) is published monthly by Mining Media Inc., 10 Sedgwick Drive, Englewood, Colorado 80113 ( Periodicals postage paid at Englewood Colorado, and additional mailing offices. Canada Post Publications Mail Agreement No. 40845540. Canada return address: Station A, PO Box 54, Windsor ON N9A 6J5, Email: cir- Current and back issues and additional resources, including subscription request forms and an editorial calander, are available online at SUBSCRIPTION RATES: Free and controlled circulation to qualified subscribers. Non-qualified persons may subscribe at the following rates: USA and Canada, 1 year $72.00, 2 year $119.00, 3 year $161.00. For subscriber services or to order single copies, write to Concrete Products, 8751 East Hampden, Suite B1, Denver, Colorado 80231 USA; call +1.303.283.0640 (USA) or visit www. ARCHIVES AND MICROFORM: This magazine is available for research and retrieval of selected archived articles from leading electronic databases and online search services, including Factiva, LexisNexis, and ProQuest. For microform availability, contact ProQuest at 800-521-0600 or +1.734-761-4700, or search the Serials in Microform listings at POSTMASTER: Send address changes to Concrete Products, P.O. Box 1337, Skokie, IL 60076. REPRINTS: Mining Media Inc, 8751 East Hampden Avenue, Suite B1, Denver, CO 80231 USA; P: +1.303.283.0640, F: 1+303.283.0641, PHOTOCOPIES: Authorization to photocopy articles for internal corporate, personal, or instructional use may be obtained from the Copyright Clearance Center (CCC) at +1.978.750.8400. To obtain further information, visit COPYRIGHT 2017: Concrete Products ALL RIGHTS RESERVED 4 • March 2017 Davis-Bacon: Repeal and don't replace

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