Foxx Introduces Legislation to Reduce Costs Associated With Federal Construction Projects

Rep. Virginia Foxx, R-N.C., has introduced legislation to stretch the limited funds available to the Highway Trust Fund by exempting it from the Davis-Bacon Act's outdated, wasteful labor requirements for federal-aid highway and public transportation projects.

"With Highway Trust Fund deficits expected to hit $157 billion by 2024, it makes sense to exempt the fund from Davis-Bacon's expensive and overly burdensome wage requirements," said Foxx. "Big Labor should not continue to use this Depression-era legislation as a shield to line its own pockets at the expense of non-union workers and taxpayers."

The Davis-Bacon Act, which became law in 1931, requires federal contractors and subcontractors to pay the local prevailing wage for construction projects on which the federal government is a party. For decades, it has been driving up the cost of federal highway projects by mandating artificially high wages.

According to a 2011 Joint Economic Committee report, Davis-Bacon-determined wages tended to inflate labor costs an average of 22 percent above market rates. Researchers at Suffolk University also found in a 2008 study that Davis-Bacon requirements cost U.S. taxpayers an additional $8.6 billion annually and add 9.9 percent to construction costs.

Beyond increasing construction costs for taxpayers, Davis-Bacon requirements force businesses working on federal highway projects to comply with burdensome paperwork and reporting regulations. Reports from the Government Accountability Office suggest that these Davis-Bacon requirements inflate costs and slow project completion.

By removing the Davis-Bacon's implications from federal-aid highway and public transportation projects, H.R. 1483, the Highway Trust Fund Reform Act, would free up funds to create more market-priced construction jobs and more affordable, timely completed projects.

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