Have you ever discovered that youâ€™ve been paying too much for something and been disappointed that you didnâ€™t find the savings earlier? Thatâ€™s what happens with almost every government construction project in Pennsylvania. Because of our outdated prevailing wage law we spend more than we should to do the work that needs to be done. Now is the time to change that.
The 56-year-old prevailing wage law was originally made to protect Pennsylvanian workers from out-of-state competition. It mandates that contractors pay the wage that â€œprevailsâ€ in the region for government construction projects that cost at least $25,000.
When adjusted for inflation, the $25,000 minimum threshold for mandated prevailing wage is the equivalent of $185,000 in todayâ€™s market. This threshold discrepancy is outdated and expensive. Even the smallest repairs now qualify for the prevailing wage mandate. For example, in 2012 a traffic light upgrade in Lebanon county cost $134,000.
And because of prevailing wage, local governments refuse important infrastructure projects, such as bridge repairs and roof replacements, in order to save taxpayer money. The law is outdated, wasteful, and bad news for taxpayers. Fortunately, thanks to the work of a two state legislators, reform may be near.
And not a moment too soon. If youâ€™ve been paying attention, you know that Pennsylvania continually spends more money than government has despite having the 15th highest tax burden in the country and one of the highest unemployment rates among states.
Local and state government warn that more taxes are necessary to cover the cost of government, but there is a way to save money and keep a tax increase off the table. Address Pennsylvaniaâ€™s prevailing wage law.
A report by the Commonwealth Foundation says that
â€¢ Based on wage data, prevailing wage raises the total cost of construction projects by 20% on average. This represents upwards of $2 billion in extra costs for Pennsylvania taxpayers each year.
â€¢ School districts alone spent more than $2 billion on construction in 2008-09. Allowing schools to opt out of the state mandate could save $400 million per year in property taxes.
Fortunately for Pennsylvanian taxpayers, two state legislators are fighting to fix the current prevailing wage law.
Sen. Mike Folmer and Rep. Steve Bloom are championing several bills between them that encourage reform for the stateâ€™s prevailing wage. From implementing a three-year moratorium, to raising the threshold from $25,000 to $100,000, to exempting certain projects from prevailing wage, Harrisburg has a chance to force government to use taxpayer dollars more wisely. Reforming a 50-year old law is a good step in the right direction for the future of Pennsylvania.
Thank you, Senator Folmer and Representative Bloom for putting constituents before special interests! Hopefully together we can reform this outdated and expensive law to move towards a more prosperous Commonwealth.
Iâ€™m Beth Anne Mumford, state director of Americans for Prosperityâ€"PA. Find out more about our grassroots efforts by visiting www.afppennsylvania.com.