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Thanks, Unions

As of December 31, 2009, stimulus funds had paid for the weatherization of about 9,100 homes—about 583,900 less than had been planned. Aside from “Why is weatherizing private homes the government’s job?” you might wonder: “Why so few?” For that outcome, you can thank Congress and its determination to protect union privilege at all cost. States, counties, and municipalities can’t just go get the best price they can on weatherization—which would mean more work to spread around. No: Congress required that they pay prevailing (higher) wages (AKA Davis-Bacon requirements) so that unions are not undercut by cheap labor. That caused some unanticipated delays, reports the Government Accountability Office:

For example, the Department of Energy’s Weatherization Assistance Program became subject to the Davis-Bacon requirements for the first time after having been previously exempt from those requirements. Thus, the Department of Labor had to determine the prevailing wages for weatherization workers in each county in the United States, a task it completed on September 3, 2009. Seven out of 16 states and the District of Columbia that GAO has been reviewing said that they had waited to begin weatherizing homes until the Department of Labor had determined county-by-county prevailing wage rates for their state. States used only a small percentage of their available funds in 2009, mostly because state and local agencies needed time to develop the infrastructures required for managing the significant increase in weatherization funding and for ensuring compliance with Recovery Act requirements, including Davis-Bacon requirements. … In addition, officials from the Department of Housing and Urban Development told us that until passage of the Recovery Act, one of its grant programs had never been subject to Davis-Bacon requirements. Therefore, agency staff, grantees, and contractors needed to establish and implement new administrative procedures, which delayed the start of construction projects. Officials from 10 states and 3 local agencies said Davis-Bacon requirements had similarly caused delays in implementing Recovery Act projects.

Posted on 02/26/10 12:11 AM by Alex Adrianson | Blog Archive

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