Nearly 100 days into the new presidency, all eyes are on which of his campaign promises President Trump will implement next. One such promise put into motion is the President’s estimated $1 trillion infrastructure plan. Touted during his campaign as a means to stimulate job growth, the President’s plan may come with more federal deregulation than the construction and government contracting industries anticipated, including possible repeal or suspension of the Davis Bacon Act (DBA).
Introduced in the midst of the Great Depression, Congress enacted the DBA as a means to prevent failing wages. Eighty years later, the DBA has become synonymous with federal contracting. Also known as the federal prevailing wage statue, the DBA requires payment of prevailing wages on federally funded or assisted construction projects for contracts in excess of $2,000. Critics of the DBA argue that the prevailing rates artificially and unreasonably increase project costs, and that the U.S. Department of Labor is unable to develop an efficient process for determining market-rate wages. Proponents – particularly labor unions – argue the DBA prevents a “race to the bottom,” increasing productivity and improving local economies.
For a number of years, Republicans have regularly introduced bills to repeal the DBA, but such bills have consistently fizzled out or been voted down. Potential repeal of the DBA is now back in the spotlight, and may be one of the next steps in President Trump’s efforts to further deregulate the federal government. Less infamous than its November 2016 sit-down with the President, the New York Times recently conducted a second interview with the President covering everything from his nomination of now-Justice Gorsuch, to his infrastructure plan. Discussed towards the conclusion of the interview, the President stirred rumors when he made veiled comments about his plans for the DBA:
NYT: Can I ask you one last question?
NYT: On the infrastructure stuff, a couple of quick things. Davis-Bacon
[a law that regulates wages on federally funded projects]. Democrats have said that will
be a poison pill. Are you going to touch Davis-Bacon?
What are you going to do?
TRUMP: We’re going to make an announcement in two weeks —
TRUMP: — on Davis-Bacon.
NYT: O.K. Can you give us a hint on where you are?
[Laughter. Cross talk.]
TRUMP: It’s an important question, actually.
TRUMP: It’s going to be good.
Just under two weeks have passed, and no announcement from the White House. Previous meetings with union leaders have some predicting the DBA is here to stay. Maintaining the status quo seems even more likely should the President need support from typically pro-DBA Democrats for his infrastructure plan. Others predict that the President may have no choice but to repeal the DBA if he wants to appease the otherwise spending-weary GOP. Even if President Trump, fearing insufficient congressional support, does not attempt to repeal the DBA, its very possible he could take unilateral action to suspend the DBA by declaring a “national emergency.” Such action has been taken by four prior Presidents: President George W. Bush in 2005, President George H.W. Bush in 1992, President Richard Nixon in 1971, and President Franklin D. Roosevelt in 1934.
Bound to stir up the hornets’ nest on one side of the aisle, federal contractors and union leaders alike will have to standby for the (hopefully) forthcoming DBA announcement, as well as whether the President’s likely industry stimulating infrastructure plan can gain support.