Davis-Bacon Act Coverage and the State Revolving Fund Program Under the Clean Water Act

[Excerpt] The Davis-Bacon Act (DBA) requires, among other things, that not less than the locally prevailing wage be paid to workers employed, under contract, on federal construction work to which the United States or the District of Columbiais aparty. Congress has added DBA prevailing wage provisions to more than 50 separate program statutes. In 1961, a DBA prevailing wage requirement was added to the Federal Water Pollution Control Act (P.L. 87-88), now known as the Clean Water Act (CWA), which assists in construction of municipal wastewater treatment works. In 1987, Congress moved from a program of federal grants for municipal pollution abatement facilities to a state revolving loan fund (SRF) arrangement in which states would be expected to contribute an amount equal to at 1 east 20% of SRF capital ization funding. The SRFs were expected to remain as a continuing and stable source of funds for construction of treatment facilities. And, Congress specified that certain administrative and policy requirements (including Davis-Bacon) were to be annexed from the core statute and would apply to treatment works constructed in whole or in part before fiscal year 1995 with SRF assistance. By October 1994, under the 1987 amendments, it was expected that federal appropriations for SRFs would end. After 1987, Congress variously reconsidered the CWA and the SRF program but made no further authorizations. It did, however, contrary to expectation when the 1987 legislation was adopted, continue to appropriate funds for SRF pollution abatement projects. Thus, a conflict arose. Did the administrative and policy requirements associated with federal funding (inter alia, the prevailing wage requirement) continue to apply? If so (or if not), upon what legal foundation? In 1995, the Environmental Protection Agency (EPA) ruled that prevailing wage rates (Davis-Bacon) would no longer be required on SRF projects. The Building and Construction Trades Department (BCTD), AFL-CIO, protested. What happened after 1994 is not entirely clear: that is, whether prevailing rates were actually paid. In the spring of 2000, EPA reversed its position and came to conclude that Davis-Bacon did indeed apply. Following notice in the Federal Register (and review of submissions from interested parties), EPA entered into a settlement agreement with the BCTD. It would enforce DBA rates on CWA projects effective July 1, 2001. But then EPA moved the effective date back, to late summer — and, then, to October. Thereafter, it seems, EPA was silent. During recent years, Congress has increasingly considered funding mechanisms other than direct appropriations for public construction: e.g., joint federal and state revolving funds, loan guarantees, tax credits, etc. This report is a case study of the application of DBA requirements to one such mechanism, the CWA/SRFs. The question of DBA application to the SRFs continues in the 110th Congress