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Federal court denies claim of Davis-Bacon provisions on private project

Source: Associated Builders and Contractors, Washington, D.C.; CP staff

In a decision limiting the scope of a federal statute widely criticized for inflating public construction project costs, U.S. District Court for the District of Columbia Judge Amy Berman Jackson rejected the U.S. Department of Labor’s ruling that the Davis-Bacon Act prevailing wage mandate can be expanded to include privately funded developments.

DOL’s Administrative Review Board had concluded that CityCenterDC, a privately funded, occupied and maintained condominium, apartment, office, and retail complex on a plot of District of Columbia-owned land, constituted a “public work” within the Davis-Bacon Act. Appointed by President Obama, Judge Jackson nevertheless rejected the Administration’s argument that CityCenterDC was a public work. She specifically disagreed with the claim that Davis-Bacon should apply merely because of the District’s role in project planning and oversight or because of the properties’ incidental benefits to the public. Her ruling is expected to save the District and/or the private developers an estimated $20 million in prevailing wage costs.

“This legal rejection of the Obama Administration’s increasingly overreaching Department of Labor will benefit the public, developers and the merit shop construction industry by reinforcing the precedent that privately-funded projects, including [those] developed on land owned by municipalities, are not subject to Davis-Bacon wages,” says ABC Vice President of Government Affairs Geoff Burr.