BEFORE THE DEPARTMENT OF LABOR AND INDUSTRY

STATE OF MONTANA

 

In the matter of the amendment of ARM 24.17.103, 24.17.107, 24.17.121, and 24.17.127 related to prevailing wage rates for public works projects - building construction services, heavy construction services, highway construction services, and nonconstruction services

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NOTICE OF AMENDMENT

 

TO:  All Concerned Persons

 

            1.  On November 26, 2010, the Department of Labor and Industry published MAR Notice No. 24-17-253 regarding the public hearing on the amendment of the above-stated rules on page 2681 of the 2010 Montana Administrative Register, issue no. 22.

 

            2.  On December 17, 2010, a public hearing was held at which time members of the public made oral and written comments and submitted documents.  Additional comments were received during the comment period.

 

            3.  The department has thoroughly considered the comments and testimony received from the public.  The following is a summary of the public comments received and the department's response to those comments:

 

Comment 1:  Lee Vaughan, Pacific Northwest Regional Council of Carpenters Local 1172, noted that the travel and per diem for the same classification of worker could vary amongst districts and asked if there is any indication that the number of zones would be decreased.

 

Response 1:  The department sets travel rates and ranges based upon documented practices within the different industries or occupations.  When the union has multiple locals and each local has different travel and per diem, the rates will reflect those differences.

 

Comment 2:  Robert Bergsing, Sheet Metal & Air Conditioning Contractors National Association Local 103, opposes the wages and benefits for Sheet Metal Workers and Heating and Air Conditioning in districts 1, 2, and 10 and the benefits in district 6.

 

Response 2:  The department received additional data after the public hearing from Mr. Bergsing.  The department incorporated the new data and the revised rates for Sheet Metal Workers and Heat and Air Conditioning are noted in paragraph 5.

 

Comment 3:  Mario Martinez, Pacific Northwest Regional Council of Carpenters Local 286, asked that the data used to set the wage and benefits in district 4 be revaluated.

 

Response 3:  The department received additional data after the public hearing from Mr. Martinez.  The department incorporated the new data and the revised rates for carpenters are noted in paragraph 5.

 

Comment 4:  Carey Hegreberg, Montana Contractors Association, voiced concern that the benefit rates across districts in all trades are not indicative of what the market place is reflecting.

 

Response 4:  The department acknowledges the differences in the benefit rates.  The more participation the department has the more accurate the rates are.  To increase participation, the department is willing to make follow-up calls to contractors during the survey period who have not turned in their survey before the survey period closes.  With the input of interested parties, the department is also willing to change the method in which prevailing wages are calculated and the number of prevailing wage districts.  The department also notes that prevailing wage rates merely establish a minimum level for wages paid on a public works project, not a ceiling or maximum.

 

Comment 5:  Carey Hegreberg, Montana Contractors Association, submitted a letter from Pavlik Electric making note that the highway rates have not seen any increases in several years, creating a financial hardship on the employees because the employer is forced to bid and pay lower wages and benefits to stay competitive with other contractors.

 

Response 5:  The department adopts the heavy and highway rates from the U.S. Department of Labor (US DOL) established under the federal Davis-Bacon Act.  The reason why some of the rates in the federal heavy and highway rates have stayed the same while others have increased is due to how the federal rates were established the last time they were set, which was several years ago.  Rates that have increased have done so, because they were set with a collective bargaining agreement by the union providing the US DOL with the new collective bargaining agreement (CBA).  The rates that have not increased were set through survey response instead of a CBA and have had to stay the same until a new survey is conducted.  The US DOL sent out a survey last year, and the department hopes that the new rates that come from that will be out in time for the department to adopt in the 2012 heavy and highway publications.  The department has also had discussions about possibly setting the heavy and highway rates through a survey like it does for the building rates.  As mentioned in Response 5 above, the department also notes that prevailing wage rates merely establish a minimum level for wage paid on a public works project, not a ceiling or maximum.

 

Comment 6:  Keith Allen, International Brotherhood of Electrical Workers Local 233, in a letter to the department, notes the travel for electricians in districts 4, 5, and 7 should be $55/day when traveling >50/mi., not $54.

 

Response 6:  The department has reviewed the travel rates for electricians.  Revised travel and per diem rates for electricians are identified below in paragraph 5.

 

Comment 7:  Pamela Bompart, Bompart Cleaning Service Inc., commented that she pays the second highest wage rate ($12.00) in the state (according to the Job Service) and questions how the department arrived at the prevailing wage rate ($17.51) for janitors and cleaners in district 5.

 

Response 7:  The proposed prevailing wage rate for janitors and cleaners in district 5 is $15.71, not $17.51.  Commenter states she pays about $12.00/ hour.  The wage portion of the proposed prevailing wage rate is $11.99/hour.  The department also did not receive a survey from Bompart Cleaning Service Inc. during this last survey period.  The department gathers a list of employers that perform the types of work outlined in 18-2-401(9)(a-l), MCA.  The department then sets the rates according to the methodology provided by 18-2-415, MCA and ARM 24.17.121.

 

Comment 8:  The department received additional data from All Glass Services and Valley Glass & Windows for Glaziers in districts 5 and 6 respectively during the public comment period. 

 

Response 8:  Revised rates are identified below in paragraph 5.

 

            4.  The rules have been amended exactly as proposed.

 

            5.  The following rates in "The State of Montana Prevailing Wage Rates – Building Construction Services" publication incorporated by reference in the rule have been amended as follows, stricken matter interlined, new matter underlined:

 

Electricians

Travel:

Districts 4, 5, 7

0-8 mi. free zone

>8-50 mi. federal mileage rate/mi.

>50 mi. $5455/day

 

Carpenters

District            Wage                          Benefit

      4                $18.31   $19.74         $5.30  $8.74

 

 

 

Sheet Metal Worker and Heating and Air Conditioning

District            Wage                          Benefit

       1               $23.59   $24.24         $  9.35  $13.24

       2               $24.55   $25.10         $10.96  $13.24

       6               $26.24                        $10.02  $13.24

 

 

Glaziers

District            Wage                          Benefit

     5                 $13.50   $15.65         $0.70

     6                 $20.00   $19.32         $8.18  $3.47

 

 

 

/s/ MARK CADWALLADER            /s/ KEITH KELLY

Mark Cadwallader                            Keith Kelly, Commissioner

Alternate Rule Reviewer                   DEPARTMENT OF LABOR AND INDUSTRY

 

 

Certified to the Secretary of State January 18, 2011