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Carpenters log support for prevailing wage, road money

Paul Snyder
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Depending on which side of the political aisle is talking, changes to the state’s prevailing wage rules and transportation financing formula are either poorly timed, expensive ideas or nearly law.

That was the mixed message waiting for the Wisconsin State Council of Carpenters as the union descended on the state Capitol on Wednesday for the 2009 Legislative Conference.

“The big focus right now is on jobs,” said Senate Majority Leader Russ Decker, D-Weston. “We want to help get money out for roads, bridges, highways, airports and building projects. And we want to get Wisconsin workers building Wisconsin’s economy.”

Mark Reihl, the Carpenters’ executive director, said the union supports the 2009-11 state budget proposal’s prevailing wage law changes, which lower the state threshold on prevailing wage projects from $234,000 to the federal threshold of $2,000. The changes also require submission of payroll records to verify contractor compliance and expand coverage to projects using tax-incremental financing and other public assistance.

But the changes are being proposed at the wrong time, said state Rep. Mark Gottlieb, R-Port Washington.

“Now is not the time to be doing things that would increase the cost of development,” he said. “You talk to municipalities, and all development activity has come to a grinding halt. We can’t be doing things to add administrative headaches or add more regulatory requirements.”

It is a common misconception that lowering the prevailing-wage threshold increases project costs, Reihl said.

“A Minnesota legislative auditor concluded recently that prevailing wage’s impact on project costs are still unclear,” he said. “But most of the comprehensive studies done failed to find a statistically significant impact.”

Decker said he expects pressure to remove prevailing wage language from the budget bill, but Democratic support should be strong enough to keep the changes in the bill.

The budget bill also marks Gov. Jim Doyle’s second attempt to establish an oil-assessment fee to generate money for Wisconsin’s transportation system.

The measure, which essentially taxes oil company profits and prevents those companies from passing the tax to consumers, failed in the last budget process. But Decker said Democratic leadership in both houses should carry it through this time.

He said the measure probably will lead to legal challenges, but is a good opportunity to identify transportation money.

“It was a big mistake to take away gas-tax indexing a few years ago,” Decker said. “But we’d have a hard time getting that back.”

Reihl said the oil-franchise fee is the best option available.

“The stimulus money is going to be a short-term solution, and we still need a long-term funding source,” he said. “It probably is going to be challenged, but that’s money being counted on to pay for transportation. If not that, then what?”

But before the Legislature latches on to a new transportation revenue source, lawmakers must find a way to protect the money that is already there, Gottlieb said.

“It’s not a question of what’s best, be it oil franchise, a return to indexing, a gas-tax increase or tolls,” he said. “None of that matters if we don’t stop using the transportation fund as a piggy bank.

“The No. 1 job we have in transportation finance is to stop transfers. Then we can talk about how to generate new money.”

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