Federal prevailing-wage rules tied to stimulus money led to the delay of weatherization projects in Wisconsin.
Nonprofit companies such as Janesville-based Community Action Inc. of Rock and Walworth Counties receive public weatherization money and either do the projects themselves or hire contractors to improve energy efficiency in houses and apartments.
“I think we’re very close to having a reasonable, well-running system in place,” said Lisa Furseth, Community Action’s executive director. “We would have liked this to happen faster, but it didn’t.”
Federal officials gave Wisconsin $141.5 million in American Recovery and Reinvestment Act money for weatherization, but projects receiving federal stimulus money are required to follow federal Davis-Bacon Act wage requirements. Companies that use only state money are not required to pay federal prevailing wages on weatherization projects.
Prevailing wage rates for weatherization are established with a U.S. Department of Labor survey of companies that have done the work in the past. Different rates apply to different counties.
The federal rules, combined with the release of new wage rates for weatherization jobs in September, delayed contract awards and some stimulus projects.
Community Action usually completes about 40 projects a month in Rock and Walworth counties, Furseth said. In the past two months, the agency has done 20 to 25. The agency was awarded $1.7 million in stimulus money.
The federal wage rules also created a midsummer lull in Milwaukee. The Social Development Commission of Milwaukee, which was awarded $5.6 million in stimulus money, did construction work on only 10 housing units in July, down from 50 in a typical month, said Vincent Montgomery, weatherization program manager for the nonprofit agency.
In August, 50 housing units were done, and the monthly totals have since risen to around 70, he said. The agency worked through the complications of the new stimulus wage rules, Montgomery said.
“Yes, it delayed projects,” he said. “The reporting changes. The rules changed, and every step we went through was very closely monitored.”
Because the wage rates for weatherization jobs were not released until early September, many nonprofits were unable to award contracts until September or October.
Agencies such as the Southwest Wisconsin Community Action Program extended last year’s contracts and continued to do projects using state money. Over the summer, the program did about 15 houses a month, the average during years past, said Phyllis Novinskie, weatherization assistant director.
Since federal stimulus money became available in October, the workload has risen to 18 to 22 houses, Novinskie said. She said her program hired six people after the stimulus money became available. The agency also has hired three or four construction companies, all of them one-person operations, compared with the two builders it usually contracts.
“It’s been a little sluggish getting going,” Novinskie said. “But now we’re pretty much doing every project we can with stimulus money.”
Furseth’s organization bid and awarded contracts in August before the new wage rates were released. She said the Wisconsin Department of Administration, which oversees weatherization programs, has provided good guidance to agencies on dealing with those situations.
But Furseth this month is rebidding two contracts because of the wage change. Once the new contracts are in place, the weatherization program should be able to get past the confusion and get more stimulus work started.
“This has not been a perfect process,” she said. “It has been a challenging environment, but it doesn’t have to always be that way.”