DEFINITION OF PUBLIC WORK
A.5498 (Bronson) - S.2975 (Murphy)
MEMORANDUM IN SUPPORT
As currently written, the Labor Law does not include a clear definition of “public work,” a significant designation that triggers the prevailing wage requirement and imposes a level of transparency and accountability in the award of construction contracts. Over the years, this ambiguity in the law has triggered court cases challenging the ‘public work status’ of several projects. In deciding these cases, the courts have gradually narrowed a worker’s basic constitutional right to receive the prevailing wage when working on government-funded projects. This legislation restores the law to its intended meaning and helps prevent situations which might allow for fraud and corruption in public bidding.
(Bill is Here)
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Ways & Means
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WHY IT'S NEEDED: The current law does not define "public work," a designation that triggers the prevailing wage rate. Here is a printable 1-pager that discusses the benefits of the prevailing wage.
The trend in New York has been to attract private investment by leveraging State funds. THINK: REDCs, Solar City’s Buffalo project, Upstate Revitalization, SUNY 2020, and SUNY Poly. These economic development initiatives are structured such that they often escape the State’s competitive bidding laws and prevailing wage requirement. The result? New York is not getting the most bang for its buck
Economic development is about more than attracting new businesses. It’s also about good wages so that residents have more disposable income to spend in their communities. It’s about making sure that jobs created offer decent health and pension benefits so that there is less of a strain on our public safety nets. It’s about supporting policies that promote workforce training and diversification. And it’s about making sure the State chooses the “High Road” approach to economic development rather than one which promotes a “Race to the Bottom” mentality by allowing contractors to compete for work by undercutting wages.
WHAT IT DOES:
This legislation defines public work to include three categories:
1. Any construction “paid for in whole or in part with public funds.” Defined to include:
Money, bonds, and grants paid by a public entity;
The transfer of a state asset, like land, for less than FMV;
Fees, costs, loans, insurance or bond premiums, interest rates, taxes, etc. that are paid, reduced, waived, or forgiven by a public entity;
Performance of construction work by a public entity;
Money loaned by a public entity that is to be repaid on a contingent basis;
Credits against a repayment obligation owed to a public entity.
THINK: IDAs, LDCs, P3s, Regional Economic Development Councils, charter schools
2. Construction work performed on private land with private funds, but upon completion,
part of the property will be leased to a public entity.
THINK: Griffiss Air Force Base, Trooper Barracks
3. Construction on a public work of improvement which is incidentally related to a private
project but must be performed as a condition of regulatory approval.
THINK: Pyramid case (private developer building a road to connect his project to state highway).
HOW IT AFFECTS YOUR MEMBERS:
All contractors - union and non-union - pay the same wages on public work projects, so union contractors will be more competitive.
Out of state contractors will be less likely to bid and be awarded projects because they will be stripped of their ability to compete by paying low wages and no benefits.
Increased apprenticeship opportunities.
Affects every trade in every area of the State!
What triggers the prevaiiling wage law in New York State?
The prevailing wage law applies when:
All of the following conditions are met:
A public entity or third party acting in place of a public entity is a party to a construction contract concerning a “public work.”
The project is paid for by public funds.
The primary objective of the work product must be of use or benefit to the general public.
It is expressly required by a statute specific to the project or program in question.