Associated Builders and Contractors of Wisconsin President Builds Case for Prevailing Wage Repeal

Wisconsin Independent Businesses President Impugns Credibility of Wisconsin Taxpayers Alliance

John Mielke, president of Associated Builders and Contractors of Wisconsin (ABC-WI), appeared recently on Wisconsin Public Television’s “Here and Now” to discuss repeal of Wisconsin’s 80 year old law requiring state mandated wages to be paid on public construction projects.  ABC-WI is the Wisconsin chapter of a national construction industry trade association with over 800 members in the Wisconsin chapter alone.  On the program, Mr. Mielke argued repeal of the prevailing wage law would open up the public construction industry in Wisconsin to more competition, provide additional opportunities for small Wisconsin construction firms to work on such projects and save taxpayer money.  In particular, he highlighted a recent Wisconsin Taxpayers Alliance released a report concluding that Wisconsin’s prevailing wage law costs taxpayers up to $300 million annually in inflated public construction costs.

Also on the program, John Gard, president of Wisconsin Independent Businesses (WIB) and a spokesperson for the Wisconsin Contractor Coalition, defended the state’s prevailing wage law.  WIB is a business advocacy organization in Wisconsin while the Wisconsin Contractor Coalition is a group of 450 Wisconsin companies.  Mr. Gard argued the state’s prevailing wage law helps to ensure Wisconsin’s public construction workforce is productive and well-trained, ultimately saving taxpayers’ money.  Mr. Gard on the program said the Wisconsin Taxpayers Alliance report is  “so incredibly flawed that it’s not real;” the reports purported savings are “fictitious;”  and that the Wisconsin Taxpayers Alliance “fudged the numbers to get to the conclusion they wanted.”

The Wisconsin Taxpayers Alliance attributed the higher costs caused by the state’s prevailing wage law, in part, due to the low response rate to DWD’s surveys, ultimately skewing the state-set prevailing wages by creating an inherent bias in the data the state uses to the set prevailing wages in Wisconsin. In particular, the Wisconsin Taxpayers Alliance noted DWD’s employer survey to set prevailing wages received a response rate of only ten percent, compared to a 76 percent return rate for surveys issued by the federal government to set federal prevailing wages. The Wisconsin Department of Administration, in its fiscal estimate of the legislation, acknowledged this low response rate. In addition, rather than using all wage survey responses to calculate prevailing wages, Wisconsin, uniquely according to the Wisconsin Taxpayers Alliance, often averages only the upper portion of the wage distribution it receives. As a consequence, the Wisconsin Taxpayers Alliance concluded Wisconsin’s prevailing wage law results in overall compensation packages which are 44 percent higher than Bureau of Labor Statistics package rates.