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Senate Dems kept public construction costs inflated

In the state of New Mexico, any contractor awarded a public contract for the construction of a public project is required to pay its employees a “prevailing wage.” Prevailing wage rates are determined by the Department of Workforce Solutions for each locality and differ according to occupation, title and other factors.

Prevailing wage regulations also require the payment of fringe benefits to cover health, insurance and other benefits that an employee is entitled to.

Prior to 2009, prevailing wages were set through a survey method. All contractors in the state of New Mexico were surveyed to determine what their employees were paid and then a decision was made as to the “prevailing wage” rates.

In 2009, during the Richardson administration, a bill (Senate Bill 33) was passed that changed the way prevailing wages were set. This was changed from the survey method to setting prevailing wage rates using union collective bargaining agreements. This bill was pushed through by the then Democratic Party majority in both houses.

Ninety-two percent of employees in the construction industry in New Mexico choose not to be represented by a union. So, the result of this 2009 legislation is that prevailing wages for the entire state of New Mexico are set by 8 percent of the construction industry.

The definition of prevailing is “predominant.” Allowing wages on public works projects to be set by labor unions is neither predominant, nor fair.

It is certainly not fair to the New Mexico taxpayer.

Since 2009, Associated Builders and Contractors of New Mexico has sought to get this law rescinded. In past years, we have supported legislation that has been killed in its first committee by the Democratic majority in Santa Fe.

This year, we had some success.

House Bill 55/80, which was carried by Rep. Nora Espinoza, R-Roswell, Pirth and Bill Rehm, attempted to rescind SB33 and return New Mexico to the previous contractor survey, which had worked for many years. Despite a massive negative campaign amassed by the unions, this bill passed through both the Business and Employment and Transportation and Public Works committees on party-line votes. The bill was debated on the House floor for over two hours and was passed, again on party-line votes.

I am sure that anyone reading this can determine the outcome of this legislation.

The bill was assigned to two committees in the Senate – Judiciary and Finance – but was never scheduled to be heard by the Democrat Party majority despite consistent requests that it at least get a hearing in the Senate.

Because of the important impact that prevailing wages have on the cost of labor to the state of New Mexico, it is important that their calculation reflect the “actual wage that prevails.”

If this legislation had been allowed to pass into law, the New Mexico taxpayer would have been ensured that the determination of prevailing wages was inclusive and correct. The Democratic majority in the Senate should have taken the steps to return the determination of prevailing wage to the survey method. A method that is fair, transparent and correctly sets the “predominant wages” paid in the state of New Mexico.

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