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CCASE:
HARPER COUNTY, KANSAS
DDATE:
19901023
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
WAB Case No. 90-30
HARPER COUNTY, KANSAS
Senior Citizens Center
Community Development Block
Grant No. 88PF 127
BEFORE: JACKSON M. ANDREWS, Chairman
STUART ROTHMAN, Member
RUTH E. PETERS, Member
DATED: October 23, 1990
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Wage Appeals Board pursuant to 29
C.F.R. 7.2 on the petition of the Board of County Commissioners of
Harper County, Kansas ("Harper County"), seeking review of a
decision rendered on May 1, 1990 by the Acting Administrator, Wage
and Hour Division.
I. BACKGROUND
In his ruling, the Acting Administrator refused for two
reasons to reconsider the wage determination which had been issued
for the construction project in this matter. First, the Acting
Administrator ruled that there had been no legal basis for Harper
[1]
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[2] County to use wage determination rates which had been issued
for construction projects in neighboring counties (Record B, p. 2).
Second, because Harper County's request for reconsideration of the
applicable wage determination was made after both award of the
contract and start of construction, the Acting Administrator
refused reconsideration based on the alleged untimeliness of the
request (Id.).
The Board's Notice of Appeal in this matter was filed on July
27, 1990. (FOOTNOTE 1) The Office of the Solicitor filed the Acting
Administrator's motion to dismiss the petition and the record of
the case on August 24, 1990. The Board bases its decision upon the
Petition for Review, the Memorandum in support of the Acting
Administrator's motion to dismiss the petition, and the facts
contained in the record. (FOOTNOTE 2)
II. FACTS
The parties are in basic agreement as to the facts which have
given rise to this dispute. The construction project which is the
subject of this petition is the Harper County Senior Citizens
Center (the "Center"). Construction of the Center was financially
assisted by the provision of a Community Development Block Grant
("CDBG") which had been provided to Harper County by the United [2]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
(FOOTNOTE 1) The original Petition for Review was dated May 29, 1990 and
had been misdirected to another office in the Department of Labor.
This communication did not include a copy of the Acting
Administrator's May 1 ruling letter. The petition was accepted by
the Board as having been timely filed.
(FOOTNOTE 2) No statement in response to the Acting Administrator's motion
to dismiss has been filed by the Petitioner. [2]
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[3] States Department of Housing and Urban Development ("HUD")
(Record D). Construction which receives CDBG assistance under
section 110 of the Housing and Community Development Act of 1974
(42 U.S.C. 5310) is subject to the Davis-Bacon labor standards
which are administered by the Secretary of Labor.
The record establishes that construction of the Center was
advertised for bids on May 19, 1989 and that Harper County did not
request a wage determination from the Department of Labor until
June 23, 1989. Petitioner has indicated that the delay in
requesting a wage determination was occasioned by its mistaken
belief that the wage determination was being requested for the
Center by the Kansas Department of Commerce (Record C).
When the appropriate wage determination was not immediately
forthcoming, Harper County made the decision to utilize the wage
rates which had been issued by the Department of Labor for use on
Davis-Bacon projects during the previous year in two adjacent
Kansas counties -- Barber and Kiowa. See, Record C, D, F. On
August 11, 1990, Harper County awarded the Center's construction
contract to Central States Construction, Inc. and construction
commenced on August 15, 1989.
The Department of Labor issued Wage Determination No. 89-KS-
0208 (reflecting the building construction wage rates applicable to
construction of the Center) on August 3, 1989 (Record A). Harper
County alleges that it received the wage determination on August
21, 1989 (Record D) and, on August 28, 1989, the Center's architect
requested reconsideration of the applicable wage determination [3]
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[4] (Record D). The only stated basis for Harper County's request
was that the Harper County wage rates were higher than those rates
which had been issued for the neighboring counties during the prior
year (Id.).
III. DECISION
The Acting Administrator's ruling of May 1, 1990 (Record B)
presents two issues for resolution by the Board in this matter.
First is the question is whether Petitioner's request for
reconsideration of the wage rates contained in Wage Determination
No. 89-KS-0208 was untimely. Second is whether the Acting
Administrator correctly ruled that "[t]here is no legal basis for
the application of wage determinations issued for building
construction projects in Barber and Kiowa Counties to the contract
for building construction in Harper County." (Record B, p. 2).
The Board does not find it necessary to reach the second issue
given its decision concerning the issue of timeliness.
The record establishes and the Petitioner has not disputed
that the request for reconsideration dated August 28, 1990 was
untimely under the applicable Department of Labor regulations at 29
C.F.R, Section 1.6(c)(3). In brief, the August 28 reconsideration
request followed both the award of the contract and the start of
construction on August 11 and 15, respectively. In this matter,
both contract award and construction of the Center commenced before
the request for reconsideration of the wage determination. The
record before the Board establishes the following procurement
chronology in 1989. The bid advertising date was May 19; see, [4]
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[5] Petition Exhibit dated August 21, 1989 ("Notice of Start of
Construction"). (FOOTNOTE 3) However, Harper County did not request a
wage determination (FOOTNOTE 4) from the Department of Labor until June
22, 1989 (Record A). Bids were opened on July 24, the contract was
awarded on August 11, and construction of the Center commenced on
August 15 (Id.). The applicable wage determination had been issued
by the Department on August 3, 1989; the Board sees no reason in
these facts to disturb the Acting Administrator's ruling that
Harper County's challenge to the wage determination was untimely.
The Board has most recently addressed the issue of the
timeliness requirement in challenging wage determinations in Dairy
Development, WAB Case No. 88-35 (August 24, 1990). In that matter,
the Board stated:
The Board acknowledges the fact that the Department's
regulations regarding the timeliness of wage determination
challenges are strict. Nevertheless, the principle that
challenges to wage determinations must be made in a timely
fashion is well-founded, being both reasonable and
indispensable to the even- [5]
ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
(FOOTNOTE 3) This exhibit is the HUD Labor Standards Form #3, applicable
to Harper County's CDBG grant for construction of the Center. In
lieu of a "Federal Wage Decision Number" to be reported as Item 6
of the form, HUD entered the notation: "Waiting on decision, Aug.
18, 1989 = 8 weeks since application."
(FOOTNOTE 4) Department of Labor regulations issued with respect to the
wage determination process specifically note that "[t]he time
required for processing requests for wage determinations varies
according to the facts and circumstances in each case. An agency
should anticipate that such processing in the Department of Labor
will take at least 30 days." 29 C.F.R. 1.5(c). Therefore, no
special mitigation is found here in the fact that Harper County
opened the bids on July 24, 1989 ("[a]fter waiting a month"). [5]
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[6] handed enforcement of the Davis-Bacon and related Acts.
The Board has consistently ruled that in order for a
challenge to be considered timely, it is a prerequisite
that such action be taken prior to contract award, or the
start of construction where there is no contract award.
In the absence of such a timeliness rule, one of the
basic purposes of the Davis-Bacon and Related Acts would
be rendered meaningless.
Dairy Development, supra at p. 18.
This same issue was previously addressed and emphasized by the
Board when it stated:
One of the purposes of the Davis-Bacon Act is to protect
laborers and mechanics by assuring that contractors know
in advance of bidding what their approximate labor costs
would be. Universities Research Association v. Coutu,
450 U.S. 754, 776 (1981). The wage determination process
generally removes wages as a method of cutting the
contract price to obtain a contract and places bidders on
a relatively even competitive footing regarding wages
paid by placing a floor thereunder.
M.A. Mortenson Company, WAB Case No. 87-50 (February 17, 1989), at
p. 6.
In stressing the importance of the timely wage determination
challenges, the Board has noted the following as a principal
reason:
It is vital to ensure that contractors competing for
federally-assisted construction contracts know their
required labor costs in advance of bidding. Manifest
injustice to bidders would result if the successful
bidder on a project could challenge his contract's wage
determination rates after all other competitors were
excluded from participation. [6]
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[7] The timeliness requirements are among the Board's
longest-standing precedents concerning challenges to wage
determinations and the Board has consistently endorsed
the restriction against challenges which are untimely.
Gananda Development Corporation, WAB Case Nos. 73-13 and
73-14 (May 14, 1977); Jordan & Nobles Construction
Company, WAB Case No. 81-18 (August 19, 1983); Kapetan
Incorporated, WAB Case No. 87-33 (September 2, 1988);
M.A. Mortenson, supra at 6-7.
Dairy Development, supra at pp. 18-19.
The Department of Labor has promulgated regulations which
mandate timely challenges, codifying at 29 C.F.R., Section
1.6(c)(3)(1983) the Board's rulings regarding the requirement for
timeliness. Specifically, this regulation, in pertinent part,
mandates that:
All actions modifying a general wage determination shall
be effective with respect to any project to which the
determination applies, *[if published before contract
award ( or the start of construction where there is no
contract award)*] except as follows: [The regulations
proceed, listing certain exceptions and specifications
which are not applicable here.]
(vi) Modification or supersedeas wage determinations to
an applicable general wage determination published after
contract award *[(or after the beginning of construction
where there is no contract award) shall not be
effective.*]
Id.; [*emphasis supplied.*]
In this case, the Petitioner was clearly bound to meet the
standard of timeliness in 29 C.F.R., Section 1.6(c)(3).
Accordingly, the Board affirms the Acting Administrator's [7]
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[8]
ruling [7] [8] that Petitioner's challenge to Wage Determination
No. 89-KS-0208 was untimely.
IV. ORDER
The decision of the Acting Wage and Hour Administrator in his
letter of May 1, 1990 is affirmed. The petition is dismissed.
BY ORDER OF THE BOARD:
__________________________
GERALD F. KRIZAN, ESQ.
Executive Secretary,
Wage Appeals Board [8]
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