GARFIELD PLACE HOUSING PROJECT, WAB No. 91-13 (WAB Aug. 27, 1991)
CCASE:
GARFIELD PLACE HOUSING PROJECT
DDATE:
19910827
TTEXT:
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[1] WAGE APPEALS BOARD
UNITED STATES DEPARTMENT OF LABOR
WASHINGTON, D. C.
In the Matter of:
GARFIELD PLACE
HOUSING PROJECT
WAB Case No. 91-13
PIATT PARK ASSOCIATES
Cincinnati, Hamilton County, Ohio
BEFORE: Charles E. Shearer, Jr., Chairman
Stuart Rothman, Senior Member
Patrick J. O'Brien, Member
DATED: August 27, 1991
DECISION OF THE WAGE APPEALS BOARD
This matter is before the Board on the petition of Piatt Park
Associates from a Wage and Hour determination affirming a ruling of
the Department of Housing and Urban Development ("HUD") that
building construction (rather than residential) wage rates apply to
the proposed Garfield Place housing project. Oral argument on this
issue was held before the Board on July 17, 1991.
For the reasons contained herein, the Wage and Hour
determination is affirmed. [1]
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[2]
I. BACKGROUND
Piatt Park Associates ("PPA" or "Petitioner") intends to
construct an apartment building containing 140 apartment units in
downtown Cincinnati. It will be partially funded by a Community
Development Block Grant provided under the Housing and Community
Development Act of 1974 (42 U.S.C. [secs] 5310, 1440(g)), a
Davis-Bacon Related Act.
The overall development plan is somewhat unusual: the City of
Cincinnati will build a four story garage with its own funds, a
structure which will be of a design integrated into the residences
above and built immediately before the apartments. The great bulk
of the residential units will be built on top of the garage space,
but 12 units on the first and second levels will mask the garage on
one side. The project plans indicate a fully integrated structure.
HUD concluded that the building was six stories in height and
that the commercial building rates apply. This conclusion was
affirmed by the Wage and Hour Division. PPA argues that the
building is really only four stories; that those four stories are
residential housing in a construction sense; and that the policy
that building rates apply to buildings of more than four stories in
height is arbitrary and capricious both in fact and in application
here.
II. DISCUSSION
Petitioner contends this is a four-story structure despite the
lower two housing levels. The top four stories are to be built
over a city owned parking garage. The shells for 12 dwelling units
on the first two levels will be constructed as a part of the
four-level garage. They will be in place or part of the garage
construction before the four housing levels can be added above.
This is a UDAG grant for a project on six, not four levels.
The grant was sought and made on that basis. The shells of the 12
units are to be turned over to Petitioner to finish. At oral
argument Petitioner limited this finishing work to such work as
"painting the interior walls." But to complete the interiors
someone will have to provide finish carpentry, interior and
exterior doors, heating, air conditioning, ventilation and all
other mechanical work, plumbing and electrical. The same UDAG
grant covers the construction work on these first and second floors
as well as the third, fourth, fifth and sixth levels. The UDAG
grant also covers completion of commercial units on the first
level.
The construction on the third to sixth levels of exterior and
interior walls as explained to the Board will be cinder block. The
floors at each level will be prestressed concrete slabs resting on
the load-bearing masonry walls. Curiously, [2]
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[3]
in its request to DOL that residential prevailing wage rates be assigned,
Petitioner stated this same type of construction is often used to
build a typical two-floor Holiday Inn. Under All Agency Memoranda
Nos. 130 and 131, motels are considered as commercial construction
absent proof of accepted local practice and usage to the contrary.
The 12 dwelling units on the first and second levels are
architecturally designed to mask the garage nature at the lower
levels. Nonetheless the 12 units are residential housing covered
by the UDAG grant. Construction of this nature is not akin to
typical residential construction four stories or less for which
garden-type apartment construction without elevators is the
prototype. See the Board's decision in Mattapony Towers
Apartments, WAB Case No. 64-02 (June 29, 1965).
HUD's architect reviewing the project concluded this to be a
six-floor project. While Petitioner seeks legal definitions to
establish a distinction between the work above the second level, it
takes only a look at the project's architectural drawings to see a
six-story residential structure on one side, five on another, with
additional commercial areas on one side of the first level.
Tenants who live on the top floor will have to take an elevator six
floors, not four. Storage space and parking space will be at
levels below the third level. The architectural design of Garfield
Place and the parking garage was made by a single architectural
firm. The design, including elevators, elevator towers for six
levels and a load-bearing capacity to support four levels of
housing above the garage would have to be integrated. At the sixth
level at what appears to be a flat roof, there are additional
towers at each end. It has not been properly explained what will
be housed in those towers. A swimming pool with UDAG money at the
third level above the parking garage would have to be recessed into
the roof of the parking garage by design. Residential apartments
four stories or less do not in the normal construction sense have
four levels of parking space below them or high-rise elevators.
The major fallacy which permeates Petitioner's argument is
that the same crafts and classes of employees employed on
residential housing four stories and less will be employed on
similar work on this project. The Davis-Bacon Act refers to
projects of a character similar, not similar work, as the basis for
determining the applicable Davis-Bacon category. Since the 1935
amendments to the Act, the focus has always been upon the
construction characteristics of the project itself rather than on
who will be employed on the project. In this case the planning,
architectural factors, construction and development characteristics
place this project in the same category as building construction.
In summary, the decision of the Wage and Hour Division is
affirmed. [3]
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[4]
CONCURRING STATEMENT OF SENIOR MEMBER ROTHMAN
My views and the views of the majority coincide on the basic
question whether Garfield Place should be treated as residential
housing up to and including four stories. I concur in the result
reached. I write separately because of two additional points.
The Building and Construction Trades Department, AFL-CIO,
submitted a statement in opposition to the petition. It argues
that Wage and Hour correctly categorized Garfield Place as
"building construction" for Davis-Bacon purposes. However,
Petitioner, Piatt Park Associates, represented that the local
Building and Construction Trades Council in Cincinnati has endorsed
this project for construction at residential housing rates:
Developer has regularly met with representatives
of the Building Trades Council who are willing
to accept a residential prevailing wage on the
apartment work in order to insure there will be
a project.
(Record, Tab F).
The Davis-Bacon Act is administered on a locality-by-locality
basis. Petitioner was asked at the July 17, 1991 hearing whether
the local building and construction trades unions had as a matter
of local practice and usage considered a project such as Garfield
Place to fall within the category of residential housing four
stories or less. Petitioner stated it had no such information.
The inference, accordingly, is that the made representation re the
local building trades unions is no longer a point of Petitioner's
argument that this project should carry the residential rates as a
project accepted in the locality, whether high-rise or not, as
housing to be built according to the prevailing wages for
residential housing up to and including four stories. If
Petitioner is of the view that it can establish that the industry
itself in Cincinnati in recognition of a local situation has carved
such projects, or just this project, out of the general building
schedule as a modification of their own negotiated agreement, it
should be permitted to do so. It would also become a relevant
question whether the residential wage rates (as differentiated from
the building/commercial rates) which prevail in Cincinnati are the
negotiated rates. The ramification of such modification relative
to the UDAG grant may be enormous. Such an interpretation by the
local Building and Construction Trades Council would carry with it
precedential value as to any other similar projects. [4]
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[5]
On the other point on which I write separately, in Dutch Hotel
(SRO) Kitchen, WAB Case No. 90-29 (Mar. 22, 1991) and A-Mac Sales
& Builders, WAB Case No. 90-37 (Apr. 19, 1991), reconsideration
denied (June 27, 1991), the Board is said to have decided "that the
`Wage and Hour [Division] has the burden of demonstrating the
correctness of its decision based upon the nature of the project --
including the work to be performed as well as the end use of the
construction -- in the context of prevailing area practices."'
Petitioner at the July 17, 1991 hearing directed the Board's
attention as relevant to the resolution of this dispute to such
distribution of burdens between itself and the Administrator. This
represents a departure from long settled precedent concerning the
proper standard of review in wage predetermination cases. I
believe that the formulation of the burden attributed to the Board
goes too far. I believe that the Board should reaffirm the
standard expressed in a 1967 case, Jefferson County, Texas, WAB
Case No. 67-07 (May 5, 1967):
The Wage Appeals Board believes that in
absence of any evidence of irregularity or
caprice on the part of the Office of the
Solicitor, the Solicitor's wage determination
must be accorded a certain weight as to its
validity. The weight to be accorded to the
validity of a Solicitor's wage determination
can, of course, be overcome by cogent proof on
the part of the petitioner; e.g. rebutting
factual data showing a lack of substantial
evidence. A petitioner would have to document
its position with rivaling or rebutting factual
data. A petitioner has the same burdens and
obligations as any other moving party, and
must prove its charge.
Slip Op. at pp. 6-7.
CONCURRING STATEMENT OF MEMBER O'BRIEN
I concur in the decision of the majority, and would reaffirm
the longstanding position of the Wage Appeals Board that the nature
of the project from a construction standpoint determines the
applicable wage rate -- not, as PPA asserts, the particulars of
legal title or project financing. Were Petitioner correct, a
ninety story structure like the Hancock Center in Chicago could be
built at residential wage rates if it consisted entirely of presold
condominium units.
I write separately to correct a misperception concerning the
Board's decision in Dutch Hotel (SRO) Kitchen, WAB Case No. 90-29
(Mar. 22, 1991), which has been cited by the Petitioner for the
proposition that Wage and Hour has the burden of proof as to all
matters at all times involving area wage [5] determinations.
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[6]
This is not the case. Dutch Hotel stands for the proposition that
Wage and Hour must develop a record adequate to support its
conclusion:
. . . the Board agrees that Wage and Hour has
the burden of demonstrating the correctness of
its decision based on the nature of the project
-- including the work to be performed as well
as the end use of the construction -- in the
context of prevailing area practices. There
is nothing in the record before the Board
which shows that Wage and Hour considered
both aspects, or even that the petitioner
had the opportunity to present its position on
the matter.
Slip Op. at p. 5. This is a statement regarding the nature and
sufficiency of the administrative record, not a characterization of
the burden of proof question at any particular point in a
proceeding. Dutch Hotel is quite consistent with Jefferson County,
supra, insofar as both would accord a certain weight to a
determination of the Wage and Hour Division in the absence of
irregularity or caprice.
BY ORDER OF THE BOARD:
Charles E. Shearer, Jr., Chairman
Stuart Rothman, Senior Member
Patrick J. O'Brien, Member
____________________________
Gerald F. Krizan, Esq.
Executive Secretary [6]
