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Prevailing-wage dispute over fiber-optic classification could complicate $1.16 billion broadband rollout, lawmakers warn
Summary
Lawmakers pressed the Department of Labor and Industry about a contested prevailing-wage rate that applies electrical line wage classifications to fiber-optic installers. The department said the matter is before the Prevailing Wage Appeal Board after a Warren County determination, and that it needs empirical evidence
A dispute over whether fiber-optic installation work should carry electrical line prevailing-wage rates drew repeated questioning at the Feb. 24 appropriations hearing, and several lawmakers said the unresolved classification risks complicating use of federal broadband deployment dollars.
Representative Krupa and others asked why the department used an electrical-line construction classification that has higher wage and workers'compensation rates rather than a telecommunications classification for some fiber-optic installation work. Officials said the Warren County rate determination is currently the subject of a pending case before the Prevailing Wage Appeal Board and that the department issued the rate using available information at that time.
"We are looking forward to the prevailing wage appeal board's decision," Secretary Walker said, adding that the department will evaluate new information submitted by stakeholders, including collective bargaining agreements and benefit packages. "If a rate and or classification change is appropriate, we will absolutely make it."
Lawmakers raised the broader risk to deployment of federal broadband funds, noting the Infrastructure Investment and Jobs Act allocation for Pennsylvania is a limited opportunity. Representatives asked whether using a higher prevailing wage on some projects could reduce the amount of broadband work the state can fund.
Department officials said they had no evidence the federal funds would be withheld and reiterated that they welcome submission of empirical wage and benefit data to the bureau that sets prevailing rates. The Prevailing Wage Appeal Board hearing is expected to conclude and a decision issued in the coming months.
Why it matters: Prevailing-wage classifications determine contractor labor rates on public projects and can affect total project costs. Lawmakers warned that a higher classification on broadband projects could make some projects more expensive and reduce deployment scale.
Ending: The department urged stakeholders to submit collective bargaining agreements and wage/benefit data to support any change; the Prevailing Wage Appeal Board decision will be the next administrative milestone.
