Alison Lundergan Grimes Again Misleads On CBO Report

FOR IMMEDIATE RELEASE

June 24, 2014

Contact: Allison Moore 502-618-1372

 

LOUISVILLE – Team Mitch today released the following statement and background information in response to Alison Lundergan Grimes once again blasting out a misleading interpretation of a CBO report.

“Alison Lundergan Grimes has proven to have no shame in misleading Kentuckians, but once again her tactics have backfired. The CBO report Grimes cites in her attempt to discredit Sen. McConnell's plan actually calls the Davis-Bacon Act obsolete and says that its repeal would save $13 billion, benefit small businesses and create more jobs. This is in stark contrast to the $200 billion tax hike crafted by Senate Democrats that Grimes claims as her own plan to pay for the Brent Spence Bridge,” said Team Mitch spokeswoman Allison Moore.

BACKGROUND:

The Davis-Bacon Act Was Passed To Ensure That Construction Workers Were Paid No Less Than A Certain, Government Mandated Wage. “Since 1935, the Davis-Bacon Act has required that workers on all federally funded or federally assisted construction projects whose contracts total more than $2,000 be paid no less than “prevailing wages” in the area in which the project is located.” (“Repeal the Davis-Bacon Act,” Congressional Budget Office, 11/13/13) 

  • CBO: Davis-Bacon Act “Is No Longer Needed” For That Purpose. “A rationale for repealing the Davis-Bacon Act is that, as a result of the enactment of other federal and state laws (including the adoption of a federal minimum wage) and other changes in labor markets since the 1930s, the Davis-Bacon Act is no longer needed to ensure minimum wages for workers employed in federal or federally financed construction. (“Repeal the Davis-Bacon Act,” Congressional Budget Office, 11/13/13) 

CBO: Davis-Bacon Act Reduces The “Employment Of Construction Workers”. “Moreover, when prevailing wages (including fringe benefits) are higher than the wages and benefits that would be paid in the absence of the Davis-Bacon Act, the Davis-Bacon Act distorts the market for construction workers. In that situation, federally funded or federally assisted construction projects are likely to use more capital and less labor than they otherwise would, thus reducing the employment of construction workers. (“Repeal the Davis-Bacon Act,” Congressional Budget Office, 11/13/13)

CBO: Davis-Bacon Act Repeal Would Result In “More Construction Projects Being Undertaken”. “In addition, by reducing the cost of federally funded or federally assisted construction projects, this option would result in more construction projects being undertaken for a given amount of federal dollars”. (“Repeal the Davis-Bacon Act,”Congressional Budget Office, 11/13/13)

CBO: Davis-Bacon Repeal Would Benefit Small Businesses. “Additional rationales for repealing the Davis-Bacon Act are that the paperwork associated with the act effectively discriminates against small firms” (“Repeal the Davis-Bacon Act,” Congressional Budget Office, 11/13/13) 

CBO: Davis-Bacon Repeal Would Save The Federal Government $13 Billion Dollars. “This option would repeal the Davis-Bacon Act, reducing appropriations, as well as limits on the government’s authority to enter into obligations for certain transportation programs, accordingly. If this policy change was implemented, the federal government would spend less on construction, saving $13 billion in discretionary outlays from 2015 through 2023, the Congressional Budget Office estimates(“Repeal the Davis-Bacon Act,” Congressional Budget Office, 11/13/13)

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