NMHC Lends Support to Davis-Bacon Reform Legislation

Just weeks after the Department of Labor issued a rule that proposed problematic Davis-Bacon reform, Republican Senators introduce legislation that gets it right.

Senators John Thune (R-S.C.) and Jerry Moran (R-Kan.) introduced the Housing Supply Expansion Act aimed at addressing the housing affordability shortage through reforms of the Davis Bacon Act. This legislation makes important changes to the Davis Bacon Act (the Act) that will go a long way in supporting the increased development and preservation of affordable housing. This comes just weeks after the Department of Labor (DOL) introduced a potentially problematic reform proposal.

What the Legislation Proposes

The legislation goes a long way in reforming this critical wage determination regulation. Specifically, it would:

Call on the DOL to study, analyze and make recommendations to modernize or change the wage rate calculation methodology.
Eliminate the use of split-wages for all multifamily residential development.
Create a task force to evaluate and recommend changes to the classification of multi-story residential buildings, the waiver of Davis-Bacon wages for certain affordable housing development and to determine alternative methods to the use of surveys for wage determination.
Lock wages applicable at the time of loan application for FHA insured multifamily mortgages, eliminating sudden and potentially deal killing changes in wages between application and commitment.

NMHC’s Take

NMHC has long sought modifications to Davis Bacon to better facilitate the development and preservation of new and existing housing. NMHC has lent our support to this piece of legislation because we believe it will make a real difference in reforming deep flaws in the Davis-Bacon wage process, in turn supporting the development and preservation of affordable housing.

Dave Borsos dborsos@nmhc.org