BEFORE THE DEPARTMENT OF LABOR AND INDUSTRY
OF THE STATE OF MONTANA
In the matter of the amendment of ARM 24.17.103 and 24.17.127 pertaining to prevailing wage rates for public works projects
NOTICE OF PUBLIC HEARING ON PROPOSED AMENDMENT
TO: All Concerned Persons
1. On November 12, 2021, at 9:00 a.m., the Department of Labor and Industry (department) will hold a public hearing via remote conferencing to consider the proposed amendment of the above-stated rules. There will be no in-person hearing. Interested parties may access the remote conferencing platform in the following ways:
a. Join Zoom Meeting, https://mt-gov.zoom.us/j/84197446312, Meeting ID: 841 9744 6312; or
b. Dial by telephone, +1 406 444 9999 or +1 646 558 8656, Meeting ID: 841 9744 6312.
The hearing will begin with a brief introduction by department staff to explain the use of the videoconference and telephonic platform. All participants will be muted except when it is their time to speak.
2. The department will make reasonable accommodations for persons with disabilities who wish to participate in this public hearing or need an alternative accessible format of this notice. If you require an accommodation, contact the department no later than 5:00 p.m., on November 5, 2021, to advise us of the nature of the accommodation that you need. Please contact Data Management Unit, Employment Relations Division, Department of Labor and Industry, Attn: Mike Smith, P.O. Box 8011, Helena, MT 59604-8011; fax (406) 444-4140; or e-mailed to MSmith3@mt.gov.
3. The rules as proposed to be amended provide as follows, new matter underlined, deleted matter interlined:
24.17.103 DEFINITIONS As used in this subchapter, the following definitions apply, unless the context of the rule clearly indicates otherwise:
(1) through (10) remain the same.
(11) "Dispatch city" is the courthouse in the city from the following list which is closest to the center of the job and within the same prevailing wage district, if any: Billings, Bozeman, Butte, Great Falls, Helena, Kalispell, Miles City,
and Missoula, and Sidney.
(12) through (24) remain the same.
AUTH: 18-2-409, 18-2-431, 39-3-202, MCA
IMP: 18-2-402, 18-2-403, 18-2-411, 18-2-422, 39-3-201, 39-3-202, 39-3-203, 39-3-204, 39-3-205, 39-3-206, 39-3-207, 39-3-208, 39-3-209, 39-3-210, 39-3-211, 39-3-212, 39-3-213, 39-3-214, 39-3-215, 39-3-216, MCA
REASON: There is reasonable necessity to change the definition of "dispatch city" to include Miles City and Sidney to conform to the enactment of House Bill 201 from the 2021 Legislative Session, which includes these locations in the definition.
24.17.127 ADOPTION OF STANDARD PREVAILING RATE OF WAGES
(1) through (1)(d) remain the same.
(e) The current building construction services rates are contained in the
2021 2022 version of the "Montana Prevailing Wage Rates for Building Construction Services" publication.
(f) The current nonconstruction services rates are contained in the
2021 2022 version of the "Montana Prevailing Wage Rates for Nonconstruction Services" publication.
(g) The current heavy construction services rates are contained in the
2021 2022 version of the "Montana Prevailing Wage Rates for Heavy Construction Services" publication.
(h) The current highway construction services rates are contained in the
2021 2022 version of the "Montana Prevailing Wage Rates for Highway Construction Services" publication.
(2) and (3) remain the same.
AUTH: 2-4-307, 18-2-409, 18-2-431, MCA
IMP: 18-2-401, 18-2-402, 18-2-403, 18-2-406, 18-2-411, 18-2-412, 18-2-413, 18-2-414, 18-2-415, 18-2-422, 18-2-431, MCA
REASON: There is reasonable necessity to update the prevailing wage rates for building construction services, heavy construction services, highway construction services, and nonconstruction services following the annual survey of wages that is provided for in 18-2-413, 18-2-414, and 18-2-415, MCA, respectively. The department surveys employers and applies the methodologies provided by ARM 24.17.119 through 24.17.122 to determine those prevailing wage rates.
4. Concerned persons may present their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to the Data Management Unit, Employment Relations Division, Department of Labor and Industry, Attn: Mike Smith, P.O. Box 8011, Helena, MT 59604-8011; fax (406) 444-4140; or e-mailed to MSmith3@mt.gov, and must be received no later than 5:00 p.m., November 12, 2021.
5. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request, which includes the name and e-mail or mailing address of the person to receive notices and specifies the particular subject matter or matters regarding which the person wishes to receive notices. Such written request may be mailed or delivered to the contact person in paragraph 2 above or may be made by completing a request form at any rules hearing held by the agency.
6. The bill sponsor contact requirements of 2-4-302, MCA, apply and have been fulfilled. Department staff attempted to contact the bill sponsor via U.S. Mail, electronic mail, and telephone.
7. With regard to the requirements of 2-4-111, MCA, the department has determined that the amendment of the above-referenced rules may significantly and directly impact small businesses. The proposed amendments will have an impact on some, but not all small businesses (those with fewer than 50 full-time employees). The proposed amendments directly affect the wages that must be paid for work on Montana public works contracts. The types of businesses affected are primarily those in the construction industry, but only affect those businesses that perform (or seek to perform) work on public works projects. In addition, there are businesses that provide certain types of nonconstruction services to state and local government agencies that are subject to payment of the prevailing wage rate. The types of nonconstruction service businesses that potentially are subject to the award of a public works contract are listed in 18-2-401(9), MCA.
There is no single effect on small businesses as a result of the proposed amendments. Some employers may have to pay higher wages as a result of changes to the prevailing wage rates; other employers may have a wage structure that is the same as or higher than the prevailing wage rate. Historically, some employers have stated that the prevailing wage rates are set too high, while other employers have stated that the rates are too low. In certain cases, the difference between the established prevailing wage rate and the employer's customary wage rate may be significant, but it is unclear whether that difference will result in a significant change to the profitability of any given small business, as there are many other economic factors at play.
Montana law requires that prevailing wage rates be set following an annual survey of wages. There is an established statutory and administrative formula that establishes the prevailing wage rate for each work classification, based on the data and information gathered. The alternative to amending the wage rates is to not amend the rate, thus freezing the wage rate at the last-adopted level. Some employers would probably be adversely affected by the failure to adopt new prevailing wage rates. The department believes that under either alternative, some small businesses will be adversely affected by the selected alternative. The small businesses likely to be adversely affected by adoption of new rates are probably not the same as those that are likely to be adversely affected by not adopting new rates.
8. Department staff has been designated to preside over and conduct this hearing.
/s/ QUINLAN L. O'CONNOR
Quinlan L. O'Connor
Alternate Rule Reviewer
/s/ LAURIE ESAU
Laurie Esau, Commissioner
DEPARTMENT OF LABOR AND INDUSTRY
Certified to the Secretary of State September 28, 2021.