Lee Introduces Repeal of Inflated Government Spending Models

WASHINGTON - U.S. Senator Mike Lee (R-UT) today introduced legislation to repeal the outdated Davis-Bacon Act to curb inflated government spending on construction projects. U.S. Senators Ted Cruz (R-TX), Rick Scott (R-FL), Tim Scott (R-SC), Katie Britt (R-AL), Ron Johnson (R-WI), James Lankford (R-OK), and Ted Budd (R-NC) cosponsored the legislation. Representative Eric Burlison (R-MO-07) introduced the House version of the bill.

"When big government offers to help, it usually creates more problems than it fixes. The Davis-Bacon Act is no exception," said Senator Mike Lee. "It is an antiquated piece of legislation that hurts middle class workers and every American taxpayer. Repealing this single bill would save tens of billions of tax dollars. It is high-time that Congress passes the Davis-Bacon Repeal Act."

"Texans reject government interference in the labor market," said Senator Ted Cruz. "Repealing the Davis-Bacon Act will save billions of taxpayer dollars, expand competition, and ensure that federal projects are awarded based on merit, not dictated by bureaucrats in Washington."

"For too long, government's burdensome regulations bog down good work and our small businesses while hardworking Americans pay the price, which is why the Davis-Bacon Act must go," said Senator Joni Ernst. "I'm proud to join Senator Lee's effort to repeal this outdated red tape and save taxpayers over $17 billion."

"The Davis-Bacon Repeal Act is a necessary step toward ensuring our federal construction policies reflect today's economic realities," said Senator Tim Scott. "The current law drives up project costs, imposes unnecessary administrative burdens, and limits opportunities for small businesses and entry-level workers to compete. At a time when we should be building more and maximizing every taxpayer dollar, this approach falls short. Repealing the Davis-Bacon Act will help lower costs, expand competition, and ensure our federal investments deliver greater value for the American people."

"The Davis-Bacon Act is a nearly century-old, outdated law," said Senator Katie Britt. "It drives up federal costs, hurts American workers, and unfairly advantages organized labor. Repealing this antiquated law would provide relief for taxpayers and improve government efficiency by instituting more accurate prevailing wage calculations on federal construction projects."

"The Davis-Bacon Act is an outdated mandate that limits opportunities for small contractors and drives up construction costs," said Senator Ron Johnson. "CBO estimates that repealing the Davis-Bacon Act would save $18 billion in taxpayer dollars. It should be repealed to ensure taxpayer dollars are better utilized and not wasted."

"The Davis-Bacon Act has been on the books for decades, and it is holding Oklahoma back," said Senator James Lankford. "It drives up costs, slows down projects, and makes it harder for our local contractors and workers to compete. At the end of the day, taxpayers are paying more for less while Washington piles on red tape. It is time to get rid of outdated mandates and make it easier for hardworking Oklahomans to build, work, and get the job done."

"The Davis-Bacon Act discriminates against non-unionized construction workers and increases construction costs for the federal government at a time when we need to rein in federal spending," said Senator Ted Budd. "These outdated requirements have held back our government's deployment of new technologies and federal investments in American manufacturing. North Carolina is a proud right-to-work state, and I am glad to join Senator Lee and our colleagues in this common-sense effort to repeal these harmful prevailing wage requirements."

The legislation is endorsed by the Small Business and Entrepreneurship Council, the Associated Builders and Contractors, and the National Federation of Independent Businesses.

"ABC proudly supports the Davis-Bacon Repeal Act, introduced by Sen. Mike Lee. For too long, the Davis-Bacon and Related Acts have created significant burdens for small businesses, discouraging them from competing for federal projects due to excessive compliance costs, confusing wage determinations and unnecessary bureaucratic red tape. By repealing Davis-Bacon, Congress can restore competition and entrepreneurship and support workforce growth." - Kristen Swearingen, Vice President of Government Affairs, Associated Builders and Contractors

"SBE Council strongly supports the Davis-Bacon Repeal Act, legislation that would eliminate an outdated mandate that continues to burden taxpayers, small businesses, and America's construction workforce. We applaud Senator Mike Lee for leading on this important bill to bring fairness, common sense, and inclusive competition within the federal procurement system." - Karen Kerrigan, President and CEO, Small Business and Entrepreneurship Council

Background

The Davis Bacon Act is a 95-year-old wage subsidy law requiring all federally funded construction projects worth over $2,000 pay workers the "prevailing wage" rate from private construction projects in the same locality. In practice, the application of this law uses inaccurate wage estimates and flawed calculation mechanisms, inflating costs so much that the Congressional Budget Office (CBO) revealed a repeal would save $17.8 billion over the next decade.

Rather than using average local pay rates for its estimations, the Department of Labor (DOL) adopted a rule under the Biden administration that if 30% of a local workforce is paid a particular rate, this is used as the prevailing wage. This method distorts the prevailing wage away from actual averages, elevates union influence over the calculations, and punishes urban workers.

Furthermore, despite having access to accurate prevailing wage rates from the Bureau of Labor Statistics, the Department of Labor has instead tasked an enforcement department with estimating prevailing wages - which reportedly made 832 errors across 49 contractors in an investigation by the DOL Inspector General.

Senator Lee's repeal of the Davis-Bacon Act would eliminate this outdated, inefficient payment model to bring government spending down from its artificially inflated height.