69674 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

C’s allocable share of the unrealized

appreciation from the intangible exceeds the

section 732(b) basis increase in the

intangible, the entire $90 of basis increase is

amortizable by A. Accordingly, after the

distribution, A will be treated as having two

intangibles, an amortizable section 197

intangible with an adjusted basis of $90 and

a new amortization period of 15 years and a

nonamortizable intangible with an adjusted

basis of $60.

(iii) In applying the anti-churning rules to

future transfers of the distributed intangible,

under paragraph (h)(12)(ii)(C) of this section,

one-half of the intangible will continue to be

subject to the anti-churning rules,

determined as follows: The sum of the

amount of the distributed intangible’s basis

that is nonamortizable under paragraph

(g)(2)(ii)(B) of this section ($60) and the total

unrealized appreciation inherent in the

intangible reduced by the amount of the

increase in the adjusted basis of the

distributed intangible under section 732(b) to

which the anti-churning rules do not apply

($120¥$90 = $30), over the fair market value

of the distributed intangible ($180).

Example 31. Partnership distribution

causing section 734(b) basis adjustment to

section 197(f)(9) intangible.

(i) On January 1, 2001, A, B, and C form

a partnership (ABC) in which each partner

shares equally in capital and income, gain,

loss, and deductions. On that date, A

contributes a section 197(f)(9) intangible with

a zero basis and a value of $150, and B and

C each contribute $150 cash. A and B are

related, but neither A nor B is related to C.

ABC does not adopt the remedial allocation

method for making section 704(c) allocations

of amortization expenses with respect to the

intangible. On December 1, 2004, when the

value of the intangible has increased to $600,

ABC distributes $300 to B in complete

redemption of B’s interest in the partnership.

ABC has an election under section 754 in

effect for the taxable year that includes

December 1, 2004. (Assume that, at the time

of the distribution, the basis of A’s

partnership interest remains zero, and the

basis of each of B’s and C’s partnership

interest remains $150.)

(ii) Immediately prior to the distribution,

the assets of the partnership are revalued

pursuant to § 1.704–1(b)(2)(iv)(f), so that the

section 197(f)(9) intangible is reflected on the

books of the partnership at a value of $600.

B recognizes $150 of gain under section

731(a)(1) upon the distribution of $300 in

redemption of B’s partnership interest. As a

result, the adjusted basis of the intangible

held by ABC increases by $150 under section

734(b). A does not satisfy any of the tests set

forth under paragraph (h)(12)(iv)(B) and thus

is not an eligible partner. C is not related to

B and thus is an eligible partner under

paragraph (h)(12)(iv)(B)(1) of this section.

The capital accounts of A and C are equal

immediately after the distribution, so,

pursuant to paragraph (h)(12)(iv)(D)(1) of this

section, each partner’s share of the basis

increase is equal to $75. Because A is not an

eligible partner, the anti-churning rules apply

to A’s share of the basis increase. The antichurning rules do not apply to C’s share of

the basis increase.

(iii) For book purposes, ABC determines

the amortization of the asset as follows: First,

the intangible that is subject to adjustment

under section 734(b) will be divided into

three assets: the first, with a basis and value

of $75 will be amortizable for both book and

tax purposes; the second, with a basis and

value of $75 will be amortizable for book, but

not tax purposes; and a third asset with a

basis of zero and a value of $450 will not be

amortizable for book or tax purposes. Any

subsequent revaluation of the intangible

pursuant to § 1.704–1(b)(2)(iv)(f) will be

made solely with respect to the third asset

(which is not amortizable for book purposes).

The book and tax attributes from the first

asset (i.e., book and tax amortization) will be

specially allocated to C. The book and tax

attributes from the second asset (i.e., book

amortization and non-amortizable tax basis)

will be specially allocated to A. Upon

disposition of the intangible, each partner’s

share of gain or loss will be determined first

by allocating among the partners an amount

realized equal to the book value of the

intangible attributable to such partner, with

any remaining amount realized being

allocated in accordance with the partnership

agreement. Each partner then will compare

its share of the amount realized with its

remaining basis in the intangible to arrive at

the gain or loss to be allocated to such

partner. This is a reasonable method for

amortizing the intangible for book purposes,

and the results in allocating the income, gain,

loss, and deductions attributable to the

intangible do not contravene the purposes of

the anti-churning rules under section 197 or

paragraph (h) of this section.

(l) * * * (1) In general. This section

applies to property acquired after

January 25, 2000, except that paragraph

(c)(13) of this section (exception from

section 197 for separately acquired

rights of fixed duration or amount)

applies to property acquired after

August 10, 1993 (or July 25, 1991, if a

valid retroactive election has been made

under § 1.197–1T), and paragraphs

(h)(12)(ii), (iii), (iv), (v), (vi)(A), and

(vii)(B) of this section (anti-churning

rules applicable to partnerships) apply

to partnership transactions occurring on

or after November 20, 2000.

(2) Application to pre-effective date

acquisitions. A taxpayer may choose, on

a transaction-by-transaction basis, to

apply the provisions of this section and

§ 1.167(a)–14 to property acquired (or

partnership transactions occurring) after

August 10, 1993 (or July 25, 1991, if a

valid retroactive election has been made

under § 1.197–1T) and—

(i) On or before January 25, 2000; or

(ii) With respect to paragraphs

(h)(12)(ii), (iii), (iv), (v), (vi)(A), and

(vii)(B) of this section, before November

20, 2000.

* * * * *

Robert E. Wenzel,

Deputy Commissioner of Internal Revenue.

Approved: November 9, 2000.

Jonathan Talisman,

Acting Assistant Secretary of the Treasury.

[FR Doc. 00–29524 Filed 11–17–00; 8:45 am]

BILLING CODE 4830–01–U

DEPARTMENT OF LABOR

Office of the Secretary

Employment Standards Administration

Wage and Hour Division

29 CFR Parts 1 and 5

RIN 1215–AA94

Procedures for Predetermination of

Wage Rates; Labor Standards

Provisions Applicable to Contracts

Covering Federally Financed and

Assisted Construction and to Certain

Nonconstruction Contracts

AGENCY: Wage and Hour Division,

Employment Standards Administration,

Labor.

ACTION: Final rule.

SUMMARY: This document adopts as a

final rule an amendment to the

regulations that govern the employment

of ‘‘helpers’’ on federally-financed and

assisted construction contracts subject

to the prevailing wage standards of the

Davis-Bacon and Related Acts (DBRA).

Specifically, this document amends the

regulations to incorporate the Wage and

Hour Division’s longstanding policy of

recognizing helper classifications and

wage rates only where their duties are

clearly defined and distinct from those

of journeyworker and laborer

classifications in the area; the use of

such helpers is an established prevailing

practice in the area; and the term

‘‘helper’’ is not synonymous with

‘‘trainee’’ in an informal training

program.

EFFECTIVE DATE: January 19, 2001.

FOR FURTHER INFORMATION CONTACT:

William W. Gross, Director, Office of

Wage Determinations, Wage and Hour

Division, Employment Standards

Administration, U.S. Department of

Labor, Room S–3028, 200 Constitution

Avenue, NW., Washington, DC 20210.

Telephone (202) 693–0569. (This is not

a toll-free number.)

SUPPLEMENTARY INFORMATION: 

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69675

1The following four new provisions were

promulgated:

• A new definition of the term ‘‘helper,’’ allowing

a helper’s duties to overlap with those of a

journeylevel worker: ‘‘A helper is a semi-skilled

worker (rather than a skilled journeyman mechanic)

who works under the direction of and assists a

journeyman. Under the journeyman’s direction and

supervision, the helper performs a variety of duties

to assist the journeyman such as preparing, carrying

and furnishing materials, tools, equipment, and

supplies and maintaining them in order; cleaning

and preparing work areas; lifting, positioning, and

holding materials or tools; and other related, semiskilled tasks as directed by the journeyman. A

helper may use tools of the trade at and under the

direction and supervision of the journeyman. The

particular duties performed by a helper vary

according to area practice.’’ [29 CFR 5.2(n)(4), 47 FR

23667.]

• A provision allowing a helper classification to

be included in the wage determination if it was an

‘‘identifiable’’ local practice. 29 CFR 1.7(d), 47 FR

23655.

• A provision limiting the number of helpers to

two for every three journeyworkers. 29 CFR

5.5(a)(4)(iv), 47 FR 23670.

• A provision allowing the addition of helper

classifications on contracts containing wage

determinations without helper classifications,

where helpers are utilized in the area. 29 CFR

5.5(a)(1)(ii)(A), 47 FR 23688.

I. Paperwork Reduction Act

This rule does not contain any new

information collection requirements and

does not modify any existing

requirements. Thus, the rule contains no

reporting or recordkeeping requirements

subject to the Paperwork Reduction Act

of 1995.

II. Background

Apart from the brief periods, as

discussed below, when the suspended

‘‘helper’’ regulations were implemented,

the longstanding practice of the

Department of Labor (‘‘DOL’’ or ‘‘the

Department’’) has been to allow the use

of helper classifications on DBRAcovered construction projects only

where (1) the duties of the helper are

clearly defined and distinct from those

of the journeyworker and laborer; (2) the

use of such helpers is an established

prevailing practice in the area; and (3)

the term ‘‘helper’’ is not synonymous

with ‘‘trainee’’ in an informal training

program.

On May 28, 1982, Wage and Hour

published revised final Regulations, 29

CFR Part 1, Procedures for

Predetermination of Wage Rates, and 29

CFR Part 5, Subpart A—Davis-Bacon

and Related Acts Provisions and

Procedures (47 FR 23644 and 23658,

respectively), containing new provisions

intended to allow contractors to expand

their use of helpers on Davis-Bacon

covered projects at wages lower than

those paid to skilled journeyworkers.1

These regulations were challenged in

a lawsuit brought by the Building and

Construction Trades Department, AFL–

CIO, and a number of individual unions.

On December 23, 1982, the U.S. District

Court for the District of Columbia

Circuit held that the new helper

regulations conflicted with the DavisBacon Act and enjoined DOL from

implementing the regulations. See

Building and Construction Trades

Department, AFL–CIO, et al. v.

Donovan, et al., 553 F. Supp. 352

(D.D.C. 1982). On appeal, the U.S. Court

of Appeals for the District of Columbia

upheld the Department’s authority to

allow the increased use of helpers,

concluding that the Secretary’s

regulatory definition was ‘‘not clearly

unreasonable.’’ Building and

Construction Trades Department, AFL–

CIO, et al. v. Donovan, et al., 712 F.2d

611, 630 (D.C. Cir. 1983), cert. denied,

464 U.S. 1069 (1983). However, the

court struck down that part of the

regulation that allowed for the issuance

of a helper wage rate where helpers

were only ‘‘identifiable.’’ Id. at 624.

On remand, the district court lifted

the injunction as it applied to the helper

definition, but maintained it as to the

remaining helper regulations. The

district court added that the Secretary

‘‘may, however, submit to this Court

reissued regulations governing the use

of helpers, and if these regulations

conform to the decision of the Court of

Appeals, they will be approved.’’ 102

CCH Labor Cases ¶ 34,648, p. 46,702

(D.D.C. 1984).

In accordance with the district court’s

order, DOL published in the Federal

Register (52 FR 31366, August 19, 1987)

proposed revisions to the helper

regulations to add the requirement that

helpers must prevail in an area in order

to be recognized. The Department, on

January 27, 1989, published a revised

final rule governing the use of helpers

on federal and federally assisted

construction contracts subject to the

Davis-Bacon and Related Acts (54 FR

4234).

On September 24, 1990, the district

court vacated its injunction, and on

December 4, 1990, Wage and Hour

published a Federal Register notice

implementing the helper regulations,

effective February 4, 1991 (55 FR

50148).

In April 1991, Congress passed the

Dire Emergency Supplemental

Appropriations Act of 1991, Public Law

102–27 (105 Stat. 130), which was

signed into law on April 10, 1991.

Section 303 of Public Law 102–27 (105

Stat. 152) prohibited the Department

from spending any funds to implement

or administer the helper regulations as

published, or to implement or

administer any other regulation that

would have the same or similar effect.

In compliance with this directive, the

Department did not implement or

administer the helper regulations for the

remainder of fiscal year 1991.

After fiscal year 1991 concluded and

subsequent continuing resolutions

expired, a new appropriations act was

passed that did not include a ban

restricting the implementation of the

helper regulations. On January 29, 1992,

Wage and Hour issued All Agency

Memorandum No. 161, instructing the

contracting agencies to include the

helper contract clauses in contracts for

which bids were solicited or

negotiations were concluded after that

date. On April 21, 1992, the U.S. Court

of Appeals for the District of Columbia

invalidated the regulation that

prescribed a ratio of two helpers for

every three journeyworkers for being

without sufficient support in the record,

but upheld the remaining helper

provisions. Building and Construction

Trades Department, AFL–CIO v. Martin,

961 F.2d 269 (D.C. Cir. 1992). To

comply with this ruling, on June 26,

1992, Wage and Hour issued a Federal

Register notice removing the

invalidated text, 29 CFR 5.5(a)(4)(iv),

from the Code of Federal Regulations.

57 FR 28776.

Subsequently, Section 104 of the

Department of Labor Appropriations Act

of 1994, Public Law 103–112, enacted

on October 21, 1993, prohibited the

Department of Labor from expending

funds to implement or administer the

helper regulations during fiscal year

1994. Accordingly, on November 5,

1993, Wage and Hour published a

Federal Register notice (58 FR 58954)

suspending the regulations governing

the use of semi-skilled helpers on

DBRA-covered contracts, and reinstating

the Department’s prior policy regarding

the use of helpers. The Department of

Labor Appropriations Act for fiscal year

1995 again barred the Department from

expending funds with respect to the

helper regulations (Section 102, Public

Law 103–333). That prohibition

extended into fiscal 1996 as a result of

several continuing resolutions. There

was no such prohibition in the

Department of Labor’s Appropriations

Acts for fiscal 1996 and 1997, Public

Law 104–134, enacted on April 26,

1996, and Public Law 104–208, enacted

on September 30, 1996.

On August 2, 1996, Wage and Hour

published in the Federal Register (61

FR 40366) a proposal to continue to

suspend the implementation of the

helper regulations while additional

rulemaking procedures were undertaken

to determine whether further

amendments should be made to those

regulations. On December 30, 1996, a

69676 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

final rule was published in the Federal

Register (61 FR 68641) continuing the

suspension. Pursuant to that final rule,

the November 5, 1993 suspension of the

helper regulations continues in effect

until Wage and Hour either (1) issues a

final rule amending (and superseding)

the suspended helper regulations; or (2)

determines that no further rulemaking is

appropriate, and issues a final rule

reinstating the suspended regulations.

By decision dated July 23, 1997, the

U.S. District Court for the District of

Columbia upheld the Department’s

December 30, 1996 final rule continuing

the suspension of the helper regulations

until the completion of rulemaking

proceedings. Associated Builders &

Contractors, Inc. v. Herman, C.A. No.

96–1490, 1997 WL 525268 (D.D.C. July

23, 1997).

The Department, by Notice of

Proposed Rulemaking (NPRM)

published in the Federal Register on

April 9, 1999 (64 FR 17442), proposed

for public comment an amendment to

the regulations that would reflect the

longstanding policy of recognizing

helpers as a distinct classification on

DBRA-covered work only where Wage

and Hour determines that (1) the duties

of the helpers are not performed by

other classifications in a given area, i.e.,

the duties of the helper are clearly

defined and distinct from those of the

journeyworker and laborer; (2) the use

of such helpers is an established

prevailing practice in the area; and (3)

the term ‘‘helper’’ is not synonymous

with ‘‘trainee’’ in an informal training

program.

In addition to the proposed rule, the

Administrator also presented for

comment the reasons the Department

had concluded that the suspended rule

should not be implemented, as well as

the various other alternatives that had

been considered by the Department: (1)

Add a ratio requirement to the

suspended helper definition; (2) change

the ‘‘helper’’ definition to emphasize the

semi-skilled nature of the classification;

(3) define ‘‘helpers’’ based on the

Bureau of Labor Statistics, Occupational

Employment Statistics (OES) Dictionary

of Occupations, which focuses on

unskilled duties and the worker’s

interaction with journeylevel craft

workers; and (4) explicitly delineate the

semi-skilled tasks performed by each

helper classification. The Administrator

also presented for comment an

Economic Impact Analysis comparing

the economic costs of the proposed rule

governing the use of helpers under the

DBRA to those under the suspended

rule and the other alternatives

considered by DOL, and a Regulatory

Flexibility Analysis.

The Department received 23

responses to the NPRM. These included

18 responses providing substantive

comments, one with no comments, and

four requesting an extension of the

comment period. Comments were

received from three groups of

Congressional Representatives:

Representatives Charlie Norwood, Bill

Goodling, Cass Ballenger, John Boehner,

Peter Hoekstra, Buck McKeon, and Ron

Paul; Representatives William L. Clay,

Major R. Owens, and James E. Clyburn;

and Representatives Jan Schakowsky

and Anthony Weiner. Comments were

also submitted by six contractor

associations: The Associated General

Contractors, Inc. (AGC); the Associated

Builders and Contractors, Inc. (ABC);

the Small Business Survival Committee

(SBSC); the Associated Prevailing Wage

Contractors, Inc. (APWC); the AGC of

Texas (Highway, Heavy, Utilities and

Industrial Branch); and the Mechanical

Electrical Sheet Metal Alliance

(MESMA), which is a coalition of

members of the Mechanical Contractors

Association of America (MCAA), the

National Electrical Contractors

Association (NECA) and the Sheet Metal

and Air Conditioning Contractors

National Association (SMACNA).

Also submitting comments were three

union organizations and a unioncontractor group: The Building and

Construction Trades Department, AFL–

CIO (Building Trades); the Laborers’

International Union of North America

(LIUNA); the International Brotherhood

of Electrical Workers (IBEW); and the

National Joint Apprenticeship and

Training Committee for the Electrical

Industry (NAJTC), which was jointly

created by the IBEW and NECA.

The Texas Department of

Transportation (TxDOT) commented on

the proposal, as did two academic

sources: A.J. Thieblot, Ph.D., Adj. Prof.,

University of Baltimore and the

Regulatory Studies Program, Mercatus

Center, George Mason University,

Wendy L. Gramm, Director. Comments

were also provided by two individual

companies, Halliburton/Kellog Brown &

Root (through in-house counsel) and

Elevator Control Service (Elcon).

Finally, two elevator contractors’

associations (the National Association of

Elevator Contractors and the National

Elevator Industry, Inc.) and two elevator

contracting companies (Quality Elevator

Co. and Barbee Curran Elevator Co.,

Inc.) requested an extension of the

comment period. Requests for extension

of time were not granted.

III. Comments and Analysis

In the NPRM, the Department

proposed not to implement the

suspended ‘‘semi-skilled’’ helper rule,

but instead, to issue a rule reflecting the

current, longstanding practice of

recognizing helpers only where they are

a separate and distinct class with clearly

defined duties. The Department also

provided therein a detailed explanation

of the problems it identified with

respect to the suspended helper

definition, as well as a discussion of

other alternatives for identifying helpers

that were considered.

As explained in the NPRM, the

Department had preliminarily

concluded that the suspended rule was

not capable of being administered and

enforced effectively in accordance with

the goals and requirements of the DavisBacon Act, especially in view of the

court-ordered abandonment of the ratio

provision. The Department stated that

the suspended rule is problematic

because it represents a sharp departure

from the Department’s traditional

practice of identifying job classifications

based on the duties performed by such

classifications. The suspended helper

definition is unique in that it allows the

determination of a Davis-Bacon

classification based on subjective

standards—the worker’s skill level

(‘‘semi-skilled’’) and the existence of

work-site supervision. Furthermore, the

Department noted that the definition is

internally inconsistent in that the

examples given of the types of

assistance the helper might provide to a

journeyworker are not semi-skilled, but

rather are largely unskilled duties

commonly performed by laborers. The

Department also stated that the

requirements that the helper be ‘‘semiskilled’’ and work under the supervision

of a journeyworker are vague and would

provide little assistance in enforcement.

The Department reasoned that,

because the suspended rule allows the

duties of a helper to overlap with those

of both journeyworkers and laborers and

provides no readily ascertainable means

for distinguishing helpers from other

classifications, contractors would find it

difficult to determine whether they were

in compliance and the Department in

turn would find it difficult to enforce

the regulation. Additionally, the

Department expressed concern that the

ambiguities in the suspended rule

would make it difficult to prevent

unscrupulous contractors from

intentionally reclassifying large

numbers of both journeyworkers and

laborers as helpers when they work on

DBRA projects, thus undermining

locally prevailing wages for

construction job classifications. The

Department indicated that this is an

even greater concern now that there is

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69677

2The final rule stated, without quantification,

that this percentage would be reduced to the extent

that collectively bargained rates were found to

prevail and did not provide for a helper

classification. 54 FR 4234, 4242 (January 27, 1989).

no longer any numerical limitation to

using helpers on DBRA projects.

The Department also concluded that

there seemed to be no generally

accepted meaning for the term ‘‘helper’’

in the construction industry, and

therefore there was reason to believe

that the definition in the suspended rule

did not in fact represent industry

practice. For this reason, the

Department was concerned that it

would be difficult to conduct

meaningful wage surveys and, therefore,

specifically requested that commenters

submit evidence regarding how helpers

are in fact used.

Wage data collected by the

Department during the implementation

period provided further support for the

Department’s decision to reconsider the

advisability of implementing the

suspended rule. A key underpinning of

the helper rule at the time it was

proposed was the notion that helper use

is widespread in construction in the

private sector. According to the

preamble to the proposed rule

published in 1987, the Secretary

projected that helpers would prevail in

two-thirds to 100% of all craft

classifications.2 The wage survey data

submitted to the Department during the

implementation period, though

admittedly limited in quantity and

geographic scope, indicated to the

Department that use of helpers might

not be as widespread as previously

thought. This led the Department to

examine other available data sources in

order to reassess its previous

assumption that helper use is

widespread.

The Department also became

concerned, as a secondary matter, that

the suspended rule might have a

negative impact on apprenticeship and

training by lessening the incentive for

contractors to employ apprentices and

trainees participating in formal

programs.

After a full and careful review of the

suspended rule, as well as a number of

alternative approaches, the Department

decided to propose for implementation

the duties-based approach to

recognizing helpers, which reflects

longstanding policy. As discussed in the

NPRM, it is the Department’s view that

this approach is more consistent with

the intent of the Davis-Bacon Act to

assure that workers employed on federal

and federally-assisted construction work

are paid at least the wages paid to

workers doing similar work on similar

construction in the area. The

Department also stated in the NPRM

that this approach, in sharp contrast to

that under the suspended rule, would

provide an objective basis for

administration and enforcement of

helper use, as well as clear criteria to

facilitate compliance.

The following is a summary and

analysis of the comments received as

they relate to the proposed regulation,

the alternatives considered, the

problems identified by the Department

with respect to the suspended rule, and

the Department’s analysis and

conclusions concerning the proposed

rule set forth in the NPRM. Each

submission has been thoroughly

reviewed and each comment has been

carefully considered.

Problems With the Suspended Helper

Definition

1. The Suspended Helper Definition

Would Be Difficult To Administer and

Enforce

The Building Trades commented that

the suspended rule would be

unenforceable because it is simply too

difficult to distinguish a helper from a

journeylevel worker on a job site. The

Building Trades stated that, if

contractors and subcontractors were

permitted to assign helpers to perform

the tasks of any and all classes of

laborers and mechanics at less pay, as

the suspended definition would allow,

the requirement in the Davis-Bacon Act

that wages be based on ‘‘corresponding

classes’’ would effectively be read out of

the statute. The AGC, the ABC, and Dr.

Thieblot, on the other hand, stated in

their respective comments that the

Department should be able to identify

helper classes through area practice

surveys as easily as it differentiates

among the various trade classifications.

The Department believes that it is

much more difficult to identify a helper

classification under the suspended rule,

than to identify a craft or laborer

classification under the traditional

duties-based approach. Under DBRA, a

laborer or mechanic is entitled to be

paid the prevailing rate for the work

performed according to the local area

practice, and therefore, is classified

based on the duties the worker

performs. Because under the suspended

definition, helpers may perform the

duties of other classifications—both

journeylevel workers and laborers—

without any limitations other than that

they be supervised by and assist a

journeyworker, it would be extremely

difficult for the Department to identify

the work of a helper in any given area,

both for enforcement and wage

determination purposes.

Comments suggesting that the

Department can simply examine

prevailing practices to identify helpers

provide no practical guidance for

resolving the suspended rule’s inherent

definitional problems. Construction

craft workers generally perform certain

basic, core duties that are specific to

their respective classifications and

therefore, are more easily identifiable

for both enforcement and wage

determination purposes. For example, it

is widely understood that carpenters use

hammers, saws and other tools of the

trade to construct structures made of

wood. Area practice issues arise

concerning gray areas, where in a

particular locality certain types of duties

may be performed by another craft as an

adjunct to its core duties, or may be

carved out as a separate classification

altogether. Thus, in some areas,

carpenters may install drywall, while in

others it may be installed by a specialty

classification referred to as ‘‘drywall

installers.’’ An area practice survey can

make this determination. But it is not

necessary for Wage and Hour to conduct

an area practice survey to determine the

work of each and every classification.

For example, an area practice survey

would not be needed to determine

whether, instead of building wood

structures, carpenters install water

pipes, because such work is part of the

basic, core duties of a plumber.

Conversely, helpers, under the

suspended rule, cannot be identified

under the duties-based approach

because there is no generally accepted

subset of duties performed by helpers

that would distinguish the helper from

other classifications.

LIUNA commented that the

combination of the suspended rule’s

allowance of overlap with laborers’

duties and the lower wages generally

paid to helpers would result in either

the displacement of laborers in favor of

workers classified and paid at lower

helpers’ rates, or the performance by the

existing laborer workforce of the same

work at lower wage and fringe benefit

rates—contrary to the purpose of the

Davis-Bacon Act to prevent Federal

construction from depressing locally

prevailing wages. LIUNA observed that

many of the work activities of certain

construction laborer classifications are

precisely the same as the potential

helper duties specifically enumerated

under the suspended rule. LIUNA

noted, for example, that a wide variety

of ‘‘tender’’ classifications, which are

negotiated between the Laborers’ local

unions and construction employers

throughout the country, include the

69678 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

3LIUNA stated that the laborer’s role as a

‘‘tender’’ or ‘‘helper’’ to other trades has a long

history, as demonstrated by the American

Federation of Labor’s 1903 charter to LIUNA, which

described the laborer’s work as ‘‘tending to masons,

mixing and handling all materials used by masons

(except stone setters), building of scaffolding for

mason’s plasters, building of centers for fire

proofing purposes, tending to carpenters, tending to

and mixing of all materials for plastering, whether

done by hand or any other process, clearing of

debris from buildings, scoring, underpinning and

raising of old buildings * * *.’’ LIUNA also stated

that, although today the term ‘‘tender’’ is preferred

over ‘‘helper’’ in describing laborers’ support

relationship to other craft workers, the two terms

are interchangeable in the construction industry

and that DOL’s Davis-Bacon General Wage

Determinations include ‘‘literally hundreds of

examples of ‘tender’ or ‘helper’ job titles (mason

tender, plasterer tender, carpenter tender, plumbing

tender, etc.) listed as part of the laborer

classification.’’

4See the recent decision of the Administrative

Review Board in Miami Elevator Company and MidAmerican Elevator Company, Inc., ARB Case Nos.

98–086 and 97–145 (April 25, 2000), pp. 33–34.

same duties that would be performed by

helpers under the suspended

regulations.3 Dr. Thieblot, however,

stated that the fact that the suspended

helper definition may include work that

would otherwise be done by laborers

should be of no more concern to the

Department than the performance by

‘‘tender’’ classifications of work that

could be done by laborers.

The Department believes that

LIUNA’s concerns on the overlap of

helper duties with other existing laborer

classifications under the suspended rule

are valid. The Department also believes

that the recognition of a wide variety of

tender classifications under its current

policy demonstrates the manner in

which helper classifications will be

recognized under the final rule. The

Department under its current policy,

and under the final rule, will issue rates

for helper classifications where the

duties they perform are distinct from

those of other classifications, including

the journeyworkers they assist and other

laborer or tender classifications. Tender

classifications recognized by the

Department must meet these criteria.

While tender classifications do perform

laborer-type duties, their performance of

such work must be prevailing in the

locality, i.e., more tenders than any

other classification perform the work in

question in that particular locality. In

contrast, under the suspended rule, the

use of helpers by contractors must be

prevailing in the locality and the duties

they perform is determined by area

practice, but there is no requirement

that their performance of certain duties

be prevailing in relation to those

performed by other classifications in the

locality. Thus, the suspended rule

would allow the duties of a helper to

overlap with those of other

classifications that prevail within the

locality, possibly leading to the

employment of helpers to perform the

work of other classifications at lower

wages. Because tender/helper

classifications must perform distinct

duties for which the tender/helper

classifications prevails in the locality,

the recognition of such classifications

does not carry the same potential for

abuse and, therefore, the undermining

of prevailing wages associated with the

use of helpers under the suspended

rule.

The Department indicated in the

NPRM that it does not believe that the

suspended rule can be effectively

enforced under the vague, subjective

criteria of its definition. For instance,

the Department stated in the NPRM that

the suspended definition’s failure to

distinguish between ‘‘semi-skilled’’ and

‘‘skilled’’ workers presented the

Department with a ‘‘fundamental

problem’’ when it tried to develop

enforcement guidelines. LIUNA

commented that the suspended

definition provides no guidance for

distinguishing between a ‘‘semi-skilled’’

helper who uses tools of the trade, and

a journeyworker with little experience.

The ABC stated, on the other hand, that

contractors have developed methods for

recognizing differences between skilled

and semi-skilled work and have

implemented pay scales based on such

differences. None of the commenters,

however, has identified any methods or

criteria used by contractors that would

be helpful to the Department in

distinguishing between skilled and

semi-skilled work. Similarly, the AGC

stated that contractors routinely make

hiring decisions based on skill level and

compensate craft workers based on their

training and experience. The

Department believes that these practices

are reflective of the normal practice of

non-union employers in many

industries where workers within an

occupation are paid a range of rates

based on their training and experience.

The Department does not believe that

such a practice demonstrates the

existence of separate classes of workers

within the meaning of the Davis-Bacon

Act.4

The AGC stated that whether a skilled

worker would accept and perform a

‘‘semi-skilled’’ job as a helper is an

irrelevant concern, because compliance

should focus on ensuring that

individuals are properly compensated

for the work they actually perform. This

point echoes one of the Department’s

main concerns which led it to reject the

suspended helper rule in favor of the

traditional duties-based approach under

the proposed rule. Under the suspended

rule, individuals classified as helpers,

who may perform the work of both

higher paid craft workers and laborers,

would not be compensated based on the

work they perform, but rather on their

comparatively lower skill levels.

Furthermore, the Department still does

not believe it could draw the line

effectively between semi-skilled and

skilled work, especially given that, in

today’s construction market, skilled

craft workers may perform a whole

range of duties from unskilled to semiskilled to skilled, and laborers often

perform what may be considered semiskilled work as well.

The Department also observed in the

NPRM that the supervision aspect of the

suspended helper definition would

provide little assistance in

distinguishing a helper from other

classifications of workers. LIUNA

agreed that supervision by a

journeyworker is not a practical

standard for distinguishing ‘‘semiskilled’’ helpers from others on the

work-site, because many classifications

are supervised by other workers or

supervisors. LIUNA stated that laborers,

apprentices, trainees and lesser skilled

journeyworkers all may work under the

‘‘direction and supervision’’ of other,

more highly skilled journeyworkers.

The AGC, on the other hand, stated that

the definition of a helper does not need

to ‘‘indicate the nature or amount of

direction that helpers must receive to

distinguish them from others on a

worksite,’’ because this should be left to

local prevailing practice. None of the

commenters offered suggestions as to

how, from a practical standpoint, the

Department could determine local

supervisory practices.

Nothing in the comments received by

the Department contradicts its view that

laborers and journeylevel construction

workers, like helpers under the

suspended rule, also may work under

the ‘‘direction and supervision’’ of other

journeyworkers. In the Department’s

experience, which is supported by

LIUNA’s comments, supervision on a

construction worksite is often an

amorphous concept, especially where it

is performed by a ‘‘team leader,’’ and

therefore, does not lend itself to

objective evaluation. Thus, the

Department continues to be of the

opinion that supervision by a

journeyworker is not a practical

standard for distinguishing semi-skilled

helpers from other classifications on the

worksite.

The Department also stated in the

NPRM that it believes the problems

resulting from the suspended rule’s

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69679

definitional ambiguities are

compounded by evidence that the term

‘‘helper’’ has multiple, quite different

meanings within the construction

industry. LIUNA stated that the

examples of duties that a helper may

perform, as listed in the suspended

definition, are not ‘‘semi-skilled,’’ but

rather include a range of skilled, semiskilled, and unskilled duties commonly

performed by other classifications. AGC,

on the other hand, stated that many

different craft classifications have

multiple, quite different meanings

within the construction industry, and

that this is the primary reason that no

standard definitions have ever been

promulgated for craft classifications

performing Davis-Bacon work.

While it is true, as discussed above,

that craft classifications may have

somewhat different meanings within the

industry, craft classifications generally

encompass certain well-recognized

duties that are widely understood to be

the core duties of the craft occupation.

Thus, despite the occasional need for

clarification regarding the prevailing

classification used by contractors in an

area for workers performing specialized

work, the fundamental scope of work of

most construction craft occupations is

not usually in question.

In contrast, it appears to the

Department, as demonstrated by the

rulemaking record, that a helper

classification can have various

meanings and uses even within the

same locality. For example, the APWC

stated that helpers, in its view, ‘‘are

semi-skilled workers who work under

the direction of and provide assistance

to journeymen,’’ whereas the AGC of

Texas described the use of helpers in

the State of Texas as ‘‘allow[ing]

construction contractors to utilize

unskilled workers while teaching them

a trade or skill through our on-the-job

training programs.’’ [Emphasis added].

Similarly, commenters on the proposed

rule to continue the suspension of the

helper regulations, variously

characterized helpers as skilled workers

who have not been trained in the full

range of journeylevel work, short-term

entry-level workers assisting

journeyworkers in unskilled laborer

duties, and longer-term specialized

workers who perform a limited number

of duties that overlap journeylevel

workers. 61 FR 68646. In this regard, the

Department, in the NPRM, invited

commenters to submit further evidence

regarding how helpers are in fact used

by contractors, particularly any data

regarding whether there is in fact a

generally recognized definition of

helpers that is capable of being

objectively identified. No such data

were submitted by the commenters. The

Department therefore believes that it

was correct in its view that no definition

of helpers exists that could adequately

reflect ‘‘the actual and varied practice in

the construction industry as a whole or

even in any particular area.’’

The Department also expressed its

concern that Wage and Hour would not

be able to conduct a meaningful wage

determination process using the

suspended definition of helpers in light

of the likelihood that contractors

responding to area wage surveys would

ascribe very different meanings to the

term ‘‘helpers.’’ Dr. Thieblot stated that

surveying for helper rates presents no

special difficulties since it is Wage and

Hour’s practice ‘‘to accept the rates and

job titles as submitted by the contractors

who paid them, whatever those titles

might be’’ without analyzing job

content. Dr. Thieblot stated, for

example, that it should be no more

difficult for Wage and Hour to

determine if the job title ‘‘mason’s

helper’’ prevails in a given area, than to

determine if the job title ‘‘mason’s

tender’’ prevails.

This comment highlights a common

misunderstanding of the Department’s

wage determination process. Wage and

Hour, in gathering wage data, does not

automatically accept the job titles as

submitted by reporting employers. Wage

and Hour’s experience in collecting

wage data is that contractors may use

different job titles for the same craft

work. When faced with more than one

name for the same type of work, Wage

and Hour must determine whether the

workers with the various job titles in

question perform the same basic duties,

in which case the data for such work

will be combined for the purpose of

determining the prevailing classification

and issuing a single prevailing rate for

the particular work performed. In other

cases, Wage and Hour might determine

that it is the prevailing practice in a

certain area for workers under a more

specific job title (e.g., drywall hanger) to

perform a subset of the duties of a more

generalized craft (e.g., carpenter), and

thus issue a separate wage rate for the

specific job title where the data indicate

that the specialized classification

prevails for such work in the area. Thus,

Wage and Hour does not automatically

accept job titles as submitted by

employers, but rather analyzes job

content, as appropriate, as part of the

wage determination process.

The problem with gathering data for

helper classifications differs

significantly from the difficulty

presented where workers in an area

perform the same craft work, but under

different job titles. A helper

classification, even if referred to by

many different names within the

locality, could nonetheless be surveyed

effectively if the duties performed by

workers with the various job titles for a

helper were distinct from those of other

classifications and essentially the same

under each title. The problem with

identifying helpers during the wage

determination process is that the term

‘‘helper’’ under the suspended rule can

serve to describe a variety of workers

performing many different types of

work. The Department is additionally

concerned that the suspended helper

rule, which imposes upon the wage

determination process a definition of a

helper that was created by the

Department, may not necessarily reflect

the reality of how helpers are in fact

utilized in any given locality. Some

employers may classify workers

performing the work of helpers under

the suspended rule as journeylevel

workers, craft workers, or semi-skilled

workers, while still others may classify

such workers as laborers, unskilled

workers, or tenders. In this regard, the

Department notes that several

contractors surveyed in the processing

of helper conformance requests during

the period the suspended regulations

were in effect indicated that they used

the job title ‘‘laborer’’ for workers

meeting the definition of ‘‘helper’’

under the suspended regulation. Thus,

because their practices vary from each

other and from the definition in the

suspended rule, the Department

continues to be of the view that

contractors, when responding to DavisBacon wage surveys, would likely be

inconsistent in how they classify

workers as helpers. This in turn would

raise questions regarding the reliability

of any wage data received for a given

locality concerning employment of

helpers.

The SBSC acknowledged that the

suspended helper rule is a break from

the tradition under the DBRA of

identifying and differentiating among

job classifications on the basis of tasks

performed by each classification. SBSC

commented, however, that the Wage

and Hour Division has an outdated

construction mentality and that its

complaints about the use of helpers

suggest a hesitancy to modernize its

views. SBSC’s comments also

questioned the Department’s concern

that helpers will replace laborers,

stating that it is a misclassification to

insist that helpers are laborers; it ‘‘is the

old class of laborer that has become

suspect.’’ SBSC’s comments provide

little practical guidance on how to

create a definition of helpers that could

69680 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

be effectively enforced consistent with

the underlying intent of the DBRA. In

addition, the substantial number of

laborers reported in the wage surveys in

the record, as well as the comments

submitted by LIUNA in support of the

interests of laborers in this rulemaking

procedure, do not support SBSC’s view

that laborers no longer constitute a

viable worker classification on DavisBacon covered construction.

The Mercatus Center acknowledged

that the Department’s enforcement and

administrative concerns may be

justified, but cautions that they must be

balanced against the productivity and

cost-saving benefits from the suspended

definition of helpers. The Mercatus

Center further noted that by proposing

to eliminate the flexibility of a helper to

perform the duties of other job

classifications, the Department would

eliminate one of the most important

cost-saving features of the helper

position. While the Department believes

that cost-saving features are certainly

desirable, they cannot be determinative

where the approach in question (i.e., the

definition of helpers under the

suspended rule) cannot be fairly and

effectively administered in a manner

consistent with the goals of the statute

to protect prevailing wages for the

corresponding classes of work

performed. Indeed, one of the principal

objectives of the Davis-Bacon Act was to

set a floor on wages so that wages would

not be reduced below the prevailing

wage as a result of competitive bidding

for Federal construction contracts.

The ABC stated that the absence of a

significant number of complaints or

incidents of abuse during the time the

suspended rule was in effect should be

viewed as evidence that the

Department’s stated concerns about

enforcement difficulties are overstated.

Neither the absence nor presence of

complaints had a bearing on the

Department’s determination that the

suspended helper rule cannot be

administered and enforced effectively;

rather, as explained in the NPRM, it was

the difficulty encountered in attempting

to develop effective enforcement

guidelines during the implementation

period that initially raised these

concerns. The suspended helper

regulations were in effect for too brief a

period for the absence of complaints to

be indicative of a lack of enforcement

difficulties. Though the suspended rule

had an implementation period of

approximately 20 months, it was nearly

a year after implementation before the

helper provisions could begin to be

included in DBRA-covered construction

contracts, following changes to the

Federal Acquisition Regulations and the

Defense Acquisition Regulations. Thus,

the suspended helper rule simply was

not in force for a sufficient period of

time to draw any conclusions from the

number of complaints received during

its application.

After carefully reviewing the

comments, the Department is persuaded

that the suspended rule cannot be

effectively administered and enforced.

The suspended rule provides no

objective basis for distinguishing

between helpers and other

classifications, and furthermore is vague

and internally inconsistent. Its effect,

contrary to the intent of the statute,

would be to allow contractors and

subcontractors on DBRA projects to

assign the duties of both craft workers

and laborers to helpers who are paid at

lower wage rates, with virtually the only

restriction being that the worker receive

some supervision. As a result, the

Department remains concerned that

implementation of the suspended rule

would lead to many instances of

intentional and unintentional

misclassification of workers and

potential abuse of the rule, which the

Department would be unable to prevent

or remedy. None of the comments

submitted provided any information or

arguments which alleviated these

concerns.

Additionally, the Department believes

it would not be able to collect

meaningful, consistent wage data

regarding use of helpers for wage

determination purposes. The

Department believes that the ambiguous

language of the definition in the

suspended rule would not give

contractors adequate guidance and

would lead to inconsistent wage

reporting. Because there is no generally

recognized practice regarding how

helpers are used, contractors reporting

wage data in accordance with the

definition in the suspended rule in

some instances probably would report

as helpers workers whom they consider

journeymen or laborers.

The court of appeals, in its review of

the Department’s original rulemaking

concerning helpers, stated that its

deference to the Secretary’s choice of

policy ‘‘is properly near its greatest

when his decision turns on the

enforceability of various regulatory

schemes.’’ Donovan, 712 F.2d at 629.

The Department has been unable to

develop a method for determining

whether workers classified as helpers

have been correctly classified under the

suspended rule, consistent with the

fundamental statutory goal of preserving

locally prevailing wages for

construction job classifications. Since

the rulemaking record does not

demonstrate that the suspended rule is

capable of practical and efficient

administration and enforcement to

achieve the statutory goals under DBRA,

the Department must reject

implementation of the suspended rule.

2. Helpers Are Less Widespread Than

Previously Believed

As explained in the preamble to the

proposed rule, the belief that a distinct

class of ‘‘helpers’’ was in widespread

use in the construction industry was a

key assumption underlying the

Department’s development of the

suspended helper regulation. 64 FR

17445. Although not a representative

sample, the data submitted to the

Department in the 78 surveys conducted

during the brief period the suspended

rule was in effect failed to substantiate

that assumption. In its earlier

rulemaking, the Department had

projected that use of helpers would be

found to be a prevailing practice in from

two-thirds to 100 percent of all craft

classifications surveyed, except where

collectively bargained rates were found

to prevail and did not provide for a

helper classification. 52 FR 31366,

31369–70 (August 19, 1987); 54 FR

4234, 4242 (January 27, 1989). The

Department’s experience with the

survey data collected in 1992 and 1993

during the brief time that the suspended

regulations were in effect was quite

different. In the 78 surveys conducted,

the use of helpers prevailed in only 69,

or 3.9 percent of the 1763 classifications

issued, and only 48 of the 69 helper

classifications, or 2.7 percent of the

1763 classifications, were based on the

practices of non-union contractors and

subcontractors. Furthermore, in only 20

of the 78 surveys conducted were any

non-union helper classifications found

to prevail.

The Economic Impact and Flexibility

Analysis in the proposed rule also

provided data showing that helpers

were less widespread than previous

analyses had assumed. The 1996

Current Population Survey (CPS),

compiled and published by the Bureau

of Labor Statistics (BLS) and the Bureau

of the Census, shows that helpers

constituted only 1.2 percent of total

construction employment. Data from the

Occupational Employment Statistics

(OES) program showed that helpers

comprised 8.7 percent of the total

construction work force. Because OES

does not contain a separate

classification for construction laborer,

and its definitions of the helper

classifications appear to include

laborers, the Department believes the

OES overstates the use of helpers. For

this reason, the Department developed

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69681

5 ‘‘Helpers, construction trades’’ were defined by

the National Compensation Survey as ‘‘[s]emiskilled workers who assist other workers of usually

higher levels of competence or skill. Helpers

perform a variety of duties such as furnishing

another worker with materials, tools, and supplies;

cleaning work areas, machines, and equipment;

feeding or offbearing machines; holding materials

and tools; and performing routine duties. Helpers

specialize in a particular craft or trade. A helper

may learn a trade but does so informally and

without contract or agreement with the employer.’’

The AGC mistakenly refers to the helper

definition used in the NCS surveys as the OES

definition. The OES definition is set forth infra at

note 15. In the future, NCS surveys (and OES

surveys) will use the new Standard Occupational

Classification (SOC) definition. Under the SOC

definition, helpers are described as follows: ‘‘Help

[craft worker] by performing duties of lesser skill.

Duties include using, supplying or holding

materials or tools, and cleaning work area and

equipment.’’

6The percentage figures cited by the AGC are

considerably higher than those previously cited by

the Department because those cited by AGC reflect

the elimination of supervisory construction workers

from the total number of construction workers

surveyed. The percentage of helpers in relation to

the entire construction workforce is the appropriate

percentage to compare to the data utilized in the

NPRM.

7The NCS surveys actually show that the average

wage rates reported for helpers are below the wage

rates reported for ‘‘unskilled’’ construction laborers.

However, the lower average wage rate paid helpers

in these NCS surveys appears to be due to the fact

that the laborer’s rates are an average of wage rates

paid to both union and non-union workers, while

the helper’s rates are based only on non-union data.

an alternative estimate, adjusting the

OES data by utilizing the percentage of

laborers in the CPS workforce. The

adjusted OES data resulted in an

estimate that helpers constituted 3.4

percent of the total construction

workforce.

In their comments, the Building

Trades stated that the Department’s data

on helper use are consistent with the

1996 Current Population Survey (CPS)

compiled by BLS and the Bureau of the

Census, which showed that helpers only

account for 1.2 percent of total

construction industry employment. The

Building Trades believes that these data

support its longstanding contention that

the underlying purpose of the

suspended helper regulation was not to

reflect locally prevailing practices, but

to ‘‘artificially interject’’ a nonprevailing classification of construction

workers into Davis-Bacon covered

projects as a means of undercutting

prevailing wages.

The ABC questioned the

appropriateness of the Department’s

consideration of whether the use of

helpers in the construction industry is

‘‘widespread.’’ The ABC stated that the

proper test for determining the existence

of helper classifications under the

statute is not whether the use of helpers

is ‘‘widespread,’’ but rather whether it

‘‘prevails.’’ The Department

acknowledges that a basic prerequisite

to issuing wage rates for classifications

under Davis-Bacon, including helper

classifications, is a determination of

whether such classifications and

corresponding pay rates prevail in the

particular locality where the project is

to be performed. However, the

Department believes its consideration of

the overall extent of helper use in the

construction industry, i.e., whether

helper use is ‘‘widespread,’’ is

appropriate as part of a broad inquiry

concerning the advisability of

implementing the suspended

regulations. As the Department stated in

the NPRM, ‘‘[t]he belief that a distinct

class known as ‘helpers’ was in

widespread use in the construction

industry was a key assumption

underlying the Department’s

development of the helper regulation.’’

64 FR 17445. It is appropriate for the

Department to determine, before taking

further regulatory action, if the original

underlying assumption concerning the

extent of helper use, which provided the

impetus for the suspended rule, was

borne out by the data collected during

the period the regulations were in effect,

or by any other more recent, relevant

data available to the Department. The

Department believes this is a

particularly significant consideration

where there is so little consensus on a

definition of helpers or how helpers are

used.

Several commenters expressed their

belief that the Department has

underestimated the prevalence of

helpers in the construction industry.

Representative Norwood and the

congressmen who joined in his

comments state that ‘‘[o]ver 75 percent

of all construction in the private sector

are performed by contractors who use

semi-skilled helpers. One study found

that on a given open-shop job, 35–50

percent of the workers in each craft are

likely to be helpers.’’ The source for

these data was not identified, and

therefore, the Department is unable to

weigh this information against the data

already available to the Department

concerning the prevalence of helpers.

These data, furthermore, do not indicate

to what extent helper classifications

actually prevail in the construction

industry.

The AGC stated that more recent BLS

survey data contradict the Department’s

conclusions regarding employment of

helpers. In support, the AGC cites the

NCS test surveys discussed above for

Jacksonville and Tucson, which,

according to the AGC, showed that

helpers comprise 13.6 percent and 14.8

percent, respectively, of the total

number of construction craft workers in

those two localities.

The AGC is referring to four fringe

benefit pilot surveys in Tucson,

Arizona; Jacksonville, Florida; Salt Lake

City, Utah; and Toledo, Ohio, which

BLS conducted pursuant to its National

Compensation Survey (NCS) program to

test the feasibility of collecting detailed

fringe benefit data for occupations

within the construction industry. In

these surveys, helpers 5 constituted 9.6

percent, 8.3 percent, 4.2 percent, and

2.5 percent, respectively, of the total

construction workforce.6 Laborers

constituted 14.3 percent, 6.9 percent,

9.9 percent, and 10.1 percent,

respectively, of the total workforce.

Combined, helper employment in these

areas was 5.8 percent of total

construction employment.

It is important to note that the four

pilot surveys, which included

Jacksonville and Tuscon, were not

designed to collect data on the

employment of helpers, and do not

report helpers by craft. In addition,

because the NCS studies obtained data

for only four geographic areas, the

information produced by these studies

cannot be projected to a nationwide

estimate of the percent of helpers

relative to the construction workforce as

a whole. The Department believes that

the information provided by these

surveys is generally in line with the

estimates used for the cost impact

analysis provided in the NPRM.

The helper data reported in these four

pilot studies also reflect inconsistencies

between the level of skill associated

with the ‘‘helper’’ and their

compensation levels. Logically, a semiskilled job would be expected to

command a higher wage than an

unskilled one, but this was not borne

out by the NCS survey data. Helpers are

defined, for purposes of these surveys,

as ‘‘semi-skilled’’ workers; however,

Table 2 of the NCS surveys shows that

‘‘semi-skilled’’ helpers are paid

approximately the same wage as

‘‘unskilled’’ non-union laborers.7 This

inconsistency lends credence to the

view that there is a widely disparate use

of ‘‘helpers’’ in the construction

industry.

The ABC stated that the Occupational

Employment Statistics (OES) data show

as many as 500,000 helpers currently

working in the construction industry.

As explained in the NPRM, the OES

survey did not include a separate

construction laborers definition, and the

helper definition appears to encompass

laborers where they assist craft workers.

It is likely therefore that the OES figures

include many laborers and other

69682 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

8 In this regard, the AGC commented that ‘‘[t]he

percentage of helpers in the ‘construction industry’

is likely to underestimate their numbers and reveals

nothing about their employment with respect to a

particular craft.’’

9The Department also reopened unpublished

surveys that were conducted before the helper rules

were in effect in order to include helper data.

10As the Department stated in the Final Rule,

continuing the suspension of the ‘‘semi-skilled’’

helper regulations, ‘‘It is inappropriate to draw

conclusions concerning the accuracy of survey

results based on the GAO report. The report did not

examine or verify the accuracy of wage

determination data, survey response rates, or

calculation of prevailing wages. It focused on the

policies and procedures utilized to prevent the use

of inaccurate data, and proposed changes to

strengthen those policies and procedures.’’ 61 FR

68641, 68645.

11The typical errors mentioned in the GAO report

concerning data submissions include:

• Reporting the wrong peak week,

• Reporting a slightly incorrect wage or fringe

benefit rate (e.g., reporting the rates currently being

paid rather than the rates that were paid during the

peak week that occurred ten months previously), or

• Reporting an average wage rate rather than the

wage rate paid to each individual worker within the

classification (e.g., an employer might report five

electricians paid one average rate when in fact each

electrician was paid a slightly different rate).

12For example, although Dr. Thieblot eliminated

highway construction and truck drivers from his

count on the assumption that these types of

construction and classifications would not use

helpers, the Department found 6 instances in which

truck driver distributor helpers prevailed and 3

instances in which mechanics’ helpers prevailed on

highway construction.

unskilled workers in the helper

category. For this reason, the

Department believes that OES figures

overstate the use of helpers in the

construction industry.

The ABC also noted that the

Department, when first publishing the

suspended rule in 1982, relied upon

earlier BLS estimates that helpers

constitute between 3 and 9 percent of

the total workers in the industry, and

stated that these estimates do not differ

greatly from the statistics cited in the

most recent NPRM. In the preamble to

its 1982 Final Rule, the Department

stated that BLS survey data of large

metropolitan areas indicated that the

estimated helper share of employment

in the construction industry was

between 3.2 percent and 5.6 percent. 47

FR 23650. However, the Department

indicated that this estimate might be

understated because the survey was

limited to areas that were ‘‘heavily

unionized.’’ Id. To correct this

understatement, the Department

assumed that the true union share of

Davis-Bacon employment was 50

percent and, accordingly, adjusted the

estimate of the helper share of

employment in the construction

industry to between 5.98 and 9.4

percent. Id. The Impact Analysis in the

1987 proposed rule utilized the OES

survey as the basis for its assumption

that 15 percent of employees in

construction will be helpers. 52 FR

31368–31369. As discussed in the

Impact Statement published in the

NPRM, the Department now believes

these estimates overstate the percentage

of helpers in construction employment.

However, none of these surveys and

studies shows the degree to which the

use of helper classifications is actually

prevailing within the meaning of the

DBRA.8 As discussed above, the 1987/

1989 rulemaking projected helper

classifications would prevail in twothirds to 100% of all non-union craft

classifications. The Department’s

limited experience, as reflected in the

data collected during the

implementation period, does not

support these projections.

Several commenters stated that the 78

wage surveys conducted in 1992–93,

upon which the Department relied in

part to assess the extent of helper use,

constituted too small a sample to be a

reliable measure of the extent of helper

employment throughout the

construction industry. The AGC and the

ABC cited a GAO audit of the DavisBacon wage survey process as the basis

for their opinion that the Davis-Bacon

surveys are unreliable and should not be

used as a basis for estimating the extent

of helper employment. GAO/HEHS–96–

130 (May 1996). The ABC suggested that

these survey results might also be

unreliable because a large number of

non-union contractors either did not

voluntarily participate in the survey

process or were not aware that helpers

should be reported during the

implementation period. Dr. Thieblot

also expressed his belief that factors

other than scarcity explain why

relatively few helper rates were

determined to prevail during the

implementation period. Dr. Thieblot

stated that the Department’s inability to

find helper rates prevailing during this

period was due to the type of surveys

conducted, where they were conducted,

and how the results were interpreted.

The Department agrees with the

comments that the 78 surveys were not

a statistically valid sample and are not

a reliable measure of the extent of

helper employment in the industry.

However, the Department has found its

1992–1993 survey data to be consistent

with the relatively low incidence of

helpers reflected in the other available

data sources discussed in the Impact

Analysis. The Department believes that

a sufficient number of surveys were

conducted to provide evidence that the

earlier estimates of the extent to which

use of helpers prevails were overstated.

It is also worth noting that most of the

surveys were selected to target areas

where the Department believed that use

of helpers would likely be found to be

prevailing.9

While the report from the GAO raises

the possibility that some prevailing

wage decisions issued during this

period might be affected by the

submission of erroneous data, there is

no evidence that the data collected by

the Department concerning prevalence

of the use of helpers were inaccurate or

skewed by the submission of erroneous

data.10 Erroneous reporting of an

employee’s classification is not a typical

error mentioned in the GAO report.11

Thus, the GAO findings are not relevant

to the issue of prevalence of the use of

helpers and cannot be used to support

the conclusion that the surveys

conducted during the time that the

semi-skilled helper rule was in effect are

an unreliable source of information on

that issue. The Department also

disagrees with the comment that

contractors were not made aware that

they should be reporting helper

employment during the implementation

period. Specific instructions were

included on the WD–10 survey forms to

inform contractors of the definition of

‘‘helper’’ and that workers falling within

that definition should be listed as

helpers, regardless of job title.

Dr. Thieblot re-analyzed the nonunion data on helper use, discarding all

surveys which, based on the areas in

which the surveys were performed and

the type of construction surveyed, he

did not believe would be likely to

produce helper classifications. He then

proceeded to eliminate all

classifications that he believed would

not ordinarily utilize helpers, such as

truck drivers and equipment operator

classifications. After paring down the

data in this manner, Dr. Thieblot

concluded that helper use prevails in

14.5% (48 of 331) of those non-union

classifications he believed could

possibly use helpers.

The assumptions on which Dr.

Thieblot’s analysis was based, regarding

which geographic areas and which types

of construction and classification are

likely to produce helper classifications,

appear to be speculative and

inconsistent with the data in the

surveys.12 In any event, this total is

much less than the two-thirds to 100%

of all (non-union) craft classifications in

which the Department previously

estimated helpers would prevail.

Dr. Thieblot also questioned what he

termed the Department’s ‘‘unexplained

rejections of helper rates as prevailing

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69683

13Wage and Hour procedures in effect at the time

required that, in order for a prevailing rate to be

issued, there must be at least 6 workers employed

by at least 3 contractors if the contractor-response

rate was less than 50 percent, and at least 3 workers

employed by at least 2 employers if the response

rate was 50 percent or more.

* * *.’’ However, the Department

followed the suspended rules at 29 CFR

1.7(d) for determining the circumstances

in which a helper classification is found

to prevail. For example, where the

union electrician’s rate was found to

prevail, an electrician’s helper

classification would not be found to be

prevailing unless it was the practice for

union contractors to hire electrician’s

helpers. Where the electrician’s rate was

based on an average of wages paid, the

determination of whether use of

electrician’s helpers prevailed was

based on a comparison of the number of

craft workers (journeymen, apprentices,

trainees and helpers) working on

projects utilizing electrician’s helpers

with the number of craft workers

(journeymen, apprentices, and trainees)

working on projects without helpers.

Finally, the Department’s data

sufficiency guidelines in effect at the

time required that the Department not

list a classification and wage rate where

the number of helpers used (or any

other classification), or the number of

contractors using helpers was not

sufficient to determine a prevailing

wage.13

After review of the comments, the

Department continues to believe that

helpers are not as widespread as it had

previously assumed.

3. The Suspended Regulation Could

Have a Negative Impact on Formal

Apprenticeship and Training Programs

Although not its primary concern in

this rulemaking, the Department

believes that the potential impact of the

suspended rule on formal

apprenticeship and training programs

merits discussion, given the Secretary’s

broad authority to protect and promote

the welfare of workers, including the

authority under the National

Apprenticeship Act of 1937, 29 U.S.C.

50, et seq. (also known as the Fitzgerald

Act) to promote apprenticeship. As

stated in the NPRM, the Department

believes that the suspended helper

regulations could undermine effective

training in the construction industry if

contractors are permitted to use helpers,

who may never become journeylevel

workers, in lieu of apprentices and

trainees participating in formal

programs that place ratio limits on their

use, assure that they receive full

training, and lead to jobs at the journey

level.

Several commenters were concerned

about the negative impact the

suspended helper rule would have on

formal apprenticeship and training

programs. Congressional

Representatives Clay, Owens, and

Clyburn stated that minority and female

workers would suffer reduced earning

opportunities and/or lost wages and

benefits if the suspended helper

regulation were implemented. These

congressmen expressed concern that the

suspended rule would trap younger

workers, including a disproportionate

share of minority workers, in the new

helper classifications; as a result these

workers would never enter

apprenticeship programs, which are the

primary route to obtaining decent wages

and fringe benefits. Representatives

Schakowsky and Weiner echoed these

concerns, stating that the suspended

rule, which contains no requirement

that contractors provide any training to

helpers, would have an adverse impact

on construction worker training and

apprenticeship programs, thus

exacerbating the current skills shortage

in the construction industry. These

congressmen also stated their belief that

the suspended regulation would reduce

opportunities available to minority and

female workers within the construction

industry by relegating them to helper

status.

The Building Trades commented that,

in the NPRM, the Department greatly

understated the long-term negative

impact the suspended regulation would

have on formal apprenticeship and

training programs. The Building Trades

stated that the suspended helper

regulations would permit almost

unfettered use of low-paid semi-skilled

helpers on DBRA-covered projects, thus

offering contractors and subcontractors

savings in labor costs without the quid

pro quo of investing in apprenticeship

training. The Building Trades stated that

contractors and subcontractors who

participate in and provide financial

support for formal apprenticeship and

training programs would be placed at a

competitive disadvantage vis-a ́-vis

contractors using helpers, thus

undermining their continued

participation in such programs. The

Building Trades also expressed its

concern that the suspended rule’s

failure to encourage formal craft training

would eventually lead to a severe

shortage of skilled craft workers in the

industry.

LIUNA cited the GAO’s finding that a

‘‘major incentive’’ for contractors to use

apprentices has been the ability to pay

less than the prevailing wage on DBRA

projects. GAO/HRD–92–43 (1992), p. 11.

LIUNA stated that the reduced

apprenticeship opportunities that would

accompany the suspended rule would

result in additional costs for training

workers, a long-term shortage of skilled

workers, fewer genuine training

opportunities for women and minority

craft workers, and an increase in

construction injuries, since most

injuries occur to new, entry-level

workers who are untrained or

inadequately trained.

MESMA noted that prevailing wage

laws support the funding and viability

of many labor-management

apprenticeship programs that provide

state-of-the-art training and produce the

most productive workers in the

industry. MESMA stated that the

overuse of helpers could lead to a

reduction in skills and diminishing

quality of construction, as well as an

increase in industrial accidents, because

helpers generally receive little or no

safety training.

The NJATC commented that helpers

under the suspended definition would

likely perform the same role that

apprentices now perform on the jobsite,

only at a lower cost. The NJATC stated

its belief that this practice would result

in fewer indentured apprentices, as

contractors, in competition to win

federal construction contracts, would

replace ‘‘journeymen-in-training’’

apprentices with lower-paid helpers in

continually increasing numbers. NJATC

stated that, within five to ten years, this

replacement of apprentices with helpers

on DBRA projects would result in an

acute shortage of skilled construction

workers.

The IBEW commented that, if use of

helpers is allowed extensively on DBRA

projects, contractors would no longer be

motivated in a competitive setting to

spend 2 percent or more of their payroll

on training, and use an apprenticeship

system requiring ratios, when they

could use helpers and avoid such

requirements.

On the other hand, both the ABC and

the AGC commented that there is no

basis for the Department’s concern that

increased recognition of helper

classifications may have a detrimental

effect on apprenticeship and training

programs. The ABC stated that, over the

last decade, funding and participation

by open shop contractors in

apprenticeship and training programs

has increased significantly, independent

of the Davis-Bacon regulatory process.

The ABC stated that the Department’s

policies regarding apprenticeship

programs and ratio requirements have

made apprenticeship training

unavailable to some workers who desire

to enter the construction industry in

semi-skilled jobs. The ABC further

69684 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

14The CBO stated in its Study: ‘‘Modifying the

Davis-Bacon Act: Implications for the Labor Market

and the Federal Budget,’’ July 1983 at page 42:

‘‘Contractors who would have been induced to

provide approved training and apprenticeship

programs, because doing so was the only way of

paying less than journeymen’s wages on federal

projects, might now reduce the number of

apprentices in favor of helpers and informal

trainees. To the extent that this adjustment

occurred, less-skilled workers might receive less

training of the type that would qualify them for

entry into the skilled crafts—possibly reducing

minority access to these crafts and limiting the

supply of skilled labor in the future.’’

stated that the helper classification is an

important point of entry into the

construction industry for young people,

women and minorities, and that it is

improper for the Department to refuse to

recognize the prevailing practice of

employing helpers in an effort to force

into training programs workers who

either may not be qualified or may not

desire such training.

While acknowledging that the helper

classification cannot be used as an

informal training program, the APWC

stated that it fulfills an important entrylevel job opportunity for many

construction workers. The AGC of

Texas, on the other hand, stated that the

use of helpers allows contractors to

utilize unskilled workers while teaching

them a trade or skill. Dr. Thieblot

expressed concern that a larger number

of skilled journeymen will be needed to

sustain the construction industry in the

future than the number which can be

provided by existing apprenticeship and

formal training programs. Dr. Thieblot

also expressed his belief that the

suspended helper rules, to the extent

they would allow informal, on-the-job

training of semi-skilled workers, would

provide a necessary alternative to formal

apprenticeship and training programs

for training and upgrading workers to

journeyman status.

The Mercatus Center expressed its

belief that the increased employment of

helpers under the suspended rule would

provide greater employment and

training opportunities for minorities and

women. The ABC recommended more

study on the potential impact on

minorities and women prior to issuance

of the proposed rule. The APWC stated

that it is inappropriate for the

Department, in analyzing the merits of

the helper regulations, to express a

preference for formal training, such as

provided under union-sponsored

apprenticeship plans, over the informal

training methods utilized in the nonunion sector.

The Department continues to believe

that formal structured training programs

are more effective than informal on-thejob training alone. The Department’s

encouragement of formal training is

reflected in the provisions of the

Secretary’s DBRA regulations that

currently allow laborers and mechanics

classified as ‘‘apprentices’’ or ‘‘trainees’’

to be paid less than the prevailing wage

rate on Davis-Bacon covered projects

only if they are enrolled in a bona fide

apprenticeship program registered with

the Department’s Office of

Apprenticeship, Training Employer and

Labor Services (ATELS) (formerly,

Bureau of Apprenticeship and Training

(BAT)) or a State Apprenticeship

Agency recognized by ATELS, or a bona

fide training program approved by the

Department’s Employment and Training

Administration.

The Department views any increases

in funding and participation in formal

training programs in the open-shop

construction community as a positive

development, but this does not address

the concerns expressed by several of the

commenters that the implementation of

the suspended rule would discourage

the growth of such programs and result

in the replacement on DBRA-covered

projects of apprentices and trainees

enrolled in formal programs, by helpers

who could perform the same work as

apprentices and trainees at a lower cost

to the construction contractor and

without any restrictions as to how

helpers are used. The Department shares

this concern, along with the additional

concern that workers employed as

helpers—and particularly, young,

minority and female workers—will not

receive the type of training necessary to

become higher skilled, better paid

workers. The Department notes that the

Congressional Budget Office (CBO) has

also recognized that the suspended rule

might have a negative impact on

apprenticeship and training programs.14

Although not the paramount concern

in this rulemaking, the Department is of

the view that the increased use of

helpers under the suspended rule poses

a significant risk that formal

apprenticeship and training programs

on DBRA-covered projects would be

undermined.

Discussion of Other Alternatives

Considered

Except for TxDOT, which appears to

favor a combination of the proposed

alternatives, none of the commenters

urged the Department to adopt any of

the alternatives set forth below. The

ABC stated that, while it believes that

the Department should reinstate the

suspended rule, it would support

further study of any of the proposed

alternatives. The ABC commented that

each of the proposed alternatives is

preferable to adoption of the proposed

rule, and that the Department has not

given sufficient study to the alternative

approaches. On the other hand, both the

Building Trades and LIUNA indicated

their belief that none of the alternative

approaches considered by the

Department is viable.

The Mercatus Center commented that

the Department has not properly

assessed the quantitative benefits of the

alternatives presented in the NPRM. The

Mercatus Center stated that, without

better information on the costs and

benefits of the alternatives, the

Department places inordinate weight on

such factors as ease of administration

and enforcement, rather than on net

social benefits. As explained in the

NPRM, ‘‘[e]ach alternative would likely

result in greater use of helpers than

under the proposed rule, but less than

under the suspended rule,’’ and

therefore, ‘‘the economic impact would

presumably yield some portion but not

all, of the savings anticipated under the

suspended rule.’’ 64 FR 17455. The

Department also stated that it would not

be possible to provide detailed estimates

of the economic impacts of the

alternatives because ‘‘each alternative

encompassed many possible variations

and outcomes’’ and ‘‘there is no data

source that would provide appropriate

information on these variations and

outcomes.’’ Id.

1. Add a Ratio Requirement to the

Suspended Helper Definition

The Department stated in the NPRM

that it believed that implementation of

a ratio provision would be essential if

the suspended rule were implemented,

in order to reduce the potential for

abuse. The Department recognized,

however, that adoption of a ratio

provision would not address or resolve

the suspended rule’s definitional

problems that make it extremely

difficult for contractors, as well as Wage

and Hour and contracting agencies, to

identify and distinguish helpers from

other workers for DBRA enforcement

and wage determination purposes. The

Department also questioned whether, as

a practical matter, an appropriate

nationwide or local ratio standard could

be determined, and expressed concern

for the substantial resources that would

be required to determine appropriate

ratios based on local practices.

The Building Trades expressed the

view that any fixed nationwide ratio,

like the ratio that was struck down in

Federal court, would be arbitrary and

capricious because it would be

inconsistent with the underlying

principle of DBRA that labor standards

reflect local prevailing practices. LIUNA

stated that the addition of a ratio

requirement under the suspended rule

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69685

would not address or resolve the

definitional problems inherent in the

suspended rule, and that it would be

extremely difficult to develop an

appropriate ratio standard that would

reflect local practices.

Noting that the D.C. Circuit Court of

Appeals allowed the Department to

reinstate a ratio requirement provided

that the Department can support such

ratio with an administrative record, the

ABC commented that the Department

failed to develop such a record and did

not attempt to set local ratios through

the wage survey process.

The Mercatus Center stated that the

Department should re-evaluate the

original rationale for including a ratio in

the suspended rule. The Mercatus

Center noted that ratios appropriate for

productive construction efforts are

subject to change with changes in

production methods, materials,

technology, and population, and that

due to regulatory time lag, any binding

ratio might be obsolete in a few years.

The Center suggested that if a rationale

for the type of abuse a ratio is intended

to prevent could be articulated, then a

ceiling that is non-binding, but that

would prevent any feared abuse of the

helper category, might be workable.

TxDOT recommended that the

Department adopt a combination of

measures, including the addition of a

ratio requirement to the suspended

definition to prevent abuse of the helper

classification. TxDOT suggested that

varying the ratio requirement,

depending on the type of work

performed, might be a way of validating

the ratio provision.

None of the commenters has provided

the Department with specific guidance

as to how an appropriate nationwide or

local ratio standard could be

determined. As noted in the NPRM, a

nationwide ratio would not accord with

local practices, whereas locally

developed ratios would present

significant administrative and

enforcement concerns and would

require substantial resources for

implementation.

The difficulty with determining

locally prevailing ratios begins with

deciding how that ratio should be

calculated. The easiest method would

be to compare the total number of

helpers to the total number of

journeyworkers reported for the

classification. This methodology,

however, does not measure the typical

ratio of helpers to journeyworkers on

any particular job. For example, four

hypothetical data submissions might

report carpenters and carpenter helpers

as follows:

Project

Number of

carpenter

helpers

Number of

carpenters

A ........................... 1 2

B ........................... 1 2

C ........................... 6 1

D ........................... 1 2

Totals ......... 9 7

In this example, the prevailing jobsite

ratio of carpenter helpers to carpenters

is clearly 1:2 (i.e., on three of the four

projects, contractors used one helper for

every two carpenters). However, if the

ratios are averaged, the resulting ratio

would be almost 2:1 (1.875), and a ratio

derived by dividing the total number of

helpers by the number of carpenters

would be greater than 1:1 (i.e., 9:7 or

1.286). Therefore, either of these

approaches could frequently yield a

distorted picture of the true prevailing

ratio.

Collecting and verifying data on the

ratio of helpers to journeyworkers for

each jobsite is likewise a difficult task.

Currently, Wage and Hour collects data

for each classification based on the

‘‘peak week’’ of employment on the

project. This ‘‘peak week’’ may differ for

each classification. Since one may find

that the peak week of employment for

carpenters is a different week than that

for the carpenters’ helpers, the ratio

would vary as well. It is not clear how

the peak week concept should be

applied in this situation. Any solution

to this question could be

administratively costly and timeconsuming for Wage and Hour and for

contractors, thereby impacting the

Department’s ability to obtain the

cooperation of contractors to collect

accurate data.

The Department remains of the view

that adding a ratio requirement would

be essential to reduce the potential for

abuse from the excessive use and

misclassification of helpers if the

suspended rule were implemented. The

D.C. Circuit Court of Appeals also

recognized the importance of a ratio

provision to the effective administration

and enforcement of the suspended

helper rule when it stated that ‘‘the

Secretary has increased the likelihood

that gross violations will be caught, or

at least that evasion will not get too far

out of line, by putting the forty-percent

cap on the use of helpers. * * * [T]he

existence of some cap at least increases

our confidence that the Secretary has

considered the enforcement problems of

the new definition and responded to

them.’’ Donovan, 712 F.2d at 630.

More importantly, the Department

continues to believe the addition of a

ratio provision to the suspended helper

rule—although it might curb the worst

abuses—would not address or resolve

the problems inherent in the suspended

rule’s definition, which, as discussed

above, make it extremely difficult to

identify helpers for DBRA enforcement

and wage determination purposes.

2. Change the Suspended ‘‘Helper’’

Definition To Emphasize the SemiSkilled Nature of the Classification

In the NPRM, the Department stated

that it believed that amending the

‘‘helper’’ definition to emphasize its

semi-skilled nature would help assure

that the helper classification would be

a true ‘‘semi-skilled’’ classification

rather than a broad catch-all

classification that could perform

everything from laborer duties to an

undefined and potentially unlimited

assortment of skilled tasks overlapping

the work of journeyworkers. The

Department suggested that this

approach would aid in distinguishing

helpers from laborers by emphasizing

the ‘‘semi-skilled’’ nature of helpers, as

distinguished from the unskilled duties

in the definition in the suspended rule.

Under this approach the definition

would elaborate on the supervisory

relationship between the helper and the

journeyworker and the craft-specific

assistance provided, and expressly limit

the unskilled work the helper could

perform. The Department noted,

however, that this alternative would not

resolve the administrative and

enforcement problems that stem from

the overlap of duties between

journeyworkers and helpers, and that it

might result in helper classifications

being used to replace, rather than

supplement, the use of apprentices and

trainees registered in bona fide training

programs.

The Building Trades commented that,

even under this modified definition of

a helper, it would not be possible to

distinguish a helper from a laborer

because laborers also assist craft

workers and many use tools of the trade

to perform certain duties. The Building

Trades also noted that a laborer working

under the supervision of a journeylevel

worker could be classified as a lowerpaid helper under this definition,

simply by adding to his or her duties a

few relatively low-skilled tasks using

tools of the trade.

LIUNA stated that this alternative

would not prevent the substitution of

helpers for laborers, because laborers

perform not only unskilled duties, but a

wide array of semi-skilled duties as

well. LIUNA further stated that, because

laborers generally earn higher wages

than helpers, this alternative would

69686 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

15The OES Dictionary of Occupations

classification scheme includes a broad category

titled ‘‘Helpers, Laborers, and Material Movers,

Hand, Exclud[ing] Agricultural and Forestry

Laborers.’’ The work of helpers in the construction

industry is described as follows: ‘‘Help workers in

the construction trades, such as Bricklayers,

Carpenters, Electricians, Painters, Plumbers and

Surveyors. Perform duties such as furnishing tools,

materials, and supplies to other workers; cleaning

work areas, machines, and tools; and holding

materials or tools for other workers.’’

result in misclassification of laborers

just as would the suspended rule.

The ABC stated that the Department’s

rejection of this alternative on the

grounds that helpers would continue to

have overlapping duties with

journeymen is inappropriate. The ABC

stated that, if the prevailing practice is

to employ helpers to perform duties

overlapping with those of journeylevel

workers, it is the Department’s statutory

obligation to recognize that practice.

The Department continues to believe

that this alternative would not resolve

the administrative and enforcement

problems that would stem from the

overlap of duties between

journeyworkers and helpers. The

Department remains of the view that the

emphasis on semi-skilled duties under

this approach might result in helper

classifications being used to replace,

rather than supplement, the use of

apprentices and trainees registered in

bona fide training programs.

Furthermore, it appears that this

alternative might not even resolve the

problems of overlap of duties between

helpers and laborers.

3. Define ‘‘Helpers’’ Based on the

Bureau of Labor Statistics, Occupational

Employment Statistics (OES) Dictionary

of Occupations, Which Focuses on

Unskilled Duties and the Worker’s

Interaction With Journeylevel Craft

Workers 15

The Department noted in the NPRM

that this approach, by focusing on the

role of the helper in assisting the

journeyworker and eliminating the

‘‘semi-skilled’’ characterization from the

definition of helpers, could provide a

more practical basis for distinguishing

helpers from journeyworkers. However,

the Department expressed its concern

that laborers may often perform the

same work encompassed within the

OES helper definition, thereby causing

significant problems for Wage and Hour

in conducting wage and area practice

surveys and in enforcement because of

the lack of clear differentiation between

the classifications. The Department also

stated that it might be difficult under

this approach for contractors to

determine whether workers performing

similar or identical duties are ‘‘laborers’’

or ‘‘helpers’’ when submitting DBRA

survey data and in classifying workers

on DBRA-covered projects.

Both the Building Trades and LIUNA

commented that this alternative would

present the same problem as that

presented by the suspended rule, viz.,

helpers and laborers both perform the

work as described in the operative

definition. The Building Trades and

LIUNA state that it would be difficult

for contractors to determine whether

workers performing similar or identical

duties are laborers or helpers when

submitting Davis-Bacon survey data and

in classifying workers on DBRA

projects.

The AGC commented that the OES

definition of a helper is consistent with

the definition in the suspended

regulation, and can be used by

contractors to effectively distinguish

helpers from laborers and other craft

workers. The ABC objected to the

Department’s characterization of the

OES definition as ‘‘eliminating the semiskilled characterization’’ from the

definition of helpers. The ABC further

stated that any such elimination would

deny an essential component of helpers

and would defeat the statutory mandate

of recognizing prevailing practices.

None of the commenters has

demonstrated how helpers can be

effectively distinguished from laborers

under this approach for both

enforcement and wage determination

purposes, given that laborers would

often perform the same work as that

described in the OES helper definition.

Moreover, the Department does not

believe that focusing on the role of the

helper in assisting the journeyworker is

an effective means for distinguishing

helpers from laborers. None of the

commenters disputes that laborers, too,

are frequently called upon in the

performance of their regular duties to

assist journeymen.

4. Explicitly Delineate the Semi-Skilled

Tasks Performed by Each Helper

Classification

As this so-called ‘‘job family’’

approach was described in the NPRM,

an employee who performs only lower

level duties that are associated with a

particular craft may be classified and

paid at the lower level helper rate;

however, an employee who performs

some lower level duties and some

higher level duties must be paid the

higher journeylevel rate for all of the

employee’s work time. The Department

stated that this approach, in effect,

would allow for the expanded use of

helpers, with differentiation based on

the skill and knowledge required to

perform particular duties. The

Department theorized that once the

duties or tasks that the helpers could

perform were clearly defined, wage data

could be collected on that basis, and

contractors could reasonably be

expected to comply with the wage

requirements for the various

classifications employed on their

contracts, thereby facilitating

administration and enforcement. The

Department stated, however, that

developing clear definitions of the

duties or tasks that helpers to each

journeylevel craft worker would be

allowed to perform would be very

difficult, requiring extensive

occupational analyses and further

rulemaking to promulgate helpers’

duties descriptions. The Department

further questioned whether this

approach, which presumably would

result in uniform, nationwide

definitions, would be consistent with

the underlying principle that DBRA

classifications are determined based on

local area practices.

The Building Trades and LIUNA

stated that developing clear definitions

of the duties or tasks that helpers would

be allowed to perform would be very

difficult, requiring extensive

occupational analyses to develop

accurate and specific descriptions of

helpers’ duties. They also commented

that the uniform, nationwide definitions

that would result from application of

this alternative would not necessarily

reflect locally prevailing practices, as

DBRA requires.

TxDOT appears to favor this or a

similar approach, in that it

recommended (in conjunction with

other recommendations) the use of

standardized definitions for both

journeylevel and helper classifications,

stating that each level of classification

should require a specific level of skill,

and for those classifications where a

specific skill is not required, the

common laborer classification should be

utilized in lieu of a helper classification.

TxDOT stated that, under this approach,

the need for a semi-skilled worker

classification would be eliminated. The

AGC of Texas provided a copy of its

‘‘Standard Job Classifications’’ booklet

to demonstrate the use of standard,

uniform job definitions for job

classifications, including several helper

classifications, in connection with

highway, heavy, utility, and industrial

construction projects in the State of

Texas.

TxDOT also proposed that the

Department expand and define the role

of training programs with regard to such

helper classifications, thus allowing

helpers to progress to a status of

‘‘journeyman trainee’’ and then

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69687

16The definition for a ‘‘Carpenter Helper, Rough’’

is fairly representative of all of the helper

definitions contained in the AGC of Texas booklet.

They generally all begin with the phrase, ‘‘A learner

or worker semi-skilled in this craft’’; require

supervision by the journeyworker; provide a list of

specific duties; and conclude with the phrase,

‘‘Performs other related duties.’’ Though the

specific duties vary from craft to craft with respect

to each helper classification, they are basically

unskilled duties that a laborer could perform.

journeyman. However, though the

Department has concern for the impact

its helper regulations may have on

apprenticeship and training programs, it

is not within the Department’s purview

in the context of this Davis-Bacon Act

rulemaking to expand and define the

role of training programs with respect to

helpers.

The Department believes that

adoption of this approach is simply not

practicable because of the expenditure

of time and resources that would be

necessary to develop job descriptions

for all the construction crafts. The

Department also believes that this

approach is inadvisable because it

would amount to recognizing subclassifications within each craft, a

practice that has never been permitted

under DBRA.

Furthermore, close examination

reveals that the helper definitions

created by the AGC of Texas suffer from

the same infirmities as the helper

definition in the suspended rule. For

example, the AGC of Texas booklet

provides the following job description

for a ‘‘Carpenter Helper, Rough’’

classification: 16

A learner or worker semi-skilled in this

craft who assists a rough carpenter by

expediting materials, keeping work area

clean, sawing lumber to size specified, and

assisting in constructing wooden structures,

under the direction of a Rough Carpenter.

Performs other related duties.

Like the suspended helper definition,

this definition uses the undefined term

‘‘semi-skilled’’ to describe the

carpenters’ helper classification without

explaining what it means to be ‘‘semiskilled.’’ Additionally, this definition is

internally inconsistent in that it defines

the carpenters’ helper as ‘‘semi-skilled,’’

but specifically lists duties that might

commonly be performed by unskilled

laborers. The definition not only allows

the duties of a helper to overlap with

those of a journeyworker, but also

provides no limitation on the duties a

carpenter’s helper can perform by

including the open-ended phrase

‘‘[p]erforms other related duties.’’

Lastly, this definition, by referring to a

carpenter helper as a ‘‘learner,’’ poses

perhaps an even greater risk than the

suspended helper definition that

helpers will be substituted for

apprentices and trainees participating in

formal programs that lead to workers

achieving journeylevel status.

The Proposed Rule—Helpers as a

Distinct Class With Clearly Defined

Duties Which Do Not Overlap With

Laborer or Journeyman Classifications

Congressional Representatives

Norwood, Goodling, Ballenger, Boehner,

Hoekstra, McKeon, and Paul opposed

the Department’s proposed helper

regulations, stating that they would tend

to discourage rather than facilitate the

use of helpers on DBRA projects. They

commented that the proposed

regulations are deficient because they

do not reflect current industry practice

and are not responsive to the needs and

practices of the vast majority of the

construction industry. These

congressmen also stated that the

proposed helper rule, in contrast to the

suspended rule, will not encourage

access by low-skilled workers to

valuable entry-level jobs. They further

stated that opening more helper jobs

under the suspended rule would attract

workers to the construction industry,

which suffers from a serious shortage of

skilled workers.

Representatives Clay, Owens, and

Clyburn supported the proposed rule on

the basis that it not only better reflects

the current practices of Davis-Bacon

contractors, but also ensures that

minority workers will be paid locally

prevailing wages and fringe benefits.

They further commented that the

proposed rule will ensure that the

Federal government, through its

procurement practices, will not act to

undermine the living standards of

workers, and will promote continued

access to the kinds of apprenticeship

programs that are essential if new

workers in the construction industry are

to better themselves.

Representatives Schakowsky and

Weiner also urged the Department to

adopt as final the proposed rule because

it recognizes the need for a clear

delineation and limitation on the use of

helpers on DBRA-covered projects. They

stated that the proposed rule will

encourage proper training for young,

minority and female workers by

promoting formal and effective

apprenticeship programs. They also

commented that the proposed rule will

enhance the presence of more skilled

and productive workers on Davis-Bacon

projects, thus reducing the costs

resulting from job-related injuries and

improving the economic situation of the

entire community.

The AGC, the ABC, Dr. Thieblot, and

the SBSC all opposed the Department’s

proposed rule and advocated

implementation of the suspended rule.

These commenters, as well as the

APWC, stated that where the use of

helpers prevails, they should be

recognized by the Department in

accordance with its statutory mandate to

reflect prevailing practices. For

example, the ABC commented that, if it

is the prevailing practice to employ

helpers in a given locality to perform

overlapping duties with journeymen,

the Department of Labor has an

obligation to recognize that practice.

The AGC echoed this point, stating that

even if helpers prevail in only 3.9

percent or 2.7 percent of surveyed job

classifications, as surmised by the

Department in its NPRM, helper

classifications should nonetheless be

recognized in those instances where

they are found to prevail. The ABC also

urged the Department to delay issuance

of the proposed rule until the upgrade

of the Department’s survey and data

collection processes has been completed

and a fair and objective study of the

helper issue is conducted.

The AGC of Texas supported restoring

the increased use of helpers under the

suspended rule, stating that for more

than 35 years helper classifications have

been recognized in Texas and are still

being used on projects that have no

Federal funds. The Mercatus Center

generally opposed adoption of the

proposed rule, primarily based on

economic considerations. Elcon

specifically objected to the Department’s

refusal under its current policy to

approve the elevator helper

classification negotiated by the

International Union of Elevator

Constructors. Elcon stated that the

Davis-Bacon Act should not be used to

make new rules that would reduce

competition, unnecessarily inflate costs

on Federal construction projects,

provide unfair advantages for nonunion

organizations, and create separate job

definitions for Federal projects.

The Building Trades and LIUNA both

urged the Department to adopt the

proposed rule. They favored the

proposed rule because it reestablishes

the duties-based classification approach,

provides an objective basis for

administration and enforcement,

including clear criteria that facilitate

contractor compliance, and is consistent

with the statutory intent to assure that

workers employed on DBRA projects

receive the prevailing wages paid to

workers performing similar work on

similar construction in the same area.

They also stated that the proposed rule’s

lack of overlapping duties will

discourage contractor misclassification

and abuse and that the requirement that

helpers be separate and distinct from

69688 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

17Employers who use helpers that meet the

definition under this final rule should report the

use of helpers in response to Davis-Bacon

prevailing wage surveys, along with a description

of the duties or other characteristics that distinguish

helpers from other workers. Where ‘‘helpers’’

perform the duties of another classification on the

wage determination, the employer should report the

‘‘helper’’ under that classification. If helpers are

listed on a WD–10 survey form, the Department will

determine whether they are a separate

classification, meeting the criteria of the

regulations; if not, the Department will determine

the appropriate classification for the work

performed and include the ‘‘helpers’’ and their

wage rates under that classification—laborer, craft

worker, or otherwise.

18The Department has created a regulatory

exception for apprentices and trainees in approved

programs.

journeylevel workers and laborers will

facilitate collection of wage data used to

establish prevailing wage rates on DBRA

work. Finally, they stated that the

proposed rule will provide strong

incentives to contractors and

subcontractors to establish and

participate in formal apprenticeship and

training programs.

MESMA opposed the use of helpers

without stringent enforcement by the

Department as part of a comprehensive

Davis-Bacon reform effort. MESMA

expressed concern that the overuse of

helpers could lead to a reduction in

workforce skills, diminishing quality of

construction, and an increase in

industrial accidents. The NJATC

opposed the helper concept in general

based on its belief that the institution of

helpers will have a negative impact on

apprenticeship and training programs.

The IBEW opposed adoption of the

Department’s proposed rule based on its

general opposition to use of helper

classifications, under any definition, on

DBRA projects. The IBEW suggested

that the creation of helper classifications

may bring down wage scales, put more

people in poverty, and force

construction workers to work more than

one job in order to survive

economically. MESMA and the IBEW

both questioned whether the helper

criteria under the proposed regulation

can be effectively administered and

enforced.

Based on careful review of the

comments and further consideration of

the alternatives, the Department has

decided to adopt as a final rule an

amendment to the regulations that will

incorporate the longstanding policy of

recognizing helpers as a distinct

classification on DBRA-covered work

only where Wage and Hour determines

that (1) the duties of the helper are

clearly defined and distinct from those

of the craft worker and laborer, i.e., the

duties of the helper are not routinely

performed by any other classifications

in a given area; (2) the use of such

helpers is the prevailing practice in the

area; and (3) the helper is not used as

a ‘‘trainee’’ in an informal training

program.

The Department favors this approach

because it incorporates the duties-based

methodology for distinguishing

classifications that the Department

utilizes in identifying other

classifications under the DBRA. By

providing for the recognition of helpers

based on the duties they perform, rather

than on the worker’s skill level and the

existence of supervision, the proposed

rule provides an objective basis for

Wage and Hour to administer and

enforce the statute’s prevailing wage

requirements with respect to the

employment of helpers. This dutiesbased approach also facilitates

compliance by providing clearer criteria

to be followed by contractors who wish

to employ helpers on DBRA-covered

projects.

The Department also believes that, by

recognizing helpers only where their

duties are distinct and do not overlap

with those routinely performed by other

classifications, the proposed rule will

discourage contractor misclassification

and/or abuse that could result from

contractors reclassifying journeyworkers

and laborers as helpers at lesser rates of

pay on DBRA jobs.

The Department believes that the

proposed rule provides the only

approach that is administratively

feasible. Unlike some of the other

alternatives considered, the policy

under the proposed rule does not

require Wage and Hour, in its

enforcement, to make a fact-bound

inquiry of each worker to assess his or

her skill level and the nature of the

worksite supervision he or she receives

to determine whether the worker will be

recognized as a ‘‘helper’’ for DavisBacon purposes. The requirement that

helpers have distinct duties from those

of other classifications on the wage

determination also facilitates the

collection of wage data that more

reliably reflect the prevailing wage rates

paid for work performed by helpers on

DBRA-covered construction work.

Under the regulations, helpers—

whatever their job title—will be

recognized, as they are today, whenever

their duties are separate and distinct

from duties routinely performed by

other classifications. For example,

tender classifications are common on

Davis-Bacon wage determinations. On

the other hand, where helpers are just

lesser skilled workers of a particular

craft, they will be included in the

surveys under the craft classification,

and their rates averaged together with

the journeylevel workers (where there is

no rate paid to a majority of the workers

in the classification).17

Additionally, this approach maintains

the current incentive to contractors to

establish and participate in structured

apprenticeship and training programs

that facilitate the advancement of lesser

skilled workers to journeylevel status.

The chief objection to the proposed

rule expressed by commenters in this

rulemaking is that it disregards local

area practices in those instances where

there may be a prevailing practice of

employing helpers who do not meet the

three-part regulatory test as set forth

above. The gravamen of this objection is

that the proposed rule does not accord

with the Department’s statutory

obligation to provide classifications and

wage rates that mirror locally prevailing

practices.

The Department believes that the

proposed rule is fully consistent with

the DBRA’s underlying prevailing wage

goals and requirements. The DavisBacon Act provides little guidance

concerning the methodology the

Secretary is to use in determining

‘‘classes’’ of laborers and mechanics and

their respective prevailing wage.

Consequently, the Secretary has a

substantial amount of flexibility and

discretion in devising a methodology to

fulfill the Department’s statutory

obligations and responsibilities under

the Act. Donovan, 712 F.2d at 616, 629–

630; Miami Elevator Company and MidAmerican Elevator Company, Inc., ARB

Case Nos. 98–086 and 97–145 (April 25,

2000), slip op. at 35.

The Davis-Bacon Act directs the

Secretary to determine the prevailing

wage for ‘‘corresponding classes’’ of

laborers and mechanics. It has been the

longstanding practice of the

Department—with the exception of the

short period during which the

suspended rule was implemented—to

utilize a duties-based approach to

identifying classes of laborer and

mechanics.18 Under this practice, the

duties that a particular class of worker

performs may vary somewhat from one

area to another; and a classification may

be recognized in one area and be

subsumed under another classification

in another area, in accordance with

prevailing area practice. Thus, in one

area a helper may be a separate class,

while, in another area, it may be

subsumed under another classification

in accordance with prevailing area

practice. Although this duties-based

distinction is not mandated by the

statute, the Department believes it is

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69689

19The Department also determined, for the

reasons explained in the NPRM, that the provisions

of the Unfunded Mandates Reform Act of 1995 do

not apply to this rulemaking. None of the

commenters disputed this determination.

fully consistent with the legislative

history and statutory intent.

Furthermore, the Department believes

it simply is not feasible to graft onto a

duties-based system of classifications,

one class defined on the basis of skill

and supervision. Since the craft worker

is not defined on the basis of skill and

supervision, and the prevailing wage of

the craft worker is based on rates paid

to workers with a range of skills and

supervision, it does not make sense to

carve out certain workers who may have

less skill and receive more supervision.

In addition, the Department has been

unable to determine how the suspended

helper rule can be administered and

enforced in accordance with the DBRA’s

prevailing wage requirement. A review

of the comments reveals no consensus

as to how helpers are used in the

construction industry, and the

commenters provided no information to

aid the Department in identifying a

generally accepted definition of a helper

that corresponds to industry practices.

Nor is there a practicable, reasonable

way to identify helpers, when the

manner in which they are used varies so

in each and every area where DBRAcovered construction is taking place.

The Department’s Administrative

Review Board in its recent decision in

the case of Miami Elevator Company

and Mid-American Elevator Company,

Inc., ARB Case Nos. 98–086 and 97–145

(April 25, 2000), explained the

Department’s position. In response to an

argument that the Department’s refusal

to approve an elevator helper

classification because it did not meet

the current three-part test resulted in ‘‘a

staffing pattern that is inconsistent with

locally prevailing practice,’’ the Board

stated as follows:

‘‘[W]e note that the oft-repeated declaration

that the purpose of the Davis-Bacon Act is to

‘hold * * * a mirror up to local prevailing

wage conditions and reflect * * * them’ on

federal construction projects is a simplistic

and inaccurate characterization of the statute.

[Citation omitted]

* * * * *

‘‘[I]t is virtually inevitable that some

laborers and mechanics who work in a given

jurisdiction are paid less than the prevailing

wage rates determined by the Secretary, yet

the congressionally-mandated prevailing

wage scheme requires that all construction

workers be paid not-less-than the prevailing

rate when employed on a federal

construction contract—even those workers

who might otherwise be employed on nonFederal projects in the local construction

industry at lower pay scales. The goal of the

Act is not merely to replicate (or ‘‘mirror’’)

the full range of local pay scales, but to

require that workers be paid at least the

prevailing rate.

* * * * *

‘‘In sum, the prevailing wage mechanism

chosen by Congress always has included the

possibility that some construction workers in

a locality who normally earn less than the

prevailing wage might earn more when

employed on a project subject to the Act;

similarly, the Secretary and the

Administrator have a long history of limiting

the circumstances under which workers in a

training mode would be allowed to work on

federally-funded projects, generally insisting

that such workers be enrolled in governmentapproved training programs designed to

promote quality training and prevent abuse.

The fact that these forces combine to produce

a staffing pattern that may not ‘mirror’ local

practice does not mean that the

Administrator’s decisions are incorrect,

either under the law or regulations.’’ Miami

Elevator Company, supra, slip op. at 33–34.

Accordingly, the Department

concludes that the proposed rule, by

requiring that the duties of a helper be

distinct from those of other

classifications employed on the jobsite,

best fulfills the fundamental purpose of

the Davis-Bacon Act to assure that

workers employed on federal and

federally-assisted construction work be

paid at least the wages paid to

corresponding classes of workers on

similar construction in the area.

The Department points out that it is

not its intention that a helper

classification would never be issued

simply because some workers in another

classification occasionally perform the

work in question. As discussed above,

the Department intends to issue helper

classifications where the duties in

question are not routinely performed by

another classification on the wage

determination and it is the prevailing

practice in the area for helpers/tenders

to perform the work in question,

provided the other criteria of the

regulation are met. In other words,

although roofers may occasionally tear

off roofing or carry roofing materials, the

Department will issue a roofer’s helper

classification in a wage determination if

more roofer’s helpers perform these

tasks than roofers on the projects

surveyed, provided that the helpers

tasks are clearly defined and do not

include duties that prevail for other

classifications in the area (e.g.,

application of roofing where it is

prevailing practice that roofers perform

this work), and that the helper is not an

informal trainee. Consistent with the

Department’s practice on approval of

additional classifications under the

conformance procedures at section

5.5(a)(1)(ii)(A), moreover, the

Department will not approve an

additional classification of helper if the

helper performs any tasks that are ever

performed by other classifications on

the wage determination. Thus, in the

example given, the Department would

not approve the roofer’s helper as an

additional classification because tearing

off of roof and carrying of roofing

materials are sometimes done by

roofers.

Consistent with the above discussion,

the regulations have been amended to

delete the suspended provision at

section 1.7(d), defining the

circumstances in which use of helpers

would be found to prevail. The

Department will apply its longstanding

policies in determining prevailing

practices. Section 5.2(n)(4) has been

revised to set forth the circumstances in

which helpers will be recognized on

wage determinations and in additional

classification (conformance) requests.

Finally, the conformance provisions at

section 5.5(a)(1)(ii) have been revised to

delete the special references to helpers

from the suspended paragraphs, and the

second conformance provision at

section 5.5(a)(1)(v), which was in effect

during the period of the suspended

regulation, has been deleted.

Additional Modifications

The regulations are further amended

to reflect the organizational change in

the title of the Bureau of Apprenticeship

and Training (BAT) to the Office of

Apprenticeship, Training Employer and

Labor Services (ATELS).

IV. Executive Order 12866; § 202 of the

Unfunded Mandates Reform Act of

1995; Small Business Regulatory

Enforcement Fairness Act

Summary

The Department determined that the

proposed rule should be treated as

‘‘economically significant’’ within the

meaning of Executive Order 12866 and

as a major rule within the meaning of

the Small Business Regulatory

Enforcement Fairness Act because the

various alternatives to the proposed

rule, including reinstatement of the

suspended rule, could result in

potential savings in excess of $100

million per year. Therefore, a full

economic impact analysis was prepared

and presented for comment.19 The

principal finding of this analysis was

that any impact resulting from the

increased use of helpers under the

suspended rule, or any of the other

alternatives considered, would be

relatively modest. The Department

estimated potential savings under the

suspended rule to be from $72.8 million

69690 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

20With its ‘‘middle ground’’ approach, the

Department calculated that the great majority of

helpers would replace higher-paid journeyworkers,

thus enhancing the potential savings computed

under the suspended definition.

21Helpers, as defined by OES, ‘‘perform duties

such as furnishing tools, materials and supplies to

other workers; cleaning work areas, machines, and

tools; and holding materials or tools for other

workers.’’ 22One or more classifications of helper (union

and open shop) were found to prevail in 35 of 78

surveys. Open shop helpers were found to prevail

in only 20 of 78 surveys. 23A 1994 GAO report, ‘‘Changes to the DavisBacon Act Regulations and Administration,’’ (GAO/

HEHS–94–95R, February 7, 1994), noted that, as of

September 1993, the use of helpers was found to be

a prevailing practice in 23 of 73 surveys (32

percent) completed since the surveys were started

in April 1992.

(utilizing Current Population Survey

(CPS) data) to $296.0 million (utilizing

Occupational Employment Statistics

(OES) data). The Department also

devised an alternative methodology that

is OES-based, but utilizes CPS data to

compensate for the likelihood that OES

data overestimate the number of helpers

and underestimate the number of

laborers. This ‘‘adjusted-OES data’’

provided an estimate of $108.6 million

in possible savings. As discussed in the

NPRM, the Department believes that the

potential savings are likely to be closer

to $72.8 million than $296.0 million.

Discussion of Comments

The AGC does not believe that the

surveys and data sources used by the

Department support the conclusion that

the employment of helpers is not as

widespread as previously believed.

Specifically, the AGC pointed out that,

although the OES survey used does

combine laborers, helpers and other

categories, the survey is being revised to

separate the helpers and laborers,

making it more useful in the future. The

AGC states that independent contractors

rarely bid on Federal construction

contracts, but rather are frequently hired

by the contractors that are awarded the

contracts. It therefore disagreed with the

Department’s view that inclusion of selfemployed workers in the CPS is a

strength of the survey. Furthermore, the

AGC disagreed with the Department’s

statement that the OES definition of

helpers is very similar to laborers who

assist journeymen. Finally, the AGC

disagreed with the Department’s

conclusion that the OES survey likely

includes laborer employment with

helper employment, thereby overstating

the number of helpers and stated that

the Department offers no support for its

view that contractors cannot distinguish

between helpers and laborers.

The ABC believes that the

Department’s economic impact and

flexibility analysis greatly understates

the economic costs of the proposed rule.

Raising similar concerns to those raised

by the AGC, the ABC stated that the

Department’s analysis is flawed by: (1)

A lack of evidence that helpers would

replace laborers and apprentices in

proportion to the number of workers in

each of those occupations; (2) the

absence of a basis for assuming that OES

statistics include large numbers of

laborers in the estimates of helpers; (3)

improper inclusion of self-employed

workers in the universe of ‘‘relevant’’

construction employment; and (4) the

use of flawed and distorted 1992–1993

wage surveys to estimate the number of

classifications in which helpers would

prevail. The ABC estimates that the

proposed rule will cost hundreds of

millions of dollars each year.

Turning first to the CPS survey, the

Department continues to believe that it

is appropriate to include independent

contractors in construction workforce

data. As the AGC said, independent

contractors (performing as journeylevel

workers) are frequently hired by

contractors on Davis-Bacon contracts.

Furthermore, independent contractors

performing the work of laborers or

mechanics are covered by the Act. No

other concerns have been raised

regarding the appropriateness of the

data in the CPS. Therefore, as stated in

the NPRM (see 64 FR 17561), based

principally on the fact at this time the

OES has not published data with a

separate classification for laborer,

together with the fact that OES does not

collect data on self-employed

individuals, Wage and Hour continues

to believe that the CPS data are more

likely than the OES data to be

representative of the distribution of

employment in construction by

occupation for helpers and laborers.

The assumption that helpers would

replace laborers, apprentices, and

journeyworkers in proportion to the

number of workers in each of these

occupations is addressed in the NPRM

at 64 FR 17499. The Department

explained that the 1989 helper impact

analysis assumed that helpers would

replace only journeyworkers, and

measured the wage differentials based

only on this replacement effect. The

Department now believes this

assumption was incorrect because

helpers frequently perform laborers’

duties and laborers’ wage rates would

sometimes be higher than helpers’ rates

on the wage determination. The

Department observed that comments

received from some contractors

surveyed in the processing of helper

conformance requests during the period

the suspended regulations were in effect

indicated that they used the job title

‘‘laborer’’ for workers meeting the

definition of ‘‘helper’’ under the

suspended regulation. The Department

took a ‘‘middle ground’’ in its impact

analysis by assuming that helpers would

replace laborers, apprentices, and

journeyworkers in the same proportion

as their relative occupational

employment.20 The comments do not

undermine the reasonableness of this

assumption or provide a reasonable,

alternative approach.

The assumption that large numbers of

laborers are included in the OES helper

data is based on the absence of a

separate OES laborer classification, and

the fact that the duties described in the

OES helper definition are similar to

those performed by laborers.21

Furthermore, other available surveys,

such as the CPS, the Decennial Census,

and the four NCS pilot surveys

conducted by BLS show a much greater

incidence of laborer employment than

could be gleaned from the OES survey

data. As AGC pointed out, a separate

construction laborer classification is

included in the new Standard

Occupational Classification definitions

and will be used in future OES surveys.

The ABC’s contention that the 1992–

1993 wage surveys were distorted has

been discussed above. In addition, these

survey results were used only for the

assumption that helpers would be likely

to ‘‘prevail’’ for a limited number of

classes in areas representing about half

the construction employment covered

by the Davis-Bacon and Related Acts. 22

Representative Norwood and the

congressmen who joined in his

comments stated that the proposed rule

is based on an unrealistic economic

impact analysis, noting that the

Congressional Budget Office (CBO) has

estimated that legislation allowing the

increased use of helpers could save the

Federal government $1.4 billion over

five years and $3.5 billion over 10 years.

The CBO’s precise methodology for

estimating the reduction in

discretionary outlays over five and ten

year periods has not been provided. It

is the Department’s understanding that

the CBO estimates are based on the

methodology used by the Department to

estimate savings in its original impact

analysis conducted in 1982, with

estimated percentages of savings

modified (from 1.6 percent of federal

construction costs to .8 percent) to

account for changes to certain

assumptions made in the 1982

analysis.23 For the reasons set forth in

the NPRM, the Department now

believes, based on more current

information and data sources that were

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69691

24The Department believed that a Regulatory

Flexibility Analysis was not necessary because (1)

the proposed regulation would not result in any

changes in requirements for small businesses; (2) if

Wage and Hour were to propose implementing the

suspended rule or any of the alternatives

considered, it would not be more costly than

current regulatory requirements, and therefore,

would not have a significant economic impact on

a substantial number of small entities; and (3)

neither the suspended rule nor any of the

alternatives considered could be implemented in a

manner that would accomplish the objectives of the

statute.

not then available, that many of those

assumptions were wrong. The

Department also points out that the CBO

savings estimates are consistent with the

high end of the savings estimates set

forth in the Department’s latest

economic impact analysis, based on the

OES data.

The Building Trades and LIUNA both

state that the Department’s economic

impact analysis overstates any possible

cost savings under the suspended rule

and that consideration of certain other

factors would eliminate the ‘‘modest’’

savings predicted by the Department in

its analysis. The other factors that the

Building Trades and LIUNA believe

would offset any potential savings

under the suspended rule include: (1)

Lowered productivity of construction

workers as contractors employ more

low-wage, lesser-skilled workers; (2)

lowered income and sales tax revenues

resulting from lowered worker income;

(3) negative impact on apprenticeship

programs with reduced training levels

and lower skill levels among

construction workers; (4) increased

incidences of accidents and increased

workers’ compensation premiums due

to the increase in the number of new,

entry-level workers who are untrained

or inadequately trained; and (5) the

negative impact on the quality of public

construction resulting from the

increased use of lower-paid, lesserskilled workers. Finally, the Building

Trades and LIUNA believe that the

suspended rule, in and of itself, would

probably have no effect on Federal

budgetary outlays, as it is unlikely that

there would be a reduction in

congressional appropriations for Federal

and federally-assisted public building

and public works projects to reflect the

anticipated cost savings from the

increased use of helpers.

While the factors mentioned by the

Building Trades and LIUNA could have

some bearing on impact analysis

estimates (the NPRM did, for example,

note the possibility of reduced savings

as a result of fewer apprenticeships and

higher journeyworker wage rates),

adequate data simply are not available

to allow detailed consideration of these

factors. Of the many studies cited, none

provides the framework or data

necessary for integration into an

economic impact analysis. Furthermore,

there may be offsetting factors which

could neutralize the effects of the factors

cited.

Of the many studies cited by these

commenters, none provides the

framework or data necessary for

integration into an economic impact

analysis. For the most part, the studies

cited in the union comments do not

focus directly on the comparative costs

of the two helper rules, but rather on the

more general cost differentials

associated with union versus open shop

construction. Moreover, the Department

has determined that comparisons would

be made using only primary, direct costs

for the following reasons: (1) Generally

accepted databases maintained by

Federal agencies should be relied upon

in the comparative cost study; and (2)

the impact of such factors as

productivity, social costs/benefits, and

construction quality are not definitive,

and therefore, consideration of these

factors would invite considerable debate

from those who have reached opposite

conclusions based on their research.

The Department therefore concludes

that the belief expressed by the Building

Trades and LIUNA that adoption of the

suspended rule would probably have no

effect on Federal budgetary outlays is

too speculative to form an appropriate

basis for their integration into a costimpact analysis.

Final Regulatory Impact Analysis

After review of the comments, the

Department has concluded that there is

no reason to change its estimates of the

potential savings under the suspended

rule and the other alternatives

considered, in comparison to the

proposed rule, as set forth in the

preliminary regulatory impact analysis.

V. Executive Order 13132 (Federalism)

The Department has reviewed this

rule in accordance with Executive Order

13132 regarding federalism, and has

determined that it does not have

‘‘federalism implications.’’ The rule

does not ‘‘have substantial direct effects

on the States, on the relationship

between the national government and

the States, or on the distribution of

power and responsibilities among the

various levels of government.’’

VI. Regulatory Flexibility Act

Under the Regulatory Flexibility Act,

Public Law 96–354 (94 Stat. 1164; 5

U.S.C. 601 et seq.), Federal agencies are

required to prepare and make available

for public comment an initial regulatory

flexibility analysis that describes the

anticipated impact of proposed rules

that would have a significant economic

impact on small entities. Though the

Department determined that a

regulatory flexibility analysis was not

necessary for the proposed rule because

it would not have a significant

economic impact on a substantial

number of small entities, it nonetheless

published for comment such an analysis

because of the interest in the rule.24

After review of the comments and

consideration of the various

alternatives, the Department has

prepared the following regulatory

flexibility analysis regarding this rule:

(1) The Need for and Objectives of the

Rule

In 1982, Wage and Hour published

final regulations which, among other

things, would have allowed contractors

to use ‘‘semi-skilled’’ helpers on DavisBacon covered projects at wages lower

than those paid to skilled

journeyworkers. These rules represented

a sharp departure from Wage and Hour’s

longstanding practice of not allowing

overlap of duties between job

classifications. To protect against

possible abuse, a provision was

included limiting the number of helpers

which could be used on a covered

project to a maximum of two helpers for

every three journeyworkers. This ratio

provision was subsequently invalidated

by the U.S. Court of Appeals for the

District of Columbia.

As discussed in greater detail above,

during its existence, the helper rule has

been the subject of considerable

litigation and Congressional attention.

The rule has been enjoined by the

district court and modified on two

occasions as a result of court of appeals

decisions. It has twice been

implemented for short periods of time.

It has also been suspended on two

occasions as the result of Congressional

action prohibiting Wage and Hour from

spending any funds to implement or

administer the helper rule. On

December 30, 1996, the Department’s

suspension of the 1982 rule was

continued pending completion of this

rulemaking.

The helper rule was originally

proposed and adopted because it was

believed that it would result in a

construction workforce on Federal

construction projects that more closely

reflected private construction’s

‘‘widespread’’ use of helpers to perform

certain craft tasks and, at the same time,

effect significant cost savings in federal

construction costs. It was also believed

69692 Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations

that the expanded definition would

provide additional job and training

opportunities for unskilled workers, in

particular women and minorities. The

Department’s subsequent efforts to

develop enforcement guidelines led it to

conclude that administration and

enforcement of the revised helper rule

would be much more difficult than

anticipated, especially in light of the

court’s invalidation of the ratio

provision. Moreover, new data has led

the Department to conclude that the use

of helpers is not as widespread as

previously thought. The Department is

also concerned about the possible

negative effect of the helper regulations

on formal apprenticeship and training

programs. These factors led the

Department to conclude that the

suspended helper rule should not be

implemented and that new regulations

were needed to govern employment of

helpers on DBRA-covered projects. The

objective of these regulations is to

establish the most appropriate approach

to governing employment of helpers on

DBRA-covered projects.

(2) Summary of Significant Issues

Raised by the Public Comments in

Response to the Initial Regulatory

Flexibility Analysis

The Department received a number of

comments regarding the economic

impact analysis prepared pursuant to

Executive Order 12866. Those

comments were discussed in the

previous section containing the

Department’s economic impact analysis.

The Department received no separate

comments concerning its initial

regulatory flexibility analysis.

(3) Number of Small Entities Covered

Under the Rule

Size standards for the construction

industry are established by the Small

Business Administration (SBA), and are

expressed in millions of dollars of

annual receipts for affected entities, i.e.,

Major Group 15, Building

Construction—General Contractors and

Operative Builders, $17 million; Major

Group 16, Heavy Construction (nonbuilding), $17 million; and Major Group

17, Special Trade Contractors, $7

million. The overwhelming majority of

construction establishments would have

annual receipts under these levels.

According to the Census, 98.7 percent of

these establishments have annual

receipts under $10 million. Therefore,

for the purpose of this analysis, it is

assumed that virtually all

establishments potentially affected by

this rule would meet the applicable

criteria used by the SBA to define small

businesses in the construction industry.

As explained above, however, the

final rule would cause no impact on

small entities since it does not propose

to make any changes in requirements

applicable to small businesses.

Implementation of the suspended rule

or any of the alternatives considered

would expand the use of helpers and

could result in some savings to the

Federal government and to recipients of

Federal assistance. The impact would

depend upon the specifications of the

alternative relative to current practice.

Even relative to unlimited use, however,

possible savings would be very modest,

ranging from 0.239 percent of the value

of Davis-Bacon annual construction

starts (CPS), to 0.359 (adjusted OES),

and 0.958 (unadjusted OES) percent

and, as discussed in the Department’s

economic impact analysis in the NPRM,

may very well be short-termed.

(4) Reporting, Recordkeeping and Other

Compliance Requirements of the Rule

There are no reporting or recording

requirements for contractors under the

final rule. Nor would there be any such

requirements under the suspended rule

or any of the alternatives considered.

The compliance requirements under any

rule regarding helpers would merely

require contractors who use helpers to

do so in accordance with a chosen

regulatory framework and pay helpers at

least the prevailing wages for the helper

classification as set by the Department.

(5) Description of the Steps Taken To

Minimize the Significant Economic

Impact on Small Entities Consistent

with the Objectives of the Davis-Bacon

and Related Acts

The Department carefully analyzed

the suspended rule, as well as a number

of alternative approaches, to determine

whether they could be enforced and

administered in a manner consistent

with the objectives of the Davis-Bacon

and Related Acts. Based on this

analysis, the Department concluded that

the final rule, which adopts the

Department’s current policy governing

employment of helpers, is the only

alternative considered that is both

consistent with the purposes of the

Davis-Bacon and Related Acts and

capable of practical and efficient

administration, enforcement, and

compliance.

The Department also performed an

economic impact analysis wherein the

Department estimated the relative

economic costs under the suspended

rule, the various alternatives

considered, and the final rule,

respectively. As detailed above, the

Department concluded from this

analysis that any economic cost savings

to the Federal government and

recipients of Federal assistance,

resulting from the increased use of

lower-paid helpers under the suspended

rule or any of the other alternatives

considered, would be relatively modest.

The Department therefore determined

that implementation of the final rule,

which preserves the status quo

concerning employment of helpers on

DBRA-covered projects, would not have

a significant economic impact on a

substantial number of small entities.

Document Preparation

This document was prepared under

the direction and control of John R.

Fraser, Deputy Administrator, Wage and

Hour Division, Employment Standards

Administration, U.S. Department of

Labor.

List of Subjects

29 CFR Part 1

Administrative practice and

procedure, Construction industry,

Government contracts, Minimum wages.

29 CFR Part 5

Administrative practice and

procedure, Construction industry,

Employee benefit plans, Government

contracts, Minimum wages, Reporting

and recordkeeping requirements.

Accordingly, for the reasons set forth

in the preamble, 29 CFR Part 1 and Part

5 are amended as set forth below:

PART 1—PROCEDURES FOR

PREDETERMINATION OF WAGE

RATES

1. The authority citation for Part 1

continues to read as follows:

Authority: 5 U.S.C. 301; R.S. 161, 64 Stat.

1267; Reorganization Plan No. 14 of 1950, 5

U.S.C. Appendix; 29 U.S.C. 259; 40 U.S.C.

276a–276a–7; 40 U.S.C. 276c; and the laws

listed in appendix A of this part.

2. Section 1.7(d) is revised to read as

follows:

§ 1.7 Scope of consideration.

* * * * *

(d) The use of helpers, apprentices

and trainees is permitted in accordance

with part 5 of this subtitle.

Federal Register / Vol. 65, No. 224 / Monday, November 20, 2000 / Rules and Regulations 69693

PART 5—LABOR STANDARDS

PROVISIONS APPLICABLE TO

CONTRACTS COVERING FEDERALLY

FINANCED AND ASSISTED

CONSTRUCTION (ALSO LABOR

STANDARDS PROVISIONS

APPLICABLE TO NONCONSTRUCTION

CONTRACTS SUBJECT TO THE

CONTRACT WORK HOURS AND

SAFETY STANDARDS ACT)

3. The authority citation for Part 5

continues to read as follows:

Authority: 40 U.S.C. 276a–276a–7; 40

U.S.C. 276c; 40 U.S.C. 327–332;

Reorganization Plan No. 14 of 1950, 5 U.S.C.

Appendix; 5 U.S.C. 301; 29 U.S.C. 259; 108

Stat. 4104(c); and the statutes listed in

section 5.1(a) of this part.

4. In § 5.2, paragraph (n)(1) is

amended by removing ‘‘Bureau of

Apprenticeship and Training’’ each

place it appears in the paragraph and

inserting in its place ‘‘Office of

Apprenticeship Training, Employer and

Labor Services’’, and paragraph (n)(4) is

revised to read as follows:

§ 5.2 Definitions.

* * * * *

(n) * * *

(4) A distinct classification of

‘‘helper’’ will be issued in wage

determinations applicable to work

performed on construction projects

covered by the labor standards

provisions of the Davis-Bacon and

Related Acts only where:

(i) The duties of the helper are clearly

defined and distinct from those of any

other classification on the wage

determination;

(ii) The use of such helpers is an

established prevailing practice in the

area; and

(iii) The helper is not employed as a

trainee in an informal training program.

A ‘‘helper’’ classification will be added

to wage determinations pursuant to

§ 5.5(a)(1)(ii)(A) only where, in addition,

the work to be performed by the helper

is not performed by a classification in

the wage determination.

* * * * *

5. Section 5.5 is amended by

removing paragraphs (a)(1)(ii)(A)(4) and

(a)(1)(v); by removing ‘‘; and’’ from the

end of paragraph (a)(1)(ii)(A)(3) and

inserting in its place a period; by

revising paragraph (a)(1)(ii)(A)(1) to read

as set forth below; and by removing the

phrase ‘‘Bureau of Apprenticeship and

Training’’ each place it appears in

paragraph (a)(4) and inserting in its

place ‘‘Office of Apprenticeship

Training, Employer and Labor Services’’

and removing ‘‘Bureau’’ each time it

appears in paragraph (a)(4) and inserting

in its place ‘‘Office’’.

§ 5.5 Contract provisions and related

matters.

* * * * *

(a) * * *

(1) * * *

(ii)(A) * * *

(1) The work to be performed by the

classification requested is not performed

by a classification in the wage

determination; and

* * * * *

Signed at Washington, D.C., on this 14th

day of November, 2000.

Bernard E. Anderson,

Assistant Secretary for Employment

Standards.

[FR Doc. 00–29533 Filed 11–17–00; 8:45 am]

BILLING CODE 4510–27–U

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[DA 00–2483; MM Docket No. 99–282; RM–

9710]

Radio Broadcasting Services;

Littlefield, AZ

AGENCY: Federal Communications

Commission.

ACTION: Final rule; petition for

reconsideration.

SUMMARY: This document dismisses a

Petition for Reconsideration filed on

behalf of Mountain West Broadcasting

directed to the Report and Order in this

proceeding, which denied the requested

allotment of Channel 265C to Littlefield,

Arizona, for failure to demonstrate that

Littlefield qualifies as a community for

allotment purposes. See 65 FR 25463,

May 2, 2000. The petition for

reconsideration is dismissed as it does

not meet the limited provisions set forth

in the Commission’s Rules under which

a rule making action will be

reconsidered. With this action, this

docketed proceeding is terminated.

FOR FURTHER INFORMATION CONTACT:

Nancy Joyner, Mass Media Bureau, (202)

418–2180.

SUPPLEMENTARY INFORMATION: This is a

summary of the Commission’s

Memorandum Opinion and Order, in

MM Docket No. 99–282, adopted

October 25, 2000, and released

November 3, 2000. The full text of this

Commission decision is available for

inspection and copying during normal

business hours in the FCC Reference

Information Center (Room CY–A257),

445 Twelfth Street, SW., Washington,

DC. The complete text of this decision

may also be purchased from the

Commission’s copy contractor,

International Transcription Service,

Inc., 1231 20th Street, NW.,

Washington, DC 20036, (202) 857–3800.

Federal Communications Commission.

John A. Karousos,

Chief, Allocations Branch, Policy and Rules

Division, Mass Media Bureau.

[FR Doc. 00–29625 Filed 11–17–00; 8:45 am]

BILLING CODE 6712–01–U

DEPARTMENT OF THE INTERIOR

Fish and Wildlife Service

50 CFR Part 17

RIN 1018–AF73

Endangered and Threatened Wildlife

and Plants; Designation of Critical

Habitat for the Tidewater Goby

AGENCY: Fish and Wildlife Service,

Interior.

ACTION: Final rule.

SUMMARY: We, the U.S. Fish and

Wildlife Service (Service), designate

critical habitat for the tidewater goby

(Eucyclogobius newberryi), pursuant to

the Endangered Species Act of 1973, as

amended (Act). The designation

includes 10 coastal stream segments in

Orange and San Diego Counties,

California, totaling approximately 9

linear miles of streams. Critical habitat

includes the stream channels and their

associated wetlands, flood plains, and

estuaries. These habitat areas provide

for the primary biological needs of

foraging, sheltering, reproduction, and

dispersal, which are essential for the

conservation of the tidewater goby.

Section 7 of the Act requires Federal

agencies to ensure that actions they

authorize, fund, or carry out are not

likely to destroy or adversely modify

designated critical habitat. As required

by section 4 of the Act, we considered

economic and other relevant impacts

prior to making a final decision on what

areas to designate as critical habitat.

DATES: The effective date of this rule is

December 20, 2000.

ADDRESSES: You may inspect the

complete file for this rule at the

Carlsbad Fish and Wildlife Office, U.S.

Fish and Wildlife Service, 2730 Loker

Avenue West, Carlsbad, California

92008, by appointment during normal

business hours.

FOR FURTHER INFORMATION CONTACT: Ken

Berg, Field Supervisor, Carlsbad Fish

and Wildlife Office, at the above

address; telephone 760/431–9440,

facsimile 760/431–5902.

SUPPLEMENTARY INFORMATION: