### - TEE ATTORNEY GENERAL OF TEXAS

Honorable Chet Brooks Opinion No. JM-1164 Chairman Health and Human Services Re: Inclusion of fringe beneCommittee fits in calculating the preTexas State Senate vailing wage under article P. 0. Box 12068 5159a, V.T.C.S. (RQ-1857) Austin, Texas 78711

Dear Senator Brooks:

You askwhether article 5159a, V.T.C.S., requires the inclusion of fringe benefits inthe calculation of the prevailing wage. That article governs the payment ofwages for the construction ofpublic works onbehalf of the state or itsvarious political subdivisions. Section 1provides in part:

Not less than the general prevailing rate of

per diem wages for work of a **similar** character inthe locality inwhich the work isperformed, and not less than the general prevailing rate ofper diemwages for legal holiday and overtime work, shall be paid to all laborers, workmen andmechanics employed by or onbehalf of the State ofTexas, or by or onbehalf of any county, city and county, city, town, district or other political subdivision of the State, or any officer or public body thereof, shall be deemed to be employed upon public works . . . . Section 4of the article provides inpart:

The term 'general prevailing rate ofper diem wages1 shall be the rate determined upon as such rate by the public body awarding the contract, or authorizing the work, whose decision inthematter shall be final.

InAttorney General Opinion H-350 (1974)this office was asked about the permissibility of including fringe benefits inthe calculation of the prevailing wage. That opinion noted that a governing body's determination fixing the prevailing wage rate was final and not judicially

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reviewable. See Texas Hiahwav Comm'n v. El Paso Blda. & -1 234 S.W.2d 857 (Tex. 1950). co st . opinion concluded that 'apublic body The had discretion under the statute to consider fringe benefits indetermining a prevailing wage rate.

You ask us tomodify the holding ofAttorney General Opinion H-350 and to construe the statute to require the inclusion of the value of fringe benefits in the determination of the prevailing wage rate. you tell us that this request isprompted by the current practice of the University of Texas System tono longer include fringe benefits in itswage table calculations for its construction contracts ingiven localities.

In its response to your request, the University of Texas **System** indicates that inthose areas where union contractors represented the prevailing work force inagiven locality, itswage tables included fringe benefits, because the payment of fringe benefits isnot prevailing practice in those areas. In those areaswhere open-shop work represents the prevailing work force,we understand that theUniversity System's wage tables do not include fringe benefits. Thus, theUniversity **System ’** **s** wage tables appear to reflect the prevailing practice in agiven locality.1 Consequently, your question does not accurately describe the practice as described by theUniversity ofTexas System.

In our opinion, the inclusion of thevalue of fringe benefits in a governmental body's determination of the prevailing wage must be amatter forthe governmental body. If the entity determines thatwages inagiven locality for **similar** work **typically** include fringe benefits, that factor should be considered inthe calculation. Itwould be inconsistent, inour opinion, to read the statute as requiring the inclusion of fringe benefits when the prevailing practice inthe locality isotherwise. As indicated in the brief filed by theUniversity of Texas System, the inclusion of fringe benefits insuch a locality would compel the contracting authority topay wages at a rate that is higher than the prevailing rate.

We note that several attempts to amend article 5159a to expressly include fringe benefits have been unsuccessful.2

**1.** We accept theUniversity System's description as accurate, because this is a factualmatter not appropriately determined inthe opinion process.
2. Legislation introduced inthe 63rd, 64th, and 68th (Footnote Continued)

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.

While this fact alone does not preclude an interpretation

that fringe benefits are mandated by the current language, it supports this office's earlier reading of the statute in Attorney General Opinion H-350. We are not persuaded that the University of Texas System's method ofdetermining the prevailing wage for agiven locality is inconsistent with article 5159a. Therefore, we decline to modify Attorney General Opinion H-350. Inour opinion, agoverning body is not required by article 5159a to include thevalue of fringe benefits in itscalculation of the prevailing wage in a given locality. It is proper for the governing body to include thevalue of fringe benefits in its calculation if itdetermines that payment of fringe benefits is the prevailing practice in the locality.

SUMMARY

A governing body is **not** required by article 5159a, V.T.C.S., to include the value of fringe benefits prevailing **wage**

-, - in its calculation of the inagiven locality. L

JIM MATTOX Attorney General of Texas

MARY KELLER FirstAssistant Attorney General

JUDGE ZOLLIE STEAKLEY Special Assistant Attorney General

RENEA HICKS Special Assistant Attorney General

RICK GILPIN Chairman, Opinion Committee
Prepared by Karen C.Gladney Assistant Attorney General

(Footnote Continued) Legislative Sessions would have amended article 5159a to include fringe benefits inthe rate ofpay calculated under that article. None of these amendments was adopted, however. See S.B. 329, 63d Leg. (1973);H.B. 936, 63d Leg. (1973); S.B. 804, 64th Leg. (1975); S.B. 1259 64th Leg. 7 (1975); S.B. 950, 68th Leg. (1983);H.B. 1399, 68th Leg.

(1983).

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