Furthermore, our initial economic analyses conducted on these issues indicate that the proposed changes have the potential for saving the state and hard-pressed local governments and California taxpayers millions of dollars in the state's infrastructure needs during coming years. In his January 1995 budget message, the Governor requested that DIR review existing prevailing wage requirements for any needed regulatory or legislative changes.
Competition is about getting the best available service at the lowest cost.
The regulatory reforms to be discussed at the public hearings include a new method for calculating the prevailing wage and repeal of a rule that requires an automatic increase in prevailing wages which are not in effect, but only scheduled in union contracts. The proposed regulations change the method for determining the prevailing wage from the modal approach to a modified weighted average, which is the same approach used by the federal government. In other words, the prevailing rate will be the rate paid to a majority of the workers or, if no single rate is paid a majority, a weighted average will be used. This has been the federal rule since the early 1980's. The modal approach required that the most frequently occurring wage rate be considered prevailing, taking no account of wages above and below that rate, even if paid to many more workers.