Court Opinion

ID: 4119912
Source: CourtListenerOpinion
Date Created: 2017-01-27 22:43:44.249119+00
Date Added: 2024-06-11T14:22:12.339606
License: Public Domain

Application of the Davis-Bacon Act
                      to Urban Development Projects
                   that Receive Partial Federal Funding

Section 110 o f the Housing and Com munity Developm ent Act o f 1974 requires that those
  engaged in construction work th at is financed w ith federal funds (whether in whole or in part)
  receive wages at rates prevailing in the locality as determined by the Secretary o f Labor under
  the Davis-Bacon Act. However, if the construction work is not financed with federal funds,
  the Davis-Bacon Act wage rates need not be paid, even if other aspects o f the construction
  project, such as land, fixtures, o r services, receive federal funds pursuant to the Act.

This question arose pursuant to a dispute between the Secretary o f Labor and the Secretary o f
  H ousing and Urban Development in the course o f exercising their respective authorities under
  the Act. T he Office o f Legal Counsel has jurisdiction to resolve the dispute pursuant to
  E xecutive O rder No. 12146.

                                                                                 August 6, 1987

                   M   em orandum       O p in io n      for th e   Secretary,
              D epa rtm en t    of   H o u s in g   and    U   rban   D evelopm ent

   This memorandum responds to your request for the opinion of the Attorney
General on the proper interpretation of § 110 of the Housing and Community
Development Act of 1974 (Act), 42 U.S.C. § 5310. The Attorney General has
referred this matter to the Office of Legal Counsel for resolution.

                                        I. Background

   Title I of the Act authorizes the Secretary of Housing and Urban Develop­
ment (HUD) to provide Community Development Block Grants (CDBG) and
Urban Development Action Grants (UDAG) to States and localities for “the
development of viable urban communities, by providing decent housing and a
suitable living environment and expanding economic opportunities, principally
for persons of low and moderate income.” 42 U.S.C. § 5301(c). Section 110 of
the Act requires that “[a]ll laborers and mechanics employed by contractors or
subcontractors in the performance of construction work financed in whole or in
part with assistance received under this chapter shall be paid wages at rates . . .
determined by the Secretary of Labor in accordance with the Davis-Bacon
Act.” 42 U.S.C. §5310.
                                                    92
   In 1985, the Department of Labor took the view that § 110 requires payment
of Davis-Bacon wages not only when UDAG and CDBG funds are used
directly to pay for the activities commonly thought of as “construction” of a
building, but also when those funds are used for other activities that are
integrally and proximately related to that construction, even if no federal funds
are expended directly for the construction work. The Department of Labor
provided three examples of the application of this standard:
       For example, if UDAG or CDBG funds were used to acquire the
       land upon which construction was later to take place, that con­
       struction should be done with Davis-Bacon wages, even if all
       UDAG or CDBG dollars had been expended before the com­
       mencement of the direct construction activity. .. . Other such
       costs could include, for example, engineering and architectural
       fees, materials, and equipment or machinery to be installed as
       part of the building.
Letter to Robert A. Georgine, President, Building & Construction Trades
Department, AFL-CIO from Susan R. Meisinger, Deputy Under Secretary for
Employment, Department of Labor at 2 (July 31, 1985) (Labor Opinion).
   HUD disputes this interpretation on the grounds that, in HUD’s view, it
would initiate a drastic departure from the consistent application of Davis-
Bacon requirements under the Act. Accordingly, HUD requested that Labor
reconsider the position taken in its July 31, 1985 letter. On July 21, 1987, the
Secretary of Labor responded by withdrawing the “integrally and proximately
related” test and stating that “the question must be whether the construction
work is federally financed,” and that “the mere use of federal funds to finance
the purchase of land . . . does not trigger Davis-Bacon coverage under the
statute.” Letter to the Honorable Samuel R. Pierce, Jr., Secretary, Department
of Housing and Urban Development, from the Honorable William E. Brock,
Secretary, Department of Labor (July 21, 1987).
   The Secretary of Labor’s letter, however, reserved the question of “the
application of Davis-Bacon requirements to projects on which UDAG/CDBG
funds are used to purchase equipment installed as part of the project,” and,
apparently, the question of the application of Davis-Bacon requirements to
non-federally funded construction work when federal funds are used to pay for
“engineering and architectural fees.” Id. After reviewing the Secretary of
Labor’s letter, the Secretary of HUD noted that the letter “does not resolve
other issues . .. raised [in the Labor Opinion]. In particular, whether UDAG/
CDBG financing of architectural and engineering fees and purchase of equip­
ment would require prevailing wages on related private construction work is
unanswered . . . . As your letter fails to resolve all the issues springing from the
[Labor Opinion], I must continue to seek a comprehensive decision from the
Attorney General.” Letter to the Honorable William E. Brock, Secretary,
Department of Labor, from the Honorable Samuel R. Pierce, Jr., Secretary,
Department of Housing and Urban Development (July 28, 1987).
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                                II. Discussion

A. Jurisdiction

   Before turning to the substantive issues presented by your request, we
address a threshold jurisdictional matter: whether the Attorney General, and
hence this Office, has authority to render an opinion on the proper interpreta­
tion of the Housing and Community Development Act at the request of the
Secretary of HUD. The Department of Labor has suggested that Reorganiza­
tion Plan No. 14 of 1950,15 Fed. Reg. 3176 ( reprinted in 5 U.S.C. app. at 1050
(1982) and in 64 Stat. 1267 (1950)), precludes the Attorney General from
rendering such an opinion. In its view, the Secretary of Labor has the exclusive
authority to issue a ruling concerning the proper interpretation of the Davis-
Bacon provisions of the Housing and Community Development Act. This
view, however, misconstrues the Reorganization Plan as well as the authority
and functions of the Attorney General and the Secretary of Housing and Urban
Development.
   Section 110 of the Act provides:
       All laborers and mechanics employed by contractors or subcon­
       tractors in the performance of construction work financed in
       whole or in part with assistance received under this chapter shall
       be paid wages at rates not less than those prevailing on similar
       construction in the locality as determined by the Secretary of
       Labor in accordance with the Davis-Bacon Act, as amended (40
       U.S.C. §§ 276a, 276a-5).. . The Secretary of Labor shall have,
       with respect to such labor standards, the authority and functions
       set forth in Reorganization Plan Numbered 14 of 1950 (15 F.R.
       3176; 64 Stat. 1267) and section 276c of title 40.
42 U.S.C. § 5310. The Reorganization Plan, in turn, provides:
       In order to assure coordination of administration and consis­
       tency of enforcement o f the labor standards provisions of each
       of the following Acts by the Federal agencies responsible for the
       administration thereof, the Secretary of Labor shall prescribe
       appropriate standards, regulations, and procedures, which shall
       be observed by these agencies . . . .
Reorganization Plan No. 14 of 1950, 15 Fed. Reg. 3176 (reprinted in 5 U.S.C.
app. at 1050 (1982) and in 64 Stat. 1267 (1950)).
  Labor argues that its interpretation of § 110 constitutes an appropriate stan­
dard, regulation, or procedure to enforce the labor standard provisions of the
Act. But even assuming the validity of this argument, the Reorganization Plan
speaks only to the respective functions of HUD and Labor in administering the
Housing and Community Development Act. The Reorganization Plan does not
preclude either the head of a department from seeking, or the Attorney General
                                      94
from rendering, an opinion on a question of law arising in the administration of
his department.
   By law, “[t]he head of an executive department may require the opinion of
the Attorney General on questions of law arising in the administration of his
department.” 28 U.S.C. § 512. The only limitation on the right of the head of an
executive department to obtain an opinion of the Attorney General is that the
question presented must be one that actually arises in the administration of his
department. See 31 Op. Att’y Gen. 234 (1918); 31 Op. Att’y Gen. 127 (1917);
20 Op. Att’y Gen. 178 (1891). Thus, the initial inquiry is whether the question
presented by the Secretary of HUD — whether the acquisition of land, fixtures,
or architectural and engineering services with federal assistance requires a
finding that “integrally and proximately related” construction work paid for
entirely with non-federal funds must be deemed financed in whole or in part
with federal assistance — is one “arising in the administration of his depart­
ment” within the meaning of 28 U.S.C. § 512.
   We think that it clearly is. The Secretary of HUD is charged with the
administration of the Act. The interpretation given to § 110 determines the
nature and contents of the contracts the Secretary must enter into with state and
local recipients of UDAG and CDBG funds. As the Secretary stated in his letter
of May 13, 1987, to the Attorney General:
         The need for a resolution of this dispute is even more urgent
       now than when I wrote you last October: the construction season
       has begun; our Urban Development Action Grant (UDAG) sub­
       missions are due in May and July; and the majority of our
       Community Development Block Grant (CDBG) submissions
       will be coming in the next two months.
Letter to the Honorable Edwin Meese III, Attorney General, from the Honor­
able Samuel R. Pierce, Jr., Secretary, Department of Housing and Urban
Development (May 13, 1987). The Reorganization Plan confirms this conclu­
sion. The Plan itself recognizes that although federal agencies must observe
“appropriate standards, regulations, and procedures” prescribed by the Secre­
tary of Labor, these agencies remain responsible for the administration of the
underlying Acts. As the Message of the President accompanying the Reorgani­
zation Plan states: “The actual performance of enforcement activities . . . will
remain the duty of the respective agencies awarding the contracts or providing
the Federal assistance.” 5 U.S.C. app. at 1050-51 (1982).
   Our conclusion that the Secretary is entitled by law to the opinion of the
Attorney General is consistent with the analysis and conclusion of Attorney
General Levi in a situation virtually identical to this one. See 43 Op. Att’y Gen.
No. 8 (Jan. 11, 1977). There, the Secretary of Commerce sought the opinion of
the Attorney General concerning the meaning of the phrase “contractors or
subcontractors” as used in § 109 of the Local Public Works Capital Develop­
ment and Investment Act of 1976. That section, in language virtually identical
to that of § 110, provides:
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        All laborers and mechanics employed by contractors or subcon­
        tractors on projects assisted by the Secretary under this Act shall
        be paid wages at rates not less than those prevailing on similar
        construction in the locality as determined by the Secretary of
        Labor in accordance with the Davis-Bacon Act, as amended (40
        U.S.C. §§ 276a-276a-5).. . . The Secretary of Labor shall have,
        with respect to the labor standards specified in this provision,
        the authority and functions set forth in Reorganization Plan
        Numbered 14 of 1950 (15 F.R. 3176; 64 Stat. 1267; 5 U.S.C.
        §§ 133z-15), and section 2 of the Act of June 13, 1964, as
        amended (40 U.S.C. § 276c).
The Secretary of Labor took the position that the phrase included state and
local governments who performed construction work with their own work
force. The Secretary of Commerce disagreed, contending that the terms “con­
tractors or subcontractors” could refer only to those who contracted with
laborers and mechanics to perform the work. The Attorney General rejected the
Labor Department’s claim that he was without authority to render the requested
opinion, finding that “the Secretary of Commerce’s administrative responsibil­
ity for implementation of the Local Public Works Act at least requires him to
satisfy himself concerning any doubts he may have regarding the lawfulness of
the Secretary of Labor’s determination, and permits him to seek my advice for
that purpose.” 43 Op. Att’y Gen. No. 8, at 3. The opinion continued:
       This conclusion will be seen as particularly appropriate when it
       is recognized that, as will be discussed below, the present con­
       troversy does not involve a uniform interpretation which the
       Secretary of Labor seeks to apply to the Davis-Bacon Act and all
       related acts, but rather a special rule applicable to the Local
       Public Works Act. To the extent the outcome hinges upon the
       peculiar text or peculiar circumstances of that law, the policy
       considerations supporting an assertion of exclusive cognizance
       in the Secretary of Labor become less persuasive, and the issue
       becomes more appropriate for — if not resolution by the Secre­
       tary of Commerce — at least examination by the Attorney
       General at the Secretary’s instance.
Id. at 3—4. This passage applies with equal force to the present request.
   Executive Order No. 12146, concerning the resolution of interagency legal
disputes, does not alter this conclusion. Executive Order No. 12146 provides in
pertinent part:
       1—401. Whenever two or more executive agencies are unable to
       resolve a legal dispute between them, including the question of
       which has jurisdiction to administer a particular program or to
       regulate a particular activity, each agency is encouraged to
       submit the dispute to the Attorney General.
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          1-402. Whenever two or more Executive agencies whose heads
          serve at the pleasure of the President are unable to resolve such a
          legal dispute, the agencies shall submit the dispute to the Attor­
          ney General prior to proceeding in any court, except where there
          is specific statutory vesting of responsibility for a resolution
          elsewhere.

Section 1-401 authorizes and encourages executive agencies to submit their
legal disputes to the Attorney General. This provision applies not only to the
executive departments, but also to all other agencies in the Executive Branch.
Executive Order No. 12146 thus expands the authority of the Attorney General
to render legal opinions beyond his statutory obligation to render opinions at
the request of the heads of executive departments on questions of law arising in
the administration of their departments. See 28 U.S.C. § 512.1
   In addition, when the heads of the agencies serve at the pleasure of the
President, § 1-402 requires the agencies to submit legal disputes they are
unable to resolve to the Attorney General “except where there is specific
statutory vesting of responsibility for a resolution elsewhere.” Labor contends
that the exception precludes resolution of the current dispute by the Attorney
General. Even assuming, however, that Reorganization Plan No. 14 of 1950 —
directing the Secretary of Labor to prescribe appropriate labor-related stan­
dards, regulations, and procedures — constitutes “specific statutory vesting of
responsibility for a resolution” of the present dispute within the Secretary of
Labor, the reorganization legislation’ in no sense affects the authority of the
head of an executive department to seek, or the Attorney General to render, an
opinion under 28 U.S.C. § 512 on questions of law that arise in the administra­
tion of his department. Rather, under the above assumption, Reorganization
Plan No. 14 of 1950 at most would mean that § 1-402 of Executive Order No.
12146 does not require the Secretaries of HUD and Labor to submit this legal
dispute to the Attorney General.
   Thus, Executive Order No. 12146 is not fully apposite to the present request.
Neither Reorganization Plan No. 14 of 1950 nor Executive Order No. 12146
purport in any way to preclude the head of an executive department from
requesting the opinion of the Attorney General on questions of law arising in
the administration of his department. Since 1789, it has been the duty of the
Attorney General “to give his advice and opinion upon questions of law .. .
   1 U nder 28 U.S.C. § 512, A ttorneys General have felt constrained to decline requests for legal opinions
from executive agencies not w ithin one o f the executive departm ents. See, e.g., 37 Op. A tt’y Gen. 488, 490
(1934) (declining to give an opinion at the request o f the Reconstruction Finance C orporation on the ground
that “the Attorney G eneral is authorized to render opinions only upon the request o f the P resident or the head
o f an executive departm ent”); 20 Op. A tt’y Gen. 312, 313 (1892) (stating that the “Civil S ervice C om m ission
is not included w ithin any o f the great D epartm ents o f G overnm ent” and that “ [ujntil the Com m ission shall
request the President, to whom they are directly responsible, to present the question o f law arising in the
discharge o f their duties to the A ttorney General, he is not called upon to give, and should not under the law
give, his opinion” ). W ith the prom ulgation o f Executive O rder No. 12146, the President has authorized all
executive agencies to request the opinion o f the A ttorney G eneral w henever a legal dispute arises between
such agencies.

                                                      97
when requested by the heads of any of the departments, touching any matters
that may concern their departments.” Judiciary Act of 1789, ch. 20, § 35,1 Stat.
73, 93. Accordingly, by law, the heads of executive departments may require
the opinion of the Attorney General, regardless o f whether a dispute exists on
the question within the Executive Branch. See 28 U.S.C. § 512. All that is
required is that the question presented be one arising in the administration of
the department whose head requests the opinion. Thus, even if HUD had never
disagreed with Labor’s interpretation of § 110 the Secretary of HUD would be
entitled to request and receive the opinion of the Attorney General on that
question. It goes without saying, therefore, that the Secretary of Labor’s
withdrawal of the Labor Department’s prior interpretation of § 110 in no way
relieves the Attorney General of his statutory authority — indeed, his responsi­
bility — to provide the Secretary of HUD with his opinion.2 The presence or
absence of a contrary or consistent Labor Department interpretation is simply
irrelevant to the Secretary’s statutory right “to require the opinion of the
Attorney General.” 28 U.S.C. § 512. Because the Secretary of HUD has not
withdrawn his request, the Attorney General’s legal obligation is to render an
opinion on the question presented.
    Finally, the Attorney General’s authority to give his opinion at the request of
the Secretary is also confirmed by 28 U.S.C. § 516 and 5 U.S.C. § 3106. The
former reserves generally to the Attorney General the conduct of all litigation
in which the United States, an agency, or officer thereof is a party. The latter
generally prohibits the head of an Executive department from employing an
attorney for the conduct of litigation in which the United States, an agency, or
an employee thereof is a party, requiring instead that the matter be referred to
the Department of Justice. Both provisions admit of exceptions only when
“otherwise authorized by law.” Although Congress has established “a solicitor
for the Department of Labor,” 29 U.S.C. § 555, the solicitor has no general
litigating authority; his authority is narrowly drawn, see 29 U.S.C. § 663
(representation of the Secretary of Labor in occupational safety and health
litigation); 29 U.S.C. § 1852(b) (litigation for the protection of migrant and
seasonal workers); 30 U.S.C. § 822 (representation of the Secretary of Labor in
mine safety and health litigation), and nevertheless “subject to the direction
and control of the Attorney General.” Id. The Attorney General’s authority to
conduct litigation on behalf of the United States necessarily includes the
exclusive and ultimate authority to determine the position of the United States
on the proper interpretation of statutes before the courts. Thus, because this
question of the proper interpretation of § 110 is the subject of pending litigation
to which the Secretary of HUD is a party, see D airy Development Ltd. v.
P ierce, Civ. Action No. 86-1353-R (W.D. Okla.), the Attorney General has
both the authority and the obligation to decide the question presented by the
Secretary of HUD.
  2 See 2 O p. A tt’y G en. 31 1 (1830), in w hich Attorney G eneral B errien observed “that it is made my duty to
give my opinion on all questions referred to me by the heads o f departm ents ‘touching any matters that may
concern th eir d ep artm en ts.’” Id. at 3 1 1.

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B. Substantive Issues

  Section 110 of the Act provides:

          All laborers and mechanics employed by contractors or sub­
       contractors in the performance of construction work financed in
       whole or in part with assistance received under this chapter shall
       be paid wages at rates not less than those prevailing on similar
       construction in the locality as determined by the Secretary of
       Labor in accordance with the Davis-Bacon Act, as amended (40
       U.S.C. § 276a, 276a-5): Provided, That this section shall apply
       to the rehabilitation of residential property only if such property
       is designed for residential use for eight or more families. The
       Secretary of Labor shall have, with respect to such labor stan­
       dards, the authority and functions set forth in Reorganization
       Plan Numbered 14 of 1950 (15 F.R. 3176; 64 Stat. 1267) and
       section 276c of title 40.

42 U.S.C. § 5310.
   We adhere to the well-established principle that “[statutory construction
must begin with the language employed by Congress and the assumption that
the ordinary meaning of that language accurately expresses the legislative
purpose.” Park ‘n Fly, Inc. v. D ollar Park and Fly, Inc., 469 U.S. 189, 194
(1985); see American Tobacco Co. v. Patterson, 456 U.S. 63,68 (1982); 2A N.
Singer, Sutherland’s Statutory Construction § 46.04 (4th ed. 1984). The opera­
tive language of § 110 is “construction work financed in whole or in part with
assistance received under this chapter.” 42 U.S.C. § 5310. The narrow question
is whether the use of CDBG or UDAG funds to pay for the land, fixtures, or
services — but not for the construction work — associated with a particular
project means that the construction work is “financed in whole or in part with”
such funds within the meaning of the Act. We think the language used in § 110
indicates that it is not.
   Construction work that is part of a project receiving federal funds to pay for
non-construction activities of the project is, of course, benefited indirectly by
such funds because the federal funds reduce the total amount of nonfederal
funds needed to finance the project. Nevertheless, the construction work itself
is not financed with the federal funds that are used to pay for the project’s other
activities. The ordinary meaning of the verb, “finance,” is “to raise or provide
funds or capital for” or “to furnish with necessary funds.” W ebster’s Ninth New
C ollegiate D ictionary 463 (1986). Because the funds used to finance the
construction work are nonfederal, the only way to conclude that the statute
applies is, in effect, to substitute “construction project” for “construction
work.” Such a construction, however, conflicts with both the statutory lan­
guage and its history.
                                        99
   The language of § 110, requiring the payment of Davis-Bacon wages when
“construction work” is financed with federal funds,3 contrasts sharply with the
broader, project-oriented approach of several other federal statutes. For ex­
ample, the labor standards section of the Public Works and Economic Develop­
ment Act of 1965 provides that “[a]ll laborers and mechanics employed by
contractors or subcontractors on projects assisted by the Secretary under this
chapter shall be paid [Davis-Bacon] wages.” 42 U.S.C. § 3222 (emphasis
added). Similarly, a 1974 amendment to the United States Housing Act of 1937
states that “[a]ll laborers and mechanics employed by contractors or subcon­
tractors in housing or development a ctivities assisted under this section shall be
paid [Davis-Bacon] wages.” 42 U.S.C. § 1440(g) (emphasis added).
   The latter provision is particularly significant because it was enacted as part
of the Housing and Community Development Act of 1974, see Pub. L. No. 93-
383, § 802(g), 88 Stat. 633,724, the same Act that contains the provision under
consideration here. See id. § 110, 88 Stat. at 649. Sections 110 and 802(g) of
the Act are identical in all material respects except that the former is triggered
by federal funding of “construction work” and the latter by federal assistance to
“housing or development activities.” By its terms, § 802(g) requires more
expansive Davis-Bacon coverage than § 110. Thus, the argument that § 110
requires the payment of Davis-Bacon wages whenever any activity associated
with a particular project (such as the acquisition of land, fixtures, or architec­
tural and engineering services) is financed with federal funds, even though the
project’s construction work is not, negates the distinction between the effect of
the two provisions, in contravention of the clear and unambiguous language of
the Act.
   The conclusion that § 110 requires payment of Davis-Bacon wages only
when construction work is financed with federal funds is also suggested by the
history of the Act. The version of the Act considered initially by the Senate
would have required the payment of prevailing wages to “[a]ll laborers and
mechanics employed by contractors and subcontractors in the performance of
work on any construction p ro je c t fin a n ced in whole or in part with funds
received under this chapter.” S. 3066, 93d Cong., 2d Sess. 314 (1974) (empha­
sis added). A “construction project” necessarily encompasses all activities
needed in order to undertake and complete the project, most notably, the
purchase of land, equipment, and raw materials, as well as actual construction.
Thus, under the Senate bill, federal funding of any activity associated with a
construction project would constitute partial federal financing of the project
and trigger the requirement that prevailing wages be paid to all laborers and
mechanics employed by contractors and subcontractors in the performance of
work on the project. The report accompanying the Senate bill acknowledges
the breadth of the Senate proposal, stating that the Senate bill would require the
payment of prevailing wages “with respect to all multifamily housing projects
  3 Accord 49 U .S.C. app. § 1609(a) (requiring the paym ent o f D avis-Bacon wages to “laborers and mechan-
ics em ployed by contractors or subcontractors in the perform ance o f construction work financed with the
assistance o f loans o r g rants under this chapter”) (em phasis added).

                                                   100
.. . , health facilities, and land development projects.” S. Rep. No. 693, 93d
Cong., 2d Sess. 36 (1974).
   The House bill, by contrast, would have required payment of prevailing
wages to laborers and mechanics employed by contractors and subcontractors
only “in the performance of construction work financed in whole or in p a rt
with assistance received under this chapter.” H.R. 15361, 93d Cong., 2d Sess.
110 (1974) (emphasis added). As discussed, construction work is merely one
element of a construction project. The specific inquiry under the House provi­
sion, then, is whether federal funds are used to finance construction work.
Whether federal funds are used to finance any other activity associated with the
construction project is immaterial. The House Report reiterates the specific
focus of the House provision, stating that the House bill would require the
payment of prevailing wages to workers employed on “construction funded
under this title.” H.R. Rep. No. 1114, 93d Cong., 2d Sess. 55 (1974). Thus,
whereas the Senate bill would have required payment of prevailing wages
whenever federal funds were used to finance any part of a construction project
(including construction work), the House bill would have required the payment
of such wages only when the activity financed with federal funds was construc­
tion work.
   With minor changes not relevant here, the Conference Committee adopted
the labor standards provision of the House bill. As the Conference Report
states, “[t]he conference report contains the House provision with a technical
amendment.” H.R. Conf. Rep. No. 1279, 93d Cong., 2d Sess. 133 (1974). As
finally enacted, § 110 applied only to “construction work financed in whole or
in part with grants received under this title.”
   We recognize that neither the Conference Report nor the floor debates
contain an explanation of the conference decision to adopt the “construction
work” language of the House bill instead of the “project” approach of the
Senate bill.4 This lack of legislative discussion hardly yields a conclusion that

   4 The Conference R eport explains:
        The Senate bill applied the prevailing wage requirem ents o f the Davis-Bacon Act to residential
        construction involving 12 o r more units and to rehabilitation involving 8 or more units The
        H ouse am endm ent applied such requirem ents only to the construction o f 8 or more units without
        reference to rehabilitation. The conference report contains the House provision with a technical
        am endm ent m aking it clear that the requirem ent applies only to rehabilitation, since construction
        o f residential structures is not a perm issible use o f com m unity developm ent funds.
H.R. Conf. Rep. No. 1279, 93d Cong., 2d Sess. 133 (1974). Contrary to L abor’s suggestion, this discussion
does not necessarily reveal the exclusive reason for C ongress’ adoption o f the H ouse provision. The selection
o f the H ouse provision was consistent with Congress* desire to carry forward the D avis-Bacon coverage o f
the H ousing Act o f 1949. Under the 1949 Act, Davis- Bacon wage requirem ents applied only to the
“undertakings and activities o f a local public agency in an urban renewal area.” 42 U.S.C. § 1460 (1976).
Thus, all privately undertaken construction and activity, even though part o f a project receiving federal
assistance, w as exem pt from D avis-Bacon requirem ents. Section 105 o f the 1974 Act, delineating the
activities eligible fo r CDBG funding, specifically includes “paym ent o f the cost o f com pleting a project
funded under title I o f the Housing Act o f 1949 " 42 U.S.C. § 5305(a)(10). By choosing the labor standards
provision o f the H ouse bill. C ongress ensured that the use o f CDBG funds to com plete outstanding projects
w ould not result in expanding D avis-Bacon coverage to the privately funded construction w ork associated
w ith such projects because such work is not financed in whole o r in part with federal funds. The Senate bill,
                                                       C ontinued

                                                     101
Congress intended Davis-Bacon coverage to be less restrictive than the choice
of the House provision would suggest. Such an anomalous conclusion would
ignore the best evidence of congressional intent — the language adopted. That
language is clear, and evinces an unambiguous intent to require less Davis-
Bacon coverage than the Senate bill.5
   Because there have been numerous, inconsistent interpretations of § 110 to
various activities in the past, we pause to consider several applications of § 110
in light of our interpretation of the Act. For example, HUD has previously
agreed with Labor that the use of CDBG or UDAG funds to purchase equip­
ment may require the payment of prevailing wages with respect to the installa­
tion of the equipment when such installation involves “more than an incidental
amount” of construction work. See Letter to John S. Selig, Esq., Mitchell,
Williams, Selig, Jackson & Turner, from Justin L. Logsdon, Assistant to the
Secretary for Labor Relations, Department of Housing and Urban Develop­
ment (Dec. 1, 1986) (advising that Davis-Bacon requirements do not apply to
the installation of federally funded equipment where the cost of installation is
only 1.5 percent of the cost of the equipment). Assuming that installation of
equipment constitutes or requires “construction work,”6 we believe that § 110
does not require the payment of prevailing wages with respect to installation
where federal funds are provided exclusively for the purchase of equipment
and not for its installation. Thus, to the extent that Labor and HUD have
adopted a contrary interpretation of § 110, they have misconstrued the Act.
   4 (. . . continued)
by contrast, w ould have required the paym ent o f prevailing wages for construction work exem pt under the
1949 Act. T h is is so because construction work is part o f a construction project, and the Senate bill would
have required the paym ent o f Davis-Bacon wages w henever “any construction project is financed in w hole or
in part w ith [federal] fu n d s.”
   M oreover, w e w ish to stress that C ongress need not ex p ress an intent that clear language means what it
says. Indeed, legislative history tending to contradict the p lain meaning o f a statute is often discounted. Here,
w here we have no expression in the legislative history o f a congressional intent contradicting the plain
language o f § 110, the statutory language necessarily controls.
   5 T his conclusion is consistent with th e subsequent am endm ents to the Act authorizing the Urban D evelop­
m ent A ction G rant program See 42 U .S.C . § 5318 The UD A G program authorizes grants to cities and urban
areas experiencing severe economic distress to help stim ulate econom ic developm ent activity. Id. § 5318(a).
U nder the program , the Secretary (1) m u st determ ine that there is a strong probability that without the grant,
the nonfederal investm ent in the project w ould not be m ade, id. § 5318(j), and (2) “assure that the am ount of
the grant is the least necessary to m ake the project feasib le.” Id. § 5318(k). Thus, the UDAG program is
designed to encourage and leverage nonfederal investm ent in depressed urban areas. In fact, the average
U D A G project has involved six nonfederal dollars for ev ery dollar o f UDAG funds. Significantly, Congress
did not change the “construction work” focus o f Section 110 in adding the UDAG program to the Act. This
m eans that if UD A G funds are used exclusively to finance the non-construction work activities of a particular
project (as they often are), Davis-Bacon w ages need not be paid. A conclusion that Section 110 required the
paym ent o f prevailing w ages under these circum stances w ould substantially impair the intended effect o f the
program . B ecause the program is designed to minim ize the amount o f federal funds necessary to cause a
p ro ject to go forw ard, a requirement th a t Davis-Bacon w ages be paid w ith respect to the entire project could
significantly increase (conceivably in excess o f the total federal investm ent) the am ount o f nonfederal funds
needed for the project. G iven the language o f Section 110 and the general, although adm ittedly not wholly
consistent, p ractice o f H U D to require th e paym ent o f D avis-Bacon w ages only when federal funds are used
to finance construction w ork, it is reasonable to conclude that C ongress added the UDAG program with this
understanding in mind. A construction o f Section 110 expanding its traditional scope, therefore, could
significantly underm ine the program in term s o f its cost and effect.
   6 If in a given case installation does not entail construction work, then § 110 is inapplicable in any event.

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   Similarly, we agree with Labor’s position that “UDAG or CDBG financing
of certain ‘soft costs’ would not, in and of itself, trigger Davis-Bacon coverage
for building construction when there was no direct UDAG or CDBG financing
of the actual construction.” Labor Opinion at 2. Labor gave as examples of
such “soft costs” legal services and tenant allowances for purchasing furniture
or obtaining business licenses. See id. In short, we do not believe that § 110
requires payment of Davis-Bacon wages when federal funds are used to pay for
any activity other than construction work. So long as no part of the cost of
construction work is paid for with UDAG or CDBG funds, § 110 does not apply.

                                  Conclusion

   Given the language of § 110 and Congress’ contemporaneous rejection of
alternative language that expressly would have required the payment of Davis-
Bacon wages for all work associated with any “construction project,” not just
“construction work,” we conclude that the Act requires the payment of prevail­
ing wages only when federal funds are used to pay for construction work. The
mere use of federal funds to acquire the land upon which that work is to take
place does not constitute federal financing of the construction work.
   Similarly, the use of federal funds either to purchase materials, equipment,
machinery, or other fixtures installed during the construction work or to pay for
the architectural and engineering services rendered prior to that work, does not
trigger Davis-Bacon coverage when no federal funds are used to pay for the
construction work itself.

                                                C harles   J.   C ooper
                                             A ssistant Attorney General
                                               Office o f Legal Counsel

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