75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
 
NOTE:  Matter within  { +  braces and plus signs + } in an
amended section is new. Matter within  { -  braces and minus
signs - } is existing law to be omitted. New sections are within
 { +  braces and plus signs + } .
 
LC 1709
 
                         House Bill 2699
 
Sponsored by Representative HOLVEY
 
 
                             SUMMARY
 
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
 
  Modifies definition of 'public works.' Requires payment of
prevailing rate of wage in connection with public works for which
funds of public agency are used, including funds received in form
of tax credit or tax abatement.
  Exempts projects that are privately owned and that use private
funds and not more than certain amount of funds of public agency
from prevailing wage requirements.
  Declares emergency, effective on passage.
 
                        A BILL FOR AN ACT
Relating to the application of prevailing wage rates; creating
  new provisions; amending ORS 279C.800, 279C.810, 279C.827 and
  279C.830; and declaring an emergency.
Be It Enacted by the People of the State of Oregon:
  SECTION 1. ORS 279C.800 is amended to read:
  279C.800. As used in ORS 279C.800 to 279C.870, unless the
context requires otherwise:
  (1) 'Fringe benefits' means the amount of:
  (a) The rate of contribution irrevocably made by a contractor
or subcontractor to a trustee or to a third person under a plan,
fund or program; and
  (b) The rate of costs to the contractor or subcontractor that
may be reasonably anticipated in providing benefits to workers
pursuant to an enforceable commitment to carry out a financially
responsible plan or program that is committed in writing to the
workers affected, for medical or hospital care, pensions on
retirement or death, compensation for injuries or illness
resulting from occupational activity, or insurance to provide any
of the foregoing, for unemployment benefits, life insurance,
disability and sickness insurance or accident insurance, for
vacation and holiday pay, for defraying costs of apprenticeship
or other similar programs or for other bona fide fringe benefits,
but only when the contractor or subcontractor is not required by
other federal, state or local law to provide any of these
benefits.
  (2) 'Housing' has the meaning given that term in ORS 456.055.
  (3) 'Locality' means the following district in which the public
works, or the major portion thereof, is to be performed:
  (a) District 1, composed of Clatsop, Columbia and Tillamook
Counties;
 
  (b) District 2, composed of Clackamas, Multnomah and Washington
Counties;
  (c) District 3, composed of Marion, Polk and Yamhill Counties;
  (d) District 4, composed of Benton, Lincoln and Linn Counties;
  (e) District 5, composed of Lane County;
  (f) District 6, composed of Douglas County;
  (g) District 7, composed of Coos and Curry Counties;
  (h) District 8, composed of Jackson and Josephine Counties;
  (i) District 9, composed of Hood River, Sherman and Wasco
Counties;
  (j) District 10, composed of Crook, Deschutes and Jefferson
Counties;
  (k) District 11, composed of Klamath and Lake Counties;
  (L) District 12, composed of Gilliam, Grant, Morrow, Umatilla
and Wheeler Counties;
  (m) District 13, composed of Baker, Union and Wallowa Counties;
and
  (n) District 14, composed of Harney and Malheur Counties.
  (4) 'Prevailing rate of wage' means the rate of hourly wage,
including all fringe benefits, paid in the locality to the
majority of workers employed on projects of similar character in
the same trade or occupation, as determined by the Commissioner
of the Bureau of Labor and Industries.
  (5) 'Public agency' means the State of Oregon or any political
subdivision thereof or any county, city, district, authority,
public corporation or entity and any instrumentality thereof
organized and existing under law or charter.
  (6)(a) 'Public works' includes, but is not limited to { + , + }
 { - : - }
    { - (A) - }  roads, highways, buildings, structures and
improvements of all types, the construction, reconstruction,
major renovation or painting of which { +  uses funds of a public
agency. + }   { - is carried on or contracted for by any public
agency to serve the public interest; - }
    { - (B) A project for the construction, reconstruction, major
renovation or painting of a privately owned road, highway,
building, structure or improvement of any type that uses funds of
a private entity and $750,000 or more of funds of a public
agency; or - }
    { - (C) A project for the construction of a privately owned
road, highway, building, structure or improvement of any type
that uses funds of a private entity and in which 25 percent or
more of the square footage of the completed project will be
occupied or used by a public agency. - }
  (b) 'Public works' does not include:
  (A) The reconstruction or renovation of privately owned
property that is leased by a public agency; or
  (B) The renovation of publicly owned real property that is more
than 75 years old by a private nonprofit entity if:
  (i) The real property is leased to the private nonprofit entity
for more than 25 years;
  (ii) Funds of a public agency used in the renovation do not
exceed 15 percent of the total cost of the renovation; and
  (iii) Contracts for the renovation were advertised or, if not
advertised, were entered into before July 1, 2003, but the
renovation has not been completed on or before July 13, 2007.
  SECTION 2. ORS 279C.810 is amended to read:
  279C.810. (1) As used in this section:
  (a) 'Funds of a public agency'   { - does not include: - }
 { +  includes, but is not limited to, the amount of a tax credit
or tax abatement that is provided in connection with a project or
in connection with an enterprise zone as designated by the
Director of the Economic and Community Development Department
under ORS 285C.080 or 285C.250.
  (b) 'Funds of a public agency' does not include: + }
 
  (A) Funds provided in the form of a government grant to a
nonprofit organization, unless the government grant is issued for
the purpose of construction, reconstruction, major renovation or
painting;
  (B) Building and development permit fees paid or waived by the
public agency;
    { - (C) Tax credits or tax abatements; - }
    { - (D) - }  { +  (C) + } Land that a public agency sells to
a private entity at fair market value;
    { - (E) - }  { +  (D) + } The difference between:
  (i) The value of land that a public agency sells to a private
entity as determined at the time of the sale after taking into
account any plan, requirement, covenant, condition, restriction
or other limitation, exclusive of zoning or land use regulations,
that the public agency imposes on the development or use of the
land; and
  (ii) The fair market value of the land if the land is not
subject to the limitations described in subparagraph (i) of this
paragraph;
    { - (F) - }  { +  (E) + } Staff resources of the public
agency used to { + :
  (i) + } Manage a project or to provide a principal source of
supervision, coordination or oversight of a project; { +  or + }
    { - (G) - }  { +  (ii) + }   { - Staff resources of the
public agency used to - } Design or inspect one or more
components of a project;
    { - (H) - }  { +  (F) + } Moneys derived from the sale of
bonds that are loaned by a state agency to a private entity { + ,
the entirety of which the private entity must repay with
interest + }, unless the moneys will be used for a public
improvement;
    { - (I) - }  { +  (G) + } Value added to land as a
consequence of a public agency's site preparation, demolition of
real property or remediation or removal of environmental
contamination, except for value added in excess of the expenses
the public agency incurred in the site preparation, demolition or
remediation or removal when the land is sold for use in a project
otherwise subject to ORS 279C.800 to 279C.870; or
    { - (J) - }  { +  (H) + } Bonds, or loans from the proceeds
of bonds, issued in accordance with ORS chapter 289 or ORS
441.525 to 441.595, unless the bonds or loans will be used for a
public improvement.
    { - (b) - }   { + (c) + } 'Nonprofit organization' means an
organization or group of organizations described in section
501(c)(3) of the Internal Revenue Code that is exempt from income
tax under section 501(a) of the Internal Revenue Code.
  (2) ORS 279C.800 to 279C.870 do not apply to:
  (a) Projects for which the contract price does not exceed
$50,000. In determining the price of a project, a public agency:
  (A) May not include the value of donated materials or work
performed on the project by individuals volunteering to the
public agency without pay; and
  (B) Shall include the value of work performed by every person
paid by a contractor or subcontractor in any manner for the
person's work on the project.
  (b) Projects for which no funds of a public agency are directly
or indirectly used. In accordance with ORS chapter 183, the
Commissioner of the Bureau of Labor and Industries shall adopt
rules to carry out the provisions of this paragraph.
  (c) Projects:
  (A) That are privately owned;
  (B) That use funds of a private entity; { +  and + }
    { - (C) In which less than 25 percent of the square footage
of a completed project will be occupied or used by a public
agency; and - }
 
    { - (D) - }   { + (C) + } For which less than
 { - $750,000 - }  { +  $2,000 + } of funds of a public agency
are used.
  (d) Projects for residential construction that are privately
owned and that predominantly provide affordable housing. As used
in this paragraph:
  (A) 'Affordable housing' means housing that serves occupants
whose incomes are no greater than 60 percent of the area median
income or, if the occupants are owners, whose incomes are no
greater than 80 percent of the area median income.
  (B) 'Predominantly' means 60 percent or more.
  (C) 'Privately owned' includes:
  (i) Affordable housing provided on real property owned by a
public agency if the real property and related structures are
leased to a private entity for 50 or more years; and
  (ii) Affordable housing owned by a partnership, nonprofit
corporation or limited liability company in which a housing
authority, as defined in ORS 456.005, is a general partner,
director or managing member and the housing authority is not a
majority owner in the partnership, nonprofit corporation or
limited liability company.
  (D) 'Residential construction' includes the construction,
reconstruction, major renovation or painting of single-family
houses or apartment buildings not more than four stories in
height and all incidental items, such as site work, parking
areas, utilities, streets and sidewalks, pursuant to the United
States Department of Labor's 'All Agency Memorandum No. 130:
Application of the Standard of Comparison 'Projects of a
Character Similar ' Under Davis-Bacon and Related Acts,' dated
March 17, 1978.  However, the commissioner may consider different
definitions of residential construction in determining whether a
project is a residential construction project for purposes of
this paragraph, including definitions that:
  (i) Exist in local ordinances or codes; or
  (ii) Differ, in the prevailing practice of a particular trade
or occupation, from the United States Department of Labor's
description of residential construction.
  SECTION 3. ORS 279C.827 is amended to read:
  279C.827. (1)(a) A public agency may not divide a public works
project into more than one contract for the purpose of avoiding
compliance with ORS 279C.800 to 279C.870.
  (b) When the Commissioner of the Bureau of Labor and Industries
determines that a public agency has divided a public works
project into more than one contract for the purpose of avoiding
compliance with ORS 279C.800 to 279C.870, the commissioner shall
issue an order compelling compliance.
  (c) In making determinations under this subsection, the
commissioner shall consider:
  (A) The physical separation of the project structures;
  (B) The timing of the work on project phases or structures;
  (C) The continuity of project contractors and subcontractors
working on project parts or phases;
  (D) The manner in which the public agency and the contractors
administer and implement the project;
  (E) Whether a single public works project includes several
types of improvements or structures; and
  (F) Whether the combined improvements or structures have an
overall purpose or function.
    { - (2) If a project is a public works of the type described
in ORS 279C.800 (6)(a)(B) or (C), the commissioner shall divide
the project, if appropriate, after applying the considerations
set forth in subsection (1)(c) of this section to separate the
parts of the project that include funds of a public agency or
that will be occupied or used by a public agency from the parts
of the project that do not include funds of a public agency and
that will not be occupied or used by a public agency. If the
commissioner divides the project, any part of the project that
does not include funds of a public agency and that will not be
occupied or used by a public agency is not subject to ORS
279C.800 to 279C.870. - }
    { - (3) - }  { +  (2) + } If a project includes parts that
are owned by a public agency and parts that are owned by a
private entity, the commissioner shall divide the project, if
appropriate, after applying the considerations set forth in
subsections (1)(c)   { - and (2) - }  of this section to separate
the parts of the project that are public works from the parts of
the project that are not public works. If the commissioner
divides the project, parts of the project that are not public
works are not subject to ORS 279C.800 to 279C.870.
  SECTION 4. ORS 279C.830 is amended to read:
  279C.830. (1)(a) Except as provided in paragraph (d) of this
subsection, the specifications for   { - every - }  { +  a + }
contract for public works shall contain a provision
 { - stating - }  { +  that states + } the existing state
prevailing rate of wage and, if applicable, the federal
prevailing rate of wage required under the Davis-Bacon Act (40
U.S.C. 3141 et seq.) that   { - may - }  { +  must + } be paid to
workers in each trade or occupation required for the public works
employed in the performance of the contract either by the
contractor or subcontractor or other person doing or contracting
to do the whole or any part of the work contemplated by the
contract. When the prevailing rates of wage are available
electronically or are accessible on the Internet, the rates may
be incorporated into the specifications by referring to the
electronically accessible or Internet-accessible rates and by
providing adequate information about how to access the rates.
  (b) If a public agency is required under paragraph (a) of this
subsection to include the state and federal prevailing rates of
wage in the specifications, the public agency also shall include
in the specifications information showing which prevailing rate
of wage is higher for workers in each trade or occupation in each
locality, as determined by the Commissioner of the Bureau of
Labor and Industries under ORS 279C.815 (2)(c).
  (c) Every contract and subcontract { +  for public works
must + }
  { - shall - }  contain a provision that the workers
 { - shall - }  { +  must + } be paid not less than the specified
minimum hourly rate of wage in accordance with ORS 279C.838 and
279C.840.
    { - (d) A public works project described in ORS 279C.800
(6)(a)(B) or (C) is subject to the existing state prevailing rate
of wage or, if applicable, the federal prevailing rate of wage
required under the Davis-Bacon Act that is in effect at the time
a public agency enters into an agreement with a private entity
for the project. After that time, the specifications for any
contract for the public works shall include the applicable
prevailing rate of wage. - }
  (2) The specifications for   { - every - }  { +  a + } contract
for public works between a public agency and a contractor
 { - shall - }  { +  must + } contain a provision stating that a
fee   { - is required to - }  { +  must + } be paid to the
Commissioner of the Bureau of Labor and Industries as provided in
ORS 279C.825 (1). The contract shall contain a provision that the
fee   { - shall - }  { +  must + } be paid to the commissioner
under the administrative rule of the commissioner.
  (3) The specifications for   { - every - }  { +  a + } contract
for public works   { - shall - }  { +  must + } contain a
provision stating that the contractor and every subcontractor
must have a public works bond filed with the Construction
Contractors Board before starting work on the project, unless
exempt under ORS 279C.836 (4), (7), (8) or (9).
 
  { - Every - }  { +  A + } contract awarded by a contracting
agency   { - shall - }  { +  must + } contain a provision
requiring the contractor { +  to + }:
  (a)   { - To - }  Have a public works bond filed with the
Construction Contractors Board before starting work on the
project, unless exempt under ORS 279C.836 (4), (7), (8) or (9).
  (b)   { - To - }  Include in every subcontract a provision
requiring the subcontractor to have a public works bond filed
with the Construction Contractors Board before starting work on
the project, unless exempt under ORS 279C.836 (4), (7), (8) or
(9).
  SECTION 5.  { + The amendments to ORS 279C.800, 279C.810,
279C.827 and 279C.830 by sections 1 to 4 of this 2009 Act apply
to contracts first advertised or, if not advertised, first
entered into on or after the effective date of this 2009 Act. + }
  SECTION 6.  { + This 2009 Act being necessary for the immediate
preservation of the public peace, health and safety, an emergency
is declared to exist, and this 2009 Act takes effect on its
passage. + }
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