OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http: //www.cga.ct.gov/ofa

HB-6652

AN ACT IMPLEMENTING THE REVENUE ITEMS IN THE BUDGET AND MAKING BUDGET ADJUSTMENTS, DEFICIENCY APPROPRIATIONS, CERTAIN REVISIONS TO BILLS OF THE CURRENT SESSION AND MISCELLANEOUS CHANGES TO THE GENERAL STATUTES.

AMENDMENT

LCO No.: 8530

OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 12 $

FY 13 $

Treasurer, Debt Serv.

GF - Savings

See Below

See Below

Treasurer, Debt Serv.

TF - Savings

See Below

See Below

Note: GF=General Fund; TF=Transportation Fund

Municipal Impact:

Municipalities

Effect

FY 12 $

FY 13 $

Various Municipalities

Savings

See Below

See Below

Explanation

The amendment increases the threshold at which the payment of prevailing wages to construction workers is required, from $400, 000 to $800, 000 for new construction projects and from $100, 000 to $200, 000 for renovation and remodeling projects. This is expected to results in a savings to the state and municipalities for new construction projects and for renovation projects valued between these amounts. The savings will primarily be in bond funds (debt service payments) because most construction and renovation projects are funded with General Obligation (GO) or Special Tax Obligation (STO) bonds. The amount of the savings cannot be quantified but a 1996 study conducted by the Legislative Program Review and Investigations Committee on the impact of prevailing wage laws on the cost of construction concluded that these requirements add from 4% to 7% to the total cost of projects.

The table below provides a history of prevailing wage thresholds in CGS Sec. 31-53(g) :

PREVAILING WAGE THRESHOLDS

YEAR/ACT

NEW BUILDING

RENOVATIONS

PA 91-74

$400, 000

$100, 000

PA 85-355

$200, 000

$50, 000

PA 79-325

$50, 000

$10, 000

1961

$5, 000

$5, 000

The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely for the purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.