Gov. Andrew M. Cuomo wants to change the state’s prevailing wage mandate, expanding its requirements to include contractors doing work on projects receiving state funds. But critics said the change could raise construction labor costs by an estimated 20 percent and put a damper on development.

The prevailing wage in Western New York is set by the State Department of Labor. It varies by job position and location, but usually mirrors the pay scale in collective bargaining agreements negotiated by trade unions.

Contractors are already required to pay the prevailing wage on public works projects. But Cuomo said in his State of the State address Tuesday that he wants to expand the public works definition to include private-sector projects assisted by tax breaks from industrial development agencies.

The Buffalo-Niagara Partnership was among 18 business groups that sent a letter to the governor last March asking him not to expand the prevailing wage requirements. Calling the mandate “already flawed and miscalculated,” it said the change would hurt smaller community-based projects that are driven by private dollars. Those projects break even at their current wage rates and increasing costs would “make many of them financially unfeasible,” the groups said.

“For most projects, such a drastic increase in total project cost dwarfs the incentives and economic benefits bestowed,” the letter said.

The letter pointed to a report from the Empire Center for Public Policy, a fiscally conservative think tank, which compared the prevailing wage to the regional medians of occupational wages for all non-residential building construction workers, including those paid union scale. It found the prevailing wage increased construction labor costs by 20 percent in the Buffalo region.

Unshackle Upstate, a business advocacy group, said the prevailing wage expansion would “severely weaken our economy and hurt taxpayers.”

“The proposal to apply prevailing wage to all projects that receive state funding is a death sentence for upstate economic development initiatives. Under this mandate, efforts to fix our crumbling infrastructure would be far too expensive to pursue,” the group said in a statement.

The National Federation of Independent Business, a small business association, said expanding the mandate would harm small businesses.

“NFIB and our members remain concerned that some proposed employer mandates contained in the Governor’s address appear to embrace a flawed, one-size-fits-all regulatory model that severely limits the autonomy and flexibility small businesses need to attract talent and remain competitive,” Greg Biryla, the group’s New York State director, said in a statement.

You may also like

Policy analyst: Cuomo wrong to write-off nursing home criticism as political conspiracy

“The importance of discussing this and getting the true facts out is to understand what did and didn’t happen so we can learn from it in case this happens again,” Hammond said. Read More

EDITORIAL: Nursing home report requires a second opinion

No doubt, the Health Department and the governor would like this report to be the final word on the subject. But if it’s all the same with them, we’d still like a truly independent review. Read More

NY Health Department Asserts Cuomo Order ‘Could Not Be the Driver’ of Nursing-Home Deaths in the State

The New York State Department of Health has concluded that an executive order requiring nursing homes to readmit coronavirus patients, issued by Governor Andrew Cuomo, was not the driving factor behind coronavirus deaths in the state’s nursing homes. Read More

Independence of New York’s nursing home report faces scrutiny

When New York released a study absolving the state as well as nursing homes and other health care facilities of blame for the more than 6,000 COVID-related nursing home deaths, health care industry leaders quickly confirmed the state’s findings in statements issued by the administration of Gov. Andrew M. Cuomo. Read More

Health insurers ask for average 11.5% premium increase amid COVID-19 uncertainty

Health insurance companies regulated by the state are waiting to hear back about their requests for 2021 rate changes for premium holders. The companies, like nearly every other industry, face many uncertainties due to the COVID-19 pandemic, and their requests vary widely. Read More

Hammond: We Need To Learn What Happened In Nursing Homes

Why did more than 6,000 nursing home residents die in New York during the height of the coronavirus pandemic? Read More

NY’s ‘cash out’ policy has survived a lot. Can it outlast the pandemic?

With the pandemic damaging the economy, fiscal experts question whether New York will continue to sustain a generous policy that lets police, teachers and other public employees cash in unused vacation, sick and other paid days off when they leave a job — or whether the system has become so ingrained in politics that it’s considered off limits no matter what. Read More

Lawsuit may hold MTA in violation of Freedom of Information Law over payroll disclosure

The Empire Center for Public Policy plans to take the Metropolitan Transportation Authority to court for allegedly violating the Freedom of Information Act for failure hand over payroll records of MTA cops to the government transparency group. Read More

Subscribe

Sign up to receive updates about Empire Center research, news and events in your email.

CONTACT INFORMATION

Empire Center for Public Policy
30 South Pearl St.
Suite 1210
Albany, NY 12207

Phone: 518-434-3100
Fax: 518-434-3130
E-Mail: info@empirecenter.org

About

The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.