U.S. Senators Jerry Moran (R-Kan.) and John Thune (R-S.D.) have introduced the Housing Supply Expansion Act, legislation that would address the shortage of affordable housing options by making targeted reforms to requirements under the Davis-Bacon Act, a 1930s-era labor law.
Sen. Moran says these reforms would reduce labor costs and administrative burdens on residential construction contractors, which would free up capital that could be redirected toward building additional affordable housing.
“Purchasing a home is a part of the American dream that is currently out of reach for many families,” said Sen. Moran. “Reducing the burden of federal regulations will help homebuilders meet the demand for new homes, making homeownership a reality for more Kansans.”
Enacted in 1931, the Davis-Bacon Act requires construction contractors involved in certain federally funded or federally assisted construction contracts, like those participating in various federal housing programs, to pay individuals working on the contract at least the prevailing wages of the vicinity in which the construction project is located. The Davis-Bacon Act – as it stands – can disincentivize the construction of affordable housing due to the high costs it places on construction contractors and the administrative burden that accompanies it. The U.S. Department of Labor (DOL) sets these prevailing wage rates by reviewing data submitted by construction contractors through voluntary surveys, which can be, at times, inaccurate or inconsistent. Last year, DOL initiated a rulemaking that would revise certain tenets of the Davis-Bacon Act.