A full turn has been made, and Davis-Bacon now defeats its intended purpose.

Prevailing wage determinations by the Department of Labor under the Davis-Bacon Act for FHA-insured housing and public housing have thus too often resulted in required wage rates for such housing which are higher than those actually prevailing in the area. Inappropriately high wage determinations have proven particularly harmful in the case of rental housing subsidized under section 236 of the National Housing Act. Higher wages have forced higher construction costs, and, therefore, market rents for subsidized projects which are higher than the rents for comparable units in conventionally financed projects. Families who are able to pay rents at or near the market level have been dissuaded from living in assisted projects, and the goal of achieving a greater income mix in those projects has been undermined.

The General Accounting Office submitted to Congress on July 14, 1971, a definitive study of the administration of the Davis-Bacon Act by the Department of Labor during the past decade. Representatives of the GAO will appear this morning as the initial witnesses in the present hearings, and I feel confident that they will underscore the findings outlined in that report.

I should like to briefly mention one or two of the problems engendered by Davis-Bacon confronting builders and sponsors of federally assisted housing which have been communicated to me, emphasizing that each restricts the production of additional housing units.

The most common complaint has centered on the lengthy period of time which has been required to secure final wage determinations. Months pass, during which time the builder is forestalled from initiating construction, and costs mount up: Renewal of land options, increased cost of materials, architect's and attorney's fees, to name but a few.

A second complaint notes that wage scales determined in larger, municipal areas have been applied to rural counties, thus inflating the local wage which prevailed prior to the determination. Obviously, this was not the intent of the act.

A third perversion of Davis-Bacon is reflected in the instances where a union scale or the product of a collective bargaining agreement have been adopted as the prevailing wage in the area, despite the fact that but a small percentage of the labor force within the jurisdiction is organized.

These are serious problems, and problems which the subcommittee must address itself to during the next few days. A lack of administrative personnel can be blamed for many of the problems; but is that a justifiable argument which can stand alone? I think not. There are more fundamental issues involved, issues which must be uncovered and examined by this subcommittee.

Mr. Chairman, I am confident that these hearings will be extremely enlightening and most beneficial in assisting each of us to recognize additional barriers which block the realization of truly low-cost housing. Low-cost housing can be quality housing, decent and safe, but not so long as those matters sought to be corrected by the Brock and Tower bills stand in the way.

92D CONGRESS 2D SESSION

S. 3373

IN THE SENATE OF THE UNITED STATES

MARCH 17, 1972

Mr. BROCK (for himself, Mr. BEALL, Mr. BENNETT, Mr. DOLE, Mr. DOMINICK, Mr. FANNIN, Mr. GURNEY, Mr. PACKWOOD, Mr. TAFT, and Mr. Tower) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing and Urban Affairs

A BILL

To promote the utilization of improved technology in federally assisted housing projects and to increase productivity in order to meet our national housing goals, and for other purposes. 1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That (a) any provision or requirement in any building code 4 or other local law or ordinance, or in any contract or agree5 ment, or any practice or other restrain which interferes with 6 or restricts the use of new or improved techniques, methods, 7 or materials or the use of preassembled products in connec8 tion with any development, construction, rehabilitation, or 9 maintenance activity assisted under any program adminis

2

1 tered by the Secretary of Housing and Urban Development 2 shall be unlawful with respect to such activity except where 3 such provision, requirement, practice, or restraint is deter4 mined to be necessary to assure safe and healthful working or 5 living conditions, except that any such technique, method, 6 material, or product that conforms to appropriate standards 7 adopted by any nationally recognized standard setting or

8

testing agency (1) approved by the Secretary of Housing 9 and Urban Development, and (2) qualified and equipped to

10

perform suitable tests or evaluations, shall, in the absence 11 of clear and convincing contrary evidence, be presumed to 12 have no adverse effect on such working or living condiitons. 13 (b) Any person who is aggrieved because of any pro14 vision or requirement in any building code or other local 15 law or ordinance, or because of any contract, agreement, 16 practice, or other restraint unlawful under subsection (a) of 17 this Act may bring a civil action in any appropriate United 18 States district court notwithstanding any other provision of 19 law and without regard to the amount in controversy, or 20 in any appropriate State or local court of general jurisdic21 tion to obtain equitable or preventive relief for violations of 22 this section, or for appropriate damages, and may request 23 such relief, or enter a claim for such damages, in any court 24 whenever relevant in connection with a defense to, or coun25 terclaim in, any suit or action brought against such person

3

1 in that court, except that damages shall not be awarded

2 where the person bringing the action under this section is 3 aggrieved by reason of any provision or requirement in 4 any building code or other local law or ordinance.

92D CONGRESS 2D SESSION

S. 3654

IN THE SENATE OF THE UNITED STATES

MAY 31, 1972

Mr. Tower introduced the following bill; which was read twice and referred to the Committee on Banking, Housing and Urban Affairs

A BILL

To repeal certain provisions of law applicable to federally assisted

1

housing.

Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 3 That section 212 of the National Housing Act is repealed.

4 SEC. 2. Paragraphs (2) and (3) of section 16 of the 5 United States Housing Act of 1937 are repealed.

II