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Government Funded Construction Projects – Quick Facts

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$49.3 billlion in government construction spendingMany contractors across the United States are subject to the Davis-Bacon Act – including a growing number of small, medium, and large construction firms as a result of the American Recovery and Reinvestment Act of 2009 (ARRA).

ARRA provides billions of dollars in funding for the improvement of the nations’ infrastructure that in turn created a slew of new government-funded construction projects requiring certified payroll reporting.

According to, as of November 23, 2009, there was $43.9 billion in spending targeted for the “construction of structures and facilities.”

A U.S. Federal Law, the Davis-Bacon Act of 1931, set “prevailing wage” rate requirements on public works projects.  All contractors and subcontractors who engage in government construction contracts and federally assisted construction projects over $2,000.00 are required to submit weekly – certified payroll reports to ensure government compliance.

What is a “prevailing wage”?

  • Determined by the U.S. Department of Labor
  • Based on wages for the area (including Union wages) in which the project will occur and the type of construction
  • Prevailing wage rates differ based on the type of work the employee performs and their level of skill
    • Can change by city, county, or job
  • Prevailing wage rates include BOTH an hourly wage rate PLUS an hourly fringe benefit amount
    • Can be more than what you currently pay your employees

What is the “hourly fringe benefit amount” and HOW is it paid?

  • Specified dollar amount in ADDITION to a base hourly rate of pay
  • Can be paid:
    • To the Union on behalf of the employee
    • To a “bona-fide” fringe benefit plan
    • In cash to the employee as part of his/her gross hourly rate of pay
    • The total hourly fringe benefit amount can be “split” between a bona-fide plan(s) with the balance paid in cash to the employee

What is a certified payroll report and what makes it “certified”?

  • Specially formatted payroll report consisting of the actual payroll report and a certification page
  • Must be submitted on a weekly basis
  • “Certification” is obtained via an ORIGINAL SIGNATURE of a company official

Is there a single, standard certified payroll-reporting format or form?

Not really – it will depend upon the state in which the construction project exists and if the project is funded with Federal or State money.

  • 24 states follow the reporting rules of the U.S. Department of Labor – Wage and Hour Division and require the filing of the Federal (USDOL) Form WH-347.
  • 13 States have their own State Prevailing Wage Laws and forms OR can require the WH-347 form when a job is funded fully by federal dollars.
  • 13 states have multiple State Agencies issuing Prevailing Wage Laws and forms, multiple compliance companies, electronic certified payroll reporting requirements OR can require the WH-347 form when a job is funded fully by federal dollars.

In addition to a weekly-certified payroll report, are their other reports that are required?

Absolutely!  It is a common misconception that all you have to do is submit a certified payroll report for each week that you work.  Additional reports include:

  • “No Work” Performed Report for weeks in which you have no employees on the job site.
  • Union/Bona-fide Plan Fringe Benefit Reports – on a monthly basis.
  • Union Dues Reports – on a monthly basis.
  • Federal, State, or Local EEOC/Workforce/Manning Reports – on a weekly, monthly, or annual basis (depending upon the State that the project resides in).
  • American Recovery & Reinvestment Act (ARRA) Reports – on a monthly basis.

How are contractors who use QuickBooks complying with prevailing wage reporting requirements?

  • Complex Excel spreadsheets which are manually updated each week
  • Use of the “alternate, substitute” certified payroll report (found in QuickBooks Enhanced Payroll and used with Premier or Enterprise Editions)
  • Stand-alone software programs which have no QuickBooks interface and require double-data entry each week
  • Through the use of QuickBooks integrated applications, specifically designed for compliance with prevailing wage requirements.

5 Responses to Government Funded Construction Projects – Quick Facts

  • Pingback: Feds to set wage standards – Pacific Daily News | Construction Economics
  • Pingback: State labor department sets prevailing wage – Springfield Business Journal | Construction Economics
  • Pingback: IN THE MATTER OF PEGASUS CLEANING CORP. v. SMITH – | Construction Economics
  • Pingback: Contractor Charged with Violating Prevailing Wage Laws on Public Work Projects – WBNG-TV | Construction Economics
About Your Host:

Nancy Smyth, Certified QuickBooks ProAdvisor

Nancy Smyth, Sunburst Software Solutions, Inc.
QuickBooks Construction & Payroll Expert

I've been using and supporting QuickBooks products since the early 1990's. I've worked with thousands of contractors, assisting them with QuickBooks setup, Certified Payroll Reporting requirements, AIA Billing and Weighted-Average Overtime.

QuickBooks is a powerful product, but learning how to use it in your construction business can be difficult. I hope you find resources available here to be helpful.

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