1. home energy + 1 ARRA - Davis Bacon Update Presented by: Wisconsin Division of Administration, Division of Energy Services. February 23, 2010

2. home energy + 2 ARRA Davis Bacon Update American Recovery and Reinvestment Act 2009 – To preserve and create jobs and promote economic recovery; – to assist those most impacted by the recession; – to invest in a way that will provide long-term economic benefits. – DAVIS BACON prevailing wages apply to ‘laborer and mechanic’ work.

3. home energy + 3 Intro Who are we? – WDOA-DES: Susan Hill – Davis Bacon coordination, T&TA & policy Sarah Bradley – Davis Bacon reporting Jim Logan – Davis Bacon monitoring/compliance

4. home energy + 4 Intro – continued Division of Energy Services responsibilities & goals - Help agencies succeed by providing guidance, technical assistance & training - Ensure compliance with reporting & other requirements

5. home energy + 5 Objectives for today’s session Review implementation of revised wage determination (S2009-WI-001) Review changes & final transition Brief overview of reporting structure Review compliance and monitoring Communicate with right parties 5

6. home energy + 6 Housekeeping Who is in the audience? (We are assuming a familiarity with Davis Bacon basic requirements) Ask questions Getting DB communications to right party within each organization – what needs to change? 6

7. home energy + 7 Housekeeping – recent changes: REPORTING: – Wx Certified Payroll Excel form for contractors – Wx Certified Payroll On-line for agency staff performing work subject to Davis Bacon Revised Wage Determination: - Effective date for contractors – agency selected - Effective date for agencies (2/28) 7

8. home energy + 8 Housekeeping Residential rates (4 stories and less) Building rates (5+ stories) 8

9. home energy + 9 Snapshot of implementation Basic foundation for implementation – wage determination (WD) As of 2/28, all agencies & contractors will be using S2009-WI-001 9

10. home energy + 10 Implementation of revised WD 2/10 – instructions, templates Revised SF 1413 required Cover letter describes changes for contractors Procurement required for some agencies We hope this is the final contract change! Agencies - SEND QUESTIONS TO THE HELP DESK 10

11. home energy + 11 Changes with revised WD CLARIFICATION: Hot water heater installation as part of a weatherization project. All individuals performing work installing a hot water heater should be paid at the plumber or electrician rate, depending on local code, in accordance with the Existing Residential Wage Determination. 11

12. home energy + 12 Changes with revised WD NO CHANGE: Heating system: Electrical and plumbing work as part of a weatherization project heating (or cooling) system repair or replacement (including clean and tune), and all associated work involved with the installation of the HVAC system including electrical, pipe, and duct work is reported under the HVAC wage determination. 12

13. home energy + 13 Changes with revised WD CLARIFICATION: Boilers – Heating system boiler replacement or repair is a specialty category. Use the Wx HVAC wage rate OR whatever local code is required to perform the work (e.g., steamfitter, plumber). Agencies - SEND QUESTIONS TO THE HELP DESK (contractors should not be contacting the Help Desk directly) 13

14. home energy + 14 Changes with revised WD CLARIFICATION: Use Weatherization Survey Column rates EXCEPT in those situations where the work is different than that described for the three classifications listed under the Weatherization Survey Column. For example, when an electrician is needed to perform electrical work not associated with the installation, repair, or overhaul of furnace or cooling equipment, then the existing electrician classification and rate listed under this column may be used for that work. The rate information under each classification is the basic hourly rate and a fringe benefit (if fringe benefits were found to be prevailing). Conformance required if no rate. Contact the Help Desk.

15. home energy + 15 Changes with revised WD How does this affect your agency? Are you missing a plumber (or other rate)? Conformance process – contact the Help Desk Appeal process – contact the Help Desk SEND QUESTIONS TO THE HELP DESK 15

16. home energy + 16 Procurement guidance (2/10/2010) Procurement or unit price adjustments: As with the prior implementation of the (9/1/09) 2009-WI-001, there will be some agencies that will need to re-bid or have their contractors adjust unit prices. Direction: If the contractor does not agree to pay the new rate using their existing bid price and does not meet the following condition, the services must be rebid. Condition: The contractor may negotiate a new price to cover the increased wage rate. The increased bid price must still remain below the next- lowest bid received. There can be no further adjustments to price.

17. home energy + 17 Changes with revised WD SEND QUESTIONS TO THE HELP DESK Document your decisions Contractors performing asbestos removal work – contact the Help Desk 17

18. home energy + 18 Moving forward - Approaching the Final Transition What is the final transition? The initial emphasis was on T&TA and the development of new reporting tools to improve compliance (WxCP Excel for contractors & WxCP On-line for agency staff).

19. home energy + 19 Moving forward - Approaching the Final Transition These CHANGES (new reporting & the revised wage determination) will be behind us soon NEW - compliance/monitoring DES staff visits are beginning Consultant on board soon – review and TA Agencies should begin to focus on compliance activities to ensure compliance by contractors

20. home energy + 20 DES direction regarding compliance We Want to Avoid ! – Penalties – Sanction – Retroactive Pay Adjustments – Fines – Litigation

21. home energy + 21 Compliance – Department of Labor (DOL) As stated in a DOE-DOL webinar, 2/18, “Once the new wage determinations are in place, you should know that some of our weatherization programs will be investigated by the Wage & Hour Division at Department of Labor.”

22. home energy + 22 Tools – contractors & non-compliance What should agencies do when contractors are not reporting as required? It depends on the individual situation. In general: Document non-performance, including record of correspondence to contractor Contractor non-performance – consider not paying invoice while working w/contractor May need to take stronger actions, if warranted

23. home energy + 23 Tools – contractors & non-compliance Agency working relationship w/contractors provides insight into potential compliance issues DOL focuses on exceptions & irregularities Does your agency have a process for addressing serious contractor non- performance (e.g., refusal to report fringe while not meeting wage rate)?

24. home energy + 24 Tools – contractors & non-compliance Repercussions of contractor non-performance & non-compliance – Record of poor performance will affect future contract opportunities – Termination of Contract – Litigation – Criminal penalties and fines – Debarment from contracts w/federal funds

25. home energy + 25 DES monitoring Each site is visited during program year Areas reviewed: – Weekly payroll process and documentation – Documentation of training and technical support provided (pre-bid and pre-construction) – Proper display of DBA posters and wage rates – Follow-up on exceptions – Provide support for corrective actions GOAL: Help ensure compliance

26. home energy + 26 DES On-Site Interviews Voluntary random interviews w/affected workers Interviews may or may not be scheduled Observation of on-site work activity (# workers on job, task being performed) Interview results will be sent to sub-grantee Corrective action plans will be developed GOAL: Verify accuracy of reports and compliance

27. home energy + 27 DES On-Site Interviews Davis-Bacon Poster – Employee Rights Under the Davis Bacon Act - Employers must post a notice (including applicable wage determination) in a prominent place where it may be seen by employees. SEE http://homeenergyplus.wi.gov/docview.asp?docid=19071 &locid=25 for poster with contact phone #. http://homeenergyplus.wi.gov/docview.asp?docid=19071 &locid=25 Wage rate and fringe rate verification Wage classification verification 27

28. home energy + 28 Compliance Monitoring Detection of Willful Violations – Concealed underpayments – Misclassification of workers – Payment of “Kickbacks” Result of Review – Discover egregious violations – Wage restitution – Debarment from further participation

29. home energy + 29 Monitoring Tools Checklists for Compliance Current Wage Rate Determinations Standard Payroll Review Process On-Site Observations Record of Employee Interview Compliance and Correction tracking system Policy and Procedures Manual (Wipfli toolkit or other documentation)

30. home energy + 30 Monitoring Results and Findings Minor discrepancies – – note to file; formal correspondence not required; corrections tracked and noted Willful Violations, falsifications, or large findings of underpayment – – Communicated to prime contractor in writing, indicating any potential withholding from contract payment

31. home energy + 31 Monitoring File Maintenance Full documentation of labor standards administration and enforcement – Labor wage rate decisions – Certified payrolls – Related documents for a period of three years after completion of project – Evidence of actions required for labor standard administration and enforcement must be retrievable from file

32. home energy + 32 Summary/questions Getting DB communications to right party within each organization – what needs to change? Send your questions to the Help Desk Request TA through the Help Desk