Public officials hailed – and some construction industry leaders frowned upon – a long-awaited change to New York’s 86-year-old Wicks Law that aims to reduce the cost of construction on most public projects. The proposed change will not affect larger-scale projects, however.
New York State lawmakers on June 14 agreed to revamp the law, which for years has been a heated topic of debate in Albany. The change is currently in the form of bills in the Assembly and Senate that leaders of both houses have pledged to pass.
The agreement between Gov. Eliot Spitzer (D) and leaders of the two chambers sets a higher monetary threshold for projects to fall under Wicks Law requirements, which mandates the issuing of four separate contracts for the major trades on publicly funded construction projects – typically general contracting, electrical, mechanical, and plumbing.
Originally enacted in 1921, the Wicks Law now covers any public project costing more than $50,000 – a benchmark that was set in 1961 for state contracts and 1964 for local government contracts. With nearly all public projects coming in over that amount, many in the industry have blamed the law for driving up construction costs because it creates coordination difficulties among the major trades.
The new agreement raises the cost threshold to $3 million downstate, $1.5 million in major suburban areas, and $500,000 upstate.
The changes will exempt about 70% of public projects from Wicks Law requirements and help save money for schools, local governments, and other public agencies, according to a statement from Spitzer. It also will allow contracting entities to avoid Wicks Law requirements through use of project labor agreements, unless the project is receiving federal dollars.
“This is a positive step forward in addressing the underlying structural problems that have negatively impacted our state’s competitiveness,” Spitzer says in the statement.
New York City Mayor Michael Bloomberg also issued a statement hailing the change, calling the older law “antiquated.”
“These important and long overdue changes … will make city construction faster, cheaper, and more efficient,” Bloomberg adds. “We will continue to support a full repeal of Wicks law, but I applaud state leaders for making major progress.”
But the General Building Contractors of New York State, an AGC chapter that represents 180 union and nonunion contractors in the state, stopped well short of praise for Thursday’s agreement. The GBC quickly released a legislative alert to its members contending that the changes would have a “significant negative impact” on the construction market.
While the GBC has generally supported Wicks Law reform, its alert contends that the proposed changes “will be worse than the status quo and not in the public interest.” It particularly warned about the proposed law’s provisions allowing prequalification for some public project bids and “a host of labor-friendly attachments” such as the PLA exemption, a prevailing wage requirement, and mandatory apprenticeship programs for projects valued at more than $3 million.
The association was refraining from further comment on Friday until it had “determined our next course of action,” says Joe Hogan, GBC executive vice president.
The Senate bill has already been introduced as S. 6146.