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OLR Bill Analysis
sSB 137
AN ACT CONCERNING GAS, ELECTRIC, SEWER AND WATER
DELIVERY WORK.
SUMMARY
This bill requires contractors on certain public utility projects to pay
their employees on the project the same prevailing wages and benefits
that would be required on public works projects. The requirement
applies to new construction projects with a total cost of at least $1
million and renovation projects with a total cost of at least $100,000. The
bill generally applies to these public utility projects the same
enforcement and record keeping requirements as the public works
prevailing wage law (see “BACKGROUND”).
Under the bill, a “public utility project” is a project for which one
party is a gas company, pipeline company, water company, sewage
company, or electric distribution company (generally, any of those types
of companies that are regulated by the Public Utilities Regulatory
Authority (PURA), see BACKGROUND).
The bill requires a public utility that must pay the prevailing wage to
recover its costs for doing so through either its base rates or a PURA-
approved rate recovery mechanism, as long as PURA finds that the costs
were prudent and reasonably incurred and recoverable under state
utility ratemaking laws.
The bill also requires any contractor who enters into a contract for a
public utility project, regardless of cost, to offer (1) apprenticeship
training through an apprenticeship program registered with the
Department of Labor or (2) a pre-apprenticeship training program
approved under the apprenticeship laws. It requires the contractor to
certify, in a way set by the labor commissioner, that it currently meets
this requirement. 2024SB-00137-R000303-BA.DOCX
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EFFECTIVE DATE: October 1, 2024
PREVAILING WAGES
Under the state’s prevailing wage law for public works projects,
contracts for covered projects must require contractors and
subcontractors to pay their construction workers the prevailing wage
and benefits. Contractors who do not provide benefits at the rate
required must make up the difference in hourly wages.
The bill requires a contract for certain public utility projects entered
into on or after October 1, 2024, to include the same prevailing wage
provision. As under the public works law, the requirement applies to
new construction projects with a combined total cost or total bond
authorization of at least $1 million and renovation projects with a
combined total cost of at least $100,000. The labor commissioner must
determine the prevailing wage and benefit for each trade or occupation
and location in the same way that she does under the public works law.
Enforcement
The bill imposes the same enforcement provisions as provided under
the public works prevailing wage law. If the labor commissioner, upon
inspection or investigation of a complaint, believes that a contractor or
subcontractor on a covered public utility project knowingly or willfully
failed to pay their employees the prevailing wage and benefits, she must
issue a citation to the contractor or subcontractor and may impose a fine
of $5,000 per offense.
The commissioner must maintain a list of any contractor or
subcontractor that, over the previous three years, violated the public
utility prevailing wage requirement or entered into a settlement with
the commissioner to resolve a public utility prevailing wage claim. For
those on the list, the commissioner must record the (1) violation’s
nature, (2) total amount of wages and benefits in violation or agreed
upon in the settlement, and (3) total amount of civil penalties and fines
agreed upon by the commissioner.
The commissioner must review the list each May 1, for the preceding 2024SB-00137-R000303-BA.DOCX
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rolling three-year period. She may refer for debarment (i.e., prohibit
from working on state or municipal projects) any contractor or
subcontractor that violated the public utility prevailing wage law
during that period. And she must do so for any contractor or
subcontractor with whom she entered into one or more settlements
totaling over the period more than $50,000 in (1) back wages or fringe
benefits or (2) civil penalties or fines. Any contractor or subcontractor
referred for debarment may request a hearing with the commissioner
under the Uniform Administrative Procedure Act.
In addition, if a public utility’s contracting officer finds that a
contractor or subcontractor on its covered project is not paying the
required prevailing wages and benefits, the utility may (1) terminate the
contractor’s right to proceed with the work for which there was a failure
to pay, with written or electronic notice; (2) prosecute the work to
completion by contract or otherwise; and (3) hold the contractor and
subcontractor’s sureties liable for any excess costs to complete the work.
In the alternative, the utility may withhold payments to the contractor
or subcontractor.
If the utility takes either of these steps, within two days its contracting
officer must notify the labor commissioner with the contractor’s or
subcontractor’s name; the project and its location; the violations
involved; the date the contract was terminated, if applicable; and steps
taken to collect the required wages. The labor commissioner may file a
complaint with the proper prosecuting authorities for violations.
Record Keeping Requirement
The bill expands the public works prevailing wage law’s record
keeping requirements to include covered public utility prevailing wage
projects. Among other things, this requires contractors and
subcontractors on a project to submit monthly certified payroll records
to the utility. The records must contain the same information required
under the public works prevailing wage law, including:
1. detailed payroll records for each employee and 2024SB-00137-R000303-BA.DOCX
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2. a signed statement that, among other things, (a) the records are
correct, (b) the employer met the law’s requirements, and (c) the
employer understands the penalties for knowingly filing false
payroll records.
The penalties for failing to comply with the certified payroll records
requirement or knowingly filing false payroll records are the same as
under the public works prevailing wage law (class D felonies with a fine
of up to $5,000, up to five years imprisonment, or both).
BACKGROUND
Public Works Prevailing Wage Law
The state’s prevailing wage law requires contracts on certain public
works projects to require that contractors and subcontractors pay their
construction workers wages and benefits equal to those that are
customary or prevailing for the same work, in the same occupation, in
the same town. The requirement applies to new construction projects of
$1 million or more and renovation projects of $100,000 or more (CGS §
31-53).
PURA-Regulated Utility Companies
Under the public utility law (CGS § 16-1) and the bill, an “electric
distribution company” is generally any person providing electric
transmission or distribution services in the state. It does not include,
among other things, a private power producer, a municipal electric
utility, or a municipal electric energy cooperative.
A “gas company” is generally any person owning, maintaining,
operating, or controlling mains, pipes, or other fixtures in public
highways or streets to transmit or distribute gas for sale for heat or
power in the state. It does not include, among other things, (1) a person
manufacturing gas through a biomass gasification plant under certain
conditions or (2) municipal gas utilities.
A “pipeline company” is generally any person owning, maintaining,
operating, or controlling mains, pipes, or other fixtures through, over,
or under any public land, water, parkways, highways, parks or public 2024SB-00137-R000303-BA.DOCX
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grounds to transport, transmit, or distribute petroleum products for hire
in the state.
A “sewage company” is generally any person owning, maintaining,
operating, or controlling, for general use in any town, city, or borough,
or portion of them, in this state, sewage disposal facilities that discharge
treated effluent into any waterway in the state.
A “water company” is generally any person owning, maintaining,
operating, or controlling any pond, lake, reservoir, stream, well, or
distributing plant or system to supply water to at least 50 consumers. It
does not include, among other things, homeowners, condominium
associations providing water only to their members; municipal
waterworks systems; or a district, metropolitan district, municipal
district or special services district authorized to supply water.
COMMITTEE ACTION
Labor and Public Employees Committee
Joint Favorable Substitute
Yea 8 Nay 4 (03/19/2024)