CDBG Entitlement FAQ

When it comes to prevailing wage in compliance with the labor laws, we have been told to always compare Federal Prevailing Wage Rates with our State Prevailing Wage Rates for the same trade and use the higher of the two. Is there language in the federal Law that states that and if there is, where can I find it?

Date Published: May 2015

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The federal law that applies federal prevailing wage rates (Davis-Bacon rates) to CDBG funding is Section 110 of the Housing and Community Development Act of 1974, as amended (42 U.S.C. 5310). Section 110 requires the payment of wages at rates "not less than" the local prevailing wages determined by the U.S. Secretary of Labor under the Davis-Bacon Act. This means that the federal wage rates are only a minimum, and if state laws, applicable to the project, require the payment of higher wages, the federal law does not interfere with the higher state requirement. However, even if state law requires the payment of higher rates, and is applicable to the project, the Davis-Bacon wage determination and contract clauses must still be included in solicitation bids and signed contracts for CDBG-financed construction work (except for residential property with less than 8 units). It is the responsibility of the CDBG recipient to contact the state Department of Labor to ascertain whether a project is subject to state prevailing wage rates.

Tags: CDBG Entitlement Program Davis-Bacon