Date Published: October 2012
NSP funded projects follow CDBG requirements regarding the applicability of Davis-Bacon Prevailing Wage requirements. These are issued by the U. S. Department of Labor and required for all construction and rehabilitation work over $2,000. Davis-Bacon applies to projects with eight or more separate, contiguous units operated by a single entity as a single project (e.g., it applies to properties with eight or more units in a single structure). Grantees must comply with the Federal Prevailing wage requirements that are specific to the type of construction project and should follow the most stringent of the Federal, state, and local requirements that follow.
The Davis-Bacon exemption applies to residential structures containing seven or fewer units per property where NSP funds are used for construction or rehabilitation. If the properties are single-family homes where each property is separately owned, then HUD views these as individual structures with one unit each. In this situation, Davis-Bacon does not apply. Note, however, that HUD considers condominiums or cooperatives to be multi-family properties because there are multiple units in one structure.