[Federal Register Volume 69, Number 241 (Thursday, December 16, 2004)]
[Proposed Rules]
[Pages 75408-75416]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-27422]



[[Page 75407]]

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Part III





Department of Labor





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Wage and Hour Division



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29 CFR Parts 1 and 4



Service Contract Act Wage Determination OnLine Request Process; 
Proposed Rule

  Federal Register / Vol. 69, No. 241 / Thursday, December 16, 2004 / 
Proposed Rules  

[[Page 75408]]


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DEPARTMENT OF LABOR

Wage and Hour Division

29 CFR Parts 1 and 4

[RIN 1215-AB47]


Service Contract Act Wage Determination OnLine Request Process

AGENCY: Wage and Hour Division, Employment Standards Administration, 
Labor.

ACTION: Proposed rule.

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SUMMARY: The Department of Labor (DOL) proposes amending two 
regulations to allow full implementation of the Wage Determinations 
OnLine (WDOL) Internet Web site (http://www.wdol.gov), reflect changes 
in a title and various statutory citations as well as update a list of 
Wage and Hour Division (WHD) Regional Offices. See SUPPLEMENTARY 
INFORMATION for additional information about where the DOL makes this 
proposed rule available.

DATES: Submit comments on or before January 18, 2005.

ADDRESSES: You may mail or otherwise hand-deliver comments to Alfred B. 
Robinson, Jr., Acting Administrator, Wage and Hour Division (Attention: 
Office of Wage Determinations), Employment Standards Administration, 
U.S. Department of Labor, Room S-3028, 200 Constitution Avenue, NW., 
Washington, DC 20210. You should enclose a self-addressed, stamped post 
card, if you want notification that the DOL received your comments. See 
SUPPLEMENTARY INFORMATION for information about submitting comments 
electronically by mail, e-mail, facsimile (``FAX'') machine or the 
http://www.regulations.gov Web site. The DOL encourages you to submit 
comments by mail early or to transmit them electronically, because 
security concerns continue to cause delays in delivering mail to the 
Washington, DC area.

FOR FURTHER INFORMATION CONTACT: William W. Gross, Director, Office of 
Wage Determinations, Wage and Hour Division, Employment Standards 
Administration, U.S. Department of Labor, Room S-3028, 200 Constitution 
Avenue, NW., Washington, DC 20210, telephone (202) 693-0062. This is 
not a toll-free number.
    You may direct questions of interpretation and/or enforcement of 
regulations issued by this agency or referenced in this notice to the 
nearest WHD District Office. Locate the nearest office by calling the 
WHD toll-free help line at 1-866-4US-WAGE (1-866-487-9243) between 8 
a.m. and 5 p.m. in your local time zone, or log onto the agency Web 
site for a nationwide listing of WHD District and Area Offices at: 
http://www.dol.gov/esa/contacts/whd/america2.htm.

SUPPLEMENTARY INFORMATION: 

I. Electronic Access and Filing

    This proposed rule is available through the Federal Register and 
http://www.regulations.gov Web site--which will allow you to find, 
review and submit comments on Federal documents that are open for 
comment and published in the Federal Register. You may also access this 
proposed rule via the WHD home page at http://www.dol.gov/esa/regs/fedreg/proposed/whdpro.htm.
    You may submit comments by mail, e-mail, ``FAX'' or the http://www.regulations.gov Web site. You may e-mail comments to [email protected] or ``FAX'' them to (202) 693-1302. This is not a toll-free 
number. Submit comments as an ASCII file, avoiding the use of special 
characters or encryption. You may also submit comments or attachments 
in Microsoft Word format. Identify all comments in electronic form by 
the docket number (1215-AB47). You should not submit comments on 
diskette or similar media, because security equipment may cause the 
loss or corruption of data.

II. Paperwork Reduction Act

    This regulation is not subject to the Paperwork Reduction Act, 
because it contains no new information collection requirements and does 
not modify any existing requirements.

III. Statutory and Regulatory Framework

    The McNamara-O'Hara Service Contract Act, as amended (SCA), 41 
U.S.C. 351 et seq., requires contractors and subcontractors performing 
services on prime contracts in excess of $2,500 to pay service 
employees in various classes no less than the wage rates and fringe 
benefits found prevailing in the locality as determined by the 
Secretary of Labor, or his authorized representative, or the rates 
(including prospective increases) contained in a predecessor 
contractor's collective bargaining agreement. The DOL issues wage 
determinations on a contract-by-contract basis in response to specific 
requests from contracting agencies.
    SCA section 4, 41 U.S.C. 353, provides the Secretary of Labor with 
authority to enforce the Act, make rules and regulations, issue orders, 
hold hearings, make decisions based upon findings of fact and take 
other appropriate action. Regulations 29 CFR part 4 contains the DOL 
rules relating to SCA administration. Regulation 29 CFR 4.4 requires 
any Federal contracting agency to file with the WHD its notice of 
intention to make a service contract (Form SF-98), if the agency 
believes the contract may be subject to the SCA. The WHD uses 
contracting agency filings to issue appropriate wage determinations.
    Section 1 of the Davis-Bacon Act (DBA), as amended, 40 U.S.C. 3141 
et seq., requires that each contract over $2,000 to which the United 
States or the District of Columbia is a party for the construction, 
alteration, or repair of public buildings or public works shall contain 
a clause setting forth the minimum wages to be paid to various classes 
of laborers and mechanics employed under the contract. Under DBA 
provisions, contractors or their subcontractors are to pay workers 
employed directly upon the site of the work no less than the locally 
prevailing wages and fringe benefits paid on projects of a similar 
character. The DBA directs the Secretary of Labor to determine such 
local prevailing wage rates and requires contractors to post the scale 
of wages to be paid in a prominent and easily accessible place at the 
site of the work.
    In Reorganization Plan No. 14 of 1950 (5 U.S.C. App., effective May 
24, 1950, 15 FR 3176, 64 Stat. 1267), Congress directed the DOL to 
prescribe appropriate standards, regulations and procedures to be 
observed by Federal agencies responsible for the administration of the 
Davis-Bacon and Related Acts (DBRA) in order to assure coordination of 
administration and consistency of enforcement.
    Regulations, 29 CFR part 1, set forth the procedures for making and 
applying determinations of prevailing wage rates and fringe benefits 
pursuant to the DBA and any other Federal statute providing for 
determinations of such wages (Related Acts) by the DOL in accordance 
with the provisions of the DBA. Regulation 29 CFR 1.5 sets forth the 
procedure Federal agencies must use to request wage determinations. 
Regulation 29 CFR 1.6 explains their use and effectiveness.
    The ``Anti-Kickback'' section of the Copeland Act, 40 U.S.C. 3145, 
precludes covered Federal construction contractors and subcontractors 
from in any way inducing an employee to give up any part of the 
compensation to which he or she is entitled under his or her contract 
of employment. The Copeland Act also requires covered Federal 
contractors and subcontractors to submit weekly statements of the

[[Page 75409]]

wages paid to each employee performing on covered work during the 
preceding payroll period.
    Public Law 107-217 recodified Title 40 of the U.S. Code and changed 
the statutory citations for the DBRA and the Copeland Act.

IV. Discussion of the Proposed Rule

    The DOL proposes to update its regulations to have contracting 
agencies use the WDOL Internet Web site to meet their obligation to 
obtain DBA general wage determinations from the WHD. Under the 
proposal, the WHD will publish wage determinations solely through WDOL 
and will no longer publish notice of changes in the Federal Register 
and the Government Printing Office (GPO) will no longer publish paper 
copies of general wage determinations. WDOL offers users the 
opportunity to request e-mail notice of future revisions to a wage 
determination they have selected for a specific period of time, or 
until a specific date. The term WDOL shall mean the Government Internet 
Web site for both DBA and SCA wage determinations or any other Internet 
Web site or electronic means that the Department of Labor may approve 
for these purposes.
    For SCA wage determinations, the DOL proposes to eliminate the 
paper Form SF-98 and replace it with an electronic ``e98,'' process by 
which contracting agencies may continue to request SCA wage 
determinations from the WHD. The DOL also proposes to allow use of WDOL 
as an alternative means of obtaining SCA wage determinations.
    The DOL further proposes to update the statutory citations for laws 
providing the authority for regulations 29 CFR part 1 and in the 
appendix that lists various acts to which the regulations apply. These 
last proposed changes simply reflect Public Law 107-217 that has 
recodified Title 40 of the U.S. Code. Finally, the proposed rule will 
update the title of the Assistant Secretary for Employment Standards in 
a definition, as well as addresses and other contact information in an 
appendix.

V. Background

    The development of WDOL requires an update to existing regulations 
to allow contracting agencies fully to realize the process improvements 
and savings that WDOL provides. This proposed rule will also create a 
basis for updating related information in the Federal Acquisition 
Regulations (FAR) to be compatible with the DOL rule.
    WDOL does not affect how the WHD determines prevailing wages under 
either the SCA or the DBA.

29 CFR Part 1

    Since 1985, the current regulations prescribing procedures for 
obtaining DBA wage determinations have not been revised. The current 
rules provide that DBA general wage determinations are published by the 
GPO in a series of volumes broken out by different geographic areas of 
the country. On a weekly basis, the WHD publishes a notice in the 
Federal Register of the wage determination updates that GPO would 
publish the following week. Users can subscribe to the GPO publication 
service and receive all weekly updates by mail. Subscription purchases 
can be limited to individual volumes or could be for all DBA general 
wage determinations.
    Shortly after the publication of the current regulations, many 
contracting agencies began inquiring about the possibility of accessing 
electronic copies of the published general wage determinations. As a 
result, the WHD entered into an agreement with the Department of 
Commerce, National Technical Information Service (NTIS) to make the DBA 
general wage determinations available online through WDOL. However, 
because the paper volumes of the DBA general wage determinations were 
still published and because the wage determinations on the NTIS site 
were identical to those contained in the GPO publication, the DBA 
regulations were not revised to add a reference to the NTIS site.
    In 2002, the GPO approached the WHD about the possibility of 
publishing DBA Wage determinations electronically. The GPO sought to 
decrease its printing workload and was willing to make DBA general wage 
determinations available electronically at no cost to the user. By 
providing free access to DBA general wage determinations, the GPO was 
hoping to decrease the number of paper subscriptions, thereby 
decreasing their printing workload. Again, because the printed wage 
determinations were still being published, the regulations were not 
changed.
    The proposed rule reflects the technological advances since 1985 
and the wide use of electronic communication and information sharing, 
and adopts the WDOL Web site as the single source for DBA general wage 
determinations. The proposed rule will eliminate the notices currently 
published in the Federal Register. Notice of future modifications and 
supersedeas general wage determinations will be posted on WDOL. The 
proposed rule will also eliminate references to GPO publication of 
general wage determinations, although GPO may continue, at their 
discretion, to publish general wage determinations. The proposed rule 
would retain the requirement in the current regulations under 29 CFR 
1.5 that Federal contracting agencies request a wage determination by 
preparing and mailing Form SF-308 to the Department of Labor, for those 
infrequent situations when a DBA general wage determination is not 
available through WDOL. DOL processed fewer than 100 Forms SF-308 in FY 
2004, and the Department does not believe providing Federal agencies 
with an electronic submission option in these rare cases warrants the 
considerable expense developing such a system would require.

29 CFR Part 4

    Since 1965, the SCA implementing regulations have required that a 
Federal contracting agency request SCA wage determinations for each 
contract. Form SF-98 was developed for this request and response 
process. In part, this individual request and response system was 
employed under the SCA because of the wide variety of service contracts 
covered under the Act. Unlike the DBA, which applied to contracts 
primarily from a single industry (i.e., the construction industry), the 
SCA applied to contracts for a much broader range of industries and 
occupations. While Bureau of Labor Statistics cross-industry survey 
data were used to establish the wage determination rates for most SCA 
covered contracts, the unique requirements of some contracts demanded 
that more specialized and targeted wage determinations be issued. The 
SF-98 process gave the DOL the ability to consider the specific 
contract services and issue the SCA wage determination that was most 
appropriate for those services.
    In 1972, the SCA was amended and a number of new provisions 
affecting the issuance of SCA wage determinations were added. Among the 
new provisions were requirements for issuing wage determinations based 
upon the predecessor contractor's collective bargaining agreement, 
giving due consideration to Federal wage rates when issuing SCA wage 
determinations and mandating the issuance of wage determinations for 
most covered contracts. The individualized SF-98 request and response 
process fit with these new statutory requirements and that process was 
retained when the regulations were revised to reflect the

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1972 SCA amendments. The SF-98-A submission requirement was added to 
the regulations at that time to facilitate the communication of 
information pertaining to the new due consideration and mandatory 
issuance provisions of the amended SCA. (See 29 CFR 4.4(b).)
    Although there have not been any major changes to the regulatory 
SF-98 request and response process since the regulations were revised 
following the 1972 amendments, the DOL has continued to work with 
contracting agencies to develop better and more efficient mechanisms 
for agencies to obtain SCA wage determinations. With the advent and 
expansion of the Internet in the mid-1990s, several contracting 
agencies approached the WHD requesting the ability to access and 
download SCA wage determinations. The vast majority of the covered 
service contracts awarded by these agencies were either options or 
renewals, and the applicable SCA wage determinations for these 
contracts were well established. By this time, the WHD had developed a 
standard set of SCA wage determinations that applied to most of these 
contracts. The NTIS had posted these wage determinations on the 
Internet for information purposes, and the agencies requested the 
ability to download and use these standard wage determinations in 
appropriate situations. After some discussion, the WHD entered into 
Memoranda of Understanding (MOUs) with several agencies to allow them 
to use these standard wage determinations without first submitting an 
SF-98. Under the MOUs, the agencies agreed to train their personnel in 
the proper selection and use of SCA wage determinations. The agencies 
also agreed to monitor the SCA wage determinations database and to use 
any subsequent revisions of the applicable wage determinations that 
were issued before the applicable procurement dates specified in the 
SCA regulations. After the agency selected an applicable SCA wage 
determination, it would notify the WHD of its selection by the 
submission of an SF-98 after the fact.
    This MOU program greatly enhanced the remedial purpose of the SCA 
by requiring that participating agencies monitor the SCA wage 
determination database and use the latest revisions published in a 
timely manner before award or commencement of the contract. With the 
paper Form SF-98, the WHD had no mechanism to follow-up and advise 
contracting agencies when wage determinations were revised. For 
example, if a solicitation were issued in May and the WHD responded to 
the SF-98 with the then current wage determination, the WHD would not 
have advised the agency of an update of the wage determination that 
occurred in July. As a result, the wage determination applied to the 
contract starting on October 1st would have been the wage determination 
current in May rather than the revised wage determination issued in 
July. The MOU program was proven to be quite successful, and it 
subsequently was expanded to numerous other agencies.
    Following the success of the MOU program, an interagency work group 
composed of representatives from the Office of Management and Budget, 
Department of the Army, Department of the Air Force, Department of the 
Navy, Army Corps of Engineers, General Services Administration, NTIS 
and the Department of Energy began development of a new online system 
designed to consolidate the best practices of agencies operating under 
the MOU program. The work group also looked at adding non-standard wage 
determinations to the online system. Principal objectives of the work 
group were the elimination of the paper Form SF-98 and the availability 
of wage determinations electronically.
    At the same time, the WHD was developing an electronic request and 
response system to replace Form SF-98. The WHD began live tests of the 
``e98'' system in FY 2003. During FY 2003, the WHD received and 
responded to more than 12,000 ``e98'' submissions. A computer responds 
to a significant number of the ``e98'' requests immediately while the 
requester is online. The remaining requests are referred to an analyst 
and the response is usually sent later the same day or the next day. 
For all requests, the ``e98'' system is designed to track individual 
requests by the procurement dates listed on the request, and when a 
wage determination that would affect a particular procurement is 
revised, an amended e-mail response is sent to the contracting agency.
    The site developed by the WDOL work group integrates the ``e98'' 
process with the best practices developed under the MOU program. WDOL 
offers users a number of unique features in a web-based environment. 
The site includes: (1) Guidance to contracting officers on selecting 
the appropriate wage determination for each contract action; (2) access 
to the most current SCA and DBA wage determinations, as well as an 
alert service for notification of future revisions to particular wage 
determinations; and, (3) access to databases containing archived wage 
determinations under both the SCA and DBA.
    To facilitate contracting officers selecting the appropriate SCA 
wage determination, the WDOL site leads the requester through a 
``decision tree'' consisting of a series of questions. Based upon the 
responses to these questions, the WDOL site will either identify an SCA 
wage determination or direct the requester to submit an ``e98.'' A link 
to the ``e98'' site is provided. In addition, the WDOL site gives the 
requester the option of going directly to the ``e98'' site without 
having to go through the ``decision tree'' selection process. If a 
contracting officer has any question regarding the selection of the 
proper SCA wage determination, the WDOL site directs the contracting 
officer to the ``e98.''
    As clearly indicated on the WDOL Web site, compliance with the 
decision tree selection process and the guidance provided by the User's 
Guide does not relieve the contracting officer or other program user of 
the requirement to carefully review the contract or solicitation, the 
FAR and its Supplements, other Federal agency acquisition regulations 
or the DOL regulations related to these actions. If the DOL discovers 
and determines, whether before or after contract award, that the 
correct SCA wage determination was not included in a covered contract, 
the contracting officer, within 30 days of notification by the DOL, is 
required to include in the contract the applicable wage determination 
issued by the DOL. (See 29 CFR 4.5(c)(2).)
    The proposed rule reflects the technological advances since 1972 
and the wide use of electronic communication and information sharing, 
and replaces the paper SF-98 with an electronic ``e98'' and enables 
contracting agencies alternatively to use the WDOL Web site to obtain 
SCA wage determinations.

VI. Regulatory Flexibility, Executive Order 12866; Small Business 
Regulatory Enforcement Fairness Act

    The proposed regulation affects Federal agency procurement 
procedures and will not have a significant economic impact on a 
substantial number of small entities within the meaning of the 
Regulatory Flexibility Act, 5 U.S.C. 601 et seq. The agency has 
certified to this effect to the Chief Counsel for Advocacy of the U.S. 
Small Business Administration.
    This proposed rule has been determined to be a significant 
rulemaking, although not economically significant or major, and has 
therefore been reviewed by OMB.

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VII. Unfunded Mandates Reform Act

    For purposes of the Unfunded Mandates Reform Act of 1995, 2 U.S.C. 
1532, this rule does not include any Federal mandate that may result in 
excess of $100 million in expenditures by State, local and tribal 
governments in the aggregate or by the private sector.

VIII. Executive Order 13132 (Federalism)

    The rule does not have federalism implications as outlined in 
Executive Order 13132 regarding federalism. The rule does not have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government.

IX. Executive Order 13175, Indian Tribal Governments

    This rule does not have ``tribal implications'' under Executive 
Order 13175 and does not require a tribal summary impact statement. The 
rule does not have ``substantial direct effects on one or more Indian 
tribes, on the relationship between the Federal government and Indian 
tribes or on the distribution of power and responsibilities between the 
Federal government and Indian tribes.''

X. Effects on Families

    The undersigned hereby certifies that the rule will not adversely 
affect the well-being of families, as discussed under section 654 of 
the Treasury and General Government Appropriations Act, 1999.

XI. Executive Order 13045, Protection of Children

    This rule has no environmental health risk or safety risk that may 
disproportionately affect children.

XII. Environmental Impact Assessment

    A review of this rule in accordance with the requirements of the 
National Environmental Policy Act of 1969 (NEPA), 42 U.S.C. 4321 et 
seq.; the regulations of the Council on Environmental Quality, 40 CFR 
1500 et seq.; and the Departmental NEPA procedures, 29 CFR part 11, 
indicate the rule will not have a significant impact on the quality of 
the human environment. There is, thus, no corresponding environmental 
assessment or an environmental impact statement.

XIII. Executive Order 13211, Energy Supply

    This rule is not subject to Executive Order 13211. It will not have 
a significant adverse effect on the supply, distribution or use of 
energy.

XIV. Executive Order 12630, Constitutionally Protected Property Rights

    This rule is not subject to Executive Order 12630, because it does 
not involve implementation of a policy ``that has takings 
implications'' or that could impose limitations on private property 
use.

XV. Executive Order 12988, Civil Justice Reform Analysis

    This rule was drafted and reviewed in accordance with Executive 
Order 12988 and will not unduly burden the Federal court system. The 
rule was: (1) Reviewed to eliminate drafting errors and ambiguities; 
(2) written to minimize litigation; and (3) written to provide a clear 
legal standard for affected conduct and to promote burden reduction.

XVI. Request for Comments

    In accordance with rulemaking requirements found at 5 U.S.C. 553, 
the DOL is providing interested persons an opportunity to comment on 
these proposed rules.

List of Subjects

29 CFR Part 1

    Administrative practice and procedure, Government contracts, 
Investigations, Labor, Minimum wages, Recordkeeping requirements, 
Reporting requirements, Wages.

29 CFR Part 4

    Administrative practice and procedure, Government contracts, 
Investigations, Labor, Minimum wages, Penalties, Recordkeeping 
requirements, Reporting requirements, Wages.

    Signed in Washington, DC, this 9th day of December, 2004.
Alfred B. Robinson, Jr.,
Acting Administrator, Wage and Hour Division.

    For the reasons set out in the preamble, the DOL proposes to amend 
Title 29, parts 1 and 4 as set forth below:

Title 29--Labor

PART 1--PROCEDURES FOR PREDETERMINATION OF WAGE RATES

    1. The authority citation for part 1 is proposed to be revised to 
read as follows:

    Authority: 5 U.S.C. 301; R.S. 161, 64 Stat. 1267; Reorganization 
Plan No. 14 of 1950, 5 U.S.C. appendix; 40 U.S.C. 3141 et seq.; 40 
U.S.C. 3145; 40 U.S.C. 3148; and the laws listed in appendix A of 
this part.

    2. Paragraph (e) is proposed to be added to Sec.  1.2 to read as 
follows:


Sec.  1.2  Definitions.\1\

* * * * *
    (e) The term Wage Determinations OnLine (WDOL) shall mean the 
Government Internet Web site for both Davis-Bacon Act and Service 
Contract Act wage determinations available at http://www.wdol.gov. In 
addition, WDOL provides compliance assistance information. The term 
will also apply to any other Internet Web site or electronic means that 
the Department of Labor may approve for these purposes.
    3. Paragraphs (a) and (b) of Sec.  1.5 are proposed to be revised 
to read as follows:


Sec.  1.5  Procedure for requesting wage determinations.

    (a) The Department of Labor publishes general wage determinations 
under the Davis-Bacon Act on the WDOL Internet Web site. If there is a 
general wage determination applicable to the project, the agency may 
use it without notifying the Department of Labor, Provided, That 
questions concerning its use shall be referred to the Department of 
Labor in accordance with Sec.  1.6(b).
    (b)(1) If a general wage determination is not available, the 
Federal agency shall request a wage determination under the Davis-Bacon 
Act or any of its related prevailing wage statutes by submitting Form 
SF-308 to the Department of Labor at this address: U.S. Department of 
Labor, Employment Standards Administration, Wage and Hour Division, 
Branch of Construction Contract Wage Determination, Washington, DC 
20210.
    In preparing Form SF-308, the agency shall check only those 
classifications that will be needed in the performance of the work. 
Inserting a note such as ``entire schedule'' or ``all applicable 
classifications'' is not sufficient. Additional classifications needed 
that are not on the form may be typed in the blank spaces or on a 
separate list and attached to the form.
    (2) In completing SF-308, the agency shall furnish:
    (i) A sufficiently detailed description of the work to indicate the 
type of construction involved. Additional description or separate 
attachment, if necessary for identification of type of project, shall 
be furnished.
    (ii) The county (or other civil subdivision) and State in which the 
proposed project is located.
    (3) Such request for a wage determination shall be accompanied by 
any pertinent wage payment information that may be available.

[[Page 75412]]

When the requesting agency is a State highway department under the 
Federal-Aid Highway Acts as codified in 23 U.S.C. 113, such agency 
shall also include its recommendations as to the wages which are 
prevailing for each classification of laborers and mechanics on similar 
construction in the area.
* * * * *
    4. Paragraphs (a)(2), (c)(3)(iv) and (c)(3)(v) of Sec.  1.6 are 
proposed to be revised to read as follows:


Sec.  1.6  Use and effectiveness of wage determinations.

    (a) * * *
    (2) General wage determinations issued pursuant to Sec.  1.5(a), 
notice of which is published on WDOL, shall contain no expiration date.
* * * * *
    (c) * * *
    (3) * * *
    (iv) If under paragraph (c)(3)(i) of this section the contract has 
not been awarded within 90 days after bid opening, or if under 
paragraph (c)(3)(ii) or (iii) of this section construction has not 
begun within 90 days after initial endorsement or the signing of the 
agreement to enter into a housing assistance payments contract, any 
modification, notice of which is published on WDOL prior to award of 
the contract or the beginning of construction, as appropriate, shall be 
effective with respect to that contract unless the head of the agency 
or his or her designee requests and obtains an extension of the 90-day 
period from the Administrator. Such request shall be supported by a 
written finding, which shall include a brief statement of the factual 
support, that the extension is necessary and proper in the public 
interest to prevent injustice or undue hardship or to avoid serious 
impairment in the conduct of Government business. The Administrator 
will either grant or deny the request for an extension after 
consideration of all the circumstances.
    (v) A modification to a general wage determination is ``published'' 
within the meaning of this section on the date notice of a modification 
or a supersedeas wage determination is published on WDOL or on the date 
the agency receives actual written notice of the modification from the 
Department of Labor, whichever occurs first.
* * * * *
    5. Items 19 and 20 in Appendix A of part 1 are proposed to be 
revised to read as follows:

Appendix A to Part 1

* * * * *
    19. National Visitors Center Facilities Act of 1968 (sec. 110, 
32 Stat.).

    Note: Section applying labor standards provisions of the Davis-
Bacon Act repealed August 21, 2002, by 116 Stat. 1318, Pub. L. 107-
217.

    20. Appalachian Regional Development Act of 1965 (sec. 402, 79 
Stat. 21; 40 U.S.C. 14701).
* * * * *
    6. Appendix B of part 1 is proposed to be revised to read as 
follows:

Appendix B to Part 1

Northeast Region

    For the States of Connecticut, Delaware, District of Columbia, 
Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, 
Pennsylvania, Puerto Rico, Rhode Island, Vermont, Virgin Islands, 
Virginia and West Virginia:
    Regional Administrator, Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, Curtis Center, 
170 South Independence Mall West, Room 850 West, Philadelphia, PA 
19106 (Telephone: (215) 861-5800, fax: (215) 861-5840).

Southeast Region

    For the States of Alabama, Florida, Georgia, Kentucky, 
Mississippi, North Carolina, South Carolina and Tennessee:
    Regional Administrator, Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, 61 Forsyth 
Street, SW., Room 7M40, Atlanta, GA 30303 (Telephone (404) 893-4531, 
fax: (404) 893-4524).

Midwest Region

    For the States of Illinois, Indiana, Iowa, Kansas, Michigan, 
Minnesota, Missouri, Nebraska, Ohio and Wisconsin:
    Regional Administrator, Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, 230 South 
Dearborn Street, Room 530, Chicago, IL 60604-1591 (Telephone: (312) 
596-7180, fax: (312) 596-7205).

Southwest Region

    For the States of Arkansas, Colorado, Louisiana, Montana, New 
Mexico, North Dakota, Oklahoma, South Dakota, Texas, Utah and 
Wyoming:
    Regional Administrator, Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, 525 South 
Griffin Street, Suite 800, Dallas, TX 75202-5007 (Telephone: (972) 
850-2600, fax: (972) 850-2601).

Western Region

    For the States of Alaska, American Samoa, Arizona, California, 
Guam, Hawaii, Idaho, Nevada, Oregon and Washington:
    Regional Administrator, Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, 71 Stevenson 
Street, Suite 930, San Francisco, CA 94105. (Telephone: (415) 848-
6600, fax: (415) 848-6655).

Appendix C to Part 1 [Removed]

    7. Appendix C of part 1 is proposed to be deleted.

PART 4--LABOR STANDARDS FOR FEDERAL SERVICE CONTRACTS

    8. The authority citation for part 4 continues to read as follows:

    Authority: 41 U.S.C. 351 et seq.; 41 U.S.C. 38 and 39; 5 U.S.C. 
301.

Subpart A--Service Contract Labor Standards Provisions and 
Procedures

    9. In Sec.  4.1a, paragraph (b) is proposed to be revised and 
paragraphs (i) and (j) are proposed to be added to read as follows:


Sec.  4.1a  Definitions and use of terms.

* * * * *
    (b) Secretary includes the Secretary of Labor, the Assistant 
Secretary for Employment Standards, and their authorized 
representatives.
* * * * *
    (i) Wage Determinations OnLine (WDOL) means the Government Internet 
Web site for both Davis-Bacon Act and Service Contract Act wage 
determinations available at http://www.wdol.gov. In addition, WDOL 
provides compliance assistance information and a link to submit an 
``e98'' or any electronic means the Department of Labor may approve for 
this purpose. The term will also apply to any other Internet Web site 
or electronic means that the Department of Labor may approve for these 
purposes.
    (j) The ``e98'' means a Department of Labor approved electronic 
application, whereby a contracting officer submits pertinent 
information to the Department of Labor and requests a wage 
determination directly from the Wage and Hour Division. The term will 
also apply to any other process or system the Department of Labor may 
establish for this purpose.
    10. In Sec.  4.3, paragraphs (b) through (d) are proposed to be 
revised and paragraph (e) is proposed to be added to read as follows:


Sec.  4.3  Wage determinations.

* * * * *
    (b) As described in subpart B of this part, two types of wage 
determinations are issued under the Act: Prevailing in the locality or 
Collective Bargaining Agreement (Successorship) wage determinations. 
The facts related to a specific solicitation and contract will 
determine the type of wage determination applicable to that 
procurement. In addition, different types of prevailing wage 
determinations may be issued depending upon the nature of the contract. 
While prevailing wage determinations based upon cross-industry survey 
data are applicable to most contracts covered by the Act, in

[[Page 75413]]

some cases the Department of Labor may issue industry specific wage 
determinations for application to specific types of service contracts. 
In addition, the geographic scope of contracts is often different and 
the geographic scope of the underlying survey data for the wage 
determinations applicable to those contracts may be different.
    (c) Such wage determinations will set forth for the various classes 
of service employees to be employed in furnishing services under such 
contracts in the appropriate localities, minimum monetary wage rates to 
be paid and minimum fringe benefits to be furnished them during the 
periods when they are engaged in the performance of such contracts, 
including, where appropriate under the Act, provisions for adjustments 
in such minimum rates and benefits to be placed in effect under such 
contracts at specified future times. The wage rates and fringe benefits 
set forth in such wage determinations shall be determined in accordance 
with the provisions of sections 2(a)(1), (2), and (5), 4(c) and 4(d) of 
the Act from those prevailing in the locality for such employees, with 
due consideration of the rates that would be paid for direct Federal 
employment of any classes of such employees whose wages, if federally 
employed, would be determined as provided in 5 U.S.C. 5341 or 5 U.S.C. 
5332, or from pertinent collective bargaining agreements with respect 
to the implementation of section 4(c). The wage rates and fringe 
benefits so determined for any class of service employees to be engaged 
in furnishing covered contract services in a locality shall be made 
applicable by contract to all service employees of such class employed 
to perform such services in the locality under any contract subject to 
section 2(a) of the Act which is entered into thereafter and before 
such determination has been rendered obsolete by a withdrawal, 
modification, or supersedure.
    (d) Generally, wage determinations issued for solicitations or 
negotiations for any contract where the place of performance is unknown 
will contain minimum monetary wages and fringe benefits for the various 
geographic localities where the work may be performed which were 
identified in the initial solicitation. (See Sec.  4.4(a)(3)(i).)
    (e) Wage determinations will be available for public inspection 
during business hours at the Wage and Hour Division, Employment 
Standards Administration, U.S. Department of Labor, Washington, DC, and 
copies will be made available on request at Regional Offices of the 
Wage and Hour Division. In addition, most prevailing wage 
determinations are available online from WDOL.
    11. Section 4.4 is proposed to be revised to read as follows:


Sec.  4.4  Obtaining a wage determination.

    (a)(1) Sections 2(a)(1) and (2) of the Act require that every 
contract and any bid specification therefore in excess of $2,500 
contain a wage determination specifying the minimum monetary wages and 
fringe benefits to be paid to service employees performing work on the 
contract. The contracting agency, therefore, must obtain a wage 
determination prior to:
    (i) Any invitation for bids;
    (ii) Request for proposals;
    (iii) Commencement of negotiations;
    (iv) Exercise of option or contract extension;
    (v) Annual anniversary date of a multi-year contract subject to 
annual fiscal appropriations of the Congress; or
    (vi) Each biennial anniversary date of a multi-year contract not 
subject to such annual appropriations, if so authorized by the Wage and 
Hour Division.
    (2) As described in Sec.  4.4(b), wage determinations may be 
obtained from the Department of Labor by electronically submitting an 
``e98'' describing the proposed contract and the occupations expected 
to be employed on the contract. Based upon the information provided on 
the ``e98,'' the Department of Labor will respond with the wage 
determination or wage determinations that the contracting agency may 
rely upon as the correct wage determination(s) for the contract 
described in the ``e98.'' Alternatively, contracting agencies may 
select and obtain a wage determination using WDOL. (See Sec.  4.4(c).) 
Although the WDOL Web site provides assistance to the agency to select 
the correct wage determination for the contract, the agency remains 
responsible for the wage determination selected.
    (3)(i) Where the place of performance of a contract for services 
subject to the Act is unknown at the time of solicitation, the 
solicitation need not initially contain a wage determination. The 
contracting agency, upon identification of firms participating in the 
procurement in response to an initial solicitation, shall obtain a wage 
determination for each location where the work may be performed as 
indicated by participating firms. An applicable wage determination must 
be obtained for each firm participating in the bidding for the location 
in which it would perform the contract. The appropriate wage 
determination shall be incorporated in the resultant contract documents 
and shall be applicable to all work performed thereunder (regardless of 
whether the successful contractor subsequently changes the place(s) of 
contract performance).
    (ii) There may be unusual situations, as determined by the 
Department of Labor upon consultation with a contracting agency, where 
the procedure in paragraph (a)(3)(i) of this section is not practicable 
in a particular situation. In these situations, the Department may 
authorize a modified procedure which may result in the subsequent 
issuance of wage determinations for one or more composite localities.
    (4) In no event may a contract subject to the Act on which more 
than five (5) service employees are contemplated to be employed be 
awarded without an appropriate wage determination. (See section 10 of 
the Act.)
    (b) ``e98'' process--
    (1) The ``e98'' is an electronic application used by contracting 
agencies to request wage determinations directly from the Wage and Hour 
Division. The WHD uses computers to analyze information provided on the 
``e98'' and to provide a response while the requester is online, if the 
analysis determines that an existing wage determination is currently 
applicable to the procurement. The response will assign a unique serial 
number to the ``e98'' and the response will provide a link to an 
electronic copy of the applicable wage determination(s). If the initial 
computer analysis cannot identify the applicable wage determination for 
the request, an online response will be provided indicating that the 
request has been referred to an analyst. Again, the online response 
will assign a unique serial number to the ``e98.'' After an analyst has 
reviewed the request, a further response will be sent to the e-mail 
address identified on the ``e98.'' In most cases, the further response 
will provide an attachment with a copy of the applicable wage 
determination(s). In some cases, however, additional information may be 
required and the additional information will be requested via e-mail. 
After an applicable wage determination is sent in response to an 
``e98,'' the ``e98'' system continues to monitor the request and if the 
applicable wage determination is revised in time to affect the 
procurement, an amended response will be sent to the e-mail address 
identified on the ``e98.''
    (2) When completing an ``e98,'' it is important that all 
information requested be completed accurately and fully. However, 
several sections are particularly important. Since most responses are 
provided via e-mail, a

[[Page 75414]]

correct e-mail address is critically important. Accurate procurement 
dates are essential for the follow-up response system to operate 
effectively. An accurate estimate of the number of service employees to 
be employed under the contract is also important because section 10 of 
the Act requires that a wage determination be issued for all contracts 
that involve more than five service employees.
    (3) Since the ``e98'' system automatically provides an amended 
response if the applicable wage determination is revised, the e-mail 
address listed on the ``e98'' must be monitored during the full 
solicitation stage of the procurement. Communications sent to the e-
mail address provided are deemed to be received by the contracting 
agency. A contracting agency must update the e-mail address through the 
``help'' process identified on the ``e98,'' if the agency no longer 
intends to monitor the e-mail address.
    (4) For invitations to bid, if the bid opening date is delayed by 
more than sixty (60) days, or if contract commencement is delayed by 
more than sixty (60) days for all other contract actions, the 
contracting agency shall submit a revised ``e98.''
    (5) If the services to be furnished under the proposed contract 
will be substantially the same as services being furnished in the same 
locality by an incumbent contractor whose contract the proposed 
contract will succeed, and if such incumbent contractor is furnishing 
such services through the use of service employees whose wage rates and 
fringe benefits are the subject of one or more collective bargaining 
agreements, the contracting agency shall reference the union and the 
collective bargaining agreement on the ``e98.'' The requester will 
receive an e-mail response giving instructions for submitting a copy of 
each such collective bargaining agreement together with any related 
documents specifying the wage rates and fringe benefits currently or 
prospectively payable under such agreement. After receipt of the 
collective bargaining agreement, the Wage and Hour Division will 
provide a further e-mail response attaching a copy of the wage 
determination based upon the collective bargaining agreement. If the 
place of contract performance is unknown, the contracting agency will 
submit the collective bargaining agreement of the incumbent contractor 
for incorporation into a wage determination applicable to a potential 
bidder located in the same geographic area as the predecessor 
contractor. If such services are being furnished at more than one 
locality and the collectively bargained wage rates and fringe benefits 
are different at different localities or do not apply to one or more 
localities, the agency shall identify the localities to which such 
agreements have application. If the collective bargaining agreement 
does not apply to all service employees under the contract, the agency 
shall identify the employees and/or work subject to the collective 
bargaining agreement. In the event the agency has reason to believe 
that any such collective bargaining agreement was not entered into as a 
result of arm's-length negotiations, a full statement of the facts so 
indicating shall be transmitted with the copy of such agreement. (See 
Sec.  4.11.)
    If the agency has information indicating that any such collectively 
bargained wage rates and fringe benefits are substantially at variance 
with those prevailing for services of a similar character in the 
locality, the agency shall so advise the Wage and Hour Division and, if 
it believes a hearing thereon pursuant to section 4(c) of the Act is 
warranted, shall file its request for such hearing pursuant to Sec.  
4.10 at the time of filing the ``e98.''
    (6) If the proposed contract is for a multi-year period subject to 
other than annual appropriations, the contracting agency shall provide 
a statement in the comments section of the ``e98'' concerning the type 
of funding and the contemplated term of the proposed contract. Unless 
otherwise advised by the Wage and Hour Division that a wage 
determination must be obtained on the annual anniversary date, a new 
wage determination shall be obtained on each biennial anniversary date 
of the proposed multi-year contract in the event its term is for a 
period in excess of two years.
    (c) WDOL process--
    (1) Contracting agencies may use the WDOL Web site to select the 
applicable prevailing wage determination for the procurement. The WDOL 
site provides assistance to the agency in the selection of the correct 
wage determination. The contracting agency, however, is fully 
responsible for selecting the correct wage determination. If the 
Department of Labor subsequently determines that an incorrect wage 
determination was applied to a specific contract, the contracting 
agency, in accordance with Sec.  4.5, shall amend the contract to 
incorporate the correct wage determination as determined by the 
Department of Labor.
    (2) If an applicable prevailing wage determination is not available 
on the WDOL site, the contracting agency must submit an ``e98'' in 
accordance with Sec.  4.4(b).
    (3) The contracting agency shall monitor the WDOL site to determine 
whether the applicable wage determination has been revised. Revisions 
published on the WDOL site or otherwise communicated to the contracting 
officer within the timeframes prescribed in Sec.  4.5(a)(2) are 
applicable and must be included in the resulting contract.
    (4) If the services to be furnished under the proposed contract 
will be substantially the same as services being furnished in the same 
locality by an incumbent contractor whose contract the proposed 
contract will succeed, and if such incumbent contractor is furnishing 
such services through the use of service employees whose wage rates and 
fringe benefits are the subject of one or more collective bargaining 
agreements, the contracting agency may prepare a wage determination 
that references the collective bargaining agreement by incorporating 
that wage determination, with a complete copy of the collective 
bargaining agreement attached thereto, into the successor contract 
action. It need not submit a copy of the collective bargaining 
agreement to the Department of Labor unless requested to do so. If the 
place of contract performance is unknown, the contracting agency will 
prepare a wage determination on WDOL and attach the collective 
bargaining agreement of the incumbent contractor and make both the wage 
determination and collective bargaining agreement applicable to a 
potential bidder located in the same geographic area as the predecessor 
contractor. (See Sec.  4.4(a)(3).) If such services are being furnished 
at more than one locality and the collectively bargained wage rates and 
fringe benefits are different at different localities or do not apply 
to one or more localities, the agency shall identify the localities to 
which such agreements have application. If the collective bargaining 
agreement does not apply to all service employees under the contract, 
the agency shall identify the employees and/or work subject to the 
collective bargaining agreement. In the event the agency has reason to 
believe that any such collective bargaining agreement was not entered 
into as a result of arm's-length negotiations, a full statement of the 
facts so indicating shall be transmitted to the Wage and Hour Division 
with the copy of such agreement. (See Sec.  4.11.) If the agency has 
information indicating that any such collectively bargained wage rates 
and fringe benefits are substantially at variance with those prevailing 
for

[[Page 75415]]

services of a similar character in the locality, the agency shall so 
advise the Wage and Hour Division and, if it believes a hearing thereon 
pursuant to section 4(c) of the Act is warranted, shall file its 
request for such hearing pursuant to Sec.  4.10. A wage determination 
based upon the collective bargaining agreement must be included in the 
contract until a hearing or a final ruling of the Administrator 
determines that the collective bargaining agreement was not reached as 
the result of arm's-length negotiations or was substantially at 
variance with locally prevailing rates. Any questions regarding 
timeliness or applicability of collective bargaining agreements must be 
referred to the Department of Labor for resolution.
    (5) If the proposed contract is for a multi-year period subject to 
other than annual appropriations, the contracting agency shall, unless 
otherwise advised by the Wage and Hour Division, obtain a new wage 
determination on each biennial anniversary date of the proposed multi-
year contract in the event its term is for a period in excess of two 
years.
    12. Section 4.5 is proposed to be amended by revising paragraphs 
(a), (c), and (d) to read as follows:


Sec.  4.5  Contract specification of determined minimum wages and 
fringe benefits.

    (a) Any contract in excess of $2,500 shall contain, as an 
attachment, the applicable, currently effective wage determination 
specifying the minimum wages and fringe benefits for service employees 
to be employed thereunder, including any document referred to in 
paragraphs (a)(1) or (2) of this section;
    (1) Any wage determination from the Wage and Hour Division, 
Employment Standards Administration, Department of Labor, responsive to 
the contracting agency's submission of an ``e98'' or obtained through 
WDOL under Sec.  4.4; or
    (2) Any revision of a wage determination issued prior to the award 
of the contract or contracts which specifies minimum wage rates or 
fringe benefits for classes of service employees whose wages or fringe 
benefits were not previously covered by wage determinations, or which 
changes previously determined minimum wage rates and fringe benefits 
for service employees employed on covered contracts in the locality. 
However, revisions received by the Federal agency later than 10 days 
before the opening of bids, in the case of contracts entered into 
pursuant to competitive bidding procedures, shall not be effective if 
the Federal agency finds that there is not a reasonable time still 
available to notify bidders of the revision. In the case of 
procurements entered into pursuant to negotiations (or in the case of 
the execution of an option or an extension of the initial contract 
term), revisions received by the agency after award (or execution of an 
option or extension of term, as the case may be) of the contract shall 
not be effective provided that the contract start of performance is 
within 30 days of such award (or execution of an option or extension of 
term). If the contract does not specify a start of performance date 
which is within 30 days from the award, and/or if performance of such 
procurement does not commence within this 30-day period, the Department 
of Labor shall be notified and any notice of a revision received by the 
agency not less than 10 days before commencement of the contract shall 
be effective. In situations arising under section 4(c) of the Act, the 
provisions in Sec.  4.1b(b) apply.
    (3) For purposes of using WDOL databases containing prevailing wage 
determinations, the date of receipt by the contracting agency will be 
the date of publication on the WDOL Web site or on the date the agency 
receives actual notice of a revised wage determination from the 
Department of Labor, whichever occurs first.
    (b) * * * * *
    (c) Where the Department of Labor discovers and determines, whether 
before or subsequent to a contract award, that a contracting agency 
made an erroneous determination that the Service Contract Act did not 
apply to a particular procurement and/or failed to include an 
appropriate wage determination in a covered contract, the contracting 
agency, within 30 days of notification by the Department of Labor, 
shall include in the contract the stipulations contained in Sec.  4.6 
and any applicable wage determination issued by the Administrator or 
his authorized representative through the exercise of any and all 
authority that may be needed (including, where necessary, its authority 
to negotiate or amend, its authority to pay any necessary additional 
costs, and its authority under any contract provision authorizing 
changes, cancellation, and termination). With respect to any contract 
subject to section 10 of the Act, the Administrator may require 
retroactive application of such wage determination. (See 53 Comp. Gen. 
412, (1973); Curtiss-Wright Corp. v. McLucas, 381 F. Supp. 657 (D NJ 
1974); Marine Engineers Beneficial Assn., District 2 v. Military 
Sealift Command, 86 CCH Labor Cases ] 33,782 (D DC 1979); Brinks, Inc. 
v. Board of Governors of the Federal Reserve System, 466 F. Supp. 112 
(D DC 1979), 466 F. Supp. 116 (D DC 1979).) (See also 32 CFR 1-403.)
    (d) In cases where the contracting agency has filed an ``e98'' and 
has not received a response from the Department of Labor, the 
contracting agency shall, with respect to any contract for which 
section 10 to the Act and Sec.  4.3 for this part mandate the inclusion 
of an applicable wage determination, contact the Wage and Hour Division 
by telephone for guidance.

Subpart B--Wage Determination Procedures

    13. Section 4.50 is proposed to be revised to read as follows:


Sec.  4.50  Types of wage and fringe benefit determinations.

    The Administrator specifies the minimum monetary wages and fringe 
benefits to be paid as required under the Act in two types of 
determinations:
    (a) Prevailing in the locality. (1) Determinations that set forth 
minimum monetary wages and fringe benefits determined to be prevailing 
for various classes of service employees in the locality (sections 
2(a)(1) and 2(a)(2) of the Act) after giving ``due consideration'' to 
the rates applicable to such service employees if directly hired by the 
Federal Government (section 2(a)(5) of the Act).
    (2) The prevailing wage determinations applicable to most contracts 
covered by the Act are based upon cross-industry survey data. However, 
in some cases the Department of Labor may issue industry specific wage 
determinations for application to specific types of service contracts. 
In addition, the geographic scope of contracts is often different and 
the geographic scope of the underlying survey data for the wage 
determinations applicable to those contracts may be different. 
Therefore, a variety of different prevailing wage determinations may be 
applicable in a particular locality. The application of these different 
prevailing wage determinations will depend upon the nature of the 
contracts to which they are applied.
    (b) Collective Bargaining Agreement--(Successorship). 
Determinations that set forth the wage rates and fringe benefits, 
including accrued and prospective increases, contained in a collective 
bargaining agreement applicable to the service employees who performed 
on a predecessor contract in the same locality. (See sections 2(a)(1) 
and (2) as well as 4(c) of the Act.)
    14. Paragraph (b) of Sec.  4.54 is proposed to be revised to read 
as follows:

[[Page 75416]]

Sec.  4.54  Locality basis of wage and fringe benefit determinations.

* * * * *
    (b) Where the services are to be performed for a Federal agency at 
the site of the successful bidder, in contrast to services to be 
performed at a specific Federal facility or installation, or in the 
locality of such installation, the location where the work will be 
performed often cannot be ascertained at the time of bid advertisement 
or solicitation. In such instances, wage determinations will generally 
be issued for the various localities identified by the agency as set 
forth in Sec.  4.4(a)(3)(i).
* * * * *
    15. Paragraphs (a) and (b) of Sec.  4.55 are proposed to be revised 
to read as follows:


Sec.  4.55  Issuance and revision of wage determinations.

    (a) Determinations will be reviewed periodically and where 
prevailing wage rates or fringe benefits have changed, such changes 
will be reflected in revised determinations. For example, in a locality 
where it is determined that the wage rate which prevails for a 
particular class of service employees is the rate specified in a 
collective bargaining agreement(s) applicable in that locality, and 
such agreement(s) specifies increases in such rates to be effective on 
specific dates, the determinations would be revised to reflect such 
changes as they become effective. Revised determinations shall be 
applicable to contracts in accordance with the provisions of Sec.  
4.5(a) of subpart A.
    (b) Determinations issued by the Wage and Hour Division with 
respect to particular contracts are required to be incorporated in the 
invitations for bids or requests for proposals or quotations issued by 
the contracting agencies, and are to be incorporated in the contract 
specifications in accordance with Sec.  4.5 of subpart A. In this 
manner, prospective contractors and subcontractors are advised of the 
minimum monetary wages and fringe benefits required under the most 
recently applicable determination to be paid the service employees who 
perform the contract work. These requirements are, of course, the same 
for all bidders so none will be placed at a competitive disadvantage.
* * * * *

Subpart C--Application of the McNamara-O'Hara Service Contract Act

    16. Paragraphs (e)(1)(iv)(A) and (e)(2)(iii)(A) of Sec.  4.123 are 
proposed to be revised to read as follows:


Sec.  4.123  Administrative limitations, variances, tolerances and 
exemptions.

* * * * *
    (e) * * *
    (1) * * *
    (iv)(A) If the Administrator determines after award of the prime 
contract that any of the requirements in paragraph (e)(1) of this 
section for exemption has not been met, the exemption will be deemed 
inapplicable, and the contract shall become subject to the Service 
Contract Act, effective as of the date of the Administrator's 
determination. In such case, the corrective procedures in Sec.  4.5(c) 
shall be followed.
* * * * *
    (2) * * *
    (iii)(A) If the Administrator determines after award of the prime 
contract that any of the requirements in paragraph (e)(2) for exemption 
has not been met, the exemption will be deemed inapplicable, and the 
contract shall become subject to the Service Contract Act. In such 
case, the corrective procedures in Sec.  4.5(c) shall be followed.
* * * * *
    17. Section 4.144 is proposed to be revised to read as follows:


Sec.  4.144  Contract modifications affecting amount.

    Where a contract that was originally issued in an amount not in 
excess of $2,500 is later modified so that its amount may exceed that 
figure, all the provisions of section 2(a) of the Act, and the 
regulations thereunder, are applicable from the date of modification to 
the date of contract completion. In the event of such modification, the 
contracting officer shall immediately obtain a wage determination from 
the Department of Labor using the ``e98'' application or directly from 
WDOL, and insert the required contract clauses and any wage 
determination issued into the contract. In the event that a contract 
for services subject to the Act in excess of $2,500 is modified so that 
it cannot exceed $2,500, compliance with the provisions of section 2(a) 
of the Act and the contract clauses required thereunder ceases to be an 
obligation of the contractor when such modification becomes effective.

[FR Doc. 04-27422 Filed 12-15-04; 8:45 am]
BILLING CODE 4510-27-P