October 01, 2002
Tuesday - 10:30 pm

Fairbanks - As rural and labor leaders looked on, Gov. Tony Knowles today signed Administrative Order No. 199, directing three state agency programs to start requiring, planning and budgeting for the payment of prevailing wages on their rural construction projects. The order takes a strong step forward in eliminating a two-tier wage system that has developed on public construction projects in rural Alaska, where workers from outside the region receive prevailing wages while local workers doing essentially the same work

"In signing this order, I want to usher in the day when rural Alaska has a professional, career-oriented resident construction workforce, fully qualified for employment on public construction projects throughout the state."... Gov. Knowles.

receive substantially lower wages.

"In signing this order, I want to usher in the day when rural Alaska has a professional, career-oriented resident construction workforce, fully qualified for employment on public construction projects throughout the state," said Knowles. "Labor leaders facing anticipated high level of retirements in the construction industry are anxiously searching for the next generation of workers. With appropriate training programs, they'll find many of them in rural Alaska's workforce."

The main goals of the order are to create more high quality jobs in rural Alaska, help establish conditions for the development of a professional, career-oriented local construction workforce in rural Alaska, protect community choice on the construction management methods that provide the most local benefits, and allow communities to receive the benefits of the competitive bidding process.

The order applies to new projects not yet funded for construction in the Village Safe Water, Rural Energy, and Community Priority Facilities programs run by the Dept. of Environmental Conservation, the Alaska Industrial Development and Export Authority, and the Dept. of Community and Economic Development respectively. To ease the transition to this new system, the order allows these programs to create and use a progressive, graduated pay scale that takes into account the skill levels of less experienced workers and the need for on-the-job training. The order also allows grant recipients to obtain a project-specific exemption from the requirement. The exemption process will be in effect for five years, until 2007.

As he signed the Administrative Order in the conference room of the Tanana Chiefs Conference, Knowles thanked the many people across the state who have been involved in the development of AO 199, from community leaders in the Alaska Municipal League, to those involved in rural, Alaska Native, health, and labor issues. The governor was joined at the signing event by Buddy Brown, president of Tanana Chiefs Conference; Bert Bell, the immediate past president of the Associated General Contractors of Alaska; Dick Cattanach, executive director of the Associated General Contractors of Alaska; Mano Frey, president of the Alaska State AFL-CIO; Will Mayo, senior rural policy advisor; and Michelle Brown, commissioner of the Department of Environmental Conservation.

The order was drafted by a 16-member Rural Construction Work Group appointed by Knowles in 2001. According to the news release from the Office of the Governor, the final product was developed after extensive consultation with a wide array of organizations and communities that are directly affected by this order. Participants ensured that the final AO meets rural needs. The order:

• Protects force account construction by ensuring that construction management methods for these programs remain a local choice;
• Directs the Department of Environmental Conservation (DEC) to conduct demonstration projects to evaluate innovative contracting methods where factors such as local hire, local purchases, and rural track record are considered in awarding construction contracts in addition to lowest bid;
• Allows DEC to give priority consideration for funding to projects that run up against the Indian Health Service cost caps;
• Directing DEC Commissioner Brown to lead an effort to develop and implement a strategy to convince the federal government to adopt cost caps that are more realistic for Alaska;
• Calls for full cooperation with all partner agencies to implement the order in a way that does not negatively impact federal funding;
• Requires the commissioners of the departments that will implement the order, in consultation with all interested parties, to provide the Governor of Alaska with an annual report describing the order's results and impact.
  

Administrative Order No. 199

Source of News Release:

Office of the Governor
Web Site

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