PREVAILING WAGE; BOND EXEMPTION S.B. 1186:
SUMMARY OF BILL
REPORTED FROM COMMITTEE
Senate Bill 1186 (as reported without amendment)
Sponsor: Senator John Cherry
Committee: Labor
CONTENT
The bill would amend Public Act 10 of 2023, which requires prevailing wages and fringe
benefits on State projects, to exempt a State project that was paid for by a bond or bond
proposal and that was authorized under the Revised School Code before February 13, 2024,
from prevailing wage and fringe benefit requirements.
MCL 408.1109
BRIEF RATIONALE
Public Act 10 of 2023 requires employees working on State projects to be paid prevailing
wage and fringe benefits. The Act exempts State projects funded by millages that are
authorized under the Revised School Code before February 13, 2024 from prevailing wage
and fringe benefit requirements; however, according to testimony, it is typical for schools to
take out bonds for their projects and to use millage revenue to pay back a bond, which allows
districts to gather all the funding necessary for a large project at one time. Accordingly, it has
been suggested that bonds and bond proposals be added to the Act's exemption to better
reflect the way school districts use millages as sources of revenue.
Legislative Analyst: Alex Krabill
FISCAL IMPACT
The bill could have a fiscal impact on the State and units of local government. It would remove
bond and bond proposals for State projects from the requirement of prevailing wage if those
bond or bond proposals were authorized before February 13, 2024. The total bond revenue is
unchanged; however, if the State contracts without prevailing wage, it is possible that the
overall costs of the project would be lower, which could allow the State to allocate the
additional funding to other projects. Local governments that bonded to use for matching State
funds for State projects would be affected in the same way.
Date Completed: 12-13-24 Fiscal Analysts: Bobby Canell
Joe Carrasco, Jr.
Cory Savino, PhD
Michael Siracuse
floor\sb1186 Bill Analysis @ www.senate.michigan.gov/sfa
This analysis was prepared by nonpartisan Senate staff for use by the Senate in its deliberations and does not
constitute an official statement of legislative intent.


Statutes affected:
Senate Introduced Bill: 408.1109
As Passed by the Senate: 408.1109