Davis-Bacon Wages for HUD Construction Loans

What Davis-Bacon Requires

The Davis-Bacon Act requires contractors and subcontractors on federally assisted construction projects to pay workers no less than the locally prevailing wages and fringe benefits for their trades. HUD 221(d)(4) new construction and substantial rehabilitation loans trigger Davis-Bacon coverage, so the wage rates in your construction budget must meet or exceed the current determination for the project's county.

How Wage Determinations Are Set

The U.S. Department of Labor publishes wage determinations by county and by construction type (building, residential, highway, and heavy). Each determination lists minimum hourly rates plus fringe benefits for every covered trade classification. Most HUD multifamily construction falls under the residential or building determinations, and a project is locked to the determination in effect when the construction contract is signed, unless the agency modifies it before then.

Where to Look Up Wages

Current wage determinations are published at sam.gov, the official source. Search by state and county, then select the construction type that matches your project. Your general contractor's estimator and your HUD lender both check these early, because a budget priced below the current determination is a finding waiting to happen.

What It Means for Your Budget

Davis-Bacon coverage affects more than the wage line. Covered projects carry weekly certified payroll reporting, trade-by-trade classification rules, and site posting requirements, and those compliance costs belong in the budget alongside the wage rates themselves. HUD reviews payrolls during construction, and underpayment findings can hold up disbursements. Budget the current determination's rates, classify crews correctly, and the requirement is a known cost rather than a surprise.

Find Your County's Wage Determination

Pick your project's state and county and we'll take you to the official wage determinations for it on SAM.gov. Determinations are published by construction type; under the Department of Labor's All Agency Memoranda 130 and 131, low-rise apartment projects generally fall under Residential determinations and high-rise projects under Building determinations. Confirm the classification with your lender and the HUD Labor Relations field specialist before pricing the budget.

The 2023 Rule Update and Current Status

The Department of Labor's final rule "Updating the Davis-Bacon and Related Acts Regulations" took effect on October 23, 2023. On June 24, 2024, the U.S. District Court for the Northern District of Texas issued a nationwide preliminary injunction covering three provisions of that rule: the material-supplier versus contractor distinction in 29 CFR 5.2, the requirement to pay prevailing wages to delivery truck drivers for onsite time that is more than de minimis, and the operation-of-law incorporation of DBRA contract clauses under 29 CFR 5.5(e). Per DOL, those three provisions are not being implemented or enforced while the injunction stands; the remainder of the rule remains in effect.

Status can change with further court action, so check DOL's rulemaking page before relying on any single provision, and raise open questions with the HUD Labor Relations desk assigned to your project.