U.S. Sen. Jerry Moran (R-KS) is pushing for a significant overhaul of the Davis-Bacon Act, introducing new legislation aimed at easing regulatory hurdles and lowering construction costs—particularly for affordable housing projects. The proposal comes as demand for new homes continues to outpace supply nationwide, intensifying cost pressures for builders and families alike.
The Davis-Bacon Act, enacted in 1931, requires contractors on certain federally funded or federally assisted construction projects to pay workers no less than the “prevailing wage” in the region where the project is located. While the law was originally designed to protect fair wages, critics argue that it has become overly burdensome, particularly for residential and affordable housing construction.
According to Moran, those requirements can have a chilling effect on development. He says the mandated wage levels and the extensive paperwork associated with compliance often make it more expensive—and sometimes financially unfeasible—for contractors to take on government-backed housing projects.
Moran noted particular concerns with how wage rates are determined by the U.S. Department of Labor. The agency relies heavily on voluntary wage surveys submitted by contractors, which Moran said can lead to gaps in accurate data. He argued the existing system risks basing project wages on inconsistent or incomplete submissions, further complicating budgeting for builders.
“Buying a home is a part of the American dream that is currently out of reach for many families,” Moran said. “Reducing the burden of federal regulations will help homebuilders meet the demand for new homes, making homeownership a reality for more Kansans.”
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Moran’s bill, the Affordable Housing Expansion Act (S. 3092), focuses on targeted reforms to Davis-Bacon rules affecting residential construction. Supporters say the bill would reduce both labor-related costs and administrative barriers, making it easier for builders to undertake multifamily and affordable housing projects while maintaining fair standards for workers.
Housing industry stakeholders welcomed the move. Bill Killmer, senior vice president of legislative and political affairs for the Mortgage Bankers Association (MBA), said the legislation addresses a longstanding challenge for developers.
“The improper application of Davis-Bacon wage rates is an unnecessary barrier to the modernization and development of multifamily housing, and this bill will help reduce the administrative burden and complexity for residential housing projects. MBA will continue to advocate on behalf of policies that both ensure a healthy real estate market and provide consumers with sustainable housing choices,” Killmer said.
The proposal lands at a time when policymakers across the country are searching for ways to boost housing supply, reduce project delays, and manage cost escalation. While supporters view the Davis-Bacon reforms as a tool to unlock new residential construction, labor advocates have historically defended the law as essential for ensuring fair compensation on government-backed projects.
As debate moves to Congress, Moran’s bill is likely to draw attention from both housing affordability advocates and labor groups—two constituencies deeply invested in the ongoing national conversation about how to build more homes at a faster, more affordable pace.
Originally reported by Dave Kovaleski in Financial Regulation News.
