Prevailing Wage Requirement for JOBZ Projects
Statutes require businesses that benefit from the JOBZ program to require contractors to pay prevailing wages to construction workers during construction of a business facility.
Any company that signs a business subsidy agreement to operate within a JOBZone must comply with the statutory requirements of the state's "prevailing wage" law, according to a letter issued by the Office of the Minnesota Attorney General. A contractor or subcontractor cannot avoid paying prevailing wages by "electing" not to be exempt from sales and use tax.
What this means is that qualified businesses that are conducting building projects must require construction companies to comply with Minnesota's prevailing wage statute.
Business subsidy agreement language and process guidance on prevailing wage requirements and all other policy questions is available on this website.
Prevailing Wage Mechanics
- The Subzone administrator informs the prospective benefiting business
of JOBZ prevailing wage requirement as stated in Section IV, L. of
the model Business Subsidy Agreement.
- The Subzone administrator informs the prospective benefiting business
that the relevant Minnesota prevailing wage statute is 116J.871 and
recommends that the business include the following language, or equivalent,
in bid packages and construction contracts: “Minnesota Statutes,
Section 116J.871 applies to this project. The statute requires recipients
of state assistance to pay the prevailing wage rates to laborers
and mechanics at the project site.”
- The Subzone administrator provides the following certification
language, or equivalent, to the business to send to the Commissioner
of the Minnesota Department of Labor and Industry: “I name, on behalf
of business name, certify that laborers and mechanics at the project
site during construction, installation, remodeling, and repairs for
which JOBZ sales tax exemptions will be provided will be paid the
prevailing wage rate as defined in M.S. Section 177.42, subdivision
6.”
- The Subzone administrator provides the prospective benefiting business and, if necessary, its contractor with the prevailing wage webpage of the Minnesota Department of Labor and Industry, www.doli.state.mn.us/pw_rates.html to find the appropriate wage rates.