Project-Area Wage Standards in the Labor Cost Component of Cost-of-Service Rates, 21503-21507 [2024-06557]
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Federal Register / Vol. 89, No. 61 / Thursday, March 28, 2024 / Notices
Docket Numbers: RP24–556–000.
Applicants: Natural Gas Pipeline
Company of America LLC.
Description: § 4(d) Rate Filing:
Negotiated Rate Agreements Filings—
Various Shippers on 03/22/2024 to be
effective 4/1/2024.
Filed Date: 3/22/24.
Accession Number: 20240322–5000.
Comment Date: 5 p.m. ET 4/3/24.
Docket Numbers: RP24–557–000.
Applicants: Natural Gas Pipeline
Company of America LLC.
Description: § 4(d) Rate Filing:
Negotiated Rate Agreements Filings—
Golden Pass LNG Terminal LLC to be
effective 4/1/2024.
Filed Date: 3/22/24.
Accession Number: 20240322–5001.
Comment Date: 5 p.m. ET 4/3/24.
Docket Numbers: RP24–558–000.
Applicants: Cheniere Corpus Christi
Pipeline, L.P.
Description: Annual Operations
Transactions Report of Cheniere Corpus
Christi Pipeline, L.P.
Filed Date: 3/22/24.
Accession Number: 20240322–5043.
Comment Date: 5 p.m. ET 4/3/24.
Docket Numbers: RP24–559–000.
Applicants: Cheniere Creole Trail
Pipeline, L.P.
Description: Annual Operations
Transactions Report of Cheniere Creole
Trail Pipeline, L.P.
Filed Date: 3/22/24.
Accession Number: 20240322–5044.
Comment Date: 5 p.m. ET 4/3/24.
Docket Numbers: RP24–560–000.
Applicants: Midship Pipeline
Company, LLC.
Description: Annual Operational
Transactions Report of Midship Pipeline
Company, LLC.
Filed Date: 3/22/24.
Accession Number: 20240322–5045.
Comment Date: 5 p.m. ET 4/3/24.
Docket Numbers: RP24–561–000.
Applicants: Northwest Pipeline LLC.
Description: § 4(d) Rate Filing:
Negotiated Rate Service Agreement—
Puget to be effective 4/1/2024.
Filed Date: 3/22/24.
Accession Number: 20240322–5088.
Comment Date: 5 p.m. ET 4/3/24.
Any person desiring to intervene, to
protest, or to answer a complaint in any
of the above proceedings must file in
accordance with Rules 211, 214, or 206
of the Commission’s Regulations (18
CFR 385.211, 385.214, or 385.206) on or
before 5:00 p.m. Eastern time on the
specified comment date. Protests may be
considered, but intervention is
necessary to become a party to the
proceeding.
The filings are accessible in the
Commission’s eLibrary system (https://
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elibrary.ferc.gov/idmws/search/
fercgensearch.asp) by querying the
docket number.
eFiling is encouraged. More detailed
information relating to filing
requirements, interventions, protests,
service, and qualifying facilities filings
can be found at: https://www.ferc.gov/
docs-filing/efiling/filing-req.pdf. For
other information, call (866) 208–3676
(toll free). For TTY, call (202) 502–8659.
The Commission’s Office of Public
Participation (OPP) supports meaningful
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Commission proceedings. OPP can help
members of the public, including
landowners, environmental justice
communities, Tribal members and
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rehearing, the public is encouraged to
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Dated: March 22, 2024.
Debbie-Anne A. Reese,
Acting Secretary.
[FR Doc. 2024–06638 Filed 3–27–24; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
[Docket No. PL24–1–000]
Project-Area Wage Standards in the
Labor Cost Component of Cost-ofService Rates
Federal Energy Regulatory
Commission, Department of Energy.
ACTION: Policy statement.
AGENCY:
The Federal Energy
Regulatory Commission (Commission)
clarifies how the Commission will treat
the use of project-area wage standards in
calculating the labor cost component of
jurisdictional cost-of-service rates.
DATES: This policy statement is effective
June 26, 2024.
FOR FURTHER INFORMATION CONTACT:
Heidi Nielsen (Legal Information),
Office of the General Counsel, (202)
502–8435, heidi.nielsen@ferc.gov
Adam Pollock (Technical Information),
Office of Energy Market Regulation,
(202) 502–8458, adam.pollock@
ferc.gov
James Sarikas (Technical Information),
Office of Energy Market Regulation,
(202) 502–6831, james.sarikas@
ferc.gov
SUMMARY:
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1. On
October 19, 2023, the Commission
issued a proposed policy statement,1
proposing to clarify how it will treat the
use of project-area wage standards in
calculating the labor cost component of
cost-of-service rates, including under
Natural Gas Act (NGA) sections 4, 5,
and 7, 15 U.S.C. 717c–d, 717f; the
Interstate Commerce Act (ICA), 49
U.S.C. app. 1(5)(a); and Federal Power
Act (FPA) sections 205 and 206, 16
U.S.C. 824d–e.2 In this Policy
Statement, we adopt the proposals in
the Proposed Policy Statement, as
discussed below.
SUPPLEMENTARY INFORMATION:
I. Background
A. Current Commission Precedent
2. Project-area wage standards are the
prevailing wages set by labor markets in
the locale where the associated project
work (e.g., construction, capital repairs,
decommissioning) is performed. Those
prevailing wages can be found in data
sources that indicate the basic hourly
wage rates and fringe benefit rates for
labor, direct employees, and/or contract
personnel that prevail in a particular
geographic area. For example, under the
Davis-Bacon Act, the U.S. Department of
Labor issues prevailing wage
determinations based on periodic
surveys of union and non-union wages
paid in a particular location. These
determinations serve as the minimum
wage that must be paid by contractors
and subcontractors performing under
certain federally funded or assisted
construction contracts.3 A number of
states have enacted their own prevailing
wage laws, sometimes referred to as
‘‘Little Davis-Bacon’’ laws.4
3. The Commission addressed the
treatment of project-area wages in
natural gas pipeline cost-of-service rates
in Opinion Nos. 510 and 524.5 In
1 Project-Area Wage Standards in the Labor Cost
Component of Cost-of-Service Rates, 185 FERC
¶ 61,049 (2023) (Proposed Policy Statement).
2 While most interstate oil pipelines have marketbased or indexed rates, some jurisdictional
pipelines have cost-of-service rates on file with the
Commission.
3 ‘‘By requiring the payment of minimum
prevailing wages, Congress sought to ‘ensure that
Government construction and federally assisted
construction would not be conducted at the
expense of depressing local wage standards.’’’ Dep’t
of Labor, Updating the Davis-Bacon & Related Acts
Reguls., 88 FR 57526, 57526 (Aug. 23, 2023) (citing
Determination of Wage Rates Under the DavisBacon & Serv. Cont. Acts 5 Op. O.LC. 174, 176
(1981)) (Final Rule).
4 Dep’t of Labor, Dollar Threshold Amount for
Contract Coverage under State Prevailing Wage
Laws (Jan. 1, 2023), https://www.dol.gov/agencies/
whd/state/prevailing-wages.
5 Portland Nat. Gas Transmission Sys., Opinion
No. 510, 134 FERC ¶ 61,129 (2011), reh’g granted
in part, 142 FERC ¶ 61,198 (2013), reh’g dismissed,
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Opinion No. 510, the Commission
rejected a pipeline operator’s proposal
to use union-only wage rates from a
single proxy location to estimate the
labor cost of decommissioning its
pipeline that spanned four states,6
finding that the pipeline operator had
not carried its burden under NGA
section 4 to show that it would use
union labor and that, based on the
evidence in that proceeding, it was
accordingly reasonable to estimate labor
costs using a ‘‘blended’’ mix of average
union and non-union wage rates in the
general private construction industry in
the states where the pipeline was
located, ‘‘weighted’’ by the length of
pipe in each state.7 The Commission
subsequently applied the same
approach in Opinion No. 524, finding
that the same operator had again failed
to present sufficient supporting
evidence for its proposal to use uniononly wage rates in its estimate of
decommissioning labor costs.8
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B. Proposed Policy Statement
4. In the Proposed Policy Statement,
the Commission proposed to clarify that
Opinion Nos. 510 and 524 were based
on the record evidence before the
Commission in those proceedings and
do not reflect a heightened standard of
review with respect to project-area wage
rates.9 The Commission proposed that
jurisdictional entities should be able to
include wages consistent with projectarea wage standards in cost-of-service
rates filed with the Commission where
the record supports that outcome.
5. Specifically, the Commission
proposed that, when a Commissionjurisdictional entity presents evidence
that it: (1) pays project-area wage
standards; (2) is contractually obligated
to pay project-area wage standards; or
(3) commits via affidavit filed in the rate
proceeding that it will pay project-area
wage standards, the Commission will
presume, absent contrary evidence, that
such project-area wage standards are
just and reasonable for the relevant
labor-cost component.10 Furthermore,
the Commission proposed that it will
150 FERC ¶ 61,106 (2015); Portland Nat. Gas
Transmission Sys., Opinion No. 524, 142 FERC
¶ 61,197 (2013), reh’g denied, 150 FERC ¶ 61,107
(2015). Among other things, these proceedings
involved estimating the expected costs for future
pipeline retirements, specifically, determining the
labor component for decommissioning costs to be
recovered by a pipeline operator, Portland Natural
Gas Transmission System.
6 Opinion No. 510, 134 FERC ¶ 61,129 at P 124.
7 Id.
8 Opinion No. 524, 142 FERC ¶ 61,197 at PP 162–
64.
9 Proposed Policy Statement, 185 FERC ¶ 61,049
at P 4.
10 Id. P 5.
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reject the inclusion of labor wages
consistent with project-area wage
standards in cost-of-service rates when
the evidence demonstrates that the
jurisdictional entity has not paid or will
not be paying labor wages consistent
with project-area wage standards.
6. The Commission proposed to
accept as evidence of project-area wage
standards: (1) Davis-Bacon Act local
prevailing wage determinations; (2) state
prevailing wage determinations; (3)
applicable collective-bargaining
agreements or Project Labor
Agreements; or (4) other evidence
demonstrating the prevailing wages paid
in the relevant locale(s), such as an
industry-accepted database used in
construction cost estimates.11 The
Commission sought comment on the
appropriateness of the four proposed
sources of project-area wage standards.
In particular, the Commission sought
comment on the appropriateness of
using industry databases with
construction cost estimates as a source
of project-area wage standards as well as
whether any project-area wage
standards might not be captured in the
first three listed categories.
7. The Commission further proposed
that jurisdictional entities seeking to
include project-area wage standards in
cost-of-service rates should maintain
and preserve records, including books of
account or records for work performed
by employees, contractors or
subcontractors, sufficient to
demonstrate that claimed project-area
wages were actually paid.12
II. Comments
8. Comments were filed by:
CenterPoint Energy Minnesota
Resources Corp dba CenterPoint Energy
Minnesota Gas (CenterPoint); Charps,
LLC; Enbridge (U.S.) Inc. (Enbridge);
Illinois Commerce Commissioners Doug
P. Scott, Michael T. Carrigan, and
Conrad R. Reddick (Illinois Commerce
Commissioners); International Union of
Operating Engineers; Interstate Natural
Gas Association of America (INGAA);
Laborers’ International Union of North
America (LIUNA); Pe Ben USA, Inc.;
Minnesota Public Utilities Commission
(Minnesota Commission); Pennsylvania
Public Utility Commissioner Kathryn
Zerfuss (Pennsylvania Commissioner
Zerfuss); Pipe Line Contractors
Association; Pipeliners Union 798
United Association; Price Gregory
International; R.L. Coolsaet
Construction Company; Southern Star
Central Gas Pipeline, Inc. (Southern
11 Id.
12 Id.
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Star); and Teamsters National Pipeline
Labor Management Cooperation Trust.
9. Commenters broadly support the
issuance of a policy statement that
clarifies how the Commission will treat
the use of project-area wage standards in
calculating the labor cost component of
jurisdictional cost-of-service rates.13
Commenters disagree, however, on
whether jurisdictional entities should be
able to use sources other than collective
bargaining agreements for the projectarea wage standard.
10. Labor unions (including
International Union of Operating
Engineers, LIUNA, Pipeline Local Union
798, Pipe Line Contractors Association,
and Teamsters National Pipeline Labor
Management Cooperation Trust);
Charps, LLC; PE Ben USA, Inc.; Price
Gregory International; and R.L. Coolsaet
Construction Company argue that
collective bargaining rates should be the
only metric for project-area wages when
an operator certifies the employment of
union labor.14 LIUNA and Pipe Line
Contractors Association explain that
collectively bargained rates not only
reflect actual wage and fringe benefit
rates paid to the project workforce,
including per diem rates but also are
legally binding and can be verified by
the Commission.15 CenterPoint states
that collectively bargained rates via the
union or project agreement accurately
reflect the actual labor cost, especially
for unexpected infrastructure work
where time is critical, and ensures that
work is done quickly while maintaining
high quality and safety.16
11. International Union of Operating
Engineers argues that the Commission
should only use Davis-Bacon and state
prevailing wages if they have been
updated recently and reflect actual
wages received (e.g., collectively
bargained rates), not a metric unused by
any other public agency or construction
estimator.17
12. International Union of Operating
Engineers cautions against the use of a
13 Illinois Commerce Commissioners, Minnesota
Commission, and Pennsylvania Commissioner
Zerfuss support the use of prevailing wages.
14 Charps, LLC Comments at 1; International
Union of Operating Engineers Comments at 2;
LIUNA Comments at 2–4; PE Ben USA, Inc.
Comments at 1; Pipeline Local Union 798
Comments at 1; Pipe Line Contractors Association
Comments at 2; Price Gregory International
Comments at 1; R.L. Coolsaet Construction
Company Comments at 1; Teamsters National
Pipeline Labor Management Cooperation Trust
Comments at 2.
15 LIUNA Comments at 2; Pipe Line Contractors
Association Comments at 2. See also PE Ben USA,
Inc. Comments at 1; Price Gregory International
Comments at 1; R.L. Coolsaet Construction
Company Comments at 1.
16 CenterPoint Comments at 2.
17 International Union of Operating Engineers
Comments at 2.
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‘‘blended wage rate’’ (i.e., the average of
union and non-union wages in the
general private construction industry
within the states where the pipeline is
located) to reimburse pipeline operator
costs for several reasons: (1) it distorts
the actual wages paid to workers; (2) it
relies upon the Bureau of Labor and
Statistics’ Occupational Employment
Statistics that do not segment the
industry into industry groups (e.g.,
heavy, highway, building, residential);
(3) it includes the residential
construction industry, which requires
different skill sets than industrial work;
(4) it fails to incorporate fringe benefits;
and (5) it disincentivizes the use of
union contractors because they are not
able to recover labor costs and gives a
false impression that union labor is
more expensive.18
13. Pipe Line Contractors Association
state that, in the absence of a union
commitment, it may be appropriate for
the Commission to consider other
sources after verifying that the source’s
labor rates reasonably reflect actual
wages and fringe benefit rates that
would need to be paid to recruit and
retain a qualified workforce.19 However,
Pipe Line Contractors Association
opposes the inclusion of ‘‘other
industry-accepted wage sources’’ and
asks the Commission to rely solely on
the other three sources. It urges the
Commission to limit the use of costing
databases because such databases are
usually based on national averages or
averages for the entire construction
industry and exclude vital
compensation components such as
fringe benefit and per diem rates (e.g.,
crew costs in RSMeans, a construction
costing application, only include the
hourly wage rate and contractor
overhead costs, not compensation
sources). It also urges the Commission
not to use costing databases with wage
rates from the Bureau of Labor Statistics
because: (1) its occupational wage rates
are based on a rolling three-year cycle
that constitute historical wages and lag
behind current market trends; (2) its
wage data does not capture sectoral
differences, which is important because
pipeline construction requires higher
skills and operator qualification; and (3)
it excludes fringe benefit contribution
rates, per diem rates, and training
investments, which are critical
compensation inputs for the pipeline
industry.
14. CenterPoint contends that the
database would be useful if it is specific
to the local affected community, stating
18 Id.
at 1–2.
Line Contractors Association Comments at
19 Pipe
2.
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that national databases are less useful,
especially in the current labor market
with labor rates varying widely across
the country.20 Enbridge and Southern
Star argue that, as long as the source for
compensation levels reflects actual
market conditions necessary to attract a
highly skilled workforce, and the
operator can certify that those rates were
paid or will be paid, the Commission
should defer these labor decisions to the
operator and find these costs to be just
and reasonable.21 Southern Star states
that there are several legitimate business
reasons for employing a workforce with
a higher labor rate.22 Southern Star
notes, for example, that a pipeline often
requires a specialized workforce with
advanced skills, experience, and
training which may offer alternative cost
savings other than the baseline labor
rate, or other advantages such as in the
area of safety.
15. INGAA states that it is appropriate
to accept and evaluate submitted
evidence from industry databases and
other evidence to demonstrate
prevailing wages paid in the relevant
locale(s), adding that the Commission
strikes an appropriate balance between
offering definitive guidance on how to
demonstrate wage standards and
retaining the flexibility that has been the
hallmark of rate cases before the
Commission.23
III. Commission Determination
16. As explained in the Proposed
Policy Statement, Opinion Nos. 510 and
524 were based on the record evidence
before the Commission in those
proceedings and do not reflect a
heightened standard of review with
respect to project-area wage rates.24 We
adopt the proposals in the Proposed
Policy Statement to allow jurisdictional
entities to include wages consistent
with project-area wage standards in
cost-of-service rates filed with the
Commission where the record supports
that outcome. Specifically, when a
Commission-jurisdictional entity
presents evidence that it: (1) pays
project-area wage standards; (2) is
contractually obligated to pay projectarea wage standards; or (3) commits via
affidavit 25 filed in the rate proceeding
20 CenterPoint
Comments at 2.
Comments at 3–4; Southern Star
Comments at 4.
22 Southern Star Comments at 3.
23 INGAA Comments at 2.
24 Proposed Policy Statement, 185 FERC ¶ 61,049
at P 4.
25 We remind filers that all information submitted
in cost-of-service filings must be truthful and
accurate, see 18 CFR 35.13(d)(6) (‘‘A utility shall
include in its filing an attestation . . . that . . . the
cost of service statements and supporting data
submitted . . . are true, accurate, and current
21 Enbridge
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that it will pay project-area wage
standards, the Commission will
presume, absent contrary evidence, that
such project-area wage standards are
just and reasonable for the relevant
labor-cost component.26 Furthermore,
the Commission will reject the inclusion
of labor wages consistent with projectarea wage standards in cost-of-service
rates when the evidence demonstrates
that the jurisdictional entity has not
paid or will not be paying labor wages
consistent with project-area wage
standards.
17. We adopt the Proposed Policy
Statement’s proposal regarding the
sources of project-area wage standards,
as clarified below. Pursuant to the
framework discussed below, we find
that appropriate sources of project-area
wage standards may include: (1)
applicable collective-bargaining
agreements or Project Labor
Agreements; 27 (2) Davis-Bacon Act local
prevailing wage determinations; 28 (3)
state prevailing wage determinations; 29
or (4) other evidence demonstrating the
prevailing wages paid in the relevant
locale(s), such as an industry-accepted
database used in construction cost
estimates.30
representations of the utility’s books, budgets, or
other corporate documents.’’), 154.308 (‘‘The filing
must include a statement . . . representing that the
cost statements, supporting data, and workpapers,
that purport to reflect the books of the company do,
in fact, set forth the results shown by such books.’’),
341.1(b)(1) (‘‘The signature on a filing constitutes a
certification that the contents are true to the best
knowledge and belief of the signer . . . .’’), and
that failure to meet this requirement may result in
a referral to the Office of Enforcement for further
investigation and action, as appropriate.
26 Consistent with 48 CFR 22.401, this policy
statement applies to employee or contract labor
whose duties are primarily manual or physical in
nature, as distinguished from mental or managerial,
and did not apply to employees or contractors
whose duties are primarily executive, supervisory,
administrative, or clerical. For purposes of this
policy statement, ‘‘wages’’ mean the basic hourly
pay rate including fringe benefits, as more fully
defined in 48 CFR 22.401.
27 Project Labor Agreements are agreements
between building trade unions and contractors.
They govern terms and conditions of employment
(including wage-related issues) on a construction
project for all craft workers—union and nonunion.
Dep’t of Labor, Project Labor Agreement Res. Guide,
Project Labor, Cmty. Workforce, & Cmty. Benefits
Agreements Res. Guide, ¶ 1, https://www.dol.gov/
general/good-jobs/project-labor-agreementresource-guide.
28 Pursuant to the Davis-Bacon Act, as amended
and codified at 40 U.S.C. 3141(2), the term
‘‘prevailing wages’’ includes the basic hourly rate
of pay and fringe benefits, as determined by the
Department of Labor. See Final Rule, 88 FR at
57526 (citing 40 U.S.C. 3142, 3145), 57531, 57546,
57699, 57722–724.
29 The applicable state prevailing wage
determination should meet or exceed the DavisBacon Act local prevailing wage determinations.
30 Proposed Policy Statement, 185 FERC ¶ 61,049
at P 6.
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18. In considering these sources of
project-area wage standards, we clarify
that the Commission will look to
applicable collective-bargaining
agreements or Project Labor Agreements
as an appropriate default source of
project-area wage standards. We find
that it is appropriate to identify these
agreements as the default source of
project-area wage standards because
collectively bargained wages reflect
actual wage and fringe benefit rates paid
to the project workforce, including per
diem rates. Moreover, such wages are
legally binding and can be verified by
the Commission. By comparison, labor
costs based upon Davis-Bacon Act data
are estimates of future costs based on
average local wages, which may differ
from the actual wages paid by a
jurisdictional entity.
19. We find, however, that there could
be circumstances when a jurisdictional
entity uses collectively bargained wages
for only part of its workforce or that
collective bargained wage data is
otherwise not representative of the
jurisdictional entity’s future labor costs.
For example, as Southern Star points
out, jurisdictional entities may need to
hire higher-wage specialized workers,
which could justify the use of sources
other than collective-bargaining
agreements or Project Labor
Agreements. For these reasons, a
jurisdictional entity may use the other
three data sources enumerated in the
Proposed Policy Statement 31 if the
jurisdictional entity provides a detailed
explanation of why these sources: (1)
better reflect actual wages than relying
on collective-bargaining agreements or
Project Labor Agreements; and (2)
accurately reflect wage information
during the project period, including
demonstrating that it is based on up-todate data.
20. Finally, we adopt the Proposed
Policy Statement proposal that
jurisdictional entities seeking to include
project-area wage standards in cost-ofservice rates should maintain and
preserve records, including books of
account or records for work performed
by employees, contractors or
subcontractors, sufficient to
demonstrate that claimed project-area
wages were actually paid.32
IV. Information Collection Statement
21. The Paperwork Reduction Act and
the implementing regulations of the
Office of Management and Budget
(OMB) require approval of certain
information collection requirements
31 See
supra P 6.
Policy Statement, 185 FERC ¶ 61,049
32 Proposed
at P 7.
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imposed by an agency. Upon approval
of a collection of information, OMB will
assign an OMB Control Number and an
expiration date. Respondents subject to
the filing requirements will not be
penalized for failing to respond to the
collection of information unless the
collection of information displays a
valid OMB control number.
22. This Policy Statement clarifies
how the Commission will treat the use
of project-area wage standards in
calculating the labor cost component of
jurisdictional cost-of-service rates filed
by a natural-gas company, interstate oil
pipeline, or public utility, pursuant to
NGA sections 4, 5 and 7, 15 U.S.C.
717c–d, 717f; ICA, 49 U.S.C. app.
1(5)(a); and FPA sections 205 and 206,
16 U.S.C. 824d-e, respectively.
23. The Commission is submitting
these reporting requirements to OMB for
its review and approval under section
3507(d) of the Paperwork Reduction
Act. Comments are solicited on whether
the information will have practical
utility, the accuracy of provided burden
estimates, ways to enhance the quality,
utility, and clarity of the information to
be collected, and any suggested methods
for minimizing the respondent’s burden,
including the use of automated
information techniques.
24. Send written comments on the
revisions to the information collections
in Docket No. PL24–1–000 to OMB
through www.reinfo.gov/public/do/
PRAMain. Attention: Federal Energy
Regulatory Commission Desk Officer.
Please identify the OMB Control
Number (identified in paragraph 25
below) in the subject line of your
comments. Comments should be sent
within 30 days of publication of this
docket to www.reginfo.gov/public/do/
PRAMain. Additionally, please submit
copies of your comments (identified by
Docket No. PL24–1–000) by either of the
following methods: (1) eFiling at
Commission’s website: https://
www.ferc.gov/docs-filing/efiling.asp or
(2) Mail/Hand Delivery/Courier: Federal
Energy Regulatory Commission,
Secretary of the Commission, at Health
and Human Services, 12225 Wilkins
Avenue, Rockville, Maryland 20852. All
submissions must be formatted and filed
in accordance with submission
guidelines at: https://www.ferc.gov/help/
submission-guide.asp. For user
assistance, contact FERC Online
Support by email at ferconlinesupport@
ferc.gov, or by phone at: (866) 208–3676
(toll-free).
25. Collection Nos., Titles and OMB
Control Nos.: FERC–516J (Labor Wage
Policy Statement, OMB Control No.
1902–TBD); FERC–537 (Gas Pipeline
Certificates: Construction, Acquisition
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and Abandonment; OMB Control No.
1902–0060); FERC–538 (Gas Pipeline
Certificates: Section 7(a) Mandatory
Initial Service, OMB Control No. 1902–
0061); FERC–545 (Gas Pipeline Rates:
Rate Change (Non-formal), OMB Control
No. 1902–0154); FERC–546 (Certificated
Rate Filings: Gas Pipeline Rates, OMB
Control No. 1902–0155); FERC–550 (Oil
Pipeline Rates—Tariff Filings and
Depreciation Studies, OMB Control No.
1902–0089); FERC–555 (Preservation of
Records for Public Utilities and
Licensees, Natural Gas and Oil Pipeline
Companies, OMB Control No. 1902–
0098).
26. Action: Revisions to the
collections of information in accordance
with the Policy Statement.
27. Respondents: The estimate of the
number of respondents that may elect to
use project-area wage standards in
calculating the labor cost component of
cost-of-service rates is based upon the
existing burden inventory currently
approved by OMB for filing rates cases,
depreciation studies and certificate
filings, include initial rates or seeking
approval to charge existing rates for
natural gas companies, public utilities
and oil pipelines. This burden estimate
is based upon one-third of the filings
electing to include an additional burden
by the filer to incorporate labor costs
based upon paying wages that at
minimum meet project-area wage
standards.
28. Frequency of Information
Collection: Jurisdictional entities, when
including elements in rates reflecting
future capital costs, may elect to make
the above showings in support of wages
that are at or above project-area wage
standards. Such proceedings may
include but are not limited to
certificates for new natural gas
pipelines, general natural gas pipeline
and electric utility rate cases, proposed
new or modified depreciation rates, and
proposed inclusion of asset retirement
obligation in rates. In total,
jurisdictional entities may make such a
showing one time per year.
29. Necessity of Information: The
information would be necessary for the
jurisdictional entity to receive the
presumption that wages for capital
projects that are at or above project-area
wage standards are not just and
reasonable.
30. Internal Review: The Commission
has reviewed the changes and has
determined that such changes are
necessary. These requirements conform
to the Commission’s need for efficient
information collection, communication,
and management within the energy
industry in support of the Commission’s
ensuring just and reasonable rates. The
E:\FR\FM\28MRN1.SGM
28MRN1
Federal Register / Vol. 89, No. 61 / Thursday, March 28, 2024 / Notices
Commission has specific, objective
support for the burden estimates
associated with the information
collection requirements. However, we
request comments with supporting
background information on the
estimates for burden and cost.
21507
31. The Commission estimates the
effect of the Policy Statement on
burden 33 and cost 34 as follows:
32.
ESTIMATES OF THE EFFECTS DUE TO THE POLICY STATEMENT IN DOCKET NO. PL24–1–000
A.
Information collection
B.
Number
of
respondents
C.
Annual number
of responses per
respondent
D.
Total
number of
responses
E.
Average burden
hours and cost
per response
F.
Total annual hour
burdens & total
annual cost
G.
Cost
per
respondent
(column D ×
column E)
(column F ÷
column B)
(column B ×
column C)
FERC–516J 35 ......................................................
6
1
6
15 hrs. $1,500
90 hrs. $9,000 ............
$1,500
Other Affected Collections 36
FERC–537
FERC–538
FERC–546
FERC–550
FERC–545
FERC–555
............................................................
............................................................
............................................................
............................................................
............................................................
............................................................
22
1
16
7
11
170
1
1
1
1
1
1
22
1
16
7
11
170
15 hrs. $1,500
15 hrs. $1,500
15 hrs. $1,500
15 hrs. $1,440
15 hrs. $1,500
1 hr. $500 ........
330 hrs. $33,000 ........
15 hrs. $1,500 ............
240 hrs. $24,000 ........
105 hrs. $10,500 ........
165 hrs. $16,500 ........
170 hrs. $17,000 ........
1,500
1,500
1,500
1,500
1,500
100
Total Effect of the Policy Statement .............
........................
..............................
233
.........................
1,115 hrs. $111,500 ...
........................
V. Document Availability
33. In addition to publishing the full
text of this document in the Federal
Register, the Commission provides all
interested persons an opportunity to
view and/or print the contents of this
document via the internet through the
Commission’s Home Page (https://
www.ferc.gov).
34. From the Commission’s Home
Page on the internet, this information is
available on eLibrary. The full text of
this document is available on eLibrary
in PDF and Microsoft Word format for
viewing, printing, and/or downloading.
To access this document in eLibrary,
type the docket number excluding the
last three digits of this document in the
docket number field.
35. User assistance is available for
eLibrary and the Commission’s website
during normal business hours from
FERC Online Support at (202) 502–6652
(toll free at 1–866–208–3676) or email at
ferconlinesupport@ferc.gov, or the
Public Reference Room at (202) 502–
8371, TTY (202) 502–8659. Email the
Public Reference Room at
public.referenceroom@ferc.gov.
VI. Effective Date
36. This Policy Statement will become
effective on June 26, 2024.
ddrumheller on DSK120RN23PROD with NOTICES1
By the Commission.
33 ‘‘Burden’’ is the total time, effort, or financial
resources expended by persons to generate,
maintain, retain, or disclose or provide information
to or for a Federal agency. For further explanation
of what is included in the estimated burden, refer
to 5 CFR 1320.3.
34 Commission staff estimates that the
respondents’ skill set (and wages and benefits) for
this docket are comparable to those of Commission
VerDate Sep<11>2014
20:27 Mar 27, 2024
Jkt 262001
Issued: March 21, 2024.
Debbie-Anne A. Reese,
Acting Secretary.
This is a supplemental notice in the
above-referenced proceeding of Maple
Flats Solar Energy Center LLC’s
application for market-based rate
authority, with an accompanying rate
tariff, noting that such application
includes a request for blanket
authorization, under 18 CFR part 34, of
future issuances of securities and
assumptions of liability.
Any person desiring to intervene or to
protest should file with the Federal
Energy Regulatory Commission, 888
First Street NE, Washington, DC 20426,
in accordance with Rules 211 and 214
of the Commission’s Rules of Practice
and Procedure (18 CFR 385.211 and
385.214). Anyone filing a motion to
intervene or protest must serve a copy
of that document on the Applicant.
Notice is hereby given that the
deadline for filing protests with regard
to the applicant’s request for blanket
authorization, under 18 CFR part 34, of
future issuances of securities and
assumptions of liability, is April 11,
2024.
The Commission encourages
electronic submission of protests and
interventions in lieu of paper, using the
FERC Online links at https://
www.ferc.gov. To facilitate electronic
service, persons with internet access
who will eFile a document and/or be
listed as a contact for an intervenor
must create and validate an
eRegistration account using the
eRegistration link. Select the eFiling
link to log on and submit the
intervention or protests.
Persons unable to file electronically
may mail similar pleadings to the
Federal Energy Regulatory Commission,
888 First Street NE, Washington, DC
20426. Hand delivered submissions in
docketed proceedings should be
delivered to Health and Human
Services, 12225 Wilkins Avenue,
Rockville, Maryland 20852.
In addition to publishing the full text
of this document in the Federal
Register, the Commission provides all
interested persons an opportunity to
employees. Based on the Commission’s Fiscal Year
2023 average cost of $207,786/year (for wages plus
benefits, for one full-time employee), $100.00/hour
is used.
35 The FERC–516J is a new temporary collection
number that includes the burden changes due to
this Policy Statement. This temporary number will
be used for the burden related to the FERC–516
(OMB# 1902–0096) information collection (IC).
Note: In the Proposed Policy Statement, the
Commission referenced the FERC–1006 temporary
collection, which will no longer be used because
most of the information collection requests have
been approved by OMB since the publication of the
Proposed Policy Statement.
36 Since the issuance of the Proposed Policy
Statement, OMB has approved data collections
FERC–545, –555, –537.
[FR Doc. 2024–06557 Filed 3–27–24; 8:45 am]
BILLING CODE 6717–01–P
DEPARTMENT OF ENERGY
Federal Energy Regulatory
Commission
[Docket No. ER24–1576–000]
Maple Flats Solar Energy Center LLC;
Supplemental Notice That Initial
Market-Based Rate Filing Includes
Request for Blanket Section 204
Authorization
PO 00000
Frm 00025
Fmt 4703
Sfmt 4703
E:\FR\FM\28MRN1.SGM
28MRN1
]]>Agencies
[Federal Register Volume 89, Number 61 (Thursday, March 28, 2024)]
[Notices]
[Pages 21503-21507]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-06557]
-----------------------------------------------------------------------
DEPARTMENT OF ENERGY
Federal Energy Regulatory Commission
[Docket No. PL24-1-000]
Project-Area Wage Standards in the Labor Cost Component of Cost-
of-Service Rates
AGENCY: Federal Energy Regulatory Commission, Department of Energy.
ACTION: Policy statement.
-----------------------------------------------------------------------
SUMMARY: The Federal Energy Regulatory Commission (Commission)
clarifies how the Commission will treat the use of project-area wage
standards in calculating the labor cost component of jurisdictional
cost-of-service rates.
DATES: This policy statement is effective June 26, 2024.
FOR FURTHER INFORMATION CONTACT:
Heidi Nielsen (Legal Information), Office of the General Counsel, (202)
502-8435, [email protected]
Adam Pollock (Technical Information), Office of Energy Market
Regulation, (202) 502-8458, [email protected]
James Sarikas (Technical Information), Office of Energy Market
Regulation, (202) 502-6831, [email protected]
SUPPLEMENTARY INFORMATION: 1. On October 19, 2023, the Commission
issued a proposed policy statement,\1\ proposing to clarify how it will
treat the use of project-area wage standards in calculating the labor
cost component of cost-of-service rates, including under Natural Gas
Act (NGA) sections 4, 5, and 7, 15 U.S.C. 717c-d, 717f; the Interstate
Commerce Act (ICA), 49 U.S.C. app. 1(5)(a); and Federal Power Act (FPA)
sections 205 and 206, 16 U.S.C. 824d-e.\2\ In this Policy Statement, we
adopt the proposals in the Proposed Policy Statement, as discussed
below.
---------------------------------------------------------------------------
\1\ Project-Area Wage Standards in the Labor Cost Component of
Cost-of-Service Rates, 185 FERC ] 61,049 (2023) (Proposed Policy
Statement).
\2\ While most interstate oil pipelines have market-based or
indexed rates, some jurisdictional pipelines have cost-of-service
rates on file with the Commission.
---------------------------------------------------------------------------
I. Background
A. Current Commission Precedent
2. Project-area wage standards are the prevailing wages set by
labor markets in the locale where the associated project work (e.g.,
construction, capital repairs, decommissioning) is performed. Those
prevailing wages can be found in data sources that indicate the basic
hourly wage rates and fringe benefit rates for labor, direct employees,
and/or contract personnel that prevail in a particular geographic area.
For example, under the Davis-Bacon Act, the U.S. Department of Labor
issues prevailing wage determinations based on periodic surveys of
union and non-union wages paid in a particular location. These
determinations serve as the minimum wage that must be paid by
contractors and subcontractors performing under certain federally
funded or assisted construction contracts.\3\ A number of states have
enacted their own prevailing wage laws, sometimes referred to as
``Little Davis-Bacon'' laws.\4\
---------------------------------------------------------------------------
\3\ ``By requiring the payment of minimum prevailing wages,
Congress sought to `ensure that Government construction and
federally assisted construction would not be conducted at the
expense of depressing local wage standards.''' Dep't of Labor,
Updating the Davis-Bacon & Related Acts Reguls., 88 FR 57526, 57526
(Aug. 23, 2023) (citing Determination of Wage Rates Under the Davis-
Bacon & Serv. Cont. Acts 5 Op. O.LC. 174, 176 (1981)) (Final Rule).
\4\ Dep't of Labor, Dollar Threshold Amount for Contract
Coverage under State Prevailing Wage Laws (Jan. 1, 2023), https://www.dol.gov/agencies/whd/state/prevailing-wages.
---------------------------------------------------------------------------
3. The Commission addressed the treatment of project-area wages in
natural gas pipeline cost-of-service rates in Opinion Nos. 510 and
524.\5\ In
[[Page 21504]]
Opinion No. 510, the Commission rejected a pipeline operator's proposal
to use union-only wage rates from a single proxy location to estimate
the labor cost of decommissioning its pipeline that spanned four
states,\6\ finding that the pipeline operator had not carried its
burden under NGA section 4 to show that it would use union labor and
that, based on the evidence in that proceeding, it was accordingly
reasonable to estimate labor costs using a ``blended'' mix of average
union and non-union wage rates in the general private construction
industry in the states where the pipeline was located, ``weighted'' by
the length of pipe in each state.\7\ The Commission subsequently
applied the same approach in Opinion No. 524, finding that the same
operator had again failed to present sufficient supporting evidence for
its proposal to use union-only wage rates in its estimate of
decommissioning labor costs.\8\
---------------------------------------------------------------------------
\5\ Portland Nat. Gas Transmission Sys., Opinion No. 510, 134
FERC ] 61,129 (2011), reh'g granted in part, 142 FERC ] 61,198
(2013), reh'g dismissed, 150 FERC ] 61,106 (2015); Portland Nat. Gas
Transmission Sys., Opinion No. 524, 142 FERC ] 61,197 (2013), reh'g
denied, 150 FERC ] 61,107 (2015). Among other things, these
proceedings involved estimating the expected costs for future
pipeline retirements, specifically, determining the labor component
for decommissioning costs to be recovered by a pipeline operator,
Portland Natural Gas Transmission System.
\6\ Opinion No. 510, 134 FERC ] 61,129 at P 124.
\7\ Id.
\8\ Opinion No. 524, 142 FERC ] 61,197 at PP 162-64.
---------------------------------------------------------------------------
B. Proposed Policy Statement
4. In the Proposed Policy Statement, the Commission proposed to
clarify that Opinion Nos. 510 and 524 were based on the record evidence
before the Commission in those proceedings and do not reflect a
heightened standard of review with respect to project-area wage
rates.\9\ The Commission proposed that jurisdictional entities should
be able to include wages consistent with project-area wage standards in
cost-of-service rates filed with the Commission where the record
supports that outcome.
---------------------------------------------------------------------------
\9\ Proposed Policy Statement, 185 FERC ] 61,049 at P 4.
---------------------------------------------------------------------------
5. Specifically, the Commission proposed that, when a Commission-
jurisdictional entity presents evidence that it: (1) pays project-area
wage standards; (2) is contractually obligated to pay project-area wage
standards; or (3) commits via affidavit filed in the rate proceeding
that it will pay project-area wage standards, the Commission will
presume, absent contrary evidence, that such project-area wage
standards are just and reasonable for the relevant labor-cost
component.\10\ Furthermore, the Commission proposed that it will reject
the inclusion of labor wages consistent with project-area wage
standards in cost-of-service rates when the evidence demonstrates that
the jurisdictional entity has not paid or will not be paying labor
wages consistent with project-area wage standards.
---------------------------------------------------------------------------
\10\ Id. P 5.
---------------------------------------------------------------------------
6. The Commission proposed to accept as evidence of project-area
wage standards: (1) Davis-Bacon Act local prevailing wage
determinations; (2) state prevailing wage determinations; (3)
applicable collective-bargaining agreements or Project Labor
Agreements; or (4) other evidence demonstrating the prevailing wages
paid in the relevant locale(s), such as an industry-accepted database
used in construction cost estimates.\11\ The Commission sought comment
on the appropriateness of the four proposed sources of project-area
wage standards. In particular, the Commission sought comment on the
appropriateness of using industry databases with construction cost
estimates as a source of project-area wage standards as well as whether
any project-area wage standards might not be captured in the first
three listed categories.
---------------------------------------------------------------------------
\11\ Id. P 6.
---------------------------------------------------------------------------
7. The Commission further proposed that jurisdictional entities
seeking to include project-area wage standards in cost-of-service rates
should maintain and preserve records, including books of account or
records for work performed by employees, contractors or subcontractors,
sufficient to demonstrate that claimed project-area wages were actually
paid.\12\
---------------------------------------------------------------------------
\12\ Id. P 7.
---------------------------------------------------------------------------
II. Comments
8. Comments were filed by: CenterPoint Energy Minnesota Resources
Corp dba CenterPoint Energy Minnesota Gas (CenterPoint); Charps, LLC;
Enbridge (U.S.) Inc. (Enbridge); Illinois Commerce Commissioners Doug
P. Scott, Michael T. Carrigan, and Conrad R. Reddick (Illinois Commerce
Commissioners); International Union of Operating Engineers; Interstate
Natural Gas Association of America (INGAA); Laborers' International
Union of North America (LIUNA); Pe Ben USA, Inc.; Minnesota Public
Utilities Commission (Minnesota Commission); Pennsylvania Public
Utility Commissioner Kathryn Zerfuss (Pennsylvania Commissioner
Zerfuss); Pipe Line Contractors Association; Pipeliners Union 798
United Association; Price Gregory International; R.L. Coolsaet
Construction Company; Southern Star Central Gas Pipeline, Inc.
(Southern Star); and Teamsters National Pipeline Labor Management
Cooperation Trust.
9. Commenters broadly support the issuance of a policy statement
that clarifies how the Commission will treat the use of project-area
wage standards in calculating the labor cost component of
jurisdictional cost-of-service rates.\13\ Commenters disagree, however,
on whether jurisdictional entities should be able to use sources other
than collective bargaining agreements for the project-area wage
standard.
---------------------------------------------------------------------------
\13\ Illinois Commerce Commissioners, Minnesota Commission, and
Pennsylvania Commissioner Zerfuss support the use of prevailing
wages.
---------------------------------------------------------------------------
10. Labor unions (including International Union of Operating
Engineers, LIUNA, Pipeline Local Union 798, Pipe Line Contractors
Association, and Teamsters National Pipeline Labor Management
Cooperation Trust); Charps, LLC; PE Ben USA, Inc.; Price Gregory
International; and R.L. Coolsaet Construction Company argue that
collective bargaining rates should be the only metric for project-area
wages when an operator certifies the employment of union labor.\14\
LIUNA and Pipe Line Contractors Association explain that collectively
bargained rates not only reflect actual wage and fringe benefit rates
paid to the project workforce, including per diem rates but also are
legally binding and can be verified by the Commission.\15\ CenterPoint
states that collectively bargained rates via the union or project
agreement accurately reflect the actual labor cost, especially for
unexpected infrastructure work where time is critical, and ensures that
work is done quickly while maintaining high quality and safety.\16\
---------------------------------------------------------------------------
\14\ Charps, LLC Comments at 1; International Union of Operating
Engineers Comments at 2; LIUNA Comments at 2-4; PE Ben USA, Inc.
Comments at 1; Pipeline Local Union 798 Comments at 1; Pipe Line
Contractors Association Comments at 2; Price Gregory International
Comments at 1; R.L. Coolsaet Construction Company Comments at 1;
Teamsters National Pipeline Labor Management Cooperation Trust
Comments at 2.
\15\ LIUNA Comments at 2; Pipe Line Contractors Association
Comments at 2. See also PE Ben USA, Inc. Comments at 1; Price
Gregory International Comments at 1; R.L. Coolsaet Construction
Company Comments at 1.
\16\ CenterPoint Comments at 2.
---------------------------------------------------------------------------
11. International Union of Operating Engineers argues that the
Commission should only use Davis-Bacon and state prevailing wages if
they have been updated recently and reflect actual wages received
(e.g., collectively bargained rates), not a metric unused by any other
public agency or construction estimator.\17\
---------------------------------------------------------------------------
\17\ International Union of Operating Engineers Comments at 2.
---------------------------------------------------------------------------
12. International Union of Operating Engineers cautions against the
use of a
[[Page 21505]]
``blended wage rate'' (i.e., the average of union and non-union wages
in the general private construction industry within the states where
the pipeline is located) to reimburse pipeline operator costs for
several reasons: (1) it distorts the actual wages paid to workers; (2)
it relies upon the Bureau of Labor and Statistics' Occupational
Employment Statistics that do not segment the industry into industry
groups (e.g., heavy, highway, building, residential); (3) it includes
the residential construction industry, which requires different skill
sets than industrial work; (4) it fails to incorporate fringe benefits;
and (5) it disincentivizes the use of union contractors because they
are not able to recover labor costs and gives a false impression that
union labor is more expensive.\18\
---------------------------------------------------------------------------
\18\ Id. at 1-2.
---------------------------------------------------------------------------
13. Pipe Line Contractors Association state that, in the absence of
a union commitment, it may be appropriate for the Commission to
consider other sources after verifying that the source's labor rates
reasonably reflect actual wages and fringe benefit rates that would
need to be paid to recruit and retain a qualified workforce.\19\
However, Pipe Line Contractors Association opposes the inclusion of
``other industry-accepted wage sources'' and asks the Commission to
rely solely on the other three sources. It urges the Commission to
limit the use of costing databases because such databases are usually
based on national averages or averages for the entire construction
industry and exclude vital compensation components such as fringe
benefit and per diem rates (e.g., crew costs in RSMeans, a construction
costing application, only include the hourly wage rate and contractor
overhead costs, not compensation sources). It also urges the Commission
not to use costing databases with wage rates from the Bureau of Labor
Statistics because: (1) its occupational wage rates are based on a
rolling three-year cycle that constitute historical wages and lag
behind current market trends; (2) its wage data does not capture
sectoral differences, which is important because pipeline construction
requires higher skills and operator qualification; and (3) it excludes
fringe benefit contribution rates, per diem rates, and training
investments, which are critical compensation inputs for the pipeline
industry.
---------------------------------------------------------------------------
\19\ Pipe Line Contractors Association Comments at 2.
---------------------------------------------------------------------------
14. CenterPoint contends that the database would be useful if it is
specific to the local affected community, stating that national
databases are less useful, especially in the current labor market with
labor rates varying widely across the country.\20\ Enbridge and
Southern Star argue that, as long as the source for compensation levels
reflects actual market conditions necessary to attract a highly skilled
workforce, and the operator can certify that those rates were paid or
will be paid, the Commission should defer these labor decisions to the
operator and find these costs to be just and reasonable.\21\ Southern
Star states that there are several legitimate business reasons for
employing a workforce with a higher labor rate.\22\ Southern Star
notes, for example, that a pipeline often requires a specialized
workforce with advanced skills, experience, and training which may
offer alternative cost savings other than the baseline labor rate, or
other advantages such as in the area of safety.
---------------------------------------------------------------------------
\20\ CenterPoint Comments at 2.
\21\ Enbridge Comments at 3-4; Southern Star Comments at 4.
\22\ Southern Star Comments at 3.
---------------------------------------------------------------------------
15. INGAA states that it is appropriate to accept and evaluate
submitted evidence from industry databases and other evidence to
demonstrate prevailing wages paid in the relevant locale(s), adding
that the Commission strikes an appropriate balance between offering
definitive guidance on how to demonstrate wage standards and retaining
the flexibility that has been the hallmark of rate cases before the
Commission.\23\
---------------------------------------------------------------------------
\23\ INGAA Comments at 2.
---------------------------------------------------------------------------
III. Commission Determination
16. As explained in the Proposed Policy Statement, Opinion Nos. 510
and 524 were based on the record evidence before the Commission in
those proceedings and do not reflect a heightened standard of review
with respect to project-area wage rates.\24\ We adopt the proposals in
the Proposed Policy Statement to allow jurisdictional entities to
include wages consistent with project-area wage standards in cost-of-
service rates filed with the Commission where the record supports that
outcome. Specifically, when a Commission-jurisdictional entity presents
evidence that it: (1) pays project-area wage standards; (2) is
contractually obligated to pay project-area wage standards; or (3)
commits via affidavit \25\ filed in the rate proceeding that it will
pay project-area wage standards, the Commission will presume, absent
contrary evidence, that such project-area wage standards are just and
reasonable for the relevant labor-cost component.\26\ Furthermore, the
Commission will reject the inclusion of labor wages consistent with
project-area wage standards in cost-of-service rates when the evidence
demonstrates that the jurisdictional entity has not paid or will not be
paying labor wages consistent with project-area wage standards.
---------------------------------------------------------------------------
\24\ Proposed Policy Statement, 185 FERC ] 61,049 at P 4.
\25\ We remind filers that all information submitted in cost-of-
service filings must be truthful and accurate, see 18 CFR
35.13(d)(6) (``A utility shall include in its filing an attestation
. . . that . . . the cost of service statements and supporting data
submitted . . . are true, accurate, and current representations of
the utility's books, budgets, or other corporate documents.''),
154.308 (``The filing must include a statement . . . representing
that the cost statements, supporting data, and workpapers, that
purport to reflect the books of the company do, in fact, set forth
the results shown by such books.''), 341.1(b)(1) (``The signature on
a filing constitutes a certification that the contents are true to
the best knowledge and belief of the signer . . . .''), and that
failure to meet this requirement may result in a referral to the
Office of Enforcement for further investigation and action, as
appropriate.
\26\ Consistent with 48 CFR 22.401, this policy statement
applies to employee or contract labor whose duties are primarily
manual or physical in nature, as distinguished from mental or
managerial, and did not apply to employees or contractors whose
duties are primarily executive, supervisory, administrative, or
clerical. For purposes of this policy statement, ``wages'' mean the
basic hourly pay rate including fringe benefits, as more fully
defined in 48 CFR 22.401.
---------------------------------------------------------------------------
17. We adopt the Proposed Policy Statement's proposal regarding the
sources of project-area wage standards, as clarified below. Pursuant to
the framework discussed below, we find that appropriate sources of
project-area wage standards may include: (1) applicable collective-
bargaining agreements or Project Labor Agreements; \27\ (2) Davis-Bacon
Act local prevailing wage determinations; \28\ (3) state prevailing
wage determinations; \29\ or (4) other evidence demonstrating the
prevailing wages paid in the relevant locale(s), such as an industry-
accepted database used in construction cost estimates.\30\
---------------------------------------------------------------------------
\27\ Project Labor Agreements are agreements between building
trade unions and contractors. They govern terms and conditions of
employment (including wage-related issues) on a construction project
for all craft workers--union and nonunion. Dep't of Labor, Project
Labor Agreement Res. Guide, Project Labor, Cmty. Workforce, & Cmty.
Benefits Agreements Res. Guide, ] 1, https://www.dol.gov/general/good-jobs/project-labor-agreement-resource-guide.
\28\ Pursuant to the Davis-Bacon Act, as amended and codified at
40 U.S.C. 3141(2), the term ``prevailing wages'' includes the basic
hourly rate of pay and fringe benefits, as determined by the
Department of Labor. See Final Rule, 88 FR at 57526 (citing 40
U.S.C. 3142, 3145), 57531, 57546, 57699, 57722-724.
\29\ The applicable state prevailing wage determination should
meet or exceed the Davis-Bacon Act local prevailing wage
determinations.
\30\ Proposed Policy Statement, 185 FERC ] 61,049 at P 6.
---------------------------------------------------------------------------
[[Page 21506]]
18. In considering these sources of project-area wage standards, we
clarify that the Commission will look to applicable collective-
bargaining agreements or Project Labor Agreements as an appropriate
default source of project-area wage standards. We find that it is
appropriate to identify these agreements as the default source of
project-area wage standards because collectively bargained wages
reflect actual wage and fringe benefit rates paid to the project
workforce, including per diem rates. Moreover, such wages are legally
binding and can be verified by the Commission. By comparison, labor
costs based upon Davis-Bacon Act data are estimates of future costs
based on average local wages, which may differ from the actual wages
paid by a jurisdictional entity.
19. We find, however, that there could be circumstances when a
jurisdictional entity uses collectively bargained wages for only part
of its workforce or that collective bargained wage data is otherwise
not representative of the jurisdictional entity's future labor costs.
For example, as Southern Star points out, jurisdictional entities may
need to hire higher-wage specialized workers, which could justify the
use of sources other than collective-bargaining agreements or Project
Labor Agreements. For these reasons, a jurisdictional entity may use
the other three data sources enumerated in the Proposed Policy
Statement \31\ if the jurisdictional entity provides a detailed
explanation of why these sources: (1) better reflect actual wages than
relying on collective-bargaining agreements or Project Labor
Agreements; and (2) accurately reflect wage information during the
project period, including demonstrating that it is based on up-to-date
data.
---------------------------------------------------------------------------
\31\ See supra P 6.
---------------------------------------------------------------------------
20. Finally, we adopt the Proposed Policy Statement proposal that
jurisdictional entities seeking to include project-area wage standards
in cost-of-service rates should maintain and preserve records,
including books of account or records for work performed by employees,
contractors or subcontractors, sufficient to demonstrate that claimed
project-area wages were actually paid.\32\
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\32\ Proposed Policy Statement, 185 FERC ] 61,049 at P 7.
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IV. Information Collection Statement
21. The Paperwork Reduction Act and the implementing regulations of
the Office of Management and Budget (OMB) require approval of certain
information collection requirements imposed by an agency. Upon approval
of a collection of information, OMB will assign an OMB Control Number
and an expiration date. Respondents subject to the filing requirements
will not be penalized for failing to respond to the collection of
information unless the collection of information displays a valid OMB
control number.
22. This Policy Statement clarifies how the Commission will treat
the use of project-area wage standards in calculating the labor cost
component of jurisdictional cost-of-service rates filed by a natural-
gas company, interstate oil pipeline, or public utility, pursuant to
NGA sections 4, 5 and 7, 15 U.S.C. 717c-d, 717f; ICA, 49 U.S.C. app.
1(5)(a); and FPA sections 205 and 206, 16 U.S.C. 824d-e, respectively.
23. The Commission is submitting these reporting requirements to
OMB for its review and approval under section 3507(d) of the Paperwork
Reduction Act. Comments are solicited on whether the information will
have practical utility, the accuracy of provided burden estimates, ways
to enhance the quality, utility, and clarity of the information to be
collected, and any suggested methods for minimizing the respondent's
burden, including the use of automated information techniques.
24. Send written comments on the revisions to the information
collections in Docket No. PL24-1-000 to OMB through www.reinfo.gov/public/do/PRAMain. Attention: Federal Energy Regulatory Commission Desk
Officer. Please identify the OMB Control Number (identified in
paragraph 25 below) in the subject line of your comments. Comments
should be sent within 30 days of publication of this docket to
www.reginfo.gov/public/do/PRAMain. Additionally, please submit copies
of your comments (identified by Docket No. PL24-1-000) by either of the
following methods: (1) eFiling at Commission's website: https://www.ferc.gov/docs-filing/efiling.asp or (2) Mail/Hand Delivery/Courier:
Federal Energy Regulatory Commission, Secretary of the Commission, at
Health and Human Services, 12225 Wilkins Avenue, Rockville, Maryland
20852. All submissions must be formatted and filed in accordance with
submission guidelines at: https://www.ferc.gov/help/submission-guide.asp. For user assistance, contact FERC Online Support by email at
[email protected], or by phone at: (866) 208-3676 (toll-free).
25. Collection Nos., Titles and OMB Control Nos.: FERC-516J (Labor
Wage Policy Statement, OMB Control No. 1902-TBD); FERC-537 (Gas
Pipeline Certificates: Construction, Acquisition and Abandonment; OMB
Control No. 1902-0060); FERC-538 (Gas Pipeline Certificates: Section
7(a) Mandatory Initial Service, OMB Control No. 1902-0061); FERC-545
(Gas Pipeline Rates: Rate Change (Non-formal), OMB Control No. 1902-
0154); FERC-546 (Certificated Rate Filings: Gas Pipeline Rates, OMB
Control No. 1902-0155); FERC-550 (Oil Pipeline Rates--Tariff Filings
and Depreciation Studies, OMB Control No. 1902-0089); FERC-555
(Preservation of Records for Public Utilities and Licensees, Natural
Gas and Oil Pipeline Companies, OMB Control No. 1902-0098).
26. Action: Revisions to the collections of information in
accordance with the Policy Statement.
27. Respondents: The estimate of the number of respondents that may
elect to use project-area wage standards in calculating the labor cost
component of cost-of-service rates is based upon the existing burden
inventory currently approved by OMB for filing rates cases,
depreciation studies and certificate filings, include initial rates or
seeking approval to charge existing rates for natural gas companies,
public utilities and oil pipelines. This burden estimate is based upon
one-third of the filings electing to include an additional burden by
the filer to incorporate labor costs based upon paying wages that at
minimum meet project-area wage standards.
28. Frequency of Information Collection: Jurisdictional entities,
when including elements in rates reflecting future capital costs, may
elect to make the above showings in support of wages that are at or
above project-area wage standards. Such proceedings may include but are
not limited to certificates for new natural gas pipelines, general
natural gas pipeline and electric utility rate cases, proposed new or
modified depreciation rates, and proposed inclusion of asset retirement
obligation in rates. In total, jurisdictional entities may make such a
showing one time per year.
29. Necessity of Information: The information would be necessary
for the jurisdictional entity to receive the presumption that wages for
capital projects that are at or above project-area wage standards are
not just and reasonable.
30. Internal Review: The Commission has reviewed the changes and
has determined that such changes are necessary. These requirements
conform to the Commission's need for efficient information collection,
communication, and management within the energy industry in support of
the Commission's ensuring just and reasonable rates. The
[[Page 21507]]
Commission has specific, objective support for the burden estimates
associated with the information collection requirements. However, we
request comments with supporting background information on the
estimates for burden and cost.
31. The Commission estimates the effect of the Policy Statement on
burden \33\ and cost \34\ as follows:
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\33\ ``Burden'' is the total time, effort, or financial
resources expended by persons to generate, maintain, retain, or
disclose or provide information to or for a Federal agency. For
further explanation of what is included in the estimated burden,
refer to 5 CFR 1320.3.
\34\ Commission staff estimates that the respondents' skill set
(and wages and benefits) for this docket are comparable to those of
Commission employees. Based on the Commission's Fiscal Year 2023
average cost of $207,786/year (for wages plus benefits, for one
full-time employee), $100.00/hour is used.
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32.
Estimates of the Effects Due to the Policy Statement in Docket No. PL24-1-000
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C. Annual number D. Total E. Average burden
A. Information collection B. Number of of responses per number of hours and cost per F. Total annual hour G. Cost per
respondents respondent responses response burdens & total annual cost respondent
.............. ................. (column B x .................... (column D x................. (column F /
column C) column E)................... column B)
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FERC-516J \35\................... 6 1 6 15 hrs. $1,500...... 90 hrs. $9,000.............. $1,500
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Other Affected Collections \36\
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FERC-537......................... 22 1 22 15 hrs. $1,500...... 330 hrs. $33,000............ 1,500
FERC-538......................... 1 1 1 15 hrs. $1,500...... 15 hrs. $1,500.............. 1,500
FERC-546......................... 16 1 16 15 hrs. $1,500...... 240 hrs. $24,000............ 1,500
FERC-550......................... 7 1 7 15 hrs. $1,440...... 105 hrs. $10,500............ 1,500
FERC-545......................... 11 1 11 15 hrs. $1,500...... 165 hrs. $16,500............ 1,500
FERC-555......................... 170 1 170 1 hr. $500.......... 170 hrs. $17,000............ 100
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Total Effect of the Policy .............. ................. 233 .................... 1,115 hrs. $111,500......... ..............
Statement.
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V. Document Availability
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\35\ The FERC-516J is a new temporary collection number that
includes the burden changes due to this Policy Statement. This
temporary number will be used for the burden related to the FERC-516
(OMB# 1902-0096) information collection (IC). Note: In the Proposed
Policy Statement, the Commission referenced the FERC-1006 temporary
collection, which will no longer be used because most of the
information collection requests have been approved by OMB since the
publication of the Proposed Policy Statement.
\36\ Since the issuance of the Proposed Policy Statement, OMB
has approved data collections FERC-545, -555, -537.
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33. In addition to publishing the full text of this document in the
Federal Register, the Commission provides all interested persons an
opportunity to view and/or print the contents of this document via the
internet through the Commission's Home Page (https://www.ferc.gov).
34. From the Commission's Home Page on the internet, this
information is available on eLibrary. The full text of this document is
available on eLibrary in PDF and Microsoft Word format for viewing,
printing, and/or downloading. To access this document in eLibrary, type
the docket number excluding the last three digits of this document in
the docket number field.
35. User assistance is available for eLibrary and the Commission's
website during normal business hours from FERC Online Support at (202)
502-6652 (toll free at 1-866-208-3676) or email at
[email protected], or the Public Reference Room at (202) 502-
8371, TTY (202) 502-8659. Email the Public Reference Room at
[email protected].
VI. Effective Date
36. This Policy Statement will become effective on June 26, 2024.
By the Commission.
Issued: March 21, 2024.
Debbie-Anne A. Reese,
Acting Secretary.
[FR Doc. 2024-06557 Filed 3-27-24; 8:45 am]
BILLING CODE 6717-01-P
