Davis-Bacon plus California prevailing wage: which rate you pay and what you file

Which rate do you pay?

Neither rate always wins. When a California awarding body controls or carries out a federally assisted project, California requires its rate whenever it is higher (8 CCR 16001(b)). For mixed federal and state funding, the DLSE manual says "the application of state prevailing wage rates when higher is required" (section 4.2.2.2). DIR's public works FAQ agrees: these projects must pay California rates that exceed Davis-Bacon rates.

What agencies write into their documents

• HACLA, Los Angeles. Under Mixed Funded public housing construction, its labor compliance page (undated, read November 4, 2026) says to pay "the higher of the applicable federal or state prevailing wage rates."
• SHRA, Sacramento. For multifamily projects it finances where HOME or CDBG money triggers Davis-Bacon, section 6.1.3 of its Multifamily Lending Policies (adopted January 1, 2025) says everyone pays "the higher of the state prevailing wage or Davis Bacon for each construction trade".
• San Francisco OLSE. Its fact sheet for dual-funded projects at San Francisco International Airport, revised January 2025, says to "Pay the higher rate of pay" when comparing Davis-Bacon and DIR prevailing wages.

Low-income public housing: the HUD exception

24 CFR 965.101 goes the other way. A state rate, including fringe benefits, "shall be inapplicable" to a contract or public housing agency (PHA) work item for the development, maintenance, and modernization of a project assisted with funds for low-income public housing under the U.S. Housing Act of 1937, when the state rate for a trade exceeds the applicable federal rate: the Davis-Bacon rate, an apprentice or trainee rate based on it, or a rate HUD determines.

The regulation requires a PHA to put a statement to this effect in its solicitations and contracts (paragraph (b)(1)). SHRA's solicitation 1973-DD, issued December 4, 2019, reproduces Form HUD-5370-EZ (1/2014), clause (m), and Form HUD-5370-C Section II, clause 8. Both say the state rate "shall not be enforced against the Contractor or any subcontractor", but they measure it differently: clause (m) against the Davis-Bacon, apprentice or trainee rate, clause 8 against the HUD-determined rate, "exclusive of any fringe benefits".

These sources conflict. California puts the higher California rate on federally assisted projects a California awarding body controls or carries out; the federal regulation puts the federal rate on top for low-income public housing. The California sources cited here (8 CCR 16001, the DLSE manual, DIR's public works FAQ) do not mention 24 CFR 965.101, though that does not show that no California rule addresses it. HACLA's public works contracting page (undated, read November 4, 2026) says its public housing projects that exceed $2,000 and are solely federally funded are ones to which the federal preemption at 24 CFR 965.101 applies. That is narrower than the regulation, which turns on assistance with low-income public housing funds, so a job with blended funding is a question for your awarding body. HACLA's labor compliance page lists the regulation under its Federally Funded entries; its Mixed Funded entry says to "Refer to the above information" and then gives the higher-of rule. Read your contract's wage clause, then ask your awarding body in writing which rate it enforces.

How to compare the two rates line by line

1. Get both determinations. The federal one is the wage determination in your contract (29 CFR 5.5(a)(1)(i)); find it on SAM.gov. The California one is the Director's general prevailing wage determination for your craft and county.
2. List both sides by classification. Federal: basic wage plus fringe. California: Basic Hourly Rate plus Employer Payments (manual section 4.2.2.1). Add each side to a total; the higher total is the rate you must meet in all, subject to California's cash floor (step 4). That fits a Davis-Bacon rate; against a HUD-determined rate, 24 CFR 965.101(a)(2)(v)(B) leaves state fringe benefits out of the comparison.
3. Compare overtime. California's determination lists daily, Saturday, Sunday and holiday overtime, figured on the Basic Hourly Rate only (manual section 4.2.3; Labor Code 1771). Federally, check your contract's overtime clause; where 29 CFR 5.5(b)(1) applies (contracts over $100,000 under the Contract Work Hours and Safety Standards Act), hours over 40 in a workweek earn at least one and one half times the basic rate.
4. Compare the cash basic rate. California does not let employer payment credits reduce the Basic Hourly Rate (Labor Code 1773.1(c), 8 CCR 16200(a)(3)(I)), apart from two narrow collective bargaining exceptions (manual section 4.2.2). The manual, California's description of federal law and not a DOL source, says Davis-Bacon does not prohibit that crediting (section 4.2.2.2). See our fringe benefits guide.

Worked example with made up numbers

Hypothetical numbers, not from any real determination, in dollars per hour.

On line B, a Davis-Bacon only payroll would pay $34.00 in cash and $21.00 into a plan. California would not accept that, because its cash basic rate cannot fall below $38.00. Paying $38.00 cash basic plus $17.00 more, in cash or as actual plan payments, reaches the $55.00 total and clears California's cash floor. Whether the federal side accepts the extra $4.00 of cash basic toward the $21.00 fringe rests here on the manual's description (section 4.2.2.2), so confirm it with your awarding body. The example ignores training amounts, which California rules (8 CCR 16200(a)(3)(G)) generally send to the apprenticeship program, not to the worker.

What you file

Each rule requires its own filing. DIR's pages cited here do not mention the WH-347, and 29 CFR 5.5 does not mention the eCPR. Our WH-347 vs eCPR guide compares them.

Unless the project is exempt, your agency's system does not replace DIR's. Asked about submitting to a union, the prime contractor, the awarding body or a labor compliance program, the FAQ answers that submitting certified payroll records to other agencies "does not fulfill the requirement" to submit to the Labor Commissioner.

DIR's exemption page, dated July 2016, says only projects monitored by an approved labor compliance program or covered by a qualifying project labor agreement may be exempt from the eCPR. It lists four legacy programs, including Caltrans, but not federal funding. The manual says California's prevailing wage laws cannot be applied to a project under the complete control of the federal government (section 2.5.2). It does not mention the eCPR; our inference is that none is owed, because Labor Code 1771.4(a) reaches only projects "otherwise subject to the requirements of this chapter". The federal payroll under 29 CFR 5.5 still applies if the contract is Davis-Bacon covered. See federal-only projects and Caltrans.

The federal Statement of Compliance certifies payment at the rates in your contract's wage determination (29 CFR 5.5(a)(3)(ii)(C)), and DOL's WH-347 page says the contractor or subcontractor, or their agent who paid or supervised payment, must sign it. California's declaration under Labor Code 1776(a) is made under penalty of perjury that the employer complied with sections 1771, 1811, and 1815. The statute does not say who may make it; see who signs certified payroll in California.

What we do

WellStanding prepares the WH-347 and, where it applies, the eCPR from the payroll export you already run, and a person reviews every filing. You review and sign, and nothing is filed until you have signed; we never sign for you.

Questions