Exceptions to prevailing wage and apprenticeship requirements primarily concern specific clauses within laws like the Inflation Reduction Act (IRA) and local prevailing wage acts.
Exceptions in the Inflation Reduction Act (IRA)
- One-Megawatt Exception: Facilities with a maximum net output of less than one megawatt of electrical or thermal energy are exempt from prevailing wage and apprenticeship requirements.
- Beginning of Construction Exception: Projects that began construction before January 29, 2023, can qualify for increased tax credits without meeting these requirements.
Additional Considerations
- Good Faith Effort Exception: This applies to apprenticeship requirements. If a taxpayer requests apprentices from a registered program and is denied or does not receive a response, they may be considered to have made a good faith effort.
- Private Projects: In New York, prevailing wages do not apply to private projects financed through tax-exempt industrial revenue bonds issued by IDAs.
Local Prevailing Wage Laws
Local laws typically do not offer broad exemptions but require that prevailing wages be paid for work exceeding specific threshold amounts or when public funding is involved. For instance, in New Jersey, work must exceed certain contract thresholds to be subject to prevailing wage laws.
While these laws may not offer blanket exceptions, they often mandate compliance for publicly funded or large-scale projects, with specific rules applying based on project size and funding sources.
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