Compliance Webinar: The 10 Most Common Prevailing Wage and Apprenticeship Compliance Questions

Published:

November 18, 2025

Updated:

November 19, 2025

3 mins

PWA Webinar: 10 Most Common Clean Energy Tax Credit Compliance Questions

Representatives from Baker Botts and Clean Energy Counsel, alongside Reunion's compliance experts, demystify the most commonly asked questions surrounding PWA compliance and demonstrate how the Reunion platform provides an audit-ready solution.

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Joined by: Brent Schoradt from Clean Energy Counsel, LLP, and Kathryn McEvilly from Baker Botts.

Mastering the complexities of Prevailing Wage and Apprenticeship (PWA) requirements is essential to protecting the full value of a project's tax credits. The financial stakes are significant, and reporting errors can put full tax credit values at risk, jeopardizing financing and project viability.

Question 1: Supplemental Wage Determinations (06:25)

In what situations should supplemental wage determinations be requested, and once you get a response from the DOL, what should you do with the s supplemental wage determination?

Summary: If a project requires a trade or occupation not listed in the applicable wage determination for the state and county where a project is being constructed, contractors must request an additional wage determination (SF-1444 conformance request). Once the DOL responds to the conformance request, contractors should ensure that laborers performing work under this supplemental wage determination are paid according to the prescribed rates.

Question 2: Delayed Supplemental Wage Determinations (09:04)

What happens if you don't receive a supplemental wage determination before the start of construction?

Summary: If construction starts before the DOL has responded to a conformance request, there is relief to avoid penalties in the case where the initially requested rate was less than the rate in the DOL's final determination: you must pay back wages (the difference between what was paid and the rate defined in the supplemental wage determination) within 30 days of receiving confirmation of the supplemental wage determination from the DOL. As long as these back wages are paid within 30 days of receipt of confirmation from the DOL, you do not have to pay interest along with the back wages.

Question 3: Changes in Supplemental Wage Determinations (11:24)

What happens if your conformance request response comes back from the DOL, and they tell you that you need to pay more than the rate that you indicated in your request?

Summary: If the final supplementary wage determination rate is higher than the rate that you had initially requested, you must pay the difference (back wages) within 30 days. Failure to pay these back wages within the 30-day window subjects the taxpayer to normal cure provisions, including interest and the $5,000 per laborer per year penalty.

Question 4: Exemption from PWA Compliance (14:13)

Are certain activities exempt from PWA compliance, and specifically, what activities are exempt during the alteration and repair period?

Summary: Exemptions exist for projects under 1 MW or those that began construction before January 29, 2023. While regular maintenance is exempt, activities like site clearing and preliminary work are considered "construction" under the Davis-Bacon Act (DBA) definition referenced by PWA, making them subject to PWA compliance.

Question 5: Apprenticeship Requirements (18:52)

How can developers be confident in satisfying the apprentice participation, ratio, labor hours, good faith effort requirements?

Summary: Developers should track compliance against the three apprenticeship requirements: Participation (at least one apprentice must be hired per contractor with four or more laborers performing work on the project), Ratio (daily tracking of the apprentice-to-jouneyworker ratio to ensure that this ratio is compliant with the prescribed ratio of the associated apprenticeship program), and Labor Hours (15% of total labor hours must be worked by apprentices for projects that began construction in 2024 or later).

The Good Faith Effort exception is met if a proper request for apprentices is submitted in writing and denied or not responded to within five business days. Additionally, the Good Faith Effort exception may be claimed if no apprentice program covers the project location, trains apprentices in the occupations needed, and supplies apprentices to employers. In this case, the US Department of Labor or state apprentice agency must be contacted to help find apprentices. The Good Faith Effort exception excuses a contractor from the apprentice participation requirement and from a portion of required apprentice labor hours, depending on how many apprentice hours were requested.

Question 6: Job Sites Across Multiple Counties (34:10)

How should I handle PWA compliance for a single site that spans two different counties?

Summary: You must comply with the prevailing wage and apprenticeship requirements of each county individually. Recommended approaches include paying the higher wage rate across both counties or requesting a single supplemental wage determination applicable to the entire job site.

Question 7: Feedback from Tax Credit Buyers and Insurers (36:20)

What are the most common items that tax credit buyers and insurers find are missing in PWA compliance reports?

Summary: The most common issue is a lack of data from subcontractors, often because the project sponsor lacks direct contractual privity with them. This logistical difficulty leads to incomplete or delayed compliance reports.

Question 8: Making Back Payments (39:23)

If a laborer is underpaid, how long do I have to pay them back? Are there any penalties associated with the underpayment? And how can I make sure that my subcontractors are aware of any wage deficiencies and that they remedy them in a timely manner?

Summary: Underpayments must be corrected by paying back wages plus interest (short-term federal rate + 6%). The penalty of $5,000 per laborer per year is waived if the deficiency is identified and corrected by the end of the month following the calendar quarter in which the underpayment occurred. The Reunion platform provides automated notifications to contractors when underpayments or other non-compliance are identified. This ensures that contractors are made aware of any back pay requirements in a timely manner.

Question 9: Demonstrating Intent to Pay Penalties (47:36)

If I have PWA penalties due and intend to pay them with my tax return, how should I document this intent for purposes of demonstrating my project's PWA compliance?

Summary: To satisfy tax credit investors/buyers, documentation often includes a letter of intent to pay the penalty with a developer's tax return. In some cases, a cash escrow account may be set up to ensure the availability of funds for the penalty payment.

Question 10: Definition of a Qualified Facility Under Section 48E (50:28)

If my project is pursuing Section 48E tax credits, do I need to track PWA compliance on a more granular level than on the project as a whole to comply with the definition of a qualified facility under Section 48E?

Summary: Unlike older credits, Section 48E technically requires establishing PWA compliance (including the 15% apprentice labor hour requirement) at the level of the qualified facility (e.g., an individual inverter block for solar). Because this granular tracking is commercially infeasible, the market is currently revolving around using a reasonable allocation method to establish compliance at the qualified facility level.