2014 Labor Reimbursement and Private Equipment Rates
"State Rates" for private Equipment Rental
The subject rates can be viewed by clicking on the above PDF file. At the top of the first page of the rates, it states, “The Maine Department of Transportation has established the following schedule of rates for Maintenance, Collector Road Improvement and other force account projects, as applicable. Increases were made to all equipment this year, but the Department is sensitive to the fact that fuel prices may continue to be volatile. The Department may revise these rates if fuel prices escalate.
Why is this done?
MaineDOT develops these annual rates in the interest of not having to negotiate every rental rate continually throughout the state. Many towns use them but it’s important to understand that the rates are NOT developed for them for that purpose. Some towns use the state rates as a guide; others apply them exactly as they are shown on the schedule. The state rates are merely a guide for municipal officials and they are convenient to use. In no way does MaineDOT say that anyone has to use these rates for their purposes.
These labor costs do not include any allowance for fringe benefits or overhead. If a municipality justifies its fringe and overhead expenses, then these costs could be added to the base hourly wage for reimbursement.
It is important to note that towns have a variety of arrangements with their road commissioners and private road contractors and for this reason the rates may have to be modified to address the situation. For example, does the road commissioner earn a salary in addition to what is paid for actual road work; does the road commissioner use his own equipment; who pays the laborers (the town, the road commissioner or the contractor?); who pays fringe benefits and insurance on workers and equipment; who supplies fuel and does maintenance on the equipment?
Adjustments to state rates may also be appropriate where there are regional disparities. Remember, the "state rates" are a statewide average and the going rates in various parts of the state may differ (higher or lower) depending on the availability of labor and how busy private contractors are.
Bottom line: if a town disagrees with these rates or needs to adjust them up or down, then it is their prerogative to do just that.
How are the rates set?
The rates are developed by consulting contractors, reviewing Rental Rate Blue Book and Green Book rates (see https://www.equipmentwatch.com/Marketing/RRBB_overview.jsp ) and discussing availability of equipment in the past year at the previous years’ rates.
The MaineDOT committee is composed of veteran MaineDOT maintenance engineers and State Aid Construction Supervisors who are responsible for getting and using this equipment on MaineDOT State Aid Construction projects. Their annual rate recommendations are reviewed and approved by MaineDOT Region Engineers and then accepted by the Commissioner.
A note regarding the consideration of fuel costs, etc that were considered as part of the 2009 review process:
Based on MaineDOT reviews, about 30% of a truck’s cost is due to operating expenses and about 1/3 of these expenses are due to fuel. For Excavators, 40% of the excavator’s cost is due to operating expenses and about 1/3 of the operating costs are due to fuel. So, about 10% of the operating costs are due to fuel for trucks and 13% for excavators. This would mean that the increase in fuel prices should be divided by 10 for trucks and 8 for excavators. (e.g. A 40% increase in fuel cost should result in a 4% increase in truck rates or a 5% increase in excavator rates).
Diesel fuel rates can be found at http://tonto.eia.doe.gov/oog/info/wohdp/diesel_detail_report_combined.asp
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