Costs to construction projects are difficult to estimate. National data show that voluntary benefits make up 1.8% of construction costs and that health insurance makes up one-third to two-thirds of voluntary benefits. This creates an impact of 0.2% to 0.78% on construction costs. The five year average for state construction (not including federal funds) is $255 million. This would create additional costs of at least $500,000 per year and could reach as high as $1,989,000 for construction costs alone. DFCM contracts would see an impact ranging from $200,000 to $250,000 for contractors providing maintenance and janitorial services. Contracts for Human Services may increase by more than $4 million for services provided by home care providers, DCFS privatized shelters for children, group homes, or a host of other services. If these costs are not funded, the State may contract for less services and fewer projects as a result of this requirement. DFCM will require an additional FTE to monitor contracts it manages internally and the Division of Purchasing will require 2 FTE for contracts they monitor. A conservative estimate places those wages and benefits at $32,000 per FTE per year plus $4,000 per FTE in the first year for equipment.

Office of the Legislative Fiscal Analyst

2/29/00 8:53:47 AM

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