Mistick PBT v. Chao, Elaine

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 20, 2005 Decided March 17, 2006

No. 04-5340

MISTICK PBT, D/B/A MISTICK CORPORATION,
APPELLANT

v.

ELAINE CHAO, SECRETARY,
UNITED STATES DEPARTMENT OF LABOR,
APPELLEE

Appeal from the United States District Court
for the District of Columbia
(No. 03cv01767)

Maurice Baskin argued the cause and filed the briefs for
appellant. Lesley A. Pate entered an appearance.

Alan Burch, Assistant U.S. Attorney, argued the cause for
appellee. With him on the brief were Kenneth L. Wainstein,
U.S. Attorney, and Michael J. Ryan, Assistant U.S. Attorney.
R. Craig Lawrence, Assistant U.S. Attorney, entered an
appearance.

Before: HENDERSON, BROWN, and GRIFFITH, Circuit
Judges.
 2

Opinion for the Court filed by Circuit Judge GRIFFITH.

GRIFFITH, Circuit Judge: Under the Davis-Bacon Act, 40
U.S.C. § 3141, et seq., bidders on certain construction projects
funded by the federal government must pay workers specified
wage rates based upon the type of work performed. See 40
U.S.C. § 3142. The Department of Labor (the “Department” or
“Secretary”) determines the categories of jobs and the prevailing
wage rates for those jobs in the community where the
construction project will be undertaken. See 29 C.F.R. §§ 1.1-
1.9. This case involves the Department’s conformance
regulations, 29 C.F.R. § 5.5(a)(1)(ii)(A), which explain how the
Secretary determines the wages for a type of job that is left out
of the Department’s pre-bid wage decision, but that a contractor
subsequently requires for the project. Such omissions are not
uncommon.

After it had been awarded a federal contract, appellant
Mistick PBT (“Mistick”) proposed several types of jobs and
accompanying minimum rates of pay that were left out of the
Secretary’s pre-bid determination. Mistick argues the
Department acted in an arbitrary and capricious manner by
refusing to evaluate Mistick’s proposed wage rates in light of
several previously approved types of jobs and accompanying
wage rates. The District Court agreed with the Department that
because the conformance process results in a wage rate, and
because the Supreme Court held in United States v. Binghamton,
347 U.S. 171, 176-78 (1954), that the courts have no jurisdiction
to review whether the Secretary’s wage determination correctly
represents the “wages . . . prevailing,” 40 U.S.C. § 3142(b), in
a locality, the Department’s application of the conformance
regulations is insulated from judicial review. We disagree with
this conclusion. In accordance with our prior decision in Ball,
Ball & Brosamer, Inc. v. Reich, 24 F.3d 1447, 1451 (D.C. Cir.
1994), we conclude that the Davis-Bacon Act does not provide
 3

clear and convincing evidence that Congress sought to preclude
review under the Administrative Procedure Act (“APA”), 5
U.S.C. § 701, et seq., of violations of Department regulations.
We hold, however, that the Department did not apply its
conformance regulations here in an arbitrary and capricious
fashion.

I.

Mistick won a bid to be general contractor for Crawford
Square Rental Phase III (“Crawford Square”), a residential
construction project in Allegheny County, Pennsylvania, which
was administered by the Urban Redevelopment Authority of
Pittsburgh (the “Authority”). Because the project received
federal funding and was subject to the Davis-Bacon Act, the
Secretary conducted a survey of prevailing wages for similar
projects in Allegheny County and issued a wage determination
in July 1996 (the “1996 Wage Determination”), which applied
to Crawford Square.

Mistick needed to employ seven types of workers not
addressed by the 1996 Wage Determination: operators of
backhoes, bobcats, excavators, hi-lifts, rollers, graders, and
pavers. Mistick requested that the Authority conform these
seven types of jobs to classifications found in an earlier wage
determination, which was based upon a November 1992 wage
survey (the “1992 Wage Determination”). The Authority
rejected Mistick’s request and concluded that (1) the bobcat
classification should be conformed to the wage rates paid to a
drywall finisher ($9.75) because the work required of a bobcat
operator is “not comparable to the power equipment
classifications;” and (2) Mistick’s other requested classifications
should be conformed to the wage rates paid to bulldozer
operators ($21.87) because each involved the operation of power
equipment. Mistick objected, contending that the power
 4

equipment operator classifications in the 1996 Wage
Determination used by the Secretary were inapplicable here
because they addressed equipment needed on a “heavy”
commercial land development project and Crawford Square was
a “residential” development.

Pursuant to 29 C.F.R. § 5.5(a)(1)(ii)(C), the dispute was
submitted to the Department of Labor’s Administrator of the
Wage and Hour Division of the Employment Standards
Administration (the “Administrator”). Mistick requested that
two positions—bobcat and roller operators—be conformed to
the wage rates paid to drywall finishers ($9.75) and that the
other five positions be conformed to the wage rates paid to
ornamental ironworkers ($13.36). A section chief rejected
Mistick’s proposal without stating reasons and approved the
Authority’s determination; consequently, bobcat operators were
assigned a wage rate of $9.75 and the other six positions were
assigned a wage rate of $21.87. Mistick appealed to the
Administrator. Mistick agreed that the bobcat operator position
was properly conformed to the wage rate paid to drywall
finishers, but objected to conforming the remaining six
classifications to the much higher wage rate paid to a bulldozer
operator. These six classifications, Mistick contended, all
involved operating “light machinery much closer in nature to a
bobcat [which had been conformed to the lower-wage drywall
finisher position] than a heavy/highway bulldozer.” At most,
Mistick argued that these classifications involved the skill of a
drywall finisher or an ornamental ironworker.

The Administrator declined to conform the six remaining
new classifications to the drywall finisher or ornamental
ironworker positions. Instead, the Administrator conformed
these positions to the bulldozer classification, citing one of the
agency’s past decisions, Tower Construction, No. 94-17, 1995
WL 90010 (Dep’t of Labor, Wage Appeals Bd. Feb. 28, 1995),
 5

for the proposition that the Administrator will not conform
power equipment operator positions to non-power equipment
operator classifications. The Administrator noted that it made
no change to the bobcat classification only because Mistick did
not take issue with that conformance. Pursuant to 29 C.F.R.
§ 7.1(b), Mistick appealed to the Administrative Review Board
(the “Board”). Mistick argued to the Board that if the
Administrator was going to follow Tower Construction, it would
be more reasonable to conform the six new equipment operator
positions to the conformed bobcat operator classification and not
the more highly skilled bulldozer classification. Mistick also
argued that Tower Construction was ill-reasoned and that it was
arbitrary for the Administrator to compare Mistick’s requested
classifications only to power equipment operator positions.

The Board rejected Mistick’s challenge but did not offer
any findings why these new classifications differed from the
bobcat classification. Instead, the Board relied upon procedural
grounds and concluded that it need not compare Mistick’s six
requested classifications with the bobcat classification. The
Board also determined that the Administrator properly followed
Tower Construction by comparing Mistick’s six remaining
requested classifications only to power equipment operator
positions.

On August 20, 2003, Mistick filed a complaint in the United
States District Court for the District of Columbia alleging
violations of the Davis-Bacon Act and the APA. The District
Court held that Binghamton precluded judicial review of
Mistick’s challenge to the Department’s application of its
conformance regulations because “the essence of Mistick’s
challenge falls upon the correctness of the Department’s
decision rather than the actual procedure that the Board
employed.” Mistick PBT v. Chao, No. 03-1767, slip op. at 8,
2004 WL 3517425, at *4 (D.D.C. July 27, 2004). In the
 6

alternative, the District Court held that there was nothing
arbitrary and capricious about the Board’s decision to conform
the six new classifications to one of the pre-existing power
equipment classifications as opposed to any of the non-power
equipment classifications. Mistick filed a timely notice of
appeal, invoking our jurisdiction under 28 U.S.C. § 1291 to
review the final decision of the District Court.

II.

To understand the dispute in this case, some background is
needed on the wage determination process employed prior to a
construction firm’s bid for a federal contract and the subsequent
conformance process set forth in the Department’s regulations.
The Board provided a helpful summary of both processes in its
opinion, setting out the “fundamental differences” between the
two processes:

A wage determination dictates the minimum wage
rates paid to classifications of employees. It is
incorporated into bid packages and ultimately into the
contract. Thus all bidders are provided with the same
information concerning the minimum wage rates that
must be paid on a federal procurement. The
Administrator typically engages in extensive analysis
of statistical data in determining locally prevailing or
collectively-bargained rates. Interested parties must
challenge wage determinations prior to submissions of
bids on procurement. This requirement ensures an
equitable procurement process in order that competing
contractors know in advance of bidding what rates
must be paid so that they can bid on an equal basis.

A conformance, on the other hand, entails adding
an employment classification omitted from a wage
 7

determination. Conformance occurs after the
conclusion of bidding on the contract and assumes that
the wage determination that was included in the bid
specifications essentially is correct with the limited
deficiency that a needed job classification and wage
rate are missing. The conformance mechanism is
designed to facilitate expedited addition of a missing
classification and wage rate while simultaneously
maintaining the integrity of the bidding procedure.
The Administrator must (i) determine which
classification already listed in the wage determination
is most comparable in terms of skill to the class of
employee performing under the contract but omitted
from the wage determination, and (ii) derive a wage
rate for the omitted class which is reasonably related to
the listed rates. The Administrator is not required to
conduct a wage survey or to issue a de novo wage
determination in order to effect a conformance.

Mistick Constr., No. 02-004, slip op. at 6-7, 2003 WL 21488362,
at *5 (Dep’t of Labor, Admin. Review Bd. June 24, 2003)
(quotation marks, internal citations, and alterations omitted).
Thus, for a wage determination, the Department conducts a
survey of wages paid for various jobs in a locality in which a
federal construction project is to take place. Bidders must
challenge those determinations prior to bidding. If they do not,
and are awarded the government contract, they must pay their
workers the wages set forth in the wage determination. The
conformance process, on the other hand, occurs after the
Government and bidder have signed a contract and requires the
Secretary to undertake a substantially different task. The
conformance process recognizes that there is a “missing
classification and wage rate” necessary to the project and
provides a means by which the Secretary can derive, in a manner
that maintains the integrity of the bidding process, a new
 8

classification based upon the “most comparable” existing
classification and a wage rate “reasonably related” to existing
rates.

III.

In United States v. Binghamton, 347 U.S. 171 (1954), a
successful bidder for a Davis-Bacon contract sought damages
from the Government because the wage determination upon
which its bid was based contained wage rates that were too low
and left it “unable to obtain workmen at the rates specified in the
contract schedule . . . .” Id. at 175. The Court rejected the
bidder’s claim and held that when the Secretary determines what
wages are “prevailing” in a locality, see 40 U.S.C. § 3142(b)
(formerly 40 U.S.C. § 276a), that determination is not an
“affirmative representation” that the bidder is “entitled to rely on
. . . in the computation of its bid.” 347 U.S. at 175. While the
Act provides a cause of action for “employees to recover from
the contractor the amount due the employees under the
minimum wage schedule,” id. at 177 n.12, “[t]he Act does not
authorize or contemplate any assurance to a successful bidder
that the specified minima will in fact be the prevailing rates,” id.
at 178. Thus, “[t]he correctness of the Secretary’s determination
is not open to attack on judicial review.” Id. at 177.

Discussing Binghamton, the Supreme Court has since noted
that while the “correctness of the Secretary’s wage rate
determination is not subject to judicial review[,] . . . [a]t least
two Courts of Appeals have held, however, that the practices
and procedures of the Secretary are reviewable under the
standards of the Administrative Procedure Act, 5 U.S.C. § 701
et seq.” Univ. Research Assoc., Inc. v. Coutu, 450 U.S. 754, 761
n.10 (1981) (citing Virginia v. Marshall, 599 F.2d 588, 592 (4th
Cir. 1979); N. Ga. Bldg. & Constr. Trades Council v.
Goldschmidt, 621 F.2d 697, 707-08 (5th Cir. 1980)) (emphasis
 9

added; additional citation omitted). The Court, however,
“express[ed] no view on the latter question.” 450 U.S. at 761
n.10.

The Department argues that this case falls within the
category of decisions that Binghamton holds are not subject to
judicial review. We disagree with the Department and conclude
that the Department’s application of its conformance regulations
is subject to judicial review under the Administrative Procedure
Act. Under the conformance process, as prescribed by 29 C.F.R.
§ 5.5(a)(1)(ii)(A)(3), the Secretary must determine whether a
proposed rate reasonably relates to existing rates in the wage
determination. The Department argues that because the result
of the conformance process is the determination of a wage rate,
Binghamton’s bar applies and the Department’s application of
the conformance regulations must also be immune from judicial
review under the APA.

But this argument reads too much into Binghamton.
Binghamton determined only that the Davis-Bacon Act does not
provide contractors a cause of action for challenging, as the
Fourth Circuit put it, the “substantive correctness of the wage
determination . . . . ” Marshall, 599 F.2d at 592. Binghamton
does not grant the Department license to arbitrarily apply its
own regulations with respect to a government contractor and
escape all APA review of its practices and procedures in its
dealings with a contractor. Binghamton does not refer to the
APA nor otherwise address in any way the extent to which a
contractor may seek APA review of whether the Department
acted arbitrarily in applying its practices and procedures.

Indeed, we have previously reviewed a facial challenge to
the validity of the conformance regulations. Bldg. & Constr.
Trades Dep’t, AFL-CIO v. Martin, 961 F.2d 269, 276 (D.C. Cir.
1992), cert. denied, 506 U.S. 915 (1992). The litigation over the
 10

validity of parts of the conformance regulations in Martin
demonstrates that the conformance process is not, contrary to the
District Court’s suggestion, simply something that reflects the
Secretary’s view of what are the “correct” prevailing wages in
a community. As the Department explained, “[t]he conformance
mechanism is designed to . . . maintain[] the integrity of the
bidding procedure. . . . The Administrator is not required to
conduct a wage survey or to issue a de novo wage determination
in order to effect a conformance.” Mistick Constr., slip op. at 7,
2003 WL 21488362 at *5. The conformance regulations set out
a specific and critical regulatory process that allows the
Department to exercise binding discretion over contractors and
employees in filling a contractual gap, based upon specific
standards in 29 C.F.R. § 5.5(a)(1)(ii)(A) that look not to
prevailing wages but what new wage rates would reasonably
relate to rates in the wage determination. As Binghamton does
not answer the question before us, we employ the familiar
framework for determining whether Congress has precluded a
party from seeking APA review of an agency’s practices and
procedures.

The APA provides for judicial review of “final agency
action for which there is no other adequate remedy in a court,”
5 U.S.C. § 704, and allows for judicial review “except to the
extent that . . . (1) statutes preclude judicial review; or (2)
agency action is committed to agency discretion by law,” 5
U.S.C. § 701(a). See also id. § 702(1). With respect to the first
exemption, there is a “strong presumption that Congress intends
judicial review of administrative action.” Bowen v. Mich. Acad.
of Family Physicians, 476 U.S. 667, 670 (1986). “[O]nly upon
a showing of ‘clear and convincing evidence’ of a contrary
legislative intent should the courts restrict access to judicial
review.” Abbott Labs. v. Gardner, 387 U.S. 136, 141 (1967)
(quoting Rusk v. Cort, 369 U.S. 367, 380 (1962)), abrogated on
other grounds by Califano v. Sanders, 430 U.S. 99, 105 (1977).
 11

The second exemption “is applicable in those rare instances
where statutes are drawn in such broad terms that in a given case
there is no law to apply.” Citizens to Pres. Overton Park, Inc.
v. Volpe, 401 U.S. 402, 410 (1971).

The Department directs us to nothing in the Davis-Bacon
Act, let alone clear and convincing evidence, demonstrating that
Congress sought to preclude judicial review of the Secretary’s
compliance with the conformance regulations or, looking even
to the broader administrative activity at issue here, the
Department’s alleged failure to follow its own regulations in its
post-bid dealings with a contractor. Nor are we aware of any
such provision. The Department does not argue that the
conformance regulations are so broad as to constitute one of
those “rare instances” where there is no law to apply. To the
contrary, the conformance regulations set out specific criteria
that are capable of review. The Department argues instead that
we should employ “a pertinent presumption of statutory
construction that Congress knows how to create a cause of
action when it wants to” and presume that Congress did not
intend for review of the conformance process. As Abbott
Laboratories makes clear, however, the presumption we are to
apply cuts the other way. Under the APA, absent clear and
convincing evidence to the contrary, we must presume that
Congress did not intend for the Department to be insulated from
judicial review in applying the conformance regulations.

Indeed, although not addressed by the Department, we have
previously applied the same Abbott Laboratories analysis to the
Davis Bacon Act:

The Secretary . . . cannot adopt regulations erasing the
presumption of reviewability embodied in the APA
unless the Davis-Bacon Act reveals clear and
convincing evidence that Congress intended to
 12

foreclose judicial review of the Secretary’s regulations
under the Act when those regulations are applied in
later adjudicatory proceedings. . . . [W]e find nothing
in the Act indicating such to be the case . . . .

Ball, Ball & Brosamer, Inc. v. Reich, 24 F.3d 1447, 1450-51
(D.C. Cir. 1994) (quotation marks omitted). That conclusion
echoes the Fourth Circuit’s holding in Marshall, the Fifth
Circuit’s determination in Goldschmidt, and the decisions
reached by several district courts.1 The Department has not
directed us to any court that has departed from that conclusion.

The role of the conformance regulations under the Davis-
Bacon Act demonstrates why Congress has not sought to
preclude APA review. During the wage determination process,
a contractor unhappy with the Department’s interpretation of the
relevant regulations can protect itself simply by not bidding on
a Davis-Bacon project. But where, as here, a bid has been
accepted, a contractor faced with arbitrary and capricious
administrative action would not have such an option. Even
though the contractor entered the contract and began
performance in reliance on the good faith of the Department to
follow its conformance regulations, the Department’s proposed
exemption from judicial review would require the contractor to
keep performing regardless of whether the Department assigned
wage rates to missing classifications in an arbitrary and
capricious fashion. There would not just be “no other adequate
remedy in a court,” 5 U.S.C. § 704, for the agency’s allegedly
capricious action; in fact, there would be no remedy at all.

Absent clear and convincing evidence from Congress to the

1
Accord Miree Constr. Corp. v. Dole, 730 F. Supp. 385 (N.D.
Ala. 1990); Framlau Corp. v. Dembling, 360 F. Supp. 806 (E.D. Pa.
1973).
 13

contrary, we decline to conclude that the Department may apply
its conformance regulations outside the limits of the
Administrative Procedure Act. We have jurisdiction to review
Mistick’s challenge to the Department’s application of the
conformance regulations.

IV.

Mistick takes issue with the Department’s application of the
third step of the conformance regulations, which requires the
contracting officer to determine whether “[t]he proposed wage
rate . . . bears a reasonable relationship to the wage rates
contained in the wage determination.” 29 C.F.R.
§ 5.5(a)(1)(ii)(A)(3).2 The Department concluded that the six

2
The three steps necessary for a conformance are found in 29
C.F.R. § 5.5(a)(1)(ii)(A), which provides:

The contracting officer shall require that any class of
laborers or mechanics, including helpers, which is not
listed in the wage determination and which is to be
employed under the contract shall be classified in
conformance with the wage determination. The
contracting officer shall approve an additional
classification and wage rate and fringe benefits
therefore only when the following criteria have been
met:

(1) The work to be performed by the
classification requested is not
performed by a classification in the
wage determination; and

(2) The classification is utilized in
the area by the construction
industry; and
 14

new classifications requested by Mistick bore a reasonable
relationship to the bulldozer operator classification in the 1996
Wage Determination. Mistick challenges two aspects of how
the Department reached that decision.

A. Consideration of Only Other Power Equipment
Operator Positions.

Mistick argues that the Department’s decision was arbitrary
and capricious because it failed to conform the proposed
classifications, each of which involved operating power
equipment, to the lower-paid drywall finisher or ironworker
classifications. The Administrator declined to do so because
agency precedent determined that “power equipment operators
are a separate and distinct subgroup of construction worker
classifications.” Tower Constr., No. 94-17, 1995 WL 90010, at
*2 (Dep’t of Labor, Wage Appeals Bd. Feb. 28, 1995).
Following Tower Construction, the Administrator would only
compare Mistick’s requested classifications to other power
equipment operators. The Administrative Review Board agreed.

“This Court affords great deference to an agency’s
interpretation of its own regulation: under well-recognized
precedent, we can reject the Secretary’s interpretation only if it
is plainly erroneous or inconsistent with the regulation.” Sec’y
of Labor v. Twentymile Coal Co., 411 F.3d 256, 260 (D.C. Cir.
2005) (quotation marks omitted); see Bowles v. Seminole Rock

(3) The proposed wage rate,
including any bona fide fringe
benefits, bears a reasonable
relationship to the wage rates
contained in the wage determination.

Id.
 15

& Sand Co., 325 U.S. 410, 414 (1945). The conformance
regulations require only a reasonable relationship between “[t]he
proposed wage rate” and “the wage rates contained in the wage
determination.” 29 C.F.R. § 5.5(a)(1)(ii)(A)(3). Applying that
standard, the Department concluded in Tower Construction that
power equipment operators have unique skill sets that make
them different from other workers, and that it is reasonable to
conform omitted power equipment operator classifications to
wage rates for power equipment operator classifications in the
applicable wage determination.

That reading of the reasonable relationship standard is far
from erroneous or inconsistent with § 5.5(a)(1)(ii)(A)(3). In
Tower Construction, the Department did what the regulations
expect and require. It employed its expertise with regard to the
skills required for various jobs and developed a uniform, fair
approach to conforming requested power equipment operator
classifications. We defer to that interpretation of
§ 5.5(a)(1)(ii)(A)(3).3

3
Mistick argues that Tower Construction is inconsistent with an
earlier decision of the Department, Clark Mechanical Contractors,
No. 95-03, 1995 WL 646572 (Dep’t of Labor, Wage Appeals Bd.
Sept. 29, 1995). There, the Wage Appeals Board concluded that the
Administrator properly conformed a requested plumber classification,
a skilled classification, to “the lowest rate for a skilled classification
above the unskilled classification of laborer.” Id. at *4. That is, the
Administrator properly compared a proposed skilled classification
with existing skilled classifications in a wage determination and not
with any existing unskilled classifications. Mistick argues that, under
Clark Mechanical, the Department “should [have] set a rate for a
conformed skilled classification equal to any skilled classification rate,
without arbitrarily limiting the rate to any particular category of
skilled classifications . . . .” Nothing in Clark Mechanical, however,
prevents the Department from determining that differences exist
among skilled classifications and that power equipment operators have
 16

B. The Earlier Bobcat Conformance.

If all of the power equipment operator positions that Mistick
requested had been conformed to other power equipment
operator positions, our task would be straightforward and
complete. But, as Mistick notes, the bobcat operator
classification Mistick requested—a power equipment operator
position—was conformed to the drywall finisher classification.
Because the Administrator was willing to conform the bobcat
operator classification to a non-power equipment operator
position, Mistick argues that the Administrator acted arbitrarily
in refusing to consider conforming Mistick’s other requested
classifications to non-power equipment operator positions.

“Where an agency departs from established precedent
without a reasoned explanation, its decision will be vacated as
arbitrary and capricious.” Ramaprakash v. FAA, 346 F.3d 1121,
1130 (D.C. Cir. 2003) (quoting ANR Pipeline Co. v. FERC, 71
F.3d 897, 901 (D.C. Cir. 1995)) (quotation marks and alterations
omitted). Viewed out of context, allowing the bobcat operator
classification to be conformed to a non-power equipment
operator classification might appear to be not only a departure
from Tower Construction, but an unexplained departure from
the Department’s decision to not consider non-power equipment
operator classifications in reviewing Mistick’s proposed
classifications.

But the Department did offer a reasoned explanation why
the bobcat classification was not conformed in accordance with
Tower Construction. After the Authority agreed to conform the

unique skill sets that merit a separate subclassification. To the
contrary, Tower Construction follows the path set out in Clark
Mechanical by developing a uniform standard for conforming
requested classifications.
 17

bobcat classification to the wage rate of a drywall finisher,
Mistick, acting on counsel, chose not to protest that
determination. The Administrator, and the Board, noted that had
Mistick protested the wage rate assigned to the bobcat
classification, “we would have given further consideration to
any evidence that the rate approved did not bear a reasonable
relationship with the other power equipment operator rates.”
Mistick Constr., slip op. at 8, 2003 WL 21488362 at *7. Had
Mistick protested the bobcat rate, there is a likelihood that the
Department would have required that bobcat operators be paid
a higher wage rate reasonably related to the wage rate paid to an
existing power equipment operator.

Mistick argues that once the Department created the bobcat
classification and its corresponding relatively low wage rate, it
had a duty to consider whether Mistick’s six other new
classifications bore a reasonable relationship, see 29 C.F.R.
§ 5.5(a)(1)(ii)(A)(3), to the bobcat classification. Given that the
bobcat classification is a power equipment operator
classification and assuming therefore that it was a proper subject
for comparison under Tower Construction, Mistick argues that
the Department’s failure to compare the six new classifications
to the newly conformed bobcat classification was itself
arbitrary.4

An agency’s “failure to respond meaningfully to the
evidence renders its decisions arbitrary and capricious. Unless
an agency answers objections that on their face appear
legitimate, its decision can hardly be said to be reasoned.”
Tesoro Alaska Petro. Co. v. FERC, 234 F.3d 1286, 1294 (D.C.
Cir. 2000) (citing Int’l Harvester Co. v. Ruckelshaus, 478 F.2d
615, 648 (D.C. Cir. 1973); City of Vernon v. FERC, 845 F.2d

4
Although this argument was raised below, the District Court did
not address it.
 18

1042, 1048 (D.C. Cir. 1988)). Despite Mistick’s request to do
so, the Department did not consider whether the six new
classifications Mistick requested bore a reasonable relationship
to the bobcat classification. Instead, the Department concluded
that three procedural grounds prevented it from looking at the
bobcat classification: (1) “the bobcat conformance in no manner
‘amended’ the general wage determination,” as the 1996 Wage
Determination continues to list only “three classifications of
power equipment operator” and not the new bobcat
classification requested by Mistick for this project; (2)
“[c]onforming the disputed classifications rather than
‘amending’ the existing wage determination is consistent with
the language of the [conformance] regulation[s],” which
“require[] that a class of laborers or mechanics ‘which is not
listed in the wage determination and which is to be employed
under the contract shall be classified in conformance with the
wage determination,’” and contemplate that “the wage rate
proposed for the classification must ‘bear[] a reasonable
relationship to the wage rates contained in the wage
determination;’” and (3) “[e]ven assuming that the wage
determination effectively is amended in some manner, . . . [w]e
consider [the 1996 Wage Determination] as it existed on the date
of the request until all conformance issues associated with the
request are resolved.” Mistick Constr., slip. op. at 9, 2003 WL
21488362 at *7-8 (quoting 29 C.F.R. § 5.5(a)(1)(ii)(A)).

There is some textual support for Mistick’s suggestion that
the conformed bobcat rate is now another wage rate to which
proposed wage rates should be compared. The conformance
regulations indicate that after a requested wage rate has been
“classified in conformance with the wage determination” the
“contracting officer shall approve” it as “an additional
classification.” 29 C.F.R. § 5.5(a)(1)(ii)(A) (emphasis added).
But Mistick’s interpretation of 29 C.F.R. § 5.5(a)(1)(ii)(A) is not
the only possible interpretation of that regulation. The
 19

Department notes that § 5.5 speaks of conforming a new
classification to classifications and wage rates found “in the
wage determination.” 29 C.F.R. § 5.5(a)(1)(ii)(A)(3) (emphasis
added). The text of the regulation thus reasonably can be read
to suggest that a new classification should only be compared to
classifications appearing in the original wage determination and
does not require that requested classifications be compared to
classifications previously created through the conformance
process.

Even though Mistick’s interpretation may be possible, it is
not the Department’s interpretation of its own regulation. We
can “reject the Secretary’s interpretation only if it is plainly
erroneous or inconsistent with the regulation.” Twentymile
Coal, 411 F.3d at 260 (quotation marks omitted). Nothing about
the Department’s reading of its regulation is plainly erroneous
or inconsistent with the text of the regulation. Accordingly, the
Department did not act arbitrarily under the conformance
regulations in refusing to compare Mistick’s six requested
classifications to a classification previously determined through
the conformance process.

V.

For the foregoing reasons, we affirm the order of the
District Court granting the Department’s motion to dismiss.

So ordered.