The U.S. Department of Transportation issued notifications on November 4 regarding the expiration of two key “Buy America” waivers—one for construction material contracts and one for ‘de minimis’ costs, small grants, and minor components—along with proposals for their replacement.
In its first notice, USDOT is proposing to waive “Buy America” preferences for iron and steel, manufactured products, and construction materials used in infrastructure projects funded under USDOT-administered financial assistance programs.
What is included in the ‘Buy America’ waiver?
There are three distinct conditions for application of the new waiver:
- The total value of the non-compliant products is no more than the lesser of $1 million or 5 percent of total allowable costs under the federal financial assistance award;
- The size of the federal financial assistance award is below $500,000;
- The non-domestically produced miscellaneous minor components comprise no more than 5 percent of the total material cost of an otherwise domestically produced iron or steel product.
In its second notice, USDOT is waiving the “Buy America” preferences awards obligated on or after November 10, as well as projects solicited before May 14, 2022, and entered into contract before March 10, 2023.
The waivers relate to President Biden’s Executive Order 14005, issued in January 2021, which directed federal agencies to maximize the use of goods, products, and materials produced in the United States via financial assistance awards and procurements.
The American Association of State Highway and Transportation Officials already provided feedback to USDOT on “Buy America” waivers in a 13-page comment letter sent on August 12.
AASHTO said in its letter at the time that more preparatory work—including robust market research into the availability of American-made goods in the broad cross-section of materials covered by the new requirements—needs to be undertaken at the federal level. That would ensure a “less disruptive” transition to American made products, as well as to provide time for adjustments in the sourcing of listed construction materials, the group noted.
Furthermore, AASHTO noted that domestic manufacturing is currently unable to ensure the availability and timely delivery of many materials needed for transportation projects that are underway, resulting in sometimes significant project delays and increased costs for limited materials.
Comments on its new waiver proposals are due by November 20.
Source: AASHTO
