This article originally appeared in the Precast Today 2023 Q2 edition.
By Barbara Burchette
There’s been a lot of talk in the nation’s capital about Buy America, also referred to as Buy American or Build America, Buy America. The reason for this word salad on the federal government’s plate is because of an executive order by President Joe Biden requesting federal agencies to review and enhance their Buy America policies in the wake of the $1.2 trillion Infrastructure Investment Jobs Act of 2021. Agencies currently are reaching out for public comments on proposed changes.
Specific to NPCA members, the proposed guidance sets domestic manufacturing standards for construction materials.
Understanding the policy
The “Buy American Act” of 1933 first required the federal government to purchase American-made goods whenever possible. This applied only to direct federal purchases. Requirements on purchases made by the recipients of federal grants came in 1977 with a series of “Buy America” laws. However, the requirements vary for different kinds of infrastructure.
The Trump administration grouped all of these policies under the umbrella term “Buy American.” The Biden administration uses the term
“Made in America Laws” for all of the statutes.
Let’s use Buy America for simplification.
An important aspect of Buy America is the discretion agencies possess to waive domestic content laws. Waivers are extended if petitioners can prove that there is no American-made source for a needed product or that the American-made versions are cost prohibitive. The Biden administration has centralized the waiver process under the White House Office of Management and Budget (OMB) and a Made in America director, so proposed waivers go there.
As a result, waivers are harder to come by.
“The previous administration didn’t take Buy American seriously enough,” Biden said. “Federal agencies waived the requirement without much pushback at all. Big corporations and special interests have long fought for loopholes to redirect American taxpayers’ dollars to foreign companies where the products are being made. The result: tens of billions of American taxpayers’ dollars supporting foreign jobs and foreign industries.”
Biden’s blanket statement caused heartburn with career employees at the U.S. Department of Transportation. Modal administrations, such as the Federal Highway Administration (FHWA), take their independent review of waivers seriously. Under Biden, the granting agency must assess whether a significant portion of the cost advantage of a foreign-sourced product is the result of the use of dumped steel, iron or manufactured goods.
Why pay attention?
The OMB’s new guidance is designed to help federal agencies implement the bipartisan infrastructure law’s Buy America provisions to strengthen Made in America requirements and help ensure that federally funded infrastructure projects use American-made iron, steel, construction materials and manufactured products.
The guidance recognizes that the bipartisan infrastructure law presents a dual opportunity to create good jobs in both construction and manufacturing. It also recognizes that America’s critical supply chains have gaps – and that waivers will be needed while manufacturers scale up to meet demand. To that end, the guidance calls on agencies to issue waivers strategically and only as needed to help ensure that Made in America goods are used once firms make needed investments to expand domestic production.
Finally, the guidance provides preliminary direction to agencies for determining when construction materials are “Made in America” so that projects funded in the near future can boost the use of U.S. goods while the administration seeks further input from affected stakeholders to develop more lasting standards.
NPCA supports these objectives and emphasizes the need to transition to new policies when supply issues are not weak. However, during times of supply chain struggles and limited availability of raw materials, waivers must be provided for construction demand under the IIJA.
In April, NPCA President and CEO Fred Grubbe signed a joint letter with PCI to OMB and to FHWA asking to maintain the inclusion of precast materials under Buy America and to respect the exemption of cementitious materials that is provided in the Build America, Buy America sections of the IIJA.
Barbara Burchett is co-principal of Innovative Advocacy, which works with NPCA to advance the interests of the precast concrete industry in Washington, D.C.
Leave a Reply