The Office of Management and Budget issued an early view of its final guidance on implementation of the Build America, Buy America provisions within the 2021 bipartisan infrastructure law that required OMB to provide guidance on applying the domestic content procurement preference to federal awards for infrastructure projects.
The 162-page document addresses previously ambiguous language about cementitious materials, aggregates and other components in manufactured precast concrete. It also more clearly defines what a manufactured product is.
In short, the new language allows for individual materials and cast-in-place concrete to be excluded from the Buy America requirements, but “manufactured products,” such as precast concrete, remain in adherence to the 55% “cost of components test.” This applies to all federal projects and federally funded projects.
According to the OMB report, materials such as stone, sand and gravel as well as binding agents and additives on their own are excluded from Buy America’s domestic preference until they are brought together in a manufactured setting. Similarly, wet concrete that is not dried or set prior to reaching the work site is excluded.
The OMB report defines manufactured products as “articles, materials, or supplies that have been: (i) processed into a specific form or shape; or (ii) combined with other articles, materials or supplies to create a product with different properties than the individual articles, materials or supplies.”
“After careful consideration of the comments received on this topic and the statutory text of (Buy America), OMB clarifies that section 70917(c) materials, on their own, are not manufactured products,” the report reads. “Further, section 70917(c) materials should not be considered manufactured products when they are used at or combined proximate to the work site — such as is the case with wet concrete or hot mix asphalt brought to the work site for incorporation. However, certain section 70917(c) materials (such as stone, sand, and gravel) may be used to produce a manufactured product, such as is precast concrete.”
This decision leaves U.S. precast concrete manufactures where they were when the original Buy America guidelines were released. Non-U.S. precast concrete manufacturers will have a more difficult time securing U.S. federal projects, though a waiver process does remain in place.
NPCA in April, in conjunction with PCI, submitted comments to the U.S. Federal Highway Administration in review of the general applicability waiver. NPCA’s position was that materials remain exempt from Buy American when applied to any finished product made by U.S. manufacturers.
These comments are referenced within the OMB’s report.
NPCA continues to examine what this means for members moving forward. Updates will be posted as information becomes available.