Buy America Requirements for Manufactured Products

DEPARTMENT OF TRANSPORTATION <SUBAGY>Federal Highway Administration</SUBAGY> <CFR>23 CFR Part 635</CFR> <DEPDOC>[Docket No. FHWA-2023-0037]</DEPDOC> <RIN>RIN 2125-AG13</RIN> <SUBJECT>Buy America Requirements for Manufactured Products</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Federal Highway Administration (FHWA), U.S. Department of Transportation (DOT). <HD SOURCE="HED">ACTION:</HD> Notice of proposed rulemaking; request for comments. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The FHWA is proposing to discontinue its general waiver of Buy America requirements for manufactured products and in doing so require FHWA recipients to start applying Buy America requirements to manufactured products. The FHWA is also proposing standards for applying Buy America to manufactured products should the waiver be discontinued. The proposed standards for applying Buy America to manufactured products are consistent with the Office of Management and Budget's (OMB) guidance implementing the Build America, Buy America Act (BABA) provisions of the Infrastructure Investment and Jobs Act (also known as the Bipartisan Infrastructure Law (BIL)). </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Comments must be received on or before May 13, 2024. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> To ensure that you do not duplicate your docket submissions, please submit comments by only one of the following means: • <E T="03">Federal eRulemaking Portal:</E> Go to <E T="03">www.regulations.gov</E> and follow the online instructions for submitting comments. • <E T="03">Mail:</E> Docket Management Facility, U.S. Department of Transportation, 1200 New Jersey Avenue SE, Washington, DC 20590. • <E T="03">Hand Delivery:</E> U.S. Department of Transportation, Docket Operations, West Building Ground Floor, Room W12-140, 1200 New Jersey Avenue SE, Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays. The telephone number is (202) 366-9329. All submissions should include the agency name and the docket number that appears in the heading of this document or the Regulation Identifier Number (RIN) for the rulemaking. All comments received will be posted without change to <E T="03">www.regulations.gov,</E> including any personal information provided. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> For questions about this document, please contact Mr. Brian Hogge, Office of Infrastructure, (202) 366-1562, or via email at <E T="03">brian.hogge@dot.gov.</E> For legal questions, please contact Mr. David Serody, Office of the Chief Counsel, (202) 366-4241, or via email at <E T="03">david.serody@dot.gov.</E> Office hours are from 8 a.m. to 4:30 p.m., E.T., Monday through Friday, except Federal holidays. </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">Electronic Access and Filing</HD> This document and all comments received may be viewed online through the Federal eRulemaking portal at <E T="03">www.regulations.gov</E> using the docket number listed above. Electronic retrieval help and guidelines are also available at <E T="03">www.regulations.gov.</E> An electronic copy of this document may also be downloaded from the Office of the Federal Register's website at <E T="03">www.FederalRegister.gov</E> and the U.S. Government Publishing Office's website at <E T="03">www.GovInfo.gov.</E> All comments received before the close of business on the comment closing date indicated above will be considered and will be available for examination in the docket at the above address. Comments received after the comment closing date will be filed in the docket and will be considered to the extent practicable. In addition to late comments, FHWA will also continue to file relevant information in the docket as it becomes available after the comment period closing date and interested persons should continue to examine the docket for new material. A final rule may be published at any time after the close of the comment period and after FHWA has had the opportunity to review the comments submitted. <HD SOURCE="HD1">I. Executive Summary</HD> <HD SOURCE="HD2">A. Purpose of the Regulatory Action</HD> The FHWA is required, by statute, to ensure that all FHWA-funded projects only use steel, iron, and manufactured products that are produced in the United States. 23 U.S.C. 313. The FHWA refers to these requirements as “Buy America” requirements. The Buy America requirement for manufactured products has existed in some form since the enactment of the 1978 Surface Transportation Assistance Act (1978 STAA), Public Law 95-599 (1978), with those requirements being modified by the 1983 Surface Transportation Assistance Act (1983 STAA), Public Law 97-424 (1983), <SU>1</SU> <FTREF/> which provides the current Buy America requirement for manufactured products. In 1983, following the passage of the 1983 STAA, FHWA determined that it would be in the public interest to waive the Buy America requirements for manufactured products, creating the Manufactured Products General Waiver that continues to this day. <E T="03">See</E> 48 FR 1946 (Jan. 17, 1983); 48 FR 53099 (Nov. 25, 1983). Due to the Manufactured Products General Waiver, manufactured products permanently incorporated into FHWA-funded projects do not need to be produced domestically, apart from predominantly iron or steel manufactured products and predominantly iron or steel components of manufactured products. <FTNT> <SU>1</SU>  For clarity, while this law was enacted as the Surface Transportation Assistance Act of 1982, because it was enacted on January 6, 1983, it will be referred to as the “1983 STAA.” </FTNT> On November 15, 2021, the President signed BIL (Pub. L. 117-58) into law. The BIL includes the Buy America, Build America Act (BABA), which expands the coverage and application of Buy America requirements in Federal financial assistance programs for infrastructure. BIL, div. G sections 70901-70953. Among other requirements, BABA mandates that all iron, steel, manufactured products, and construction materials used in projects supported by funds made available for a Federal financial assistance program for infrastructure be produced in the United States. BABA section 70914. BABA provides that this mandate applies to such materials only to the extent that a domestic content procurement preference that meets the requirements of section 70914 does not already apply. BABA section 70917(a). As FHWA has an existing statutory Buy America requirement for steel, iron, and manufactured products at 23 U.S.C. 313, BABA's savings provision means that FHWA's existing Buy America requirements under 23 U.S.C. 313 apply to these products. The BABA's savings provision, however, requires that any domestic content procurement preference at least meets the requirements of section 70914. The requirements of section 70914 apply the definitions contained in section 70912, including the definition of “produced in the United States.” Accordingly, while FHWA does not directly apply BABA's manufactured products requirements, FHWA interprets BABA as requiring FHWA's Buy America requirements to be generally consistent with the BABA requirements that are applicable to section 70914, including the BABA definition of “produced in the United States” for manufactured products at section 70912(6)(B). BABA also expresses a general policy preference against general applicability waivers like the Manufactured Products General Waiver. Section 70914(d) of BABA requires Federal Agencies to review existing general applicability waivers of Buy America requirements by publishing in the <E T="04">Federal Register</E> a notice that: (i) describes the justification for the general applicability waiver; and (ii) requests public comments for a period of not less than 30 days on the continued need for the general applicability waiver. As described in further detail below, FHWA has undergone that review. Based on the contents of that review, and after considering the President's policy, as embodied in Executive Order (E.O.) 14005, “Ensuring the Future Is Made in All of America by All of America's Workers,” to maximize the use of goods, products, and materials produced in the United States; the intent of Congress, as expressed in BABA's preference against general applicability waivers; the purpose and goals of domestic content procurement preferences and waivers; and FHWA's original rationale for issuing the Manufactured Products General Waiver compared to the current domestic manufacturing situation, FHWA is proposing the discontinuation of the Manufactured Products General Waiver. Simultaneously, FHWA is proposing to modify its current regulations implementing Buy America at 23 CFR 635.410 to set forth the standards for when a manufactured product will be considered to be “produced in the United States” and therefore Buy America-compliant. For uniformity and consistency with BABA, FHWA is proposing that these standards mirror the standards OMB has established for BABA's domestic content procurement preference for manufactured products in its final guidance implementing BABA at 2 CFR part 184 (part 184). <SU>2</SU> <FTREF/> 88 FR 57750. <FTNT> <SU>2</SU>  Throughout this document, references to part 184 refer to both the text in 2 CFR part 184 and the Preamble published in the <E T="04">Federal Register</E> . </FTNT> <HD SOURCE="HD2">B. Summary of the Major Provisions of the Regulatory Action in Question</HD> The FHWA is proposing to set standards regarding its Buy America requirement for manufactured products, defining when a manufactured product is “produced in the United States” for the purposes of complying with 23 U.S.C. 313. Under this definition, which mirrors the definition at section 70912(6)(B) of BABA and in part 184, to be produce ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 117k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━