Notice of Final Nonavailability Waiver of Buy America Requirements for Certain High-Speed Rail Products for the California Inaugural High-Speed Rail Service Project

<NOTICE> DEPARTMENT OF TRANSPORTATION <SUBAGY>Federal Railroad Administration</SUBAGY> <DEPDOC>Docket No. FRA-2024-0104]</DEPDOC> <SUBJECT>Notice of Final Nonavailability Waiver of Buy America Requirements for Certain High-Speed Rail Products for the California Inaugural High-Speed Rail Service Project</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Federal Railroad Administration (FRA), Department of Transportation (DOT). <HD SOURCE="HED">ACTION:</HD> Notice. <SUM> <HD SOURCE="HED">SUMMARY:</HD> The Federal Railroad Administration (FRA) is issuing a waiver of its Buy America requirements to the California High-Speed Rail Authority (the Authority) to use certain products that are not produced in the United States for use in the California Inaugural High-Speed Rail Service Project between Merced, California and Bakersfield, California (Project). FRA is funding the Project under the Federal-State Partnership for Intercity Passenger Rail Program (FSP Program); therefore, FRA's Buy America requirements apply to the Project. FRA's Buy America requirements include both FRA's statutory requirements, which require 100 percent of the manufactured products and steel and iron used in an FRA-funded project to be produced in the United States, and the Build America, Buy America Act (BABA), which requires that all construction materials used in the FRA-funded project be produced in the United States. FRA is not waiving the applicable BABA requirements for construction materials used in the Project. The final waiver would apply to the aluminum car shells, signal systems, high-speed rail turnouts and fire alarm systems based on the domestic nonavailability of such products, as identified by the Authority. The Authority estimates that over 98 percent of the total direct dollar expenditures for the Project would be spent on domestically sourced products and labor, including 100 percent of the civil infrastructure costs. </SUM> <DATES> <HD SOURCE="HED">DATES:</HD> This waiver is effective December 4, 2024. </DATES> <HD SOURCE="HED">ADDRESSES:</HD> Please submit all comments electronically to the Federal eRulemaking Portal. Go to <E T="03">https://www.regulations.gov</E> and follow the instructions for submitting comments. <E T="03">Instructions:</E> All submissions must refer to the Federal Railroad Administration and the docket number in this notice (FRA-2024-0104). Note that all submissions received, including any personal information provided, will be posted without change and will be available to the public on <E T="03">https://www.regulations.gov.</E> You may review DOT's complete Privacy Act Statement in the <E T="04">Federal Register</E> published April 11, 2000 (65 FR 19477), or at <E T="03">https://www.transportation.gov/</E> privacy. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> For questions about this notice, please contact Shreyas Bhatnagar, Regional Supervisor, Office of Regional Outreach & Project Delivery, Office of Railroad Development, FRA, telephone: (202) 495-8630, email: <E T="03">Shreyas.Bhatnagar@dot.gov</E> or Ryan Arbuckle, Chief, Program Coordination and Strategy, Office of Railroad Development, FRA, telephone: (202) 617-0212, email: <E T="03">Ryan.Arbuckle@dot.gov.</E> For legal questions, please contact Faris Mohammed, Attorney-Adviser, Office of the Chief Counsel, FRA, telephone: (202) 763-3230, email: <E T="03">Faris.Mohammed@dot.gov.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Project History and Background</HD> On December 7, 2022, FRA published a Notice of Funding Opportunity (NOFO) announcing application requirements and procedures to obtain grant funding under the FSP Program for projects not located on the Northeast Corridor for Fiscal Year 2022. The FSP Program provides a federal funding opportunity to improve passenger rail service. On February 3, 2023, FRA published a notice adding funding and extending the application period for the FSP Program NOFO. On March 22, 2023, FRA published a notice (March Notice) inviting high-speed rail project sponsors to voluntarily submit, in advance of being selected to receive FRA funding, a domestic sourcing and workforce plan (DSWP) to demonstrate how the sponsor will maximize the use of domestic goods, products and materials, consistent with FRA's Buy America requirements. <SU>1</SU> <FTREF/> <FTNT> <SU>1</SU>  Advancing High-Speed Rail Projects Intended for Operations Over 160 Miles Per Hour Through Domestic Sourcing Plans and Buy America Compliance, 88 FR 17289 (March 22, 2023). </FTNT> The Authority applied for FSP Program funding expressing its intent to advance the California High-Speed Rail System through completion of the Inaugural High-Speed Rail Service Project between the cities of Merced and Bakersfield in the Central Valley of California. <SU>2</SU> <FTREF/> Consistent with FRA's March Notice, the Authority submitted a DSWP, <SU>3</SU> <FTREF/> which included an initial request for a waiver of FRA's Buy America requirements for certain products that the Authority concluded are not produced in the United States. The DSWP also provides the Authority's justification for seeking a waiver based on nonavailability of the requested products. The Authority describes its coordination with potential suppliers and consideration of alternate products. In addition to the Authority's market research and coordination, the Authority also refers to market research conducted by Brightline West for the Brightline West High-Speed Train Project, as the Authority anticipates using the same or substantially similar products for the Project. In December 2023, FRA selected the Project to receive $3,073,600,000 in funding under the FSP Program. In a letter dated September 13, 2024, the Authority requested a waiver from FRA's Buy America requirements consistent with the Authority's DSWP. <FTNT> <SU>2</SU>  The California High-Speed Rail System is a multi-phase effort that is planned to provide service between San Francisco and Los Angeles and to provide a competitive transportation mode with estimated speeds capable of 186 (or greater) miles per hour. </FTNT> <FTNT> <SU>3</SU>  The DSWP contains proprietary information that FRA has determined is confidential business information. As such, FRA is not making the DSWP available to the public at this time; however, pertinent non-proprietary information provided in the DSWP is discussed in this notice. </FTNT> The Authority is responsible for developing product specifications and procuring materials for use in the Project and expects to use FSP Program funds for costs associated with those procurements. The Authority's procurement process is separate from FRA's review of the Authority's request for a waiver of Buy America requirements, and FRA is not involved in the development of product specifications or the Authority's procurement process. FRA's role is limited to reviewing the Authority's request for a waiver and making certain statutory findings, consistent with 49 U.S.C. 22905(a)(2). FRA plays no role in the business decisions the Authority makes with respect to procurement of the best products for its project. In August 2023, the Authority issued a Request for Qualifications (RFQ) to procure six trainsets for the Project that could meet FRA's Passenger Equipment Safety Standards governing Tier III equipment (Tier III Rule), which establishes safety standards for high-speed rail equipment and operations that travel at speeds above 125 mph. <SU>4</SU> <FTREF/> Two Original Equipment Manufacturers (OEMs) responded to the Authority's RFQ. Neither OEM indicated that they would be able to supply a fully Buy America-compliant trainset in their responses as both OEMs indicated they would need a waiver from FRA's Buy America requirements for the aluminum car shells (shell, structure, and vehicle paintwork), as the car shells are not produced in the United States. In April 2024, the Authority issued a Request for Proposals for the six trainsets. In addition to trainsets, the Authority identified additional products that are not produced domestically, which would also require a waiver. The Authority expects to complete its procurement process for the trainsets and other contracts later this year. <FTNT> <SU>4</SU>   <E T="03">See</E> 49 CFR part 238. </FTNT> Based on information gathered through the procurement process and through market research, the Authority revised its initial DSWP, which further explains how the Authority will meet FRA's Buy America requirements and identifies any necessary waivers for noncompliant products. FRA reviewed the DSWP, including the market research conducted by the Authority. On September 20, 2024, FRA published for a 30-day public comment period a proposed waiver for the Project based on the domestic nonavailability of certain components. FRA received 11 unique comments, which are discussed below. This notice summarizes FRA's Buy America requirements, the Authority's request for a waiver, and FRA's findings and final waiver. <HD SOURCE="HD1">II. FRA's Buy America Requirements and Policy</HD> Projects that receive funding under FRA's FSP Program are subject to FRA's Buy America requirements. FRA's Buy America requirements include both: (i) FRA's statutory requirements for steel, iron, and manufactured goods at 49 U.S.C. 22905(a); and (ii) requirements under the Build America, Buy America Act (BABA) and related guidance at 2 CFR 184.6 for construction materials. This means that FRA can fund a project only if the steel, iron, and manufactured goods used in the project are produced in the United States. 49 U.S.C. 22905(a). In addition, FRA-funded projects must also comply with the relevant provisions of BABA, including the requirement that all construction materials used in the proje ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 18k characters. Full document text is stored and available for version comparison. ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━