23 CFR Part 635 Final Rule General Material Requirements
VOL. 58, No. 138
Rules and Regulations
DEPARTMENT OF TRANSPORTATION (DOT)
Federal Highway Administration (FHA)
23 CFR Part 635
General Material Requirements
58 FR 38973
DATE: Wednesday, July 21, 1993
ACTION: Final rule.
SUMMARY: The FHWA is amending its regulations on the Buy America provisions and the use of convict produced materials to comply with the Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA). Sections 1041(a) and 1048 of the ISTEA amended and clarified the Buy America provisions. Iron has been added to the materials and products that are covered under the Buy America provisions. The coating of steel has been determined to be a manufacturing process and thereby subject to the Buy America provisions. Section 1019 of the ISTEA clarifies the intent of Congress regarding convict produced materials. Materials produced by convict labor after July 1, 1991, may not be used for Federal-aid highway construction projects unless produced at a prison facility producing convict made materials for Federal-aid construction projects prior to July 1, 1987. This action reaffirms the requirements previously placed on the use of material produced by convict labor on Federal-aid highway projects.
EFFECTIVE DATE: July 21, 1993.
FOR FURTHER INFORMATION CONTACT: Mr. William A. Weseman, Chief, Construction and Maintenance Division, Office of Engineering, 202-366-0392, or Mr. Wilbert Baccus, Office of Chief Counsel, 202-366-0780, Federal Highway Administration, 400 Seventh Street, SW., Washington, DC 20590. Office hours are from 7:45 a.m. to 4:15 p.m., e.t., Monday through Friday, except legal Federal holidays.
On December 18, 1991, the President signed into law the ISTEA (Pub. L. 102-240, 105 Stat. 1914) to develop a national intermodal surface transportation system, to authorize funds for construction of highways, for highway safety programs and mass transit programs, and for other purposes. Section 1048(a) of the ISTEA amended section 165 of the Surface Transportation Assistance Act of 1982 (Pub. L. 97-424, 96 Stat. 2136), which had established Buy America [*38974] requirements for Federal-aid highway projects, by inserting the word "iron" after the word "steel." By adding the word "iron," the Congress has expanded Buy America protection to include iron and iron products in addition to steel and steel products, which were previously protected.
Section 1041(a) of the ISTEA requires that existing 23 CFR 635.410 relating to Buy America requirements for the Federal-aid highway program be applied to coating. By its action, the Congress has clarified that the activity of coating is considered a manufacturing process. The material being applied as a coating is not covered under Buy America. Coating is interpreted to mean all processes that protect or enhance the value of a material or product to which it is applied, such as epoxy coatings, galvanizing or painting.
Although the subtitle for section 1041(a) addressed "coating of steel," the text of section 1041(a) refers to "coating" without limitation. The FHWA believes that the Congress intended that the Buy America provisions of 23 CFR 635.410 be applied to the process of coating whenever a material that is subject to Buy America is covered with a coating intended to protect or enhance the value of the material that is coated. Section 1048 of the ISTEA also amended the Buy America Program to add iron to steel as covered by the program. Accordingly, the FHWA is amending section 635.410 to include the process of applying a coating to either steel or iron.
Convict Produced Materials
Section 1019 reestablishes the restrictions of 23 U.S.C. 114 on the use of convict produced materials on Federal-aid highway construction projects for materials produced after July 1, 1991. This section overrides the provisions of the Department of Justice's 1989 Appropriations Act which permitted the unrestricted use of these materials in the construction of Federal-aid highways. Now only materials which were produced by convicts prior to July 2, 1991, may be used on Federal-aid highway projects free from the restrictions placed on the use of these materials by 23 U.S.C. 114.
The Surface Transportation and Uniform Relocation Assistance Act (STURAA) became law on April 2, 1987 (Pub. L. 100-17, 101 Stat. 132). Section 112 of the STURAA amended 23 U.S.C. 114(b) to include limitations on convict produced materials. The section as amended limited the use of materials produced by convict labor for use in Federal-aid highway construction to (1) materials produced by convicts who are on parole, supervised release, or probation from a prison or (2) materials produced in a qualified prison facility with the amount of such materials produced during any 12-month period not exceeding the amount produced in such facility for use in such construction during the 12-month period ending July 1, 1987.
Subsequently, section 202 of the Judiciary and Related Agencies Appropriation Act for Fiscal Year 1989 (JRAA), Pub. L. 100-459, 102 Stat. 2186, contained language which nullified the limitations on the use of convict produced materials on Federal-aid projects imposed by section 112 of the STURAA. Section 1019 of the ISTEA negates the nullifying effect of section 202 of the JRAA and thereby reinstates the restrictive requirements of section 112 of the STURAA (23 U.S.C. 114(b)(2)).
Rulemaking Analysis and Notices
Executive Order 12291 (Federal Regulation) and DOT Regulatory Policies and Procedures
The FHWA has determined that this document does not contain a major rule under Executive Order 12291, or a significant regulation under the regulatory policies and procedures of the Department of Transportation. Because the revisions in this document substantially reflect statutory language mandated by the ISTEA, the FHWA for good cause finds that public comment is unnecessary under section 553(b)(3)(B) of the Administrative Procedure Act. In addition, notice and opportunity for comment are not required under the regulatory policies and procedures of the Department of Transportation because it is not anticipated that such action would result in the receipt of useful information for the following reasons. First, the FHWA has already issued an informal guidance memorandum in February 1992, informing its regional offices and the State transportation departments of the changes effected by sections 1041 and 1048, so the FHWA has apprised interested persons of the actions covered by this final rule. Second, in revising these regulations to conform to the ISTEA, the FHWA is not interpreting the statute nor exercising discretion in a way that could be meaningfully affected by public comment. The FHWA believes that the Administrative Procedure Act does not require prior notice and opportunity for public comment on the limited interpretation of section 1041(a) as it relates to coating. See 5 U.S.C. 553(b).
This final rule is made effective upon publication. Section 1019 of the ISTEA, reinstating regulatory restrictions of the use of convict produced materials, section 1041(a), requiring that 23 CFR 635.410 be applied so that the process of coating is included in the Buy America program, and section 1048(a), adding iron to the material covered under the Buy America provisions, are self implementing statutory provisions. Therefore, these amendments are merely technical ones which conform the relevant regulatory provisions to the ISTEA, which itself effected these changes. For this reason, and to immediately implement congressional mandates, the FHWA finds that there is good cause for publishing this rule less than 30 days before its effective date, as is ordinarily required under section 553(d) of the Administrative Procedure Act. Additionally, the Administrative Procedure Act provides that the 30-day delay in effective date requirement does not apply to interpretative rules such as the FHWA's amendment to 23 CFR 635.410 incorporating the FHWA's limited interpretation of section 1041(a) as it relates to coating.
Regulatory Flexibility Act
In compliance with the Regulatory Flexibility Act (5 U.S.C. 601-612), the agency has evaluated the effects of this rule on small entities. It is anticipated that this rule will have a minimal economic impact. Hence, the FHWA certifies that this rule would not have a significant economic impact on a substantial number of small entities.
Executive Order 12612 (Federalism Assessment)
This action has been analyzed in accordance with the principles and criteria contained in Executive Order 12612. It has been determined that this document has federalism implications. However, we believe that the federalism implications are mitigated by the need to meet requirements mandated by statute, and the agency has allowed States the maximum administrative discretion to meet the intent of the statute. Therefore, the FHWA certifies that this action has insufficient federalism implications to warrant the preparation of a separate Federalism Assessment.
Executive Order 12372 (Intergovernmental Review)
Catalog of Federal Domestic Assistance Program Number 20.205, Highway Planning and Construction. The regulations implementing Executive Order 12372 regarding intergovernmental consultation on [*38975] Federal programs and activities apply to this program.
Paperwork Reduction Act
This rule does not contain a collection of information requirement for purposes of the Paperwork Reduction Act of 1980, 44 U.S.C. 3501-3520.
National Environmental Policy Act
The agency has analyzed this action for the purpose of the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and has determined that this action would not have any effect on the quality of the environment.
Regulatory Identification Number
A regulatory identification number (RIN) is assigned to each regulatory action listed in the Unified Agenda of Federal Regulations. The Regulatory information Service Center publishes the Unified Agenda in April and October of each year. The RIN contained in the heading of this document can be used to cross reference this action with the Unified Agenda.
List of Subjects in 23 CFR Part 635
Government contracts, Grant programs-transportation, Highways and roads.
In consideration of the foregoing, the FHWA hereby amends part 635, subpart D of ch. I of title 23, Code of Federal Regulations, as set forth below.
Issued on: July 13, 1993.
Rodney E. Slater,
Federal Highway Administrator.
PART 635-CONSTRUCTION AND MAINTENANCE
1. The authority citation for part 635 is revised to read as follows:
Authority: 23 U.S.C. 112, 113, 114, 117, 128, and 315; 31 U.S.C. 6505; 42 U.S.C. 3334, 4601, et seq.; 49 CFR 1.48(b); @@ 635.410 and 635.417 are also issued under secs. 1019, 1041(a) and 1048, Pub. L. 102-240, 105 Stat. 1914; sec. 10, Pub. L. 98-229, 98 Stat. 55; sec. 165, Pub. L. 97-424, 96 Stat. 2136; sec. 112, Pub. L. 100-17, 101 Stat. 132.
Subpart D-General Material Requirements
2. In @ 635.410 paragraphs (b) (1) through (4) and (c)(1)(ii) are revised to read as follows:
@ 635.410 -- Buy America requirements.
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(b) * * *
(1) The project either: (i) Includes no permanently incorporated steel or iron materials, or (ii) if steel or iron materials are to be used, all manufacturing processes, including application of a coating, for these materials must occur in the United States. Coating includes all processes which protect or enhance the value of the material to which the coating is applied.
(2) The State has standard contract provisions that require the use of domestic materials and products, including steel and iron materials, to the same or greater extent as the provisions set forth in this section.
(3) The State elects to include alternate bid provisions for foreign and domestic steel and iron materials which comply with the following requirements. Any procedure for obtaining alternate bids based on furnishing foreign steel and iron materials which is acceptable to the Division Administrator may be used. The contract provisions must (i) require all bidders to submit a bid based on furnishing domestic steel and iron materials, and (ii) clearly state that the contract will be awarded to the bidder who submits the lowest total bid based on furnishing domestic steel and iron materials unless such total bid exceeds the lowest total bid based on furnishing foreign steel and iron materials by more than 25 percent.
(4) When steel and iron materials are used in a project, the requirements of this section do not prevent a minimal use of foreign steel and iron materials, if the cost of such materials used does not exceed one-tenth of one percent (0.1 percent) of the total contract cost or $ 2,500, whichever is greater. For purposes of this paragraph, the cost is that shown to be the value of the steel and iron products as they are delivered to the project.
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(c)(1) * * *
(ii) Steel and iron materials/products are not produced in the United States in sufficient and reasonably available quantities which are of a satisfactory quality.
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3. In @ 635.417, the introductory text of paragraph (a) is revised to read as follows:
@ 635.417 -- Convict produced materials.
(a) Materials produced after July 1, 1991, by convict labor may only be incorporated in a Federal-aid highway construction project if such materials have been:
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[FR Doc. 93-17192 Filed 7-20-93; 8:45 am]