Construction

Notice of Buy America Waiver Request

Action: Notice, request for comments.

Web posting date: 01/05/2021

Federal Register Notice of Finding Publication Date: 09/30/21

Effective Date of Federal Register: 10/01/21

Close of public comment period : 10/06/21

Summary:

The Federal Highway Administration (FHWA) is seeking comments on whether a waiver of the Buy America requirements under 23 CFR § 635.410(b) should be granted to permit the use of non-domestic parts for the construction of two pedestrian elevators or let-down structures needed for a pedestrian bridge associated with the I-74 Mississippi River Bridge project in Bettendorf, Iowa. The non-domestic parts include: (i) traction elevator components; (ii) elevator guide rails; and (iii) additional auxiliary components of the two elevators or let-down structures.

The FHWA will only consider a Buy America waiver when the conditions of 23 CFR § 635.410(c) have been met. This includes: (1) when the application of the requirements under § 635.410(c) would be inconsistent with the public interest; or (2) when steel and iron products are not produced in the United States in sufficient and reasonably available quantities, which are of a satisfactory quality.

Background on the I-74 Mississippi River Bridge Project and Waiver Request: The City of Bettendorf, Iowa, through the Iowa Department of Transportation (Iowa DOT), is seeking a Buy America waiver for pedestrian elevators or let-down structures needed for a pedestrian bridge associated with the I-74 Mississippi River Bridge project in Bettendorf, Iowa. The waiver request is for procurement of foreign iron and steel components for construction of the two elevators, specifically including: (i) traction elevator components; (ii) elevator guide rails; and (iii) additional auxiliary components of the two elevators or let-down structures.

The two elevators are part of the approximately $1.2 billion I-74 Mississippi River Bridge reconstruction project. The elevators are needed to meet accessibility requirements under the Americans with Disabilities Act, 42 U.S.C. § 12101, et seq., for a new pedestrian bridge. The elevators also provide additional safety for pedestrians and bicyclists. The pedestrian bridge and elevators will provide links to both the Illinois and Iowa river trail network.

The Pedestrian Bridge and elevators are included under an approximately $2.2 million contract. The City originally estimated that the elevators would cost approximately $427,000. This contract is 100 percent funded by the City of Bettendorf, Iowa, with no Federal funding. However, the pedestrian bridge and structures connecting the bridge to the trail network were included under the final environmental impact statement and record for the overall I-74 Mississippi River Bridge project. Therefore, under 23 U.S.C. § 313(g), FHWA’s Buy America provision applies to the contract and letdown structure. All other contracts associated with the approximately $1.2 billion project are expected to comply with Buy America requirements.

Waiver request and subsequent communications with FHWA: The Iowa DOT originally submitted a Buy America waiver request letter to FHWA for certain components of the elevators in March 2020. Prior to requesting a waiver, the City of Bettendorf unsuccessfully attempted to identify domestic manufacturers for these products. The Iowa DOT reported to FHWA in the waiver request letter that the City contacted 11 U.S. elevator manufacturers, but none of them could produce elevators meeting the needs of the project using only U.S. steel. The March 2020 request letter sought a waiver for traction elevator components and elevator guide rails.

The elevators identified by Iowa DOT and the City as meeting the needs of the project are produced by KONE Oyj, a company with headquarters in Finland, but also with operations and facilities in the U.S. Iowa DOT identifies the elevators as two Monospace 500 model elevators with glass rear walls.

Consistent with Executive Order 13788, after receiving the waiver request, in April 2020 FHWA requested that the Iowa DOT and City of Bettendorf answer questions about their previous search for Buy America compliant products. FHWA also requested that they continue seeking to maximize the use of goods, products, and materials produced in the U.S. on the project. In response to this request and later follow-up questions from FHWA, the City of Bettendorf attempted over several additional months to identify domestic manufacturers that it had not identified in its original search, or, if full compliance was not possible, foreign manufacturers that could maximize use of domestic content by using greater quantities of U.S. steel. These additional search activities continued between April and August of 2020, but the City did not identify compliant products.

In August 2020, Iowa DOT responded to FHWA’s questions. It explained that none of the manufacturers Iowa DOT or the City of Bettendorf contacted could satisfy Buy America requirements. It also explained that none of the manufacturers could provide reliable certifications of domestic content percentages (to show maximization of domestic content). After completing its additional research, Iowa DOT expanded its waiver request to include certain additional components of the elevator letdown structures. Iowa DOT explained that it could not find a manufacturer to meet Buy America requirements for additional auxiliary “components [in the elevator letdown structures], such as mechanical air handling equipment.” The contacted manufactures explained that they were unable to verify origin of source of materials to satisfy FHWA’s Buy America requirements. Iowa DOT explained that these components are not frequently used in highway construction projects. Instead, they are predominantly used for commercial applications around the world in which material certifications and Buy America requirements are not applicable.

The August 2020 letter from Iowa also explained that KONE Oyj was asked to review the potential for assembling non-standard elevators that would have a greater domestic steel and iron content to meet Buy America requirements. KONE provided an alternative design, but could still neither meet the Buy America requirements nor guarantee or certify the precise amount of domestic content. Moreover, the alternative design provided by KONE would not meet project requirements in terms of size, capacity, or safety. Regarding safety, elevators designed with unique, customized parts would be more difficult to maintain, which could impact the safety and reliability of their operation.

Iowa DOT’s August 2020 letter also addressed alternative designs that were considered such as rack and pinion elevators. Iowa DOT explained that rack-and-pinion elevators, which are used primarily as freight elevators, were not suitable to the elevator’s intended purpose of passenger transport. Moreover, adding structural elements to the project design to support rack-and-pinion elevators could increase project costs by $2 million. It did not consider this cost increase feasible. An alternative design would also result in significant delays for the project. The I-74 Mississippi River Bridge is currently scheduled to open to Iowa-bound vehicle traffic by the end of 2020 and to Illinois-bound vehicle traffic before the end of 2021. Iowa DOT also reported that other alternative designs were considered, but also could not fully comply with Buy America requirements for all components and would result in significantly higher construction costs and lengthy project redesign. Thus, Iowa DOT did not find justification for pursuing the alternative designs.

Iowa DOT also explained the current fiscal situation in the City of Bettendorf in the August 2020 letter. It explained that COVID-19 has caused financial hardship for the City and that any additional costs associated with Buy America compliance, such as completely redesigning the elevators or adding structural components, would impact the city’s ability to complete the project and fund necessary services.

In October 2020, FHWA again contacted Iowa DOT with additional questions regarding its efforts to comply with Buy America and Executive Order 13788. FHWA also sought clarity on the scope of waiver the request. Later that month, Iowa DOT provided answers to FHWA’s questions with additional information on its compliance efforts and a cost estimate sheet identifying all items for which it seeks a waiver (Exhibit D). A link to Exhibit D is provided below. All items included in the waiver request are identified as not meeting Buy America in the first column of Exhibit D. The estimated total cost of the waiver items is approximately $768,000. FHWA removed the cost estimates for individual line items in Exhibit D to maintain the confidentiality of the City’s procurement-sensitive information during its solicitation process.

The FHWA seeks comments on whether a waiver of the Buy America requirements under 23 CFR § 635.410(b) should be granted to Iowa DOT and the City of Bettendorf for: (i) traction elevator components; (ii) elevator guide rails; and (iii) additional auxiliary components of the two elevators or let-down structures identified in Exhibit D. In addition to comments on the availability of compliant products, the FHWA seeks comments on whether the City of Bettendorf, given its circumstances, has taken sufficient actions to maximize its use of goods, products, and materials produced in the United States.

The FHWA will consider all comments received in the initial 15-day comment period during our evaluation of the waiver request. Comments received after this period, but before notice of our finding is published in the Federal Register, will be considered to the extent practicable. Follow-up coordination on the comments received may result in a delay in the publication of our waiver finding in the Federal Register. Comments received during the 5-day comment period after notice of our finding is published in the Federal Register will be reviewed, but the finding will continue to remain valid. Comments received during the comment period after the effective date of the finding may influence the FHWA’s decision to terminate or modify a finding.

The FHWA will consider all comments received in the initial 15-day comment period during our evaluation of the waiver request. Comments received after this period, but before notice of our finding is published in the Federal Register, will be considered to the extent practicable. Follow-up coordination on the comments received may result in a delay in the publication of our waiver finding in the Federal Register. Comments received during the 5-day comment period after notice of our finding is published in the Federal Register will be reviewed, but the finding will continue to remain valid. Comments received during the comment period after the effective date of the finding may influence the FHWA's decision to terminate or modify a finding.

Iowa DOT Contact: Iowa Department of Transportation, Danielle Alvarez, I-74 Project Manager, Iowa DOT District 6, 563-823-4373, Danielle.Alvarez@iowadot.us

Request Letter: Iowa DOT 3/20/2020 letter (.pdf. 0.1 mb)

Second request letter: Iowa DOT 8/10/2020 letter (.pdf. 0.1 mb)

Exhibit D 10/21/2020 (.pdf. 0.1 mb)

Federal Register / Vol. 86, No. 187

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