Notice of Buy America Waiver Request
Action: Notice, request for comments.
Web posting date: 12/18/2024
Federal Register Notice of Finding Publication Date: To be determined.
Effective Date of Federal Register: To be determined.
Close of public comment period : 5 days following the effective date.
Summary: The FHWA proposes to grant public interest waivers of FHWA's Buy America requirements to 16 projects for eligible vehicle and equipment related projects on two conditions. First, the vehicles, equipment, or modifications must be assembled in the United States. Second, FHWA proposes to grant the waiver on the condition that the country of origin of the engine or, in the case of electric vehicles, the motor, must be the United States.
Background:
FHWA’s Buy America requirements at 23 U.S.C. 313 and 23 CFR 635.410(b)(1) provide that all steel or iron materials that are permanently incorporated into a project must be domestically manufactured. FHWA applies these steel and iron requirements to all predominantly iron or steel components, regardless of the composition of the product in which the components are included. In other words, FHWA requires that all manufacturing processes of all predominantly steel or iron components occur domestically, even when those components are included in manufactured products 1. Furthermore, FHWA applies its Buy America requirements to all Federal-aid projects, even those that are not considered to be traditional highway construction projects, such as the procurement of vehicles. If the procurement of a vehicle is the project itself, it is longstanding FHWA policy to consider that vehicle inherently permanently incorporated into the project; therefore, pursuant to FHWA’s Buy America requirements, all steel or iron materials included in these vehicles, including all predominantly steel or iron components, must be domestically manufactured.
Since the enactment of FHWA’s Buy America requirements and FHWA’s issuance of its implementing regulations, Congress has authorized various programs providing limited eligibility for the procurement of vehicles or equipment under the Federal-aid highway program, including under the Congestion Mitigation and Air Quality Improvement Program (CMAQ), Carbon Reduction Program (CRP), and Rebuilding American Infrastructure with Sustainability and Equity (RAISE) program.
Thirteen different entities have requested a Buy America waiver to allow for the procurement of vehicles or equipment for 16 different projects under these funding programs. The vehicle and equipment projects subject to this proposed waiver (including the State in which the project is located, the State Transportation Improvement Program project number, and the descriptions and quantities of vehicles sought) can be viewed in the attached spreadsheet.
In today’s global vehicle manufacturing industry, vehicle components are typically obtained from suppliers all over the world. Given the number of components and small subcomponents in vehicles, entities including recipients, have found it is not practical for domestic or foreign vehicle manufacturers to certify that the vehicles the requesters are seeking to procure meet FHWA’s Buy America requirements. Doing so would require the vehicle manufacturers to track the origin of all iron and steel components, of whatever size, in their vehicles 2. In addition, to manufacture FHWA Buy America-compliant vehicles, manufacturers using any foreign iron or steel components would need to alter their sources of iron and steel components to ensure that those materials come from domestic sources. Waiver requesters conducted an independent search for Buy America-compliant vehicles and equipment by contacting multiple manufacturers. There were no manufacturers who were able to provide Buy America-compliant vehicles and equipment. In addition, FHWA has reviewed the AALA lists and concluded that none of the vehicles listed meet FHWA’s unique Buy America requirements. Beyond these efforts, FHWA further believes that no manufacturer is able to certify that their vehicles and equipment are compliant with FHWA’s unique Buy America requirements.
The FHWA does not believe that manufacturers currently track such compliance by analyzing the origin of every iron or steel component, nor is the FHWA funded share of the vehicle and equipment market large enough to incentivize them to do so. Thus, because, at best, compliance with Buy America requirements will be unknown, the requesters will not be able to receive certifications that the vehicles and equipment they are seeking to procure are compliant with FHWA’s Buy America requirements and therefore are unable to procure such eligible vehicles and equipment using FHWA financial assistance.
The FHWA believes that preventing the procurement of eligible vehicles and equipment for these reasons is not in the public interest. Such a result would prevent the requesters from using CMAQ, CRP, and RAISE funds to procure vehicles and equipment to achieve the objectives of these funding programs, such as meeting the requirements of the Clean Air Act and reducing congestion and improve air quality for areas that do not meet the National Ambient Air Quality Standards for ozone, carbon monoxide, or particulate matter (nonattainment areas) and for former nonattainment areas that are now in compliance; reducing transportation emissions; improving safety, environmental sustainability, the quality of life of rural areas or urbanized areas; increasing economic competitiveness and opportunity; contributing to a state of good repair; and improving mobility and community connectivity. The wholesale application of Buy America requirements on the requesters’ projects would hinder these goals without providing any benefit in terms of maximizing the use of goods, products, and materials produced in the United States.
Under 23 U.S.C. 313(b)(1) and 23 CFR 635.410(c)(1)(i), FHWA may waive the application of its Buy America requirement for steel and iron when the application of those requirements would be inconsistent with the public interest. For the reasons stated above, FHWA does not believe that preventing the procurement of eligible vehicles and equipment and the achievement of important project goals is in the public interest.
Accordingly, FHWA proposes a waiver of its Buy America requirements for the procurement of vehicles and equipment in 16 projects. The vehicles and equipment include electric sedans, pickups, SUVs, trucks, and equipment, including Tier4 Cargo front-end loaders, street sweepers, mowers, trail maintenance equipment, and low emission locomotives. More information on the vehicles, equipment, and project can be found in the attached spreadsheet.
At the same time, while FHWA is proposing to generally waive FHWA’s Buy America requirements, FHWA is proposing to structure this waiver to ensure the utilization of goods, products, and materials produced in the United States to the greatest extent possible. To that end, FHWA is proposing that vehicles and equipment be covered under this waiver only if they meet two conditions, as applicable. First, the vehicles, equipment, or modifications must be assembled in the United States. For vehicles reported to the National Highway Traffic Safety Administration (NHTSA) under the American Automobile Labelling Act (AALA), FHWA proposes to determine whether the vehicle is assembled in the United States through the country of origin reported to NHTSA under the AALA. Second, FHWA proposes to grant the waiver on the condition that the country of origin of the engine or, in the case of electric vehicles, the motor, must be the United States, as reported to NHTSA under the AALA. Where information on the location of assembly and the location of the country of origin of the engine or motor is not reported to NHTSA under the AALA, FHWA still expects recipients to demonstrate compliance with these conditions. To meet these conditions outside of relying on information reported to NHTSA under the AALA, recipients must provide documentation that the vehicles, equipment, or modifications are assembled in the United States and that the country of origin of the engine or motor is the United States. In terms of determining the country of origin of the engine or motor where such information is not reported to NHTSA under the AALA, recipients may use the same methodology to determine the country of origin as called for by NHTSA for the purpose of reporting under the AALA. See 49 CFR 583.8. This will enable recipients and subrecipients of FHWA financial assistance the ability to use this financial assistance on eligible projects so long as the vehicles and equipment are assembled in the United States.
This proposed waiver is further limited to only to the vehicles and equipment meeting the above two conditions, as applicable, that are identified in the attached spreadsheet. This proposed waiver would be limited to purchases of the vehicle and equipment by the applicable entity listed in the attached spreadsheet, their contractors, or subcontractors (of whatever tier) for the specific projects described in the attached spreadsheet. This proposed waiver would not apply to purchases made for any other products or projects. This proposed waiver would be effective from the effective date of the final waiver through the period of performance and closeout of FHWA’s financial assistance for each project.
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.
Vehicles & equipment spreadsheet
1 FHWA does not currently apply a Buy America requirement to manufactured products themselves. While 23 U.S.C. 313 requires that all manufactured products used in FHWA-funded projects must be produced in the United States, FHWA has waived this requirement. See 48 FR 1946 (Jan. 17, 1983); 48 FR 53099 (Nov. 25, 1983). In other words, 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.
2 Under regulations promulgated by NHTSA, manufacturers of new passenger motor vehicles must report the overall percentage, by value, of the passenger motor vehicle equipment installed on vehicles that originated in the United States and/or Canada (49 CFR 583.5(a)(2)). Equipment that originated in Canada, however, would not be compliant with FHWA’s Buy America requirements. In addition, NHTSA determines whether equipment is considered to be U.S./Canadian in a way that is different from FHWA’s requirement that all manufacturing processes of the iron or steel occur in the United States.
Comments
| Jacqueline A. Terrill 12/18/2024 |
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Good afternoon and thank you for your interest in what I have to say.
In 2019, the Village of Marcellus was in line for a CMAQ grant that would have covered about 1/2 the cost for a much-needed plow truck. IF the Buy America waiver had been granted, the Village would not have been forced to pay cash, approximately 1/2 of its annual property tax revenues, for that plow truck. The Village had to forgo its claim to CMAQ funds so that they could be used elsewhere.
I pleaded with my Congressman and with the Federal Highway Administration to do something to help but nothing came of it. The waiver was denied.
Again, I appreciate efforts to ensure projects maximize use of goods, products and materials that are produced in the United States. When they just are not available, these types of decisions have devastating effects on small Villages like ours.
Please notice and support Villages like mine.
Thank you, Jacqueline Terrill, Village of Marcellus Manager/Clerk
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| Rocky Wallace 12/18/2024 |
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I am in full support of a CMAC waiver for vehicle and equipment purchases. I would like to suggest that a national waiver be authorized for any CMAC funded vehicle purchase be set at $750,000.00 per vehicle. This would allow jurisdictions the ability to purchase multiple units and it be based on a per vehicle basis and not a total dollar amount.
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| Michael Clark 12/19/2024 |
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I am writing to you from the Village of Marcellus. It is my understanding that the Buy America requirements are nearly impossible to meet due to the lack of parts made in America. As a small community, this puts a financial burden on small communities to attain the National Ambient Air Quality Standards. I understand that you want to keep American businesses going, but there needs to be some sort of compromise on the Buy America part.
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| Alleyn Harned 12/19/2024 |
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U.S. Department of Transportatoin should grant all of these waivers -these products do not have an American steel certification tool in the United States. These states have professional staff identifying American equipment to the greatest extent practical, and should be granted a go-ahead for clean air products listed on the waiver request.
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| Garry Shinn 12/20/2024 |
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This is a great idea. The problem I see with this is on the 2nd requirement. With the engine being composed of countless parts and these parts being manufactured all accross the world, I have a hard time seeing any engine being composed of all components from a single country.
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| Jamie West 12/20/2024 |
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Qualifying purchases are not feasible for smaller communities and jurisdictions without the ability to utilize CMAQ and CRP to supplement the costs. With said funds, the cost of qualifying items that strictly comply with the Buy America requirements are still in excess of such budgets. This waiver allows for better variety and attainability while still adhering to the major principles for which the Buy America requirements were adopted. I would support that FHWA approves such waivers as outlined in this notice.
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| Amy G Regimbal 12/26/2024 |
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A Build America, Buy America (BABA) waiver can be beneficial for purchasing electric vehicles (EVs) for several reasons:
1. Accelerated Implementation: A waiver allows for the immediate acquisition of EVs and, without waiting for domestic production to catch up with demand. This can speed up the deployment of EVs and support the transition to cleaner transportation more quickly.
2. Encouragement of Domestic Production: By providing a temporary waiver, the government can incentivize domestic manufacturers to ramp up production and meet the demand for EVs. This helps build a robust domestic supply chain and creates jobs in the manufacturing sector.
3. Cost Management: Waivers can help manage costs by allowing the use of more affordable components that may not be available domestically yet. This can make the transition to EVs more financially feasible for government agencies and other entities.
4. Flexibility: A waiver provides flexibility in meeting the BABA requirements, allowing for a phased approach where domestic content requirements are gradually increased over time. This ensures that the transition to fully compliant EVs can happen in a manageable way.
Overall, a BABA waiver can help balance the need for immediate action on climate goals with the long-term objective of strengthening domestic manufacturing capabilities.
The Oregon DOT supports a BABA waiver for EVs to help us meet a state mandate to transition to EVs.
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| Art Logan 01/02/2025 |
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The Elgin Whirlwind will not meet the new guidelines for Buy America Build America because the auxiliary engine used to power the sweeper is mfg in Mexico. Can this be changed to allow the Elgin Whirlwind to comply?
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| Brian Hensel 01/02/2025 |
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After speaking with sweeper manufacturers sales representatives, the common issue seems to be with auxiliary diesel engines being assemble outside the US. Please remove this requirement.
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