Four leading construction industry groups, unhappy with the White House Office of Management and Budget's implementation of federal Buy America requirements, are calling for a major shift in the administering of the rules. The coalition would prefer that OMB focus on general domestic-preference policy, with infrastructure funding agencies such as the U.S. Dept. of Transportation taking the lead on program specifics.
Buy America's reach expanded greatly under the 2021 Infrastructure Investment and Jobs Act (IIJA). The $1.2-trillion infrastructure law includes the Build America, Buy America Act (BABAA), which outlines the federal domestic preference requirements.
In a Feb. 15 petition to OMB Director Shalanda D. Young, the Associated General Contractors of America, American Road & Transportation Builders Association, American Public Transportation Association and National Association of Home Builders say they fully support the IIJA’s goal of bolstering U.S.-based manufacturing. But they add, “Unfortunately, OMB’s focus on managing virtually every aspect of the Build America, Buy America Act requirements is not practical and causes confusion and delay with federal agencies that fund construction projects.”
The groups say that their members "have encountered significant difficulty in navigating an opaque and unbalanced implementation of BABAA" by OMB and its Made in America Office.
Bigger Role Sought for Other Agencies
The industry associations want to see OMB concentrate on broader policy issues, with more authority over the program's nuts and bolts going to other federal agencies more familiar with infrastructure projects.
“Because each agency’s infrastructure construction stakeholders must account for unique inflationary, supply chain and related dynamics, OMB should focus on implementing BABAA at a generalized level of policy and empower federal agencies with broad discretion to fill in the details," say the groups.
A particular focus of the coalition is the Made in America Office's process for evaluating proposed waivers from the Buy American requirements. The associations say the process often is long and unpredictable. They cite an Illinois Dept. of Transportation May 21, 2021, waiver request to OMB that was not posted for public comment until Aug. 28, 2023.
“OMB needs to change course and foster a deliberative, data-driven implementation process that not only prioritizes domestic manufacturing but also provides adequate consideration for the timely and successful delivery of essential infrastructure projects," the coalition says. "Failure to act will result in the IIJA’s inability to fulfill its infrastructure promise to the American people.”
In their petition to Young, the associations say that the construction materials market is still adjusting to meet BABAA requirements, as the industry seeks to deliver an increased volume of IIJA-funded projects. "Amidst these historic challenges, we have encountered significant difficulty in navigating an opaque and unbalanced implementation of BABAA " by OMB, says the coalition. This would result in more pared down, delayed and costlier infrastructure projects, it asserts.
An OMB spokesperson did not immediately respond to an ENR request for comment.
In their petition, the associations request that OMB issue new BABAA implementation guidance and that it also review information that other federal agencies collected for Buy America waivers. The groups say those information collections do not comply with the Paperwork Reduction Act.
Federal domestic preference requirements have existed for decades, notably for steel. But Buy America's importance increased under the IIJA.
For one thing, the infrastructure act's funding for projects rose sharply from earlier levels. In addition, the statute added construction materials to the types of products subject to the requirements. Moreover, the law expanded its application beyond IIJA-funded projects to those funded by other legislation, such as appropriations bills.
House Panel Also Airs Buy America Issues
Buy America programs, and waivers, also were the focus of a House highways and transit subcommittee hearing on Feb. 15.
"State DOTs have recognized since 'day one' of the IIJA that the delivery of this historic investment is paramount," said Carlos Braceras, executive director of the Utah DOT. "American money should be spent on American stuff."
Braceras, who was testifying for the American Association of State Highway and Transportation Officials, said that state DOTs have experienced delays on IIJA-supported projects for several reasons, including the availability of materials and worker shortages. But he added that "we're seeing further delays as part of the industry efforts to comply with BABAA."
Braceras said that many states would like to see improvements in the Buy America waiver process, including shortening the time it takes to process applications.
"Historically, the waiver process has not been transparent or efficient," said Ty Edmondson, CEO of T.A. Loving Co., a Goldsboro, N.C.-based contractor. Edmondson, who was testifying on behalf of AGC of America, also cited the Illinois DOT waiver case, and said it was "not an isolated example." He said the current BABAA process leads to "unintended consequences, such as project delays, material substitutions, project redesigns or contractors opting not to bid on a project."
