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Buy America Requirements for Federal Highway Projects (2020)

Chapter: III. APPLICATION TO MANUFACTURED PRODUCTS

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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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Suggested Citation:"III. APPLICATION TO MANUFACTURED PRODUCTS." National Academies of Sciences, Engineering, and Medicine. 2020. Buy America Requirements for Federal Highway Projects. Washington, DC: The National Academies Press. doi: 10.17226/25799.
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NCHRP LRD 80 13 without notice and opportunity for public comment.130 The U.S. District Court for the District of Columbia concluded that the emergency regulation had been validly issued, because the FHWA Buy America provision (which had been enacted eleven days earlier) was effective immediately and would have prohib- ited the commitment of FHWA funds in some cases.131 FHWA “promulgated regulations to enforce the new provision in order expeditiously to bring federal highway assistance programs in line with Congress’ mandate.”132 However, the court also con- cluded that FHWA was required to enforce and implement the FHWA Buy America provision passed by Congress, and “can- not be allowed to continue to rely indefinitely on an emergency which at this date is almost two years old.”133 The court ordered FHWA “to cease enforcing the emergency regulations and to issue valid regulations instead” by November 1980 (two years after the date of the emergency regulation).134 In November 1980, in response to the Valiant Steel rul- ing, FHWA proposed new regulations in the Federal Register, proposing to expand application of the FHWA Buy America provision beyond just structural steel.135 Under the proposed approach, manufactured products other than construction materials (i.e., “equipment”) purchased with FHWA funds would be required to comply with the Buy America regulations promulgated by the Urban Mass Transportation Administration (UMTA),136 which at the time provided that a manufactured product was considered domestic as long as the cost of its do- mestic components was at least 50 percent of the total cost of all components of the manufactured product, and final assembly of the components into the manufactured product took place in the United States.137 However, these regulations proposed by FHWA in 1980 were never formally adopted, and the 1978 emergency regulation remained in place. In January 1983, Congress significantly revised the FHWA Buy America provision, expressly requiring all “steel, cement, and manufactured products used” on FHWA-funded contracts to be manufactured in the United States.138 Once again, eleven days after the enactment of the revised FHWA Buy America provision, FHWA issued another emergency regulation, grant- ing a Public Interest waiver for all manufactured products 130 Id. at 411. 131 Id. at 412. 132 Id. 133 Id. at 413. 134 Id. at 414-15. 135 Buy America Requirements: Proposed Revisions, 45 Fed. Reg. 77,455 (Nov. 24, 1980). 136 Id. (“Contracts for projects concerning equipment and ferry boats would follow 49 CFR 660, the Buy America requirements issued by the Urban Mass Transportation Administration in December 1978.”). 137 Buy America Requirements, 43 Fed. Reg. 57,144, 57,146 (Dec. 6, 1978) (codified at 49 C.F.R. § 660.22 (1981)). 138 Surface Transportation Assistance Act of 1982, Pub. L. No. 97-424, § 165(a), 96 Stat. 2097, 2136 (Jan. 6, 1983). proposed waiver be expanded to expressly cover “miscellaneous” steel or iron products such as nuts, bolts, washers, and screws. Ultimately, the nationwide waiver for COTS products was not granted, due in part to the Executive Order issued in April 2017 ordering federal agencies to “minimize the use of waivers” from Buy America requirements and “to maximize, consistent with law, through terms and conditions of Federal financial as- sistance awards and Federal procurements, the use of goods, products, and materials produced in the United States.”126 Ac- cordingly, in light of the United Steel ruling, there is presently no exemption for miscellaneous steel or iron products and no immediate plans to implement such an exemption. Therefore, miscellaneous steel or iron products such as bolts, nuts, washers, and screws purchased by state transportation agency construc- tion contractors for use on FHWA-funded projects must com- ply with the FHWA Buy America provision, meaning that they must either be manufactured in the United States or else the total cost of all such foreign items must satisfy the Minimal Use exception. III. APPLICATION TO MANUFACTURED PRODUCTS A. Manufactured Products Waiver As long as the FHWA Buy America provision has been in existence in its various incarnations, FHWA has waived its ap- plication to “manufactured products.” The original FHWA Buy America provision, enacted on November 6, 1978, required that only domestic materials and manufactured products (i.e., prod- ucts “manufactured in the United States substantially all from articles, materials, and supplies mined, produced, or manu- factured, as the case may be, in the United States”) be used on FHWA-funded contracts.127 Just eleven days later, on November 17, 1978, FHWA issued an “emergency regulation,” granting a Public Interest waiver from the FHWA Buy America provision for all “products and materials, other than structural steel, used in highway construction.”128 By limiting the FHWA Buy Amer- ica provision only to structural steel, the 1978 emergency regu- lation waived its application to a broad range of construction materials as well as manufactured products such as mechanical and electrical equipment. In Valiant Steel and Equipment, Inc. v. Goldschmidt,129 the 1978 emergency regulation was challenged for being issued small miscellaneous hardware such as fasteners, washers, nuts, bolts and screws less than ¾ [inch] in diameter, etc.”), available at https:// www.regulations.gov/document?D=FHWA-2016-0028-0063. 126 Presidential Executive Order on Buy American and Hire Ameri- can (Apr. 18, 2017), Exec. Order No. 13788, 82 Fed. Reg. 18,837 (Apr. 21, 2017), available at https://www.whitehouse.gov/presidential-actions/ presidential-executive-order-buy-american-hire-american/. 127 Surface Transportation Assistance Act of 1978, Pub. L. No. 95-599, § 401, 92 Stat. 2689 (Nov. 6, 1978). 128 Buy American Requirements, 43 Fed. Reg. 53,717 (Nov. 17, 1978). 129 499 F. Supp. 410 (D.D.C. 1980).

14 NCHRP LRD 80 to trace.”149 Accordingly, in the 1983 final rule, FHWA issued a Public Interest waiver from the FHWA Buy America provi- sion for all “manufactured products other than steel and cement manufactured products.”150 This November 1983 Manufactured Products waiver has never been rescinded and remains in ef- fect today, although there have been some substantive changes in the FHWA Buy America provision since then. For example, the FHWA Buy America provision has not applied to cement since 1984,151 and has applied to iron since 1991.152 Therefore, the Manufactured Products waiver has long been construed to exempt all manufactured products except for predominantly steel or iron products from the FHWA Buy America require- ments.153 The Manufactured Products waiver allows FHWA grant recipients and their contractors to purchase a broad range of manufactured products (such as mechanical and electrical equipment) without regard to the country of origin. In 2013, FHWA published a notice in the Federal Register, requesting public comments on the continued need for the Manufactured Products waiver.154 In the notice, FHWA again cited “difficulties in tracing the origin of all items used to man- ufacture these products.”155 “In general, traffic controllers and traffic management hardware and equipment are examples of manufactured products that are composed of multiple com- ponents and subcomponents whose origins are difficult, if not impossible to trace.”156 FHWA specifically requested comment as to whether “FHWA needs to reconsider its criteria for apply- ing Buy America requirements to manufactured products,” and whether there were “specific or general types of manufactured products” to which the Manufactured Products waiver should (or should not) apply.157 More than seventy-five responses were received (including responses from sixteen state transportation agencies), and the responses generally indicated support for the Manufactured Products waiver, and no significant opposition to it. Many of the responses indicated that, if anything, it would be even more impracticable today to apply the FHWA Buy America provision to manufactured products than it would have been in 1983 when the Manufactured Products waiver was issued. AASHTO commented, “with the globalization of manu- 149 Id. at 53,102. 150 Id. 151 National System of Interstate and Defense Highways, appor- tioned funds, Pub. L. No. 98-229, § 10, 98 Stat. 55, 57 (1984). 152 ISTEA § 1048. 153 See, e.g., Memorandum from Donald P. Steinke, FHWA Chief of Highway Operations, to Edward V.A. Kussy, FHWA Chief Counsel, Re: Buy America Policy Response (Dec. 22, 1997) (“While FHWA does not apply Buy America requirements to ‘manufactured products,’ we do apply the requirements to specific components within those products. . . . FHWA policy has been that the steel components of a predominately steel product must be of domestic manufacture . . ..”), available at http:// www.fhwa.dot.gov/programadmin/contracts/122297.cfm. 154 Buy America Policy, 78 Fed. Reg. 41,492 (July 10, 2013). 155 Id. at 41,494. 156 Id. 157 Id. at 41,495. other than steel and cement.139 The 1983 decision to “tempo- rarily” waive application of the FWHA Buy America provision to manufactured products was “based on the fact that sufficient information is not yet available in order to adequately assess the impacts of applying Buy America provisions to all manufac- tured products.”140 The emergency regulation was originally set to expire on September 30, 1983.141 including the necessity of tracing the source of all components of the manufactured prod- ucts. However, FHWA issued another emergency regulation on September 30, 1983, extending the “temporary” Manufactured Products waiver until “the final rule becomes effective.”142 In November 1983, FHWA published a final rule in the Federal Register, permanently adopting the Manufactured Products waiver.143 In the final rule, FHWA noted that it had received more than 560 comments in response to the January 1983 emergency regulation, including comments from product manufacturers, state transportation agencies, and members of Congress.144 “Most responses from product manufacturers rec- ommended that manufactured products should be excluded from Buy America and/or expressed only a passing interest in the regulation.”145 Furthermore, “several State highway agen- cies were opposed” to applying the FHWA Buy America pro- vision to manufactured products, due to “administrative diffi- culties” such as determining the source of the components of a manufactured product.146 “Several commenters noted that it is virtually impossible for a contracting agency to trace all com- ponents of some manufactured products incorporated into highway products; e.g.; signal controllers, glass for the signal heads, almost all electrical equipment, paints, and asphalt.”147 Some state transportation agencies indicated that it would not be practicable to apply the FHWA Buy America provision to such products, unless manufactured products were defined to be domestic where “the final manufacturing process which produces a usable product”148 is located in the United States, without regard to the country of origin of the components of the product. FHWA agreed “with the commenters who noted that it is very difficult to identify the various materials and then trace their origin. A manufactured product such as a traffic controller which has many components is particularly difficult 139 Contract Procedures—Buy America Requirements, 48 Fed. Reg. 1,946 (Jan. 17, 1983). 140 Id. 141 Id. 142 Contracts Procedures; Buy America Requirements; Extension of Interim Final Rule As Amended, 48 Fed. Reg. 44,776 (Sept. 30, 1983). 143 Buy America Requirements, 48 Fed. Reg. 53,099 (Nov. 25, 1983) (“The waiver exempting manufactured products other than steel and cement contained in the January 17, 1983, interim final rule is retained.”). 144 Id. at 53,100. 145 Id. at 53,101. 146 Id. 147 Id. 148 Id.

NCHRP LRD 80 15 exclusion for “programs providing Federal financial assistance that are subject to comparable domestic preferences.”163 Argu- ably, the FHWA Buy America provision constitutes a “compa- rable domestic preference” so that the 2019 Executive Order does not apply to projects subject to the FHWA Buy America provision. However, it is questionable whether the domestic preferences in the FHWA Buy America provision are truly com- parable to the January 2019 Executive Order, since domestic content requirements for manufactured products are waived under the former but are maximized under the latter. It remains to be seen how the January 2019 Executive Order will impact the use of manufactured products on FHWA-funded infrastruc- ture projects. B. Steel or Iron Components of Manufactured Products Despite the aforementioned Manufactured Products waiver, FHWA has long taken the position that steel or iron compo- nents and subcomponents of manufactured products must be domestic.164 For example, a 1997 FHWA memorandum stated, “While FHWA does not apply Buy America requirements to ‘manufactured products,’ we do apply the requirements to spe- cific components within those products. . . . If the foreign source components are ferrous, their use must be based on the minimal use threshold.”165 Although the 1997 FHWA memo stated that the FHWA Buy America provision applied to ferrous compo- nents of manufactured products, it also stated, “FHWA policy has been that the steel components of a predominately steel product must be of domestic manufacture unless the value of the components is less than the minimal use threshold”166 for the project. This sentence may have suggested, but did not ex- pressly state, that the FHWA Buy America provision does not apply to all steel or iron components of manufactured products that are not predominantly steel or iron. However, for many years after the 1997 FHWA memo, sub- sequent FHWA guidance continued to indicate that the FHWA Buy America provision applies to all steel or iron components of all manufactured products,167 not just to components of pre- 163 Id. § 2. (e)(ii). 164 United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int’l Union v. Fed. Highway Admin., 151 F. Supp. 3d 76, 81 (D.D.C. 2015) (“Various guidances issued by the FHWA since the 1983 Regulations have confirmed the applicability of Buy America to all steel components and subcomponents, regardless of their form and the extent to which they comprise a particular product.”). 165 Memorandum from Donald P. Steinke, FHWA Chief of High- way Operations, to Edward V.A. Kussy, FHWA Chief Counsel, Re: Buy America Policy Response (Dec. 22, 1997), available at http://www.fhwa. dot.gov/programadmin/contracts/122297.cfm. 166 Id. 167 See, e.g., FHWA, Buy America Q&A for Federal-aid Program (Dec. 12, 2013), http://www.fhwa.dot.gov/construction/contracts/ buyam_qa.cfm (“Buy America requirements apply to any steel or iron component of a manufactured product regardless of the overall compo- sition of the manufactured product . . ..”). facturing, as well as the increasing technological sophistica- tion of many manufactured products, it has become even more difficult to trace the origin of each individual component of a product.”158 Citing “the increased globalization of production of manufactured products,” UDOT commented, The amount of effort required to identify the origin and verify the entire manufacturing process of hundreds of different components in numerous manufactured products is not cost effective, has negligible effect on domestic steel production, and is not in the public interest. In many cases details about the production and handling chain are not completely available.”159 VDOT commented, “The time and money spent tracking down manufactured products to satisfy the Buy America pol- icy will result in higher costs to the program and project.  .  . . It is very difficult to trace the origin of many components and sub-components”160 of manufactured products such as movable bridges and backup generators. The American Public Transpor- tation Association commented, A requirement to track, at some level of detail, the US sourced por- tion of these expenditures would necessitate the expenditure of pre- cious resources at each level to track, check, and ensure the level of US content. This diversion of resources would doubtlessly increase project costs without necessarily creating US jobs.161 The only significant controversies or disagreements regard- ing the Manufactured Products waiver, identified as a result of the 2013 notice and comments, involved whether the FHWA Buy America provision applied to steel or iron components of manufactured products, as discussed in Section III.B, or how to define a “predominantly steel or iron” manufactured product to which the FHWA Buy America provision does not apply, dis- cussed in Section III.C. An Executive Order issued in January 2019 would require federal agencies to “maximize” the use of “manufactured products produced in the United States” (specifically includ- ing cement) in federally assisted contracts for “infrastructure projects” (which expressly includes projects to improve “sur- face transportation, including roadways, bridges, railroads, and transit”).162 At first glance, the FHWA Manufactured Products waiver appears to conflict with the January 2019 Executive Order. However, the January 2019 Executive Order contains an 158 AASHTO, Comments, Docket No. FHWA-2013-0041 (Sept. 6, 2013), available at https://www.regulations.gov/document?D=FHWA- 2013-0041-0055. 159 UDOT, Comments, Docket No. FHWA-2013-0041 (Aug.  8, 2013), available at https://www.regulations.gov/document?D=FHWA- 2013-0041-0020. 160 VDOT, Comments, Docket No. FHWA-2013-0041 (Aug.  29, 2013), available at https://www.regulations.gov/document?D=FHWA- 2013-0041-0067. 161 American Public Transportation Association, Comments, Docket No. FHWA-2013-0041 (Sept. 6, 2013), available at https://www. regulations.gov/document?D=FHWA-2013-0041-0044. 162 Executive Order on Strengthening BuyAmerican Preferences for Infrastructure Projects (Jan. 31, 2019), Exec. Order No 13858, 84 Fed. Reg. 2039 (Feb. 5, 2019), available at https://www.whitehouse.gov/ presidential-actions/executive-order-strengthening-buy-american- preferences-infrastructure-projects/.

16 NCHRP LRD 80 However, as discussed in Section II.C, FHWA reversed course in a December 2012 memorandum, in which FHWA undertook to specifically address whether “nuts, bolts, washers, and other miscellaneous steel or iron parts used in common off-the-shelf products such as toilets and the filaments in light bulbs must be Buy America compliant.”175 In the 2012 FHWA memo, FHWA expressed concern that the FHWA Buy America provision was being applied to steel and iron components of manufactured products. According to the 2012 FHWA memo, this was “inconsistent” with the 1983 Manufactured Products waiver and was “not cost-effective to administer.”176 The 2012 FHWA memo stated that “some States have subjected signal heads and other traffic control equipment to Buy America,” as a specific example of such an “inconsistent” practice (despite the fact that 2006 FHWA guidance specifically identified traf- fic signal heads as components that were subject to the FHWA Buy America provision). Reexamining the 1983 Manufactured Products waiver, in conjunction with the 1997 FHWA memo, FHWA determined that the Manufactured Products waiver “was intended to encompass miscellaneous steel or iron com- ponents or subcomponents”177 of manufactured products. The 2012 FHWA memo concluded that the waiver was intended to exempt all steel and iron components and subcomponents of manufactured products, except in the case of products “manu- factured predominantly of steel or iron,”178 a conclusion sug- gested by the 1997 FHWA memo. Certain portions of the 2012 FHWA memo were invalidated in the December 2015 United Steel ruling,179 causing FHWA to cancel the 2012 FHWA memo. The United Steel court deter- mined that the 2012 FHWA memo improperly granted a waiver for direct or standalone purchases of miscellaneous steel or iron items,180 discussed in Section II.C. Also, the United Steel court determined that the 2012 FHWA memo improperly established a quantitative threshold for predominantly steel products.181 However, the United Steel court did not expressly disturb the 2012 FHWA memo’s primary conclusion that the Manufactured Products waiver covers all steel and iron components and sub- components of manufactured products that are not predomi- nantly steel or iron products (despite decades of prior FHWA ance (Aug. 2012), available at https://www.fhwa.dot.gov/federal- aidessentials/companionresources/28buyamerica.pdf. 175 Memorandum from John R. Baxter, FHWA Associate Adminis- trator for Infrastructure, to FHWA Division Administrators et al. (Dec. 21, 2012) (canceled), available at http://www.fhwa.dot.gov/ construction/ contracts/121221.cfm. 176 Id. 177 Id. 178 Id. (“The miscellaneous steel or iron components . . . [of] manu- factured products that are not predominantly steel or iron[] are not sub- ject to Buy America coverage.”). 179 United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int’l Union v. Fed. Highway Admin., 151 F. Supp. 3d 76 (D.D.C. 2015). 180 Id. at 93-94. 181 Id. at 90. dominantly steel or iron manufactured products. For example, 2002 FHWA guidance stated, “All steel and iron materials are covered by Buy America regardless of the percentage they comprise in a manufactured product or form they take.”168 The 2002 guidance further provided, “A product containing both steel and/or iron components and other components, may be assembled outside the United States and meet Buy America requirements if the constituent steel and iron components (in excess of the minimal amounts permitted) were manufactured domestically and are not modified at the assembly location prior to final assembly.”169 Likewise, 2006 FHWA guidance provided, “All foreign steel and iron materials and products are covered by Buy America regardless of the percentage they comprise in a manufactured product or the form they may take.”170 The 2006 guidance also stated that the FHWA Buy America provision ap- plied to steel or iron products that were “incorporated as a com- ponent of a more complex product through a further manufac- turing process (e.g., the case for a traffic signal head),” unless the cost of all such “foreign source” products and components used in the project fell within the threshold of the Minimal Use exception.171 In August 2012, FHWA was formally delegated responsibil- ity for “[m]aximizing the positive impacts on the U.S. economy by encouraging domestic manufacturing on highway projects through the enforcement of Buy America provisions.”172 Mate- rials published by FHWA as recently as August 2012 reiterated FWHA’s longstanding interpretation that the “Buy America pro- visions require that iron and steel components in pre-assembled manufactured products must also conform to the regulation”:173 The Buy America provisions specifically address pre-assembled manufactured products that contain steel or iron components. Your contractor should identify steel or iron components of any pre-as- sembled, manufactured product. When this is the case, the company who completed the assembly should provide the appropriate certifi- cation statement of conformance with the Buy America regulation. You need to track the value of those components in contract admin- istration records if certification statements are not provided to avoid exceeding the minimum use threshold.174 168 FHWA, Buy America Application to Federal-aid Highway Con- struction Projects (July 29, 2002), http://www.fhwa.dot.gov/programa- dmin/contracts/buyamgen.cfm. This 2002 guidance to FHWA field offices was cancelled in February 2015, while the United Steel litigation was pending. 169 Id. (emphasis in original). 170 FHWA, Contract Administration Core Curriculum Par- ticipant’s Manual and Reference Guide at 58 (2006), available at https://web.archive.org/web/20120926183012/http://www.fhwa.dot. gov/programadmin/contracts/cacc.pdf. 171 Id. 172 49 C.F.R. §  1.84(k) (2018); Organization and Delegation of Powers and Duties, 77 Fed. Reg. 49,964, 49,981 (Aug. 17, 2012). 173 FHWA, Project Development, Contract Specifications: Buy America Contract Requirements (Aug. 2012), available at https://www.fhwa.dot.gov/federal-aidessentials/companionresources/ 27buyamerica.pdf. 174 FHWA, Project Construction and Contract Adminis- tration, Contract Administration: Buy America Field Compli-

NCHRP LRD 80 17 from 29 state transportation agencies186). While the comments generally indicated support for clarifying the Manufactured Products waiver and eliminating the need to determine the cost and country of origin of all of the steel or iron components and subcomponents of manufactured products, the responses also revealed that the proposed definition of a COTS product would introduce additional confusion. Some state transporta- tion agencies requested sub-definitions of some of the phrases (such as “manufactured product”187 and “available and sold to the public”188) incorporated into the lengthy definition of COTS products. Some state transportation agencies identified additional predominantly steel or iron construction materials (such as steel or iron conduit and bridge drains189) that did not fall neatly into any of the eleven specific categories of products excluded from the COTS product waiver, raising the question whether the waiver would apply to those products or whether the list of eleven categories needed to be expanded. Some state transportation agencies requested that the COTS product defi- nition be expanded to include a list of specific COTS products covered by the waiver190 (similar to the list of 11 specific catego- ries excluded from the waiver). Likewise, a number of manu- facturing industry representatives requested clarifications to the COTS product definition, generally requesting that specific products either be added to the list of 11 excluded categories,191 or that specific products be added to a list of COTS products expressly covered by the waiver.192 Ultimately, FHWA took no action on the proposed waiver for COTS products, due in part to the Executive Order issued in April 2017 ordering federal agencies to “minimize the use 186 Many of the state transportation agency comments are incorpo- rated into a response posted by AASHTO. AASHTO, Comments, Docket No. FHWA-2016-0028 (Dec. 1, 2016), available at https://www. regulations.gov/document?D=FHWA-2016-0028-0034. 187 See, e.g., Oklahoma DOT, Comments, Docket No. FHWA-2016- 0028 (posted Oct. 28, 2016) (“[T]here is ambiguity due to the reference to ‘manufactured products’ which is not defined and left to interpreta- tion.”), available at https://www.regulations.gov/document?D=FHWA- 2016-0028-0003. 188 See, e.g., IDOT, Comments, Docket No. FHWA-2016-0028 (Dec. 1, 2016) (“If the FHWA issues policy that defines what is ‘available and sold to the public…’ then the definition proposed in the federal register may work.”), available at https://www.regulations.gov/ document?D=FHWA-2016-0028-0034. 189 See, e.g., WSDOT, Comments, Docket No. FHWA-2016-0028 (posted Nov.  23, 2016), available at https://www.regulations.gov/ document?D=FHWA-2016-0028-0015. 190 See, e.g., KYTC, Comments, Docket No. FHWA-2016-0028 (Dec. 1, 2016) (“The definition could be more inclusive by listing more items to which the waiver would apply.”), available at https://www. regulations.gov/document?D=FHWA-2016-0028-0034. 191 See, e.g., American Step Co. Inc., Comments, Docket No. FHWA-2016-0028 (Nov. 18, 2016) (“[I]t must be clearly stated that lift- ers are not considered ‘off the shelf ’ items.”), available at https://www. regulations.gov/document?D=FHWA-2016-0028-0009. 192 See, e.g., Association of American Railroads, Comments, Docket No. FHWA-2016-0028 (Dec.  2, 2016) (“[R]ailroad communications and signal items of all types, should be deemed ‘COTS.’”), available at https://www.regulations.gov/document?D=FHWA-2016-0028-0056. guidance indicating that all steel or iron components of manu- factured products must be domestic). In a 2016 notice published in the Federal Register, FHWA stated that the United Steel ruling “returned matters to pre- 2012 memorandum conditions, when there was uncertainty on whether the FHWA Buy America requirements applied to COTS products with steel or iron components.”182 In order to address the uncertainty, in the 2016 Federal Register notice, FHWA proposed a new nationwide waiver for COTS products, which was defined as “any manufactured product incorporating steel or iron components” that met the following criteria: (1) Is available and sold to the public in the retail and whole- sale market; (2) is offered to a contracting agency, under a contract or subcontract at any tier, without modification, and in the same form in which it is sold in the retail or wholesale market; and (3) is broadly used in the construction industry.183 Making the definition of a COTS product even more unwieldy, the 2016 Federal Register notice also provided a list of eleven specific categories of predominantly steel or iron construc- tion materials (such as structural steel) which were expressly excluded from the definition of COTS products.184 The COTS product waiver as proposed would have effec- tively replaced the 1983 Manufactured Products waiver and would have expressly provided that steel or iron components of COTS products need not be manufactured in the United States. The COTS product waiver as proposed would not cover products historically understood to be predominantly steel or iron construction materials, which would continue to be sub- ject to the FHWA Buy America provision. However, instead of requiring state transportation agencies to quantify the cost of steel or iron content in a manufactured product to determine whether the product was predominantly steel or iron, under the proposed COTS product waiver, state transportation agencies would determine whether the product is described by any of the eleven specific categories of steel or iron construction materials that were excluded from the definition of a COTS product. The effect of the COTS waiver would be to exempt a broad range of manufactured products from the FHWA Buy America pro- vision, “such as sinks, faucets, toilets, door hinges, electrical products, and ITS hardware that are not made specifically for highway projects but are incidental to such projects,”185 without regard to the steel or iron components in those products. More than 60 public comments were received in direct re- sponse to the proposed COTS waiver (including responses 182 Buy America Nationwide Waiver Notification for Commercially Available Off-the-Shelf (COTS) Products with Steel or Iron Compo- nents and for Steel Tie Wire Permanently Incorporated in Precast Con- crete Products, 81 Fed. Reg. 71,784, 71,786 (Oct. 18, 2016). 183 Id. at 71,787 (emphasis supplied). 184 Id. at 71,786–87. 185 Id. at 71,787.

18 NCHRP LRD 80 manufactured product consisting of less than 90 percent steel or iron was covered by the Manufactured Products waiver, and could be procured for use on an FHWA project without seek- ing a project-specific waiver for that product. This would have exempted large quantities of steel and iron from the FHWA Buy America provision, because under that definition of “predomi- nantly” steel or iron, any manufactured product could be sup- plied to an FHWA-funded project without a waiver as long as more than 10 percent of its content consisted of some material other than steel or iron, as delivered to the project site. However, as discussed in Section II.C, in the United Steel case, multiple parties filed suit against FHWA, seeking injunc- tive and declaratory relief related to the 2012 FHWA memo.199 In United Steel, the U.S. District Court for the District of Columbia stated that the “90% steel or iron” definition of predominantly steel or iron products could not “reasonably be discerned” from the 1983 Manufactured Products waiver—“The number quite literally appears to have been pulled out of thin air.”200 The court concluded that the “90% steel or iron” threshold enunciated in the 2012 FHWA memo was invalid under the APA, both be- cause the 90 percent figure was determined without notice-and- comment rulemaking201 and because the 90 percent figure was “arbitrary and capricious.”202 The court agreed with FHWA that “predominant” means “more than 50 percent,” but was unwilling to allow FHWA to set the quantitative threshold for “predomi- nant” at 90 percent without undergoing notice-and-comment rulemaking.203 As a result of United Steel, state transportation agencies and their contractors can no longer presume that the FHWA Buy America provision is waived for all manufactured products consisting of less than 90 percent steel or iron. In 2013, in anticipation of the United Steel litigation, FHWA had formally requested public comment on the following ques- tions: • Should the FHWA continue to distinguish manufac- tured products that are comprised predominantly of steel and iron for purposes of requiring all manufactur- ing processes to occur in the United States? • How should a predominantly steel and iron product be defined? • Should the FHWA continue to consider a predominant- ly steel and iron product as one comprising 90 percent steel and iron?204 Responses from state transportation agencies in 2013 gener- ally indicated agreement with and support for the 90 percent available at http://www.fhwa.dot.gov/construction/contracts/121221. cfm. 199 United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int’l Union v. Fed. Highway Admin., 151 F. Supp. 3d 76, 80 (D.D.C. 2015). 200 Id. at 90. 201 Id. at 88-89 (citing 5 U.S.C. § 553). 202 Id. at 90 (citing 5 U.S.C. § 706). 203 Id. at 88. 204 Buy America Policy, 78 Fed. Reg. 41,492, 41,495 (July 10, 2013). of waivers” from Buy America requirements.193 Therefore, the 1983 Manufactured Products waiver remains the primary legal authority regarding whether steel and iron components of man- ufactured products must comply with the FHWA Buy America provision. As noted above, the United Steel court did not ex- pressly disturb the 2012 FHWA memo’s primary conclusion that the Manufactured Products waiver covers steel and iron components and subcomponents of manufactured products that are not predominantly steel or iron manufactured prod- ucts. The issue left unanswered after United Steel, as discussed in Section III.C, is how to define a predominantly steel or iron manufactured product, to which the Manufactured Products waiver does not apply. C. Predominantly Steel or Iron Manufactured Products The Manufactured Products waiver does not apply to manu- factured products that are predominantly steel or iron, which must comply with the FHWA Buy America provision. This is seen from the language of the 1983 Manufactured Products waiver itself, in which FHWA decided “to waive the application of Buy America to manufactured products other than steel and cement manufactured products.”194 Congress removed coverage for cement from the FHWA Buy America provision in 1984,195 and added coverage for iron to the FHWA Buy America pro- vision in 1991.196 Since that time, the Manufactured Products waiver has been understood to apply to manufactured products other than steel or iron manufactured products. As discussed in Section III.B, a 1997 FHWA memorandum clarified that the manufactured products waiver did not apply to a “predomi- nately” steel or iron manufactured product, due to the “basic premise” of the FHWA Buy America provision—“that the steel and iron used for Federal-aid highway and transit work be pre- dominately of U.S. domestic manufacture.”197 FHWA reexamined the 1983 Manufactured Products waiver in conjunction with the 1997 FHWA memo in a December 2012 memorandum, which stated, “FHWA deems a product to be manufactured predominantly of steel or iron if the product consists of at least 90% steel or iron content when it is delivered to the job site for installation.”198 The implication was that any 193 Presidential Executive Order on Buy American and Hire Ameri- can (Apr. 18, 2017), Exec. Order No. 13788, 82 Fed. Reg. 18,837 (Apr. 21, 2017), available at https://www.whitehouse.gov/presidential-actions/ presidential-executive-order-buy-american-hire-american/. 194 Buy America Requirements, 48 Fed. Reg. 53,099, 53,102 (Nov. 25, 1983) (emphasis supplied). 195 National System of Interstate and Defense Highways, appor- tioned funds, Pub. L. No. 98-229, § 10, 98 Stat. 55, 57 (1984). 196 ISTEA § 1048. 197 Memorandum from Donald P. Steinke, FHWA Chief of Highway Operations, to Edward V.A. Kussy, FHWA Chief Counsel, Re: Buy America Policy Response (Dec. 22, 1997) (emphasis supplied), available at http://www.fhwa.dot.gov/programadmin/contracts/122297.cfm. 198 Memorandum from John R. Baxter, FHWA Associate Adminis- trator for Infrastructure, to FHWA Division Administrators and Direc- tors of Field Services (Dec. 21, 2012) (emphasis supplied) (cancelled),

NCHRP LRD 80 19 factured product. However, the United Steel court appeared to agree that as long as a manufactured product is comprised of less than 50 percent steel or iron, it is not “predominantly” steel or iron.208 It would appear reasonable for an FHWA division to conclude that any manufactured product comprised of less than 50 percent steel or iron is covered by the Manufactured Prod- ucts waiver, and that a project-specific waiver is not required for either the product or its steel and iron components, even in light of the United Steel ruling. D. Vehicles and Rolling Stock An issue that has arisen in recent years concerns application of the FHWA Buy America provision to “rolling stock,” such as vehicles purchased with FHWA funds under the Congestion Mitigation and Air Quality (CMAQ) improvement program.209 The 1983 rulemaking that introduced the Manufactured Prod- ucts waiver did not specifically address vehicles or other rolling stock.210 Although the current version of the FHWA Buy America provision as enacted by Congress only applies to steel, iron, and manufactured products, this has not always been the case. The original 1978 Buy America provision applicable to both FHWA and UMTA required that only domestic materials and manu- factured products (i.e., products “manufactured in the United States substantially all from” domestic materials)211 be used on federally funded projects. As discussed in Section II.A, FHWA originally applied this Buy America provision only to structural steel. However, in November 1980, FHWA proposed to revise its regulations to subject purchases of “equipment” (defined to include “vehicles”) to the UMTA Buy America regulations,212 which specifically addressed rolling stock. The UMTA regula- tions at the time established that manufactured products in- cluding vehicles were considered domestic as long as the cost of domestic components was at least 50 percent of the total cost of all components and final assembly took place in the United States.213 However, the FHWA regulations proposed in 1980, which would have applied Buy America requirements to vehi- cles purchased with FHWA funds, were never formally adopted. Congress significantly revised the Buy America provision applicable to both FHWA and UMTA in 1983, requiring all 208 Id. (“Predominately surely means more than 50 percent.”). 209 23 U.S.C. § 149 (2018). 210 Buy America Waiver Notification, 76 Fed. Reg. 72,027 (Nov. 2, 2011) (“Vehicles, however, are not the types of products that were ini- tially envisioned as being purchased with Federal-aid highway funds when Buy America was first enacted.”). 211 Surface Transportation Assistance Act of 1978, Pub. L. No. 95-599, 401(a), 92 Stat. 2689, 2756 (Nov. 6, 1978). 212 Buy America Requirements: Proposed Revisions, 45 Fed. Reg. 77,455 (Nov. 24, 1980) (“Contracts for projects concerning equipment and ferry boats would follow 49 CFR 660, the Buy America require- ments issued by the Urban Mass Transportation Administration in December 1978 (43 FR 57145).”). 213 Buy America Requirements, 43 Fed. Reg. 57,144 (Dec. 6, 1978) (codified at 49 C.F.R. § 660.22 (1981)). threshold for predominantly steel or iron manufactured prod- ucts.205 Some confusion was expressed over how the percent- age of steel and iron should be calculated (e.g., by cost, mass, or volume).206 However, minimal opposition was expressed to using the 90 percent threshold, and it appeared that FHWA would have been justified in establishing the 90 percent thresh- old for predominantly steel or iron products as a result of the 2013 notice-and-comment rulemaking. However, no action was taken in response to the 2013 notice and comments, and in 2015, the United Steel decision invalidated the 90 percent threshold based on FHWA’s failure to undergo notice-and-com- ment rulemaking prior to issuing its December 2012 memo.207 As a result of United Steel, it is presently up to each FHWA division to determine whether a manufactured product is pre- dominantly steel or iron (so that it is subject to the FHWA Buy America provision) or not (and thus covered by the Manu- factured Products waiver). FHWA canceled its December 2012 memo that announced the 90 percent threshold after the December 2015 ruling in United Steel and has not issued subse- quent written guidance to assist the FHWA divisions in deter- mining what constitutes a predominantly steel or iron manu- 205 See, e.g., ODOT, Comments, Docket No. FHWA-2013-0041 (July 15, 2013) (“We are agreeable to manufactured products being at least 90% steel or iron.”), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0003; DelDOT, Comments, Docket No. FHWA-2013-0041 (Aug. 9, 2013) (“We feel the 90% rule referenced in response #1 should remain in place unchanged.”), available at https:// www.regulations.gov/document?D=FHWA-2013-0041-0015; Caltrans, Comments, Docket No. FHWA-2013-0041 (posted Sept. 9, 2013) (“The ‘90% rule’ is reasonable and Caltrans supports it.”), available at https:// www.regulations.gov/document?D=FHWA-2013-0041-0061; MDOT, Comments, Docket No. FHWA-2013-0041 (Oct.  22, 2013) (“MDOT supports the continued definition that manufactured products that contain 90 percent or greater of steel or iron material are subject to Buy America requirements . . ..”), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0083. 206 See, e.g., North Carolina State University, Comments, Docket No. FHWA-2013-0041 (posted Sept.  3, 2013) (“[T]he current ‘90%’ standard is ambiguous in that it fails to state whether the standard applies by product weight, volume, cost, or some other metric.”), avail- able at https://www.regulations.gov/document?D=FHWA-2013- 0041-0036; IDOT, Comments, Docket No. FHWA-2013-0041 (posted Sept. 6, 2013) (“The 90% is not clear – value of product or weight?”), available at https://www.regulations.gov/document?D=FHWA-2013- 0041-0050; Caltrans, Comments, Docket No. FHWA-2013-0041 (posted Sept.  9, 2013) (“The 90% calculation should be expanded to also include a volumetric measurement analysis . . . as well as the cur- rently applied weight measurement analysis (which is appropriately applied when the non-steel material is metallic).”), available at https:// www.regulations.gov/document?D=FHWA-2013-0041-0061; UDOT, Comments, Docket No. FHWA-2013-0041 (Aug.  8, 2013) (“In the example of a fire hydrant that has over fifty different types of compo- nents, calculating the volume or weight of each different material is not a reasonable approach to determining whether the product is predomi- nantly iron and steel.”), available at https://www.regulations.gov/docum ent?D=FHWA-2013-0041-0020. 207 United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Int’l Union v. Fed. Highway Admin., 151 F. Supp. 3d 76, 88 (D.D.C. 2015) (“[T]he 90-Percent Threshold is a sub- stantive rule for which the FHWA was required to seek notice and com- ment under the APA.”).

20 NCHRP LRD 80 provision.220 Although the FHWA Buy America provision had expressly referred to vehicles and rolling stock for more than a decade, that statutory language was never seriously tested, due in part to the Manufactured Products waiver, and due in part to the fact that relatively few vehicles were purchased with FHWA grant funds. In May 2011, FHWA published Buy America waiver requests it had received from Alameda County, CA and San Francisco County, CA to purchase electric vehicles and hybrid vehicles using FHWA funds under the CMAQ program.221 Pursuant to its notice-and-comment waiver requirements discussed in de- tail in Section IV.A.2, FHWA posted the waiver requests on its Buy America website for 15 days to receive public comments on the requests. Based on the waiver requests and the comments, it appeared that the applicants requested waivers because it was their understanding that the FHWA Buy America provi- sion required all iron and steel components of the vehicles to be domestic. Neither the applicants nor any of the commenters ad- dressed whether the vehicles were exempt under the Manufac- tured Products waiver. FHWA addressed both waiver requests in the Federal Register on November 21, 2011.222 In March 2012, FHWA addressed a similar request by Merced County, CA.223 In all three of these cases, FHWA granted a partial Public Interest waiver: the grant recipients could purchase the vehicles on the condition that final assembly took place in the United States, regardless of domestic content. In granting these partial waiv- ers, FHWA did not address the Manufactured Products waiver or whether it covered vehicles. In fact, FHWA implied that a project-specific waiver was required for vehicle purchases be- cause “FHWA has not located a vehicle that meets a 100 percent domestic iron and steel content requirement.”224 In March 2012, around the time it was granting the Merced County waiver, FHWA published on its website yet another waiver request to purchase vehicles under the CMAQ pro- gram, this time from the Vermont Agency of Transportation (VTrans).225 FHWA received a number of comments in re- 220 An Act to revise, codify, and enact without substantive change certain general and permanent laws related to transportation, Pub. L. No. 103-272, § 4(r)(2), 108 Stat. 745, 1371 (July 5, 1994). 221 FHWA, Notice of Buy America Waiver Request (May 12, 2011), available at https://web.archive.org/web/20130606191133/https://www. fhwa.dot.gov/construction/contracts/waivers.cfm?id=57; FHWA, Notice of Buy America Waiver Request (May 31, 2011), available at https://web. archive.org/web/20130606201137/https://www.fhwa.dot.gov/ construction/contracts/waivers.cfm?id=59. 222 Buy America Waiver Notification, 76 Fed. Reg. 72,027 (Nov. 21, 2011); Buy America Waiver Notification, 76 Fed. Reg. 72,028 (Nov. 21, 2011). 223 Buy America Waiver Notification, 77 Fed. Reg. 19,410 (Mar. 30, 2012); see also FHWA, Notice of Buy America Waiver Request (posted Jan. 11, 2012), available at https://web.archive.org/web/20130606201653/ https://www.fhwa.dot.gov/construction/contracts/waivers.cfm?id=65. 224 Buy America Waiver Notification, 77 Fed. Reg. 19,410, 19,411 (Mar. 30, 2012); Buy America Waiver Notification, 76 Fed. Reg. 72,027, 72,028 (Nov. 21, 2011). 225 FHWA, Notice of Buy America Waiver Request (posted Mar. 5, 2012), available at http://web.archive.org/web/20170223073332/http:// “steel, cement, and manufactured products used”214 on federally funded projects to be domestic. The updated Buy America pro- vision specifically addressed the procurement of vehicles and other rolling stock. For example, the 1983 legislation expressly increased the Price Differential threshold from 10 percent to 25 percent for most projects, but fixed the Price Differential thresh- old at 10 percent “in the case of projects for the acquisition of rolling stock.”215 On its face, this legislation made it significantly easier for FHWA grant recipients to satisfy the Price Differen- tial exception with regard to vehicle procurement than on con- struction projects. The 1983 Buy America provision applicable to both FHWA and UMTA also contained a Domestic Content exception which closely tracked the earlier UMTA regulations, allowing “the procurement of bus and other rolling stock” as long as (A) the cost of components which are produced in the United States is more than 50 per centum of the cost of all components of the vehicle or equipment described in this paragraph, and (B) final assembly of the vehicle or equipment described in this paragraph has taken place in the United States.216 There was no Domestic Content exception for other manufac- tured products, suggesting that Congress intended for manu- factured products other than vehicles to satisfy a 100 percent domestic content requirement. However, FHWA issued a Man- ufactured Products waiver in November 1983, exempting all products but steel and concrete from the FHWA Buy America provision, and rendering the statutory references to vehicles and rolling stock meaningless as to FHWA. In 1987, Congress significantly strengthened the Buy Amer- ica requirements for vehicles and rolling stock, as the Price Differential threshold was increased from 10 percent to 25 percent,217 the Domestic Content waiver requirement was in- creased from 50 percent to 60 percent,218 and grant recipients were required to evaluate Domestic Content of rolling stock by considering both components and subcomponents.219 This ver- sion of the Buy America provision, with its references to vehicles and rolling stock, was incorporated into the United States Code as a note at the introduction to Title 23. However, FHWA’s Buy America regulations were never revised to address purchases of vehicles and rolling stock, as the 1983 Manufactured Prod- ucts waiver was never rescinded. In 1994, Congress enacted a separate Buy America provision applicable only to the Federal Transit Administration (FTA), and formally removed all refer- ences to vehicles or rolling stock from the FHWA Buy America 214 Surface Transportation Assistance Act of 1982, Pub. L. No. 97-424, § 165(a), 96 Stat. 2097, 2136 (Jan. 6, 1983). 215 Id. § 165(b)(4). 216 Id. § 165(b)(3). The Domestic Content exception may have had no application to FHWA, since it only applied to procurements “under the Urban Mass Transportation Act of 1964.” 217 Surface Transportation and Uniform Relocation Assistance Act of 1987, Pub. L. No. 100-17, § 337(c), 101 Stat. 241 (1987). 218 Id. § 337(a). 219 Id. § 337(b) (emphasis supplied).

NCHRP LRD 80 21 same commenters criticized FHWA for its practice of grant- ing partial Public Interest waivers that permitted some FHWA grant recipients to purchase vehicles conditioned only on final assembly in the United States, without any domestic content requirements.232 No formal action was taken by FHWA in response to the 2013 notice and comments, regarding the applicability of the FHWA Buy America provision to vehicles. Subsequent state- ments by FHWA indicated that, while it would prefer not to subject vehicle procurements to the FHWA Buy America provi- sion, FHWA considered itself legally obligated to, at minimum, require final assembly in the United States. In November 2013, FHWA stated that it “does not believe that application of a do- mestic content standard should be applied to the purchase of vehicles.”233 In December 2013, FHWA expressed its “strong preference to no longer process Buy America waivers for the purchase of transit vehicles,”234 and encouraged state transpor- tation agencies to transfer CMAQ funds for administration by FTA,235 so that CMAQ vehicle purchases would be subject to the FTA Buy America provision and its rolling stock requirements rather than the FHWA Buy America provision. In June 2014, FHWA explained that project-specific Buy America waivers were required, and that the Manufactured Products waiver does not apply to vehicles, “because they involve predominately steel and iron manufactured products.”236 For the next few years, FHWA continued to regularly grant conditional waivers from the FHWA Buy America provision, al- lowing grant recipients to purchase vehicles under the CMAQ program on the condition that final assembly be performed in the United States.237 Numerous waiver requests from FHWA regulations.gov/document?D=FHWA-2013-0041-0046; International Union, United Automobile, Aerospace and Agricultural Implement Workers of America, Comments, Docket No. FHWA-2013-0041 (Sept.  6, 2013), available at https://www.regulations.gov/document? D=FHWA-2013-0041-0063; Municipal Castings Association, Com- ments, Docket No. FHWA-2013-0041 (Sept.  6, 2013), available at https://www.regulations.gov/document?D=FHWA-2013-0041-0059; Alliance for American Manufacturing, Comments, Docket No. FHWA- 2013-0041 (Sept.  8, 2013), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0066. 232 Id. 233 Buy America Waiver Notification, 78 Fed. Reg. 70,395 (Nov. 25, 2013). 234 Memorandum from Fred R. Wagner, FHWA Chief Counsel, to FHWA Associate Administrators and FHWA Regional Administrators, Re: Transfer of Funds for Transit Projects (Dec. 11, 2013), available at https://www.fhwa.dot.gov/construction/contracts/131211.cfm. 235 See 23  U.S.C. §  104(f)(1) (2018) (authorizing the transfer of funds appropriated under Title 23 for transit programs to FTA for administration). 236 Buy America Waiver Notification, 79 Fed, Reg. 33,633 (June 11, 2014). 237 See, e.g., Buy America Waiver Notification, 83 Fed. Reg. 16,421 (Apr. 16, 2018); Buy America Waiver Notification, 81 Fed. Reg. 63,854 (Sept. 16, 2016); Buy America Waiver Notification, 81 Fed. Reg. 50,785 (Aug. 2, 2016); Buy America Waiver Notification, 81 Fed. Reg. 30,601 (May 17, 2016); Buy America Waiver Notification, 81 Fed. Reg. 19,701 (Apr. 5, 2016); Buy America Waiver Notification, 80 Fed. Reg. 75,702 sponse to the VTrans waiver request, most opposing a waiver. It took FHWA more than one year to address the VTrans waiver request. Finally, in June 2013, FHWA granted a partial Public Interest waiver request for the VTrans vehicles,226 as well as 74 other projects involving the purchase of “3,500 vehicles (includ- ing sedans, vans, pickups, SUVs, trucks, buses, and equipment, such as backhoes, street sweepers, and tractors).”227 This was not a general waiver for all vehicles, but rather a waiver of the domestic content requirement of the FHWA Buy America pro- vision for these specific projects, conditioned on final assembly of the vehicles in the United States. At that time, FHWA stated that it was still trying to determine “what standards should apply to vehicles.”228 Immediately thereafter, in July 2013, FHWA published a notice in the Federal Register requesting public comment on whether the FHWA Buy America provision should apply to ve- hicles purchased by FHWA grant recipients, such as those pur- chased under the CMAQ program.229 Responses were mixed. State transportation agencies responding to the notice generally expressed the opinion that vehicles should be exempt from the FHWA Buy America provision.230 However, representatives of the domestic manufacturing industry and labor organizations commended FHWA for recognizing that vehicles are not cov- ered by the Manufactured Products waiver and should be sub- ject to the FHWA Buy America provision.231 However, those www.fhwa.dot.gov/construction/contracts/waivers.cfm?id=67. 226 Buy America Waiver Notification, 78 Fed. Reg. 36,295 (June 17, 2013). 227 Buy America Waiver Notification, 78 Fed. Reg. 36,296 (June 17, 2013). 228 Id. at 36,298; see also Buy America Waiver Notification, 78 Fed. Reg. 36,295, 36,296 (June 17, 2013). 229 Buy America Policy, 78 Fed. Reg. 41,492, 41,495–96 (July 10, 2013). 230 See, e.g., AASHTO, Comments, Docket No. FHWA-2013-0041 (Sept.  6, 2013), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0055; Alaska DOT&PF, Comments, Docket No. FHWA-2013-0041 (July  25, 2013), available at https:// www.regulations.gov/document?D=FHWA-2013-0041-0013; Alaska DOT&PF, Comments, Docket No. FHWA-2013-0041 (Sept. 12, 2013), available at https://www.regulations.gov/document?D=FHWA-2013- 0041-0078; DelDOT, Comments, Docket No. FHWA-2013-0041 (Aug.  6, 2013), available at https://www.regulations.gov/document? D=FHWA-2013-0041-0015; IDOT, Comments, Docket No. FHWA- 2013-0041 (Sept.  6, 2013), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0050; North Carolina State Univer- sity, Comments, Docket No. FHWA-2013-0041 (posted Sept. 3, 2013), available at https://www.regulations.gov/document?D=FHWA-2013- 0041-0036; ODOT, Comments, Docket No. FHWA-2013-0041 (posted Aug. 9, 2013), available at https://www.regulations.gov/document?D= FHWA-2013-0041-0003; VDOT, Comments, Docket No. FHWA-2013- 0041 (Aug.  29, 2013), available at https://www.regulations.gov/ document?D=FHWA-2013-0041-0067. 231 See, e.g., United Steel, Paper and Forestry, Rubber, Manufactur- ing, Energy, Allied and Industrial and Service Workers International Union, Comments, Docket No. FHWA-2013-0041 (Sept.  6, 2013), available at https://www.regulations.gov/document?D=FHWA-2013- 0041-0047; AFLCIO Transportation Trades Department, Comments, Docket No. FHWA-2013-0041 (Sept. 6, 2013), available at https://www.

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The Federal Highway Administration's “Buy America Act” requires federally funded highway projects to use only steel, iron, and manufactured products produced in the United States.

The TRB National Cooperative Highway Research Program's NCHRP LRD 80: Buy America Requirements for Federal Highway Projects summarizes the intent and application of the provision. It also summarizes the procedure that FHWA has implemented for granting waivers and the impact that court interpretation of such waivers has had on the industry.

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