Buy American? Not Necessarily Necessary
Highway departments can continue using cheaper foreign steel for bridge projects, despite attempts by Congress to constrict the practice.
Congress is near completing a second piece of legislation with “advisory” language concerning “Buy America” provisions for projects funded by the Federal Highway Administration (FHWA). Congress first addressed the issue in 2005 when it added a non-binding resolution to SAFETEA-LU allowing the FHWA to waive the Buy America requirement only if using foreign steel would lower a project's cost by at least 25%.
The FHWA believes the requirement can be waived if using U.S. steel on a bridge component (i.e., the foundation, superstructure, deck, or approaches), rather than the entire project, will cost 25% or more than using foreign steel.
When the House overwhelmingly passed a SAFETEA-LU technical corrections bill (H.R. 1195) in March, the legislation declared the FHWA's application of the Buy America exemption “inconsistent” with last year's provision and requires the U.S. Secretary of Transportation to provide detailed justifications for issuing waivers. The Senate will most likely pass that bill in the near future.
In the meantime, the FHWAis sticking to its guns.
When he appeared before the House Transportation and Infrastructure Committee on April 24, FHWA administrator J. Richard Capka said he had no intention of changing the agency's interpretation of Buy America requirements: “In our view, the words of section 313 of the federal code require us to apply the Buy America requirement on a contract-by-contract basis.”
The distinction is not an inconsequential issue for public infrastructure owners.
The California Highway Department, for example, received a waiver to use foreign steel on one of the 16 contracts making up the East Span Seismic Safety Project on the Bay Bridge in San Francisco, saving $400 million on the $1.8 billion contract. Had the FHWA used the $5 billion project cost as the basis for judging the suitability of a waiver, the waiver would have been denied.
Fhwa Broadens Culvert Pipe Options
Highway departments must consider materials beyond concrete or steel pipe on drainage projects.
The FHWA's elimination of “Appendix A”—tagged onto “Summary of Acceptable Criteria for Specifying Types of Culvert Pipes”—means public works departments must get bids for alternative pipe materials if the materials will provide “satisfactory quality” and are “equally acceptable on the basis of engineering and economic analyses.” The public works departments themselves determine if the materials meet these criteria. The point: to stretch federal highway dollars and curb the sole-source habit some states have fallen into.