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From the Desk of Executive Director Bryon Short

From the Desk of Executive Director Bryon Short - October 21, 2022

The $1.2 trillion bipartisan Infrastructure Investment and Jobs Act (IIJA) included the “Build America, Buy America Act” (BABA) which applies a domestic preference to all taxpayer-funded infrastructure projects. The U.S. Office of Management and Budget released BABA implementation guidance this past April. The guidelines are meant to assist federal agencies in the application of “Buy America” requirements and the waiver processes for all federally funded infrastructure projects and not just those funded by the IIJA. The requirements are set to be in effect starting October 25, 2022.

In brief, domestic sourcing requirements as stated in the guidance are:

  1. Steel and Iron – manufacturing processes from the melting stage to applying coatings occurs in the U.S.
  2. Manufactured Products – an end product must be manufactured in the U.S. and that 55% of the total cost of components are sourced from the U.S.
  3. Construction Materials – all processes for manufacturing construction materials are taking place in the U.S. These items include non-ferrous metals, plastic and polymer-based products, glass, lumber, drywall and more.

The Delaware Department of Transportation has been working to develop its process for BABA implementation. A couple of weeks ago, DelDOT reached out to DCA’s Highway Group seeking input on the Department’s draft implementation plan. This week, our Highway Group participated in a presentation by DelDOT of their BABA implementation plan with key components of the presentation available here. With 93 percent of construction firms reporting to AGC of America that they are experiencing material shortages, both contractors and the Department agree that this aspect of the federal law will be challenging.

Waivers can be issued under certain circumstances such as the material not being produced in the U.S. in sufficient quantities or the cost of the materials increasing the overall cost of a project by more than 25%. Waiver requests must be in writing and will be available for public comments for at least 15 days. The waiver requests must also be reviewed by the Made in America Office.

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