[Congressional Record Volume 146, Number 10 (Tuesday, February 8, 2000)]
[Extensions of Remarks]
[Page E94]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  THE FEDERAL EMERGENCY MANAGEMENT AGENCY BUY AMERICAN COMPLIANCE ACT

                                 ______
                                 

                            HON. MAC COLLINS

                               of georgia

                    in the house of representatives

                       Tuesday, February 8, 2000

  Mr. COLLINS. Mr. Speaker, after a strong earthquake shook Northridge, 
CA, the Federal Emergency Management Agency (FEMA) made funds available 
to the Los Angeles Department of Water and Power to improve the power 
system's resistance to earthquakes. A $2 million contract for open air 
disconnect switches went to a foreign firm. That is not right. FEMA is 
subject to Buy American provisions, but there is a loophole once a 
grant is made. That loophole needs to be closed.
  I have introduced legislation today which will apply the requirements 
of the Buy American Act to non-emergency Federal Emergency Management 
Agency (FEMA) assistance payments.
  As you know, the Buy American Act was designed to provide a 
preference to American businesses in federal procurement. Each year 
FEMA awards a number of grants for non-emergency projects. Currently, 
the Agency adheres to the requirements of the Buy American Act. 
However, once the Agency awards taxpayer funds to a state or local 
entity in the form of a grant, that entity is not required to comply 
with Buy American when spending those funds. I believe this needs to be 
changed. Mr. Speaker, the Buy American requirements should be applied 
whether the federal government is directly spending the money, or 
whether it is passing the funds down to a state or municipality to be 
spent.
  The Buy American Act is necessary to protect American firms from the 
dumping of cheap foreign-made products. Many of the nations we trade 
with have significantly lower labor costs than the U.S. Without the 
safeguard provided by the Buy American Act, foreign companies are able 
to underbid American companies on U.S. government contracts.
  It is important to understand the Buy American Act's criteria for 
determining whether a product is foreign or domestic. The nation where 
the corporation is headquartered is irrelevant, Buy American is focused 
upon the origin of the materials used in the construction project. In 
order to be considered an American product, the product in question has 
to fulfill these two criteria: (1) the product must be manufactured in 
the United States, and (2) the cost of the components manufactured in 
the United States must constitute over 50% of the cost of all the 
components used in the item.
  My proposed legislation would stipulate that taxpayer funds 
distributed by FEMA as financial assistance could only be used for 
projects in which the manufactured products are American made, 
according to the criteria established by the Buy American Act.
  Mr. Speaker, it does not make sense that FEMA should have to comply 
with the Buy American Act when making an expenditure, while these same 
funds are somehow exempt once passed down from FEMA to another 
government agency. If FEMA gives a grant for a project, those taxpayer 
funds should still be managed according to the terms of the Buy 
American Act.
  Mr. Speaker, I introduce this legislation in order to ensure there is 
consistency in the law, with regard to FEMA and the provisions of the 
Buy American Act. I hope the members of this House will join me in 
support of this pro-American measure.

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