[Federal Register Volume 76, Number 247 (Friday, December 23, 2011)]
[Notices]
[Pages 80369-80371]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-33015]


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ENVIRONMENTAL PROTECTION AGENCY

[FRL-9609-6]


Notice of a Regional Project Waiver of Section 1605 (Buy 
American) of the American Recovery and Reinvestment Act of 2009 (ARRA) 
to the Sussex County, DE

SUMMARY: The EPA is hereby granting a waiver of the Buy American 
Requirements of ARRA Section 1605 under the authority of Section 
1605(b)(2) [manufactured goods are not produced in the United States in 
sufficient and reasonably available quantities and of a satisfactory 
quality] to Sussex County, DE (``County''), for the purchase of one 
ductless split heating/air conditioning (HVAC) system, manufactured in 
Japan by Fujitsu General American, Inc. This is a project specific 
waiver and only applies to the use of the specified product for the 
ARRA project being proposed. Any other ARRA recipient that wishes to 
use the same product must apply for a separate waiver based on project 
specific circumstances. The County evaluated two different 
manufacturers of the specified ductless split air conditioning and heat 
pump systems. The ARRA funded project is for construction of the Town 
of Millsboro, Oak Orchard Sanitary Sewer District Expansion Area 1, 
Pump Station No. 326 with a ductless split HVAC system. Based upon 
information submitted by the County and its consulting engineer, EPA 
has concluded that there are no HVAC systems manufactured in the United 
States in sufficient and reasonable quantity and of a satisfactory 
quality to meet the technical specifications and that a waiver of the 
Buy American provisions is justified. The Regional Administrator is 
making

[[Page 80370]]

this determination based on the review and recommendations of the EPA 
Region III, Water Protection Division, Office of Infrastructure and 
Assistance.
    The Assistant Administrator of the Office of Administration and 
Resources Management has concurred on this decision to make an 
exception to the requirements of Section 1605(a) of ARRA. This action 
permits the purchase of a ductless split HVAC system for the proposed 
project being implemented by Sussex County.

DATES: Effective Date: December 23, 2011.

FOR FURTHER INFORMATION CONTACT: Robert Chominski, Deputy Associate 
Director, (215) 814-2162, or David McAdams, Environmental Engineer, 
(215) 814-5764, Office of Infrastructure & Assistance (OIA), Water 
Protection Division, U.S. EPA Region III, 1650 Arch Street, 
Philadelphia, PA 19103-2029.

SUPPLEMENTARY INFORMATION: In accordance with ARRA Section 1605(c), the 
EPA hereby provides notice that it is granting a project waiver of the 
requirements of Section 1605(a) of Public Law 111-5, Buy American 
requirements, to Sussex County, Delaware for the purchase of one 
ductless split heating/air conditioning system (HVAC) for Pump Station 
No. 326. EPA has evaluated the County's basis for procuring the HVAC 
system for the pump station. The ARRA funded project is for a pump 
station (PS No. 326) with a HVAC system. The construction of the pump 
station number 326 includes a heat pump system for the electrical room. 
The system includes an indoor wall mounted evaporator-fan unit and an 
outdoor aired cooled compressor-condenser. The new HVAC split system 
will provide benefits to the County due to the product's reliability 
with the electronics controlling critical infrastructure, cost 
effectiveness, energy efficiency, and ease of maintenance. The HVAC 
system is specifically designed for this project to provide heat and 
cooling in the pump station's electrical room. Based upon information 
submitted by the County and its consulting engineer, EPA has concluded 
that there are no HVAC systems manufactured in the United States in 
sufficient and reasonable quantity and of a satisfactory quality to 
meet the technical specifications for the County to pursue the purchase 
of domestically manufactured HVAC systems.
    Section 1605 of the ARRA requires that none of the appropriated 
funds may be used for the construction, alteration, maintenance, or 
repair of a public building or a public works project unless all of the 
iron, steel, and manufactured goods used in the project is produced in 
the United States, or unless a waiver is provided to the recipient by 
the head of the appropriate agency, here the EPA. A waiver may be 
provided under Section 1605(b) if EPA determines that (1) applying 
these requirements would be inconsistent with the public interest; (2) 
iron, steel, and the relevant manufactured goods are not produced in 
the United States in sufficient and reasonably available quantities and 
of a satisfactory quality; or (3) inclusion of iron, steel, and the 
relevant manufactured goods produced in the United States will increase 
the cost of the overall project by more than 25 percent.
    EPA has also evaluated the County's request to determine if its 
submission is considered late or if it could be considered as if it was 
timely filed, as per the OMB Guidance at 2 CFR 176.120. EPA will 
generally regard waiver requests with respect to components that were 
specified in the bid solicitation or in a general/primary construction 
contract as ``late'' if submitted after the contract date. However EPA 
could also determine that a request be evaluated as timely, though made 
after the date that the contract was signed, if the need for a waiver 
was not reasonably foreseeable. If the need for a waiver is reasonably 
foreseeable, then EPA could still apply discretion in these late cases 
as per the OMB guidance, which says ``the award official may deny the 
request''. For those waiver requests that do not have a reasonably 
unforeseeable basis for lateness, but for which the waiver basis is 
valid and there is no apparent gain by the ARRA recipient or loss on 
behalf of the government, then EPA will still consider granting a 
waiver.
    In this case, there are no U.S. manufacturers that meet the 
County's project specifications for the HVAC system. The waiver request 
was submitted after the contract date because the County was not 
notified that a Buy American waiver was needed, and that there are no 
American manufacturers of the HVAC system that could meet the project 
specifications, until their contractor submitted their shop drawings on 
August 1, 2011. Therefore, the County did not submit a waiver request 
until September 22, 2011. There is no indication that the County failed 
to request a waiver to avoid the requirements of the ARRA, particularly 
since there are no domestically manufactured products that meet the 
project specifications. EPA will consider the County's waiver request, 
a foreseeable late request, as though it had been timely made since 
there is no gain by the County and no loss by the government due to the 
late request.
    The April 28, 2009 EPA HQ Memorandum, Implementation of Buy 
American provisions of Public Law 111-5, the ``American Recovery and 
Reinvestment Act of 2009'', defines reasonably available quantity as 
``the quantity of iron, steel, or relevant manufactured good is 
available or will be available at the time needed and place needed, and 
in the proper form or specification as specified in the project plans 
and design.'' The County has provided information to the EPA 
representing that there are currently no domestic manufacturers of the 
HVAC systems that meet the project specification requirements. Based on 
additional research by EPA's consulting contractor and to the best of 
the Region's knowledge at this time, there does not appear to be any 
other manufacturer capable of meeting the County's specifications.
    The purpose of the ARRA is to stimulate economic recovery in part 
by funding current infrastructure construction, not to delay projects 
that are ``shovel ready'' by requiring utilities, such as the County, 
to revise their standards and specifications, institute a new bidding 
process, and potentially choose a more costly, less efficient project. 
The imposition of ARRA Buy American requirements on such projects 
otherwise eligible for State Revolving Fund assistance would result in 
unreasonable delay and thus displace the ``shovel ready'' status for 
this project. To further delay construction is in direct conflict with 
a fundamental economic purpose of the ARRA, which is to create or 
retain jobs. The OIA has reviewed this waiver request and to the best 
of our knowledge at the time of review has determined that the 
supporting documentation provided by the County is sufficient to meet 
the criteria listed under Section 1605(b) and in the April 28, 2009, 
``Implementation of Buy American provisions of Public Law 111-5, the 
`American Recovery and Reinvestment Act of 2009' Memorandum:'' Iron, 
steel, and the manufactured goods are not produced in the United States 
in sufficient and reasonably available quantities and of a satisfactory 
quality. The basis for this project waiver is the authorization 
provided in Section 1605(b)(2). Due to the lack of production of this 
product in the United States in sufficient and reasonably available 
quantities and of a satisfactory quality to meet the County's technical 
specifications, a waiver from

[[Page 80371]]

the Buy American requirement is justified.
    The March 31, 2009 Delegation of Authority Memorandum provided 
Regional Administrators with the authority to issue exceptions to 
Section 1605 of ARRA within the geographic boundaries of their 
respective regions and with respect to requests by individual grant 
recipients. Having established both a proper basis to specify the 
particular good required for this project, and that this manufactured 
good was not available from a producer in the United States, Sussex 
County is hereby granted a waiver from the Buy American requirements of 
Section 1605(a) of Public Law 111-5 for the purchase of a ductless 
split HVAC system using ARRA funds as specified in Sussex County's 
request of September 22, 2011. This supplementary information 
constitutes the detailed written justification required by Section 
1605(c) for waivers ``based on a finding under subsection (b).''

    Authority:  Public Law 111-5, section 1605.

    Issued on: December 13, 2011.
James W. Newsom,
Acting Regional Administrator, U.S. Environmental Protection Agency, 
Region III.
[FR Doc. 2011-33015 Filed 12-22-11; 8:45 am]
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