[Federal Register Volume 89, Number 52 (Friday, March 15, 2024)]
[Notices]
[Pages 19001-19003]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-05533]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration


Buy America Waiver Notification

AGENCY: Federal Highway Administration (FHWA), U.S. Department of 
Transportation (DOT).

ACTION: Notice.

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SUMMARY: This notice provides information regarding FHWA's finding that 
it is appropriate to grant a Buy America waiver to the City of Mount 
Vernon, Washington, for procurement of non-domestic iron and steel 
products and components, used in construction of the Mount Vernon 
Library Commons Project (Project) in the City of Mount Vernon, 
Washington. The waiver relates specifically to manufactured products 
that are part of the elevator equipment; mechanical, electrical, and 
plumbing systems; and architectural elements of the Project.

DATES: The effective date of the waiver is March 18, 2024.

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
please contact Mr. Brian Hogge, FHWA Office of Infrastructure, 202-366-
1562, or via email at [email protected]. For legal questions, please 
contact Mr. David Serody, FHWA Office of the Chief Counsel, 202-366-
1345, or via email at [email protected]. Office hours for FHWA are 
from 8 a.m. to 4:30 p.m., E.T., Monday through Friday, except Federal 
holidays.

SUPPLEMENTARY INFORMATION: 

Electronic Access

    An electronic copy of this document may be downloaded from the 
Federal Register's home page at: www.FederalRegister.gov and the 
Government Publishing Office's database at: www.GovInfo.gov.

Background

    The FHWA's Buy America requirements for steel and iron are set 
forth at 23 U.S.C. 313 and 23 CFR 635.410 and require that all steel 
and iron that are permanently incorporated into a Federal-aid project 
must be

[[Page 19002]]

produced in the United States unless a waiver is granted, including 
predominantly steel and iron components of a manufactured product.\1\ 
Under these requirements, all manufacturing processes, including the 
application of a coating, must occur in the United States.\2\
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    \1\ Under 23 U.S.C. 313, FHWA has a Buy America requirement for 
manufactured products; however, FHWA has a standing waiver under 23 
U.S.C. 313(b), known as the Manufactured Products General Waiver, 
which covers manufactured products that are not predominantly steel 
and iron. See 48 FR 53099 (Nov. 25, 1983).
    \2\ While the Build America, Buy America Act (BABA), included in 
the Infrastructure Investment and Jobs Act (also known as the 
``Bipartisan Infrastructure Law'' (BIL)) (Pub. L. 117-58), sets out 
Buy America preferences for steel, iron, manufactured products, and 
construction materials, these preferences only apply to the extent 
that a domestic content procurement preference, as described in 
section 70914 of BABA, does not already apply to iron, steel, 
manufactured products, and construction materials. BIL section 
70917(a)-(b). As FHWA has existing domestic content preferences for 
steel, iron, and manufactured products at 23 U.S.C. 313, the 
requirements under 23 U.S.C. 313 apply to steel, iron, and 
manufactured products instead of the requirements under BABA. As 
FHWA's existing Buy America requirement does not specifically cover 
construction materials, the Buy America preference under section 
70914 of BABA applies for construction materials.
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    Under 23 U.S.C. 313(b) and 23 CFR 635.410(c), FHWA may waive the 
application of its Buy America requirement for steel and iron if the 
application would be inconsistent with the public interest; or when 
products are not produced in the United States in sufficient and 
reasonably available quantities of a satisfactory quality. This notice 
provides information regarding FHWA's finding that it is appropriate to 
grant the City of Mount Vernon a Buy America waiver for procurement of 
non-domestic iron and steel products that are part of the elevator 
equipment; mechanical, electrical, and plumbing systems; and 
architectural elements of the Project. The ``specified products'' 
include: (i) elevator conveying equipment; (ii) elevator sump pump; 
(iii) HVAC controls; (iv) hydronic pumps; (v) energy recovery 
ventilators; (vi) split system A/C; (vii) coalescing style air and 
sediment separator; (viii) air source water heat pumps; (ix) fan coil 
units Nailor; (x) fan coil units Daikin; (xi) switchboards; (xii) 
panelboards; (xiii) an intercom system; (xiv) an AV system wall rack; 
(xv) heat pump water heaters; (xvi) a backflow preventer; (xvii) metal 
wall and roof panel fasteners; (xviii) terracotta fasteners; (xix) a 
retractable acoustic wall; (xx) a folding glass panel partition; (xxi) 
electric bike charging lockers; (xxii) uni-strut fasteners; and (xxiii) 
a fire alarm system (collectively ``waiver items'').
    Background on the Project: The Project is a multi-story structure 
that includes multiple civic elements including a public parking 
garage, public library, community center, meeting rooms, commercial 
kitchen, public restrooms, STEM center, and public computing area. The 
project also incorporates electric vehicle charging infrastructure.
    The notice of waiver request stated that the City of Mount Vernon 
had not received FHWA financial assistance to that point but was 
applying for funding under the Charging and Fueling Infrastructure 
Discretionary Grant Program (CFI Program) and Transportation 
Infrastructure Finance and Innovation Act program (TIFIA). Since the 
notice of waiver request was published, FHWA recently awarded the City 
$12,500,000 in funding under the CFI Program; \3\ the City continues to 
seek additional credit assistance under TIFIA.
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    \3\ Under 23 U.S.C. 313(h), FHWA's Buy America requirement 
applies to the entire scope of the project, as defined in the 
applicable finding, determination, or decision under the National 
Environmental Policy Act, when Federal funds are used in any part of 
the project regardless of whether Federal funds are used in the 
actual component that is subject to the waiver.
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    Background on Waiver Request: The City of Mount Vernon and its 
contractor contacted numerous manufacturers regarding Buy America-
compliant versions of the waiver items. The city and its consultants 
also conducted an independent search for Buy America-compliant versions 
of the waiver items with distributors and manufacturers and by 
contacting smaller but reputable manufacturers with whom they have 
previously worked. The City of Mount Vernon, the city's contractor, and 
the city's consultants were unable to locate any domestic manufacturers 
or fabricators of the waiver items that were able to provide Buy 
America-compliant products that satisfy the Project's design needs 
prior to requesting a waiver.
    In accordance with section 123 of Division A of the Consolidated 
Appropriations Act, 2010 (Pub. L. 111-117), section 117 of the SAFETEA-
LU Technical Corrections Act of 2008 (Pub. L. 110-244), and 23 U.S.C. 
313(g), FHWA posted a notice of the waiver request on its website on 
September 13, 2023, soliciting public comment on the intent to issue a 
waiver of the waiver items for a 15-day period.\4\
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    \4\ https://www.fhwa.dot.gov/construction/contracts/waivers.cfm?id=176.
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Waiver Justification Summary

    Comments to the Notice of Waiver Request: The FHWA received 25 
comments in response to the notice of the waiver request. Twenty-three 
commenters supported the waiver and two opposed it. One of the 
commenters opposing the waiver merely stated that the commenter did not 
support the waiver because the commenter does not support the use of 
FHWA funds for the Project. This commenter did not offer any specific 
information on the availability of Buy America-compliant waiver items, 
nor did the commenter suggest specific, additional actions that the 
City of Mount Vernon could take to maximize its use of goods, products, 
and materials produced in the United States.
    The other commenter, who represented a manufacturer, indicated they 
can make many of the waiver items domestically. In subsequent 
discussions between FHWA, the City of Mount Vernon, and the 
manufacturer, the company stated that the only Buy America-compliant 
waiver item that it might be able to provide domestically would be the 
hydronic pumps. On October 18, 2023, the city provided the manufacturer 
with the timeline for when each hydronic pump would be needed on site 
based on the project schedule. The city also requested a response that 
included a commitment to provide the hydronic pumps by November 21, 
2023. On November 27, 2023, the City of Mount Vernon notified FHWA that 
the city had received no further reply. Thus, the city did not receive 
any new information indicating that any of the waiver items could be 
produced by domestic manufacturers from any of the commenters opposing 
the waiver.
    Accordingly, FHWA believes that the city has made substantial 
efforts to find suitable Buy America-compliant waiver items for the 
Library Commons project. The FHWA reviewed the market research 
conducted by the city and, in consultation with the National Institute 
of Standards and Technology Manufacturing Extension Partnership, 
determined that further supplier scouting would not be warranted. The 
waiver items include iron and steel components of manufactured products 
of unknown origin, and FHWA does not believe that additional supplier 
scouting would uncover items where all iron and steel components could 
be shown to be domestically produced or manufacturers who wish to 
modify their manufacturing processes to incorporate such domestically 
produced components.

[[Page 19003]]

    Timing and Need for a Waiver: The waiver items are essential to the 
Project. Further, the City of Mount Vernon maintains that approval of a 
Buy America waiver for use of the waiver items in the Project is 
critical to maintain the schedule of ongoing construction on the 
Project. The City explained that the Project is scheduled to be 
substantially complete in March 2024 and that it is now at a juncture 
where delays in the approval of the Buy America waiver may delay 
completion of construction with commensurate additional payments to the 
contractor.
    In addition, the City of Mount Vernon has not located any domestic 
manufacturers for the waiver items, nor has any domestic manufacturer 
identified the ability to produce Buy America-compliant waiver items 
through the public comment process. These waiver items include many 
small iron and steel components of unknown origin incorporated into 
manufactured products that under FHWA's Buy America requirements must 
be domestically manufactured.\5\ Due to the nature of the Project and 
the waiver items, however, many of the waiver items are not commonly 
used on FHWA-funded projects.
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    \5\ FHWA's Buy America requirements differ from requirements 
applicable to other Federal Agencies under BABA in that 
predominantly iron and steel components of manufactured products 
must be Buy America- compliant. Under BABA, manufactured products 
must be manufactured in the United States and the cost of the 
manufactured product's components that are mined, produced, or 
manufactured in the United States must be greater than 55 percent of 
the total cost of all components of the manufactured product; 
however, BABA does not specifically mandate that iron and steel 
components in particular must be domestically manufactured. See BABA 
section 70912(6)(B).
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    Executive Order 14005: Executive Order (E.O.) 14005, entitled 
``Ensuring the Future is Made in All of America by All of America's 
Workers,'' provides that Federal Agencies should, consistent with 
applicable law, maximize the use of goods, products, and materials 
produced in, and services offered in, the United States. 86 FR 7475 
(Jan. 28, 2021). Based on the information contained in the waiver 
request from the City of Mount Vernon and the lack of responsive 
comments to the notice of waiver request, FHWA concludes that issuing a 
waiver is not inconsistent with E.O. 14005.

Finding and Request for Comments

    Based on all the information available to the Agency, FHWA 
concludes that, with respect to the specified products, there are no 
Buy America-compliant items and is waiving its Buy America requirements 
for steel and iron set forth at 23 U.S.C. 313 and 23 CFR 635.410 for 
recipient purchases of the following produces used in the Mount Vernon 
Library Commons Project (``specified products''): (i) elevator 
conveying equipment; (ii) elevator sump pump; (iii) HVAC controls; (iv) 
hydronic pumps; (v) energy recovery ventilators; (vi) split system A/C; 
(vii) coalescing style air and sediment separator; (viii) air source 
water heat pumps; (ix) fan coil units Nailor; (x) fan coil units 
Daikin; (xi) switchboards; (xii) panelboards; (xiii) an intercom 
system; (xiv) an AV system wall rack; (xv) heat pump water heaters; 
(xvi) a backflow preventer; (xvii) metal wall and roof panel fasteners; 
(xviii) terracotta fasteners; (xix) a retractable acoustic wall; (xx) a 
folding glass panel partition; (xxi) electric bike charging lockers; 
(xxii) uni-strut fasteners; and (xxiii) a fire alarm system. This 
finding only includes components identified in the waiver request and 
supporting documents included on FHWA's website.
    The waiver applies to the specified products used in the Project 
that are subject to Buy America as a result of obligations of Federal 
financial assistance made by FHWA for the Project. FHWA will obligate 
award funds following the effective date of this waiver. The City of 
Mount Vernon and its contractors and subcontractors involved in the 
procurement of the relevant components are reminded of the need to 
comply with the Cargo Preference Act in 46 CFR part 38, if applicable.
    The OMB Memorandum M-24-02 provides that, before granting a waiver 
in the public interest, to the extent permitted by law, Federal 
Agencies shall assess whether a significant portion of any cost 
advantage of a foreign-sourced product is ``the result of the use of 
dumped steel, iron, or manufactured products or the use of injuriously 
subsidized steel, iron, or manufactured products.'' \6\ However, 
because the waiver that FHWA is finalizing in this notice is not based 
on consideration of the cost advantage of any foreign-sourced steel, 
iron, or manufactured products, there is not a specific cost advantage 
for FHWA to now consider.
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    \6\ https://www.whitehouse.gov/wp-content/uploads/2023/10/M-24-02-Buy-America-Implementation-Guidance-Update.pdf.
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    In accordance with the provisions of section 117 of the SAFETEA-LU 
Technical Corrections Act of 2008, FHWA is providing this notice as its 
finding that a waiver of its Buy America requirements for steel and 
iron is appropriate. The FHWA invites public comment on this finding 
for an additional five days following the effective date of the 
finding. Comments may be submitted to FHWA's website via the link 
provided to the waiver page noted above.
    Authority: 23 U.S.C. 313; Pub. L. 110-161; 23 CFR 635.410.

Shailen P. Bhatt,
Administrator, Federal Highway Administration.
[FR Doc. 2024-05533 Filed 3-14-24; 8:45 am]
BILLING CODE 4910-22-P