81 FR 19701 - Buy America Waiver Notification

DEPARTMENT OF TRANSPORTATION
Federal Highway Administration

Federal Register Volume 81, Issue 65 (April 5, 2016)

This notice provides information regarding FHWA's finding that a Buy America waiver is appropriate for the obligation of Federal-aid funds for 48 State projects involving the acquisition of vehicles and equipment on the condition that they be assembled in the U.S.

[Federal Register Volume 81, Number 65 (Tuesday, April 5, 2016)]
[Notices]
[Pages 19701-19702]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2016-07800]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration


Buy America Waiver Notification

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

ACTION: Notice.

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SUMMARY: This notice provides information regarding FHWA's finding that 
a Buy America waiver is appropriate for the obligation of Federal-aid 
funds for 48 State projects involving the acquisition of vehicles and 
equipment on the condition that they be assembled in the U.S.

DATES: The effective date of the waiver is April 6, 2016.

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
please contact Mr. Gerald Yakowenko, FHWA Office of Program 
Administration, 202-366-1562, or via email at [email protected]. 
For legal questions, please contact Mr. Jomar Maldonado, FHWA Office of 
the Chief Counsel, 202-366-1373, or via email at 
[email protected]. Office hours for the FHWA are from 8:00 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 http://www.archives.gov and the 
Government Publishing Office's database at http://www.access.thefederalregister.org/nara.

Background

    This notice provides information regarding FHWA's finding that a 
Buy America waiver is appropriate for the obligation of Federal-aid 
funds for 48 State projects involving the acquisition of vehicles 
(including sedans, vans, pickups, trucks, buses, and street sweepers) 
and equipment (such as trail grooming equipment) on the condition that 
they be assembled in the U.S. The waiver would apply to approximately 
393 vehicles and equipment acquisitions. The requests for the third 
quarter of calendar year 2015, available at http://www.fhwa.dot.gov/construction/contracts/cmaq160105.cfm, are incorporated by reference 
into this notice. These projects are being undertaken to implement air 
quality improvement, safety, and mobility goals under FHWA's Congestion 
Mitigation and Air Quality Improvement Program and the Recreational 
Trails Program.
    Title 23, Code of Federal Regulations, section 635.410 requires 
that steel or iron materials (including protective coatings) that will 
be permanently incorporated in a Federal-aid project must be 
manufactured in the U.S. For FHWA, this means that all the processes 
that modified the chemical content, physical shape or size, or final 
finish of the material (from initial melting and mixing, continuing 
through the bending and coating) occurred in the U.S. The statute and 
regulations create a process for granting waivers from the Buy America 
requirements when its application would be inconsistent with the public 
interest or when satisfactory quality domestic steel and iron products 
are not sufficiently available. In 1983, FHWA determined that it was 
both in the public interest and consistent with the legislative intent 
to waive Buy America for manufactured products other than steel 
manufactured products. However, FHWA's national waiver for manufactured 
products does not apply to the requests in this notice because they 
involve predominately steel and iron manufactured products. The FHWA's 
Buy America requirements do not have special provisions for applying 
Buy America to ``rolling stock'' such as vehicles or vehicle components 
(see 49 U.S.C. 5323(j)(2)(C), 49 CFR 661.11, and 49 U.S.C. 
24405(a)(2)(C) for examples of Buy America rolling stock provisions for 
other DOT agencies).
    Based on all the information available to the agency, FHWA 
concludes that there are no domestic manufacturers that produce the 
vehicles and vehicle components identified in this notice in such a way 
that their steel and iron elements are manufactured domestically. The 
FHWA's Buy America requirements were tailored to the types of products 
that are typically used in highway construction, which generally meet 
the requirement that steel and iron materials be manufactured 
domestically. In today's global industry, vehicles are assembled with 
iron and steel components that are manufactured all over the world. The 
FHWA is not aware of any domestically produced vehicle on the market 
that meets FHWA's Buy America requirement to have all its iron and 
steel be manufactured exclusively in the U.S. For example, the 
Chevrolet Volt, which was identified by many commenters in a November 
21, 2011, Federal Register Notice (76 FR 72027) as a car that is made 
in the U.S., is comprised of only 45 percent of U.S. and Canadian 
content according to the National Highway Traffic Safety 
Administration's Part 583 American Automobile Labeling Act Report Web 
page (http://www.nhtsa.gov/Laws+&+Regulations/Part+583+American+Automobile+Labeling+Act+(AALA)+Reports). Moreover, 
there is no indication of how much of this 45 percent content is U.S.-
manufactured (from initial melting and mixing) iron and steel content.
    In accordance with Division K, section 122 of the ``Consolidated 
and

[[Page 19702]]

Further Continuing Appropriations Act, 2015'' (Pub. L. 113-235), FHWA 
published a notice of intent to issue a waiver on its Web site at 
http://www.fhwa.dot.gov/construction/contracts/waivers.cfm?id=117 on 
January 5, 2016. The FHWA received five comments in response to the 
publication. Four commenters suggested that preference should be given 
to American products in support of American workers and a waiver should 
only be granted if there are no domestic products available. These 
commenters did not provide a recommendation for domestic products that 
fully comply with FHWA's Buy America requirements. The fifth commenter 
supports granting a waiver and agreed that domestic assembly for the 
vehicles seems to be the only course to follow.
    Based on FHWA's conclusion that there are no domestic manufacturers 
that can produce the vehicles and equipment identified in this notice 
in such a way that steel and iron materials are manufactured 
domestically, and after consideration of the comments received, FHWA 
finds that application of FHWA's Buy America requirements to these 
products is inconsistent with the public interest (23 U.S.C. 313(b)(1) 
and 23 CFR 635.410(c)(2)(i)). However, FHWA believes that it is in the 
public interest and consistent with the Buy America requirements to 
impose the condition that the vehicles and the vehicle components be 
assembled in the U.S. Requiring final assembly to be performed in the 
U.S. is consistent with past guidance to FHWA Division Offices on 
manufactured products (see Memorandum on Buy America Policy Response, 
Dec. 22, 1997, http://www.fhwa.dot.gov/programadmin/contracts/122297.cfm). A waiver of the Buy America requirement without any regard 
to where the vehicle is assembled would diminish the purpose of the Buy 
America requirement. Moreover, in today's economic environment, the Buy 
America requirement is especially significant in that it will ensure 
that Federal Highway Trust Fund dollars are used to support and create 
jobs in the U.S. This approach is similar to the conditional waivers 
previously given for various vehicle projects. Thus, so long as the 
final assembly of the 48 State projects occurs in the U.S., applicants 
to this waiver request may proceed to purchase these vehicles and 
equipment consistent with the Buy America requirement.
    In accordance with the provisions of section 117 of the ``Safe, 
Accountable, Flexible, Efficient Transportation Equity Act: A Legacy 
for Users, Technical Corrections Act of 2008'' (Pub. L. 110-244), FHWA 
is providing this notice of its finding that a public interest waiver 
of Buy America requirements is appropriate on the condition that the 
vehicles and equipment identified in the notice be assembled in the 
U.S. The FHWA invites public comment on this finding for an additional 
15 days following the effective date of the finding. Comments may be 
submitted to FHWA's Web site via the link provided to the waiver page 
noted above.

    Authority: 23 U.S.C. 313; Pub. L. 110-161, 23 CFR 635.410.

    Issued on: March 29, 2016.
Gregory G. Nadeau,
Administrator, Federal Highway Administration.
[FR Doc. 2016-07800 Filed 4-4-16; 8:45 am]
BILLING CODE 4910-22-P