The Biden administration seems to be doubling down on the application and enforcement of the Buy American Act with the president’s January 25 executive order. While former President Trump’s order focused on increasing domestic material percentages, President Biden’s order focuses on oversight, enforcement, and access to information.
The first part of President Biden’s order establishes a Made in America Office (MAO) to increase oversight of Buy America and Buy American waivers. Buy America gives preference to the use of domestic materials on federal contracts that relate to transportation, and Buy American generally requires the use of domestic construction materials on any federal construction project. MAO will oversee both Buy America and Buy American and will be responsible for several new changes, including:
- Reviewing and approving all Buy America and Buy American waivers
- Establishing a “checklist” of information the agency head must provide along with waiver requests
- Making all waiver requests and the results of those requests available to the public on one website
These changes add yet another level of red tape for contractors seeking Buy America or Buy American waivers. Contractors must now wait for MAO approval after submitting their request to the proper agency head. However, contractors will also have more guidance on what needs to be included in a successful waiver request, and the new checklist will offer uniformity across waiver requests. While specific agency procedures will still need to be complied with, the checklist will provide new insight on what MAO expects in successful waiver requests. Contractors should have a working knowledge of the checklist once released to increase their chances of receiving a waiver.
The new website, which will catalog all waiver requests and decisions, will become a searchable database that contractors can reference when drafting requests. Further, contractors and their attorneys will be able to more efficiently research products and projects that have received waiver requests. This will allow for more persuasive waiver requests and, perhaps even automatic approvals if the item in question is the same as a previously approved item.
In addition to normal waiver considerations, President Biden’s order now allows the MAO to consider whether the use of dumped steel, iron, or manufactured goods or the use of subsidized steel, iron, or manufactured goods offsets the price advantage in a foreign product. “Dumping” occurs when a country sells an item to another country at a discount compared to the selling country’s market rate. How much this will impact waiver decisions is unclear, but it is no longer a simple question of whether a foreign product is cheaper by a certain percentage.
Agencies are now required to scout companies that are able to produce goods, products, and materials in the United States that meet federal procurement needs. The order does not explain how this information will be communicated to contractors, but any information regarding approved products and suppliers will be helpful. Ideally, the results of these investigations will lead to the creation of a list of certified products and suppliers that contractors can rely upon without worrying about whether the products comply with Buy American or Buy America.
Finally, President Biden’s order also makes a number of recommendations to the FAR Council and requires the Council to rule on these recommendations within the next 180 days. The president’s recommendations may increase Buy American restrictions even further if accepted. Be sure to check back for a follow-up blog post once these recommendations are implemented, and, as always, feel free to contact our team with any questions.