New OMB Proposed Buy America Guidance

New proposed White House guidance on Build America, Buy America Act compliance brings yet more questions for contractors as well as owners.

After President Biden raised Buy America in his State of the Union address, the Office of Management and Budget (OMB) finally released long-anticipated new proposed guidance for the Build America, Buy America Act (BABAA) requirements that include construction materials. You may recall, AGC recently reported that the Federal Highway Administration released guidance on Buy America. Interestingly enough, the FHWA attempt to clear up confusion may already be at odds with OMB’s updated guidance.

Proposed changes to BABAA include expanded definitions of the terms “manufactured products” versus “construction material” and expanded domestic manufacturing requirements for materials under the “construction materials” category. Some of these changes seem to contradict OMB’s initial guidance, which Federal agencies and state partners have been utilizing to formulate their policies to date.

For example, the Infrastructure Investment and Jobs Act (IIJA) specifically exempted “cement and cementitious materials; aggregates such as stone, sand, or gravel; and aggregate binding agents or additives.” Yet, OMB is now asking “how should OMB treat cement and cementitious materials before they are processed into a specific form and shape?” OMB seems to be implying that asphalt would not be exempt from the requirements as FHWA suggested a week ago, and Congress intended in the IIJA. A preview of our upcoming comments to OMB will include: “See Section 70917(c) of the IIJA and follow the intent of Congress.”

Should these proposed changes come into effect, it would force agencies and their partners to reevaluate all of their BABAA policies and documents (including the FHWA Q&A document) that they have released so far. The federal government continues to create uncertainty as it relates to new Buy America requirements, and at a time when most of the country will soon be entering construction season.

The proposed changes by OMB will be open for public comment until March 13, 2023 and AGC plans to comment on these changes. Unfortunately, it seems that every time we get an answer, they have contradicted themselves and thus created new questions.

If you have any questions on BABAA which you believe have not been properly addressed by agencies and their partners in order to fully comply and complete projects, please contact Deniz Mustafa at [email protected].

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