U.S. DOT Finalizes Buy America Waiver

On August 16, the US Department of Transportation (DOT) released its finalized Build America, Buy America Act (BABAA) waiver for de minimis costs and small grants.

The waiver took effect on August 16 and applies to iron and steel, manufactured products, and construction materials used in DOT funded and assisted projects for which:

  • The total value of the non-compliant products is no more than the lesser of $1,000,000 or 5% of total applicable costs for the project; or
  • The total amount of Federal financial assistance applied to the project, through awards or subawards, is below $500,000.

There were a few exceptions made to this waiver to not conflict with other existing agency actions, such as BABAA requirements for electric vehicle chargers under the Federal Highway Administration (FHWA).

The waiver does not include an expiration date, but the DOT will need to review the waiver every five years to determine whether to continue or modify it, as required by BABAA.

For additional background, on November 4, 2022, the DOT had proposed a limited waiver to replace an expiring general applicability waiver for Build America, Buy America Act (BABAA) requirements. The proposed waiver was similar in scope to the recently finalized version, with a few minor changes made to clarify the language.

AGC continues to engage with federal agencies and the White House on BABAA implementation to support a strong domestic manufacturing industry while also ensuring that the construction industry is not adversely affected by a rushed and burdensome implementation of the law.

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