Build America, Buy America Act
February 14, 2025
Statute Compilations
Introduction
The Build America, Buy America Act (BABAA) is a landmark piece of legislation signed into law on February 14, 2025. This act aims to strengthen the American economy by prioritizing the purchase of American-made goods and materials in infrastructure projects funded by the federal government.
Key Provisions
- Domestic Content Requirements: BABAA establishes minimum domestic content requirements for construction materials, iron and steel products, manufactured goods, and certain other products used in federally funded infrastructure projects. These requirements vary depending on the type of product and range from 50% to 100%.
- Manufactured in America Waiver: The act includes a waiver provision that allows federal agencies to purchase non-American-made goods and materials if they determine that domestic alternatives are not reasonably available, are not of sufficient quality, or are not available at a competitive price.
- Enforcement: The Federal Acquisition Regulation (FAR) is amended to include provisions for enforcing the domestic content requirements. Federal agencies are responsible for verifying that contractors comply with these requirements.
- Exceptions: The act includes several exceptions to the domestic content requirements, such as:
- Projects funded by foreign aid programs
- Projects involving the repair or maintenance of existing infrastructure
- Projects where the use of domestic goods and materials would increase the cost of the project by more than 25%
- Reporting: Federal agencies are required to report annually on their compliance with the domestic content requirements.
Objectives
BABAA has several objectives, including:
- Supporting American Jobs: The act is designed to create jobs in the American manufacturing sector by incentivizing the purchase of American-made goods.
- Promoting Economic Growth: By supporting American businesses, BABAA aims to stimulate economic growth and strengthen the domestic supply chain.
- Reducing Reliance on Foreign Imports: The act reduces the reliance on imported goods and materials, which can lead to increased national security and decreased vulnerability to supply chain disruptions.
- Improving Infrastructure Quality: BABAA ensures that federally funded infrastructure projects are constructed using high-quality American-made goods and materials.
Impact and Implementation
BABAA has significant implications for the infrastructure industry and the American economy as a whole. The act is expected to boost manufacturing output, create jobs, and improve the quality of infrastructure projects.
Federal agencies are currently working to implement BABAA by amending procurement regulations, establishing reporting systems, and providing guidance to contractors. The full impact of the act is expected to be felt over the coming years as infrastructure projects funded by the federal government begin to incorporate the new domestic content requirements.
Conclusion
The Build America, Buy America Act is a transformative piece of legislation that aims to strengthen the American economy, support American jobs, and improve the quality of infrastructure. The act’s domestic content requirements will have a significant impact on the procurement process for federally funded infrastructure projects and are expected to have far-reaching benefits for the United States.
Build America, Buy America Act
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