November 15, 2021, President Biden signed the Infrastructure Investment Jobs Act (IIJA) Pub. L. No. 117-58, which included the Title IX Subtitle A- Build America, Buy America Act (BABA). The following is an excerpt from the Public Law No. 117-85.
DOMESTIC CONTENT PROCUREMENT PREFERENCE. —The term ‘‘domestic content procurement preference’’ means a requirement that no amounts made available through a program for federal financial assistance may be obligated for a project unless—
(A) all iron and steel used in the project are produced in the United States.
(B) the manufactured products used in the project are produced in the United States; or
(C) the construction materials used in the project are produced in the United States.
PRODUCED IN THE UNITED STATES. —The term ‘‘produced in the United States’’ means—
(A) in the case of iron or steel products, that all manufacturing processes, from the initial melting stage through the application of coatings, occurred in the United States.
(B) in the case of manufactured products, that—
(i) the manufactured product was manufactured in the United States; and
(ii) the cost of the components of the manufactured product that are mined, produced, or manufactured in the United States is greater than 55 percent of the total cost of all components of the manufactured product, unless another standard for determining the minimum amount of domestic content of the manufactured product has been established under applicable law or regulation; and
(C) in the case of construction materials, that all manufacturing processes for the construction material occurred in the United States.
M-22-11 Memorandum for Heads of Executive Departments and Agencies (Initial Implementation Guidance on Application of Buy America Preference in Federal Financial Assistance Programs) The following are excerpts from the M-22-11.
By May 14, 2022, agencies must ensure that all applicable programs comply with section 70914 of BABA.
On August 23, 2023, the Office of Management and Budget (OMB) published final Guidance for Grants and Agreements to support implementation of the BABA Act.
(Revised guidance takes effect on October 23, 2023)
The new regulations implementing the Final Guidance will be published in a new part of the Code of Federal Regulations (“C.F.R.”) (2 C.F.R. Part 184). OMB is intending to replace Memorandum M-22-11 prior to the October 23, 2023, effective date.
- Iron and Steel:
- Articles, materials, or supplies that consist wholly or predominantly of iron or steel or a combination of both.
- The cost of the iron and steel content exceeds 50% of the total cost of all components.
- The cost of iron and steel is the cost of the iron or steel mill products (such as bar, billet, slab, wire, plate, or sheet), castings, or forgings utilized in the manufacture of the product and a good faith estimate of the cost of iron or steel components
- Produced in the United States, all manufacturing processes for the iron or steel, from the initial melting stage through the application of coatings, must occur in the Unites States.
- Manufactured Products:
- Articles, materials, or supplies that have been: (i) Processed into a specific form and shape; or (ii) Combined with other articles, materials, or supplies to create a product with different properties than the individual articles, materials, or supplies.
- (2) If an item is classified as an iron or steel product, a construction material, or a section 70917(c) material under § 184.4(e) and the definitions set forth in this section, then it is not a manufactured product. However, an article, material, or supply classified as a manufactured product under § 184.4(e) and paragraph (1) of this definition may include components that are construction materials, iron or steel products, or section 70917(c) materials.
- Construction Materials are defined as articles, materials, or supplies that consist of only one of the following items:
- Non-ferrous metals – “All manufacturing processes, from initial smelting or melting through final shaping, coating, and assembly, occurred in the United States.”
- Plastic and polymer-based products (including polyvinylchloride, composite building materials, and polymers used in fiber optic cables) – “All manufacturing processes, from initial combination of constituent plastic or polymer-based inputs, or, where applicable, constituent composite materials, until the item is in its final form, occurred in the United States.”
- Glass (including optic glass) – “All manufacturing processes, from initial batching and melting of raw materials through annealing, cooling, and cutting, occurred in the United States.”
- Fiber optic cable (including drop cable) – “All manufacturing processes, from the initial ribboning (if applicable), through buffering, fiber stranding and jacketing, occurred in the United States. All manufacturing processes also include the standards for glass and optical fiber, but not for non-ferrous metal, plastic and polymer-based products, or any others.
- Optical fiber – “All manufacturing processes, from the initial preform fabrication stage through the completion of the draw, occurred in the United States.”
- Lumber – “All manufacturing processes, from initial debarking through treatment and planning, occurred in the United States.”
- Drywall – “All manufacturing processes, from initial blending of mined or synthetic gypsum plaster and additives through cutting and drying of sandwiched panels, occurred in the United States.”
- Engineered wood – “All manufacturing processes from the initial combination of constituent materials until the wood product is in its final form, occurred in the United States.”
- Section 70917 (c) Materials:
- cement and cementitious materials; aggregates such as stone, sand, or gravel; or aggregate binding agents or additives