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Global MFG - Aug 16, 2023

White House issues guidelines to boost use of US-made goods in government-funded infrastructure projects

The White House on Monday issued guidance to boost the use of U.S.-made goods including steel, iron and other construction materials, in government-funded infrastructure projects.

The "Buy America" binding guidance, first proposed in February, was finalized by the White House Office of Management and Budget (OMB) after receiving nearly 2,000 public comments.

OMB said the final guidance directed by Congress under the $1 trillion 2021 infrastructure law "will bolster American businesses, workers, and economic growth."

The infrastructure law significantly expanded standards to require government-funded infrastructure projects use more U.S.-made iron, steel, construction materials and manufactured products.

The OMB guidance sets manufacturing standards for plastic and polymer-based products, glass including optic glass, lumber, engineered wood, drywall, fiber optic cable and optical fiber.

The infrastructure law includes $110 billion for roads, bridges and major projects; $66 billion for rail; $55 billion for water infrastructure and $42 billion in broadband infrastructure grants.

OMB added engineered wood but opted not to include some additional construction materials, including paint and stain, and bricks. To qualify manufactured products must be U.S. manufactured and the cost of domestic-made components must exceed 55% of the cost of all components.

U.S. President Joe Biden speaks

In an event held in the East Room of the White House on Nov. 2, 2022, U.S. President Joe Biden addresses the topics of job training, infrastructure jobs, and advancements in broadband, construction, and manufacturing. (REUTERS/Leah Millis/File Photo / Reuters Photos)

The rules do not apply to tools, equipment, and supplies, such as temporary scaffolding, brought to the construction site and removed at the end of the project.

President Joe Biden in 2021 signed an executive order aimed at closing loopholes in existing "Buy American" provisions, which apply to about a third of the $600 billion in goods and services the federal government buys annually.

OMB noted agencies can issue waivers if needed when U.S.-made products are not sufficiently available. Agencies can also seek a waiver if the use of U.S. materials will increase the cost of the overall infrastructure project by more than 25%.

In March 2022, the Biden administration separately issued rules to raise domestic content thresholds.

Products previously qualified as Made in America for federal purchases if 55% of the value of their component parts were manufactured in the United States. The 2022 rule increased the threshold to 60% in October, 65% in 2024, and 75% in 2029.


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