While domestic preference requirements in federal procurements, namely the Buy America and Buy American Acts, are not new their increased emphasis are. As has been well publicized, a central focus of the Trump Administration has been to encourage and increase the use of domestically sourced products and materials in connection with federal procurements. While this policy objective is relatively straightforward, the intersection and resulting nuances, between these Acts, their regulations and related trade statutes, agreements or exceptions generally are anything but. On Jan. 31, 2019, the President added to the mix by signing an executive order to further the administration’s Buy American push. The Jan. 31, 2019 Executive Order, “Strengthening Buy American Preferences for Infrastructure Projects,” expands on the President’s April 18, 2017, Executive Order 13788 and instructs federal agencies to develop plans and rules to encourage contractors to adhere to domestic preference requirements to the maximum extent practicable in all projects that receive indirect federal government assistance by way of loans, loan guarantees, or grants and other cooperative agreements. The Jan. 31, 2019 Executive Order has significant, potential implications for the contractor community because prior to the Executive Order the Buy American Act only applied in cases of federal procurements directly issued by the government. With the new Executive Order, however, the Buy American Act now potentially applies to any project that receives financial assistance from the federal government even if the project is not a procurement that was solicited by the federal government.
So what is covered now? The Executive Order directs federal agencies to “maximize, consistent with law, the use of goods, products, and materials produced in the United States . . . [including] through the terms and conditions of Federal financial assistance awards.” In this regard, the Executive Order directs agencies “[w]ithin 90 days . . . [to] encourage recipients of new Federal financial assistance awards pursuant to a covered program to use, to the greatest extent practicable, iron and aluminum as well as steel, cement, and other manufactured products produced in the United States in every contract, subcontract, purchase order or sub-award that is chargeable against such Federal financial assistance award.” The scope of the Executive Order, in terms of the materials, projects, and the types of work that are covered, is very broad. For example, “manufactured products” broadly covers any “items and construction materials composed in whole or in part of non-ferrous metals such as aluminum; plastics and polymer-based products such as polyvinyl chloride pipe; aggregates such as concrete; glass, including optical fiber; and lumber.” This term also encompasses iron, aluminum, steel and even cement. Continue Reading President Trump Expands Buy American Act – Another Wrench in the Works?