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US issues guidance on domestic steel sourcing for infrastructure – S&P Global

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Requirements take effect May 14
Guidance outlines waiver process

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The US issued guidance to federal agencies April 18 detailing domestic steel and iron sourcing requirements for federally funded infrastructure projects that aligns with the “Buy America” provisions included in the bipartisan infrastructure investment package passed in 2021.
“The [Infrastructure Investment and Jobs Act] requires that no later than May 14, 2022… the head of each covered Federal agency shall ensure that ‘none of the funds made available for a federal financial assistance program for infrastructure, including each deficient program, may be obligated for a project unless all of the iron, steel, manufactured products, and construction materials used in the project are produced in the United States,'” the US Office of Management and Budget said in a memorandum.
“The Act affirms, consistent with Executive Order 14005, Ensuring the Future Is Made in All of America by All of America’s Workers, this administration’s priority to ‘use terms and conditions of federal financial assistance awards to maximize the use of goods, products, and materials produced in, and services offered in, the United States.'”
Agencies must ensure that all iron and steel products purchased for a project have been fully produced in the US from the initial melting process to the final application of coatings.
Furthermore, all manufactured products that are sourced for a federal project must be produced in the US, and “the cost of the components of the manufactured product that are mined, produced, or manufactured in the United States is greater than 55% of the total cost of all components of the manufactured product,” unless another standard has been established under applicable law or regulation.
The domestic sourcing requirements apply to all infrastructure projects that receive federal funding, regardless of whether the funds are made available through the infrastructure legislation.
However, the guidance does not apply to expenditures needed in response to disaster relief and emergency assistance. The memorandum also provides a transparent process by which a project can waive the “Buy America” preference.
Federal agencies may apply for a waiver from the requirements if domestic sourcing is not possible, inconsistent with public interest or would increase the cost of a project by over 25%.
The American Iron and Steel Institute said it welcomed the federal guidance on domestic steel procurement and appreciated the commitment of the Biden administration to ensure that all federally funded infrastructure projects support the domestic industry.
“As some federal programs do not apply ‘Buy America’ requirements for the procurement of iron and steel products, we are pleased that today’s initiative begins the process to remedy this situation by providing clear guidance to federal agencies for adopting appropriate ‘Buy America’ requirements for all federally-funded infrastructure projects,” AISI CEO Kevin Dempsey said in a statement April 18.
Dempsey said the issuance of the memorandum represents “an important first step toward ensuring the fullest possible implementation and enforcement of ‘Buy America’ domestic procurement preferences.”
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