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Buy American/Hire American Executive Order

From: Russ Martin
Sent: April 19, 2017
Subject: Buy American/Hire American Executive Order

GHSA Members,
 
Yesterday, President Trump signed a new “Buy American, Hire American” executive order. Part of the order mandates an administrative review of the foreign worker visa system. The other part orders creates new requirements related to rules for procurement, directly under the federal government or using federal grants:

  • The order establishes the policy of the executive branch to “maximize the use of goods, products, and materials produced in the United States”.
  • The order directs federal agencies to minimize the use of waivers and requires agency heads to approve public interest waivers. Public interest waivers “should be construed to ensure the maximum utilization of goods, products, and materials produced in the United States” and agencies must determine whether “a significant portion of the cost advantage” is due to unfair trade practices.
  • The order directs the Secretary of Commerce, Wilbur Ross, and the OMB to coordinate a comprehensive inter-agency procurement review to assess Buy America compliance and the use of waivers. Agencies must submit their findings within 150 days and the final recommendations are due to the President within 220 days.
  • Finally, the Commerce Secretary and U.S. Trade Representative will analyze U.S. trade agreements in the context of domestic procurement preferences.
 
The federal highway safety grant program is already governed under the Buy America Act. To recap: SHSOs may not use grant funds to purchase any manufactured products unless the products are assembled or manufactured in the U.S. On June 30, 2015, NHTSA published a standing public interest waiver exempting manufactured products costing $5,000 or less, excluding motor vehicles. For other foreign-made products, SHSOs must apply for a waiver under a partly public process as described in NHTSA’s Buy America Guidance.
 
With today’s executive order, the Trump Administration has reinforced its clear policy to clamp down on overseas procurement and waivers. We should expect few if any further waivers to be granted in the short-term and stricter US DOT consideration of any future waiver applications moving forward. The review may or may not impact NHTSA’s current standing waiver. The Administration may decide to let it stand or it may decide to “reset” all of its transportation waivers using the new rules.
 
Two proposals to broadly reform Buy America rules have been introduced in Congress. Neither bill has yet advanced and neither would significantly impact highway safety grant programs.
  • H.R. 94, introduced by Daniel Lipinski (D-IL), would require US DOT to report to Congress annually on Buy America Act waivers, and mandates reform of Buy America rules for specific transportation modes.
  • S. 181, introduced by Senator Sherrod Brown (D-OH), reforms Buy America rules specifically for transportation construction.
 
We will update the association as we learn more. In the meantime, we strongly discourage states from filing for new Buy America Act waivers and thus bringing unwanted attention to our program.
 
Russ Martin
Director of Government Relations
Governors Highway Safety Association (GHSA)
444 N. Capitol Street, NW Suite 722
Washington, DC  20001-1534
202-789-0942, ext. 180
rmartin@ghsa.org
@russ_martin81