How Asahi/America Fits Into The Buy American Act (BAA) And The Build America, Buy American Act (BABAA)

Are you one of many who are confused by the “Buy American” acts? Asahi/America, Inc. continues to receive requests whether our products can be used on projects with these requirements. The following is information explaining the government programs along with details on how you can continue to use Asahi/America’s products on these government-backed initiatives:

What’s the difference between the Buy American Act (BAA) and the Build America, Buy American Act (BABAA)?

• The Buy American Act (BAA) generally applies to direct federal procurement, which means purchases made by the U.S. federal government. The Build America, Buy America Act (BABAA) focuses on federal financial assistance programs, including grants, loans, and infrastructure projects. BABAA can have specific differences in its application depending on the federal agency (like the Department of Energy or Department of Transportation), as agencies may interpret or implement BABAA requirements uniquely. For more information, reference the Brief History appendix at the end of this article.

Do Asahi/America products meet the requirements of the Buy American Act (BAA)?

• Some products naturally meet the requirement, and some others must be requested by the purchasing agency through a waiver due to domestic non-availability. Some products do not meet the requirements. Components manufactured in World Trade Organization (WTO) member countries (Japan, Austria, Germany, Spain, etc.) may be purchased through Asahi/America under the Trade Agreements Act (TAA).

Do Asahi/America products meet the requirements of the Build America, Buy American Act (BABAA)?

• Some products naturally meet the requirement, and some others must be requested by the purchasing agency through a waiver due to domestic non-availability. Some products do not meet the requirements. Typically, federal financial assistance awards are not subject to international trade agreements, but this varies based on the state and agency. There are some other common limits where it is not required to get a waiver. Each federal agency will have different recommendations. Below are some common examples:
  • De Minimis Waivers: Often, a de minimis threshold allows for minor components of foreign origin to be used without a waiver if the total value of these components is relatively small compared to the total project cost. These thresholds typically cover items that make up less than 5% of the total cost of the materials used in a project, with a cap on the dollar value (often around $1 million).
  • Small Projects Exemption: For some infrastructure programs under the Infrastructure Investment and Jobs Act (IIJA) and other federal funding sources, a waiver may not be required for projects below a certain financial threshold (e.g., less than $250,000), although this too may vary by agency and specific funding conditions.

What constitutes “Made in America,” according to BAA?

• The Federal Acquisition Regulations (FAR) 25.003 states that non-iron or steel products must be manufactured in the USA, and the domestic content threshold must be 60% (October 25, 2022), 65% (January 1, 2024), and 75% (January 1, 2029). However, in the event no domestic products can meet the new thresholds or the cost to acquire them would be unreasonable, there is a 55 percent fallback threshold in effect from October 25, 2022, through December 31, 2029. Iron and steel products must contain 95% domestic components.

What constitutes “Made in America,” according to BABAA?

• Non-iron or steel products must be manufactured in the USA, and the domestic content threshold must be 55% of the total cost. Iron and steel products must be fully produced in the USA, from the initial production stages to the final coating process.

What can I do to make sure my customer is able to use the world-class products from Asahi/America?

• If the project is following BAA, consult Asahi/America Technical Services, and we will guide you through the WTO/TAA guidelines. If a waiver is required for BABAA, a form must be submitted by the recipient of the federal financial aid or the entity responsible for the project (engineers, project managers, etc.).

Asahi/America has always been committed to providing our customers the highest quality products available in the market. To do so, we have partnered with the top manufacturers in the world for thermoplastic valves and piping. Asahi/America also designs, manufactures, and supports many of our products from our Massachusetts-based headquarters and Louisiana production facility.

Asahi/America is happy to assist with any of the product details needed to populate the waiver request. Please contact our Technical Services department at 781-321-5409 or click below to request a sample section of information to include in the waiver request.

CLICK HERE TO REQUEST SAMPLE INFORMATION

BRIEF HISTORY

Timeline of Legislation

• 1933: Buy American Act (BAA) enacted.
• 1979: Trade Agreements Act (TAA) introduced.
• 2009: American Recovery and Reinvestment Act (ARRA) temporarily expands Buy American provisions.
• 2015: FAST Act and other transportation acts reinforce Buy America requirements.
• 2019: Executive Order 13881 raises domestic content thresholds.
• 2021: Build America, Buy America Act (BABAA) introduced under Infrastructure Investment and Jobs Act (IIJA).
• 2022: Executive Order 14082 increases domestic content thresholds under the BAA.

Buy American Act (BAA): Active

• Legislation: Enacted as part of the Buy American Act of 1933 (41 U.S.C. §§ 8301-8305).
• Purpose: Requires the U.S. government to prefer U.S.-made products in its purchases, provided they are available at a reasonable cost.
• Scope: Applies primarily to direct federal procurement.
• Amendments:
  • Federal Acquisition Regulation (FAR) Part 25: This regulation provides specific guidelines on implementing the BAA in federal contracts.
  • Several updates have been made to the act over the years, adjusting the requirements for domestic content thresholds and the definition of American-made goods.

Trade Agreements Act (TAA): Active

• Legislation: Trade Agreements Act of 1979 (19 U.S.C. §§ 2501-2581).
• Purpose: Allows the U.S. to waive BAA requirements for products from countries that are parties to international trade agreements, such as those in the World Trade Organization’s Government Procurement Agreement (GPA).
• Scope: Facilitates the purchase of goods and services from countries that have trade agreements with the U.S. in situations where BAA requirements would otherwise apply.

American Recovery and Reinvestment Act (ARRA): No longer applicable

• Legislation: Part of the American Recovery and Reinvestment Act of 2009 (Pub. L. 111-5).
• Purpose: Included provisions that expanded Buy American requirements to cover a broader range of federally funded projects, particularly in infrastructure and construction.
• Scope: Applied to specific projects funded by ARRA, requiring the use of U.S.-made iron, steel, and manufactured goods.

Infrastructure Investment and Jobs Act (IIJA): Active

• Legislation: Enacted on November 15, 2021, as Public Law 117-58.
• Purpose: Aims to invest approximately $1.2 trillion in U.S. infrastructure, creating jobs and addressing critical infrastructure needs across various sectors.
• Scope: Covers transportation, water systems, broadband, energy, and other public infrastructure projects; strengthens Buy America requirements through the Build America, Buy America Act (BABAA).

Build America, Buy America Act (BABAA): Active

• Legislation: Part of the Infrastructure Investment and Jobs Act (IIJA), also known as the Bipartisan Infrastructure Law, signed into law on November 15, 2021.
• Purpose: Expands Buy America requirements to cover all federally funded infrastructure projects, including those funded through financial assistance programs.
• Scope: Requires that iron, steel, manufactured products, and construction materials used in infrastructure projects be produced in the United States.

EDITOR’S NOTICE: Please note, the information in this article is for educational purposes only and does not supersede any Asahi/America technical information or product specifications. Please consult Asahi/America’s technical department at 1-800-343-3618 or [email protected] on all product applications in regards to material selection based on the pressure, temperature, environmental factors, chemical, media, application, and more.