WASHINGTON — The Coalition for a Prosperous America (CPA) today applauded the Made in America Office at the Office of Management and Budget (OMB) for unveiling a new Buy America waiver transparency process on Wednesday. Under this new guidance, the 24 largest federal agencies must enter proposed non-availability waivers into a digital portal on the Made in America Office website. As a result, these waivers will be publicly available to the American people and will provide American companies and workers an opportunity to challenge waivers and compete for more federally funded contracts. Smaller government agencies will be required to follow this new process by Jan. 1, 2022.
“CPA is proud to represent companies and workers that make things right here in America,” CPA Chair Zach Mottl said. “We appreciate the Biden administration for continuing to undertake efforts that show they are serious about strengthening Buy America rules. For too long, the federal government has granted waivers to foreign companies that exploit glaring Buy American loopholes in order to win government contracts. These new guidelines will bring much-needed transparency to a program that is supposed to ensure that taxpayer dollars support American manufacturing and American workers.”
In July, CPA applauded the Biden administration for proposing a new rule pursuant to Executive Order (EO) 14005, Ensuring the Future is Made in All of America by All of America’s Workers, which President Joe Biden signed in January. The proposed rule aims to increase American-made content in federal purchases and bolster critical supply chains. The effort builds upon the Biden administration’s efforts to modernize and strengthen implementation of the Buy American Act. With $600 billion in annual procurement spending, nearly half of which is in manufactured products, the Federal government is a major buyer of goods and services, including the single largest purchaser of consumer goods in the world. However, CPA remains concerned about possible future weakening of the content rules by using a “value added” test proposed by those opposing Buy America.
Importantly, the proposed rule would raise the domestic content threshold and eliminate a loophole that benefits foreign producers. Although the Buy American Act requires that products bought with taxpayer dollars must “substantially all” be made in the U.S., products could still qualify today if just 55 percent of the value of their component parts are manufactured in the U.S. The proposed rule would implement an immediate increase of the threshold to 60 percent and a phased increase to 75 percent.
“CPA looks forward to working with Made in America Director Celeste Drake as these new guidelines are implemented,” said Michael Stumo, CEO of CPA. “For more than a decade, CPA has been a strong advocate for increasing domestic sourcing and purchasing by the federal government. However, loopholes in Buy America rules and a lack of transparency has allowed foreign companies to unfairly win government contracts over U.S. domestic firms. We look forward to engaging with the Biden administration as they bring transparency to this process.”
In June, CPA welcomed guidance from the Biden administration on how federal agencies should implement EO 14005, which requires the Office of Management and Budget (OMB) to establish the Made in America Office (MIAO) to focus on increasing opportunities for domestic sourcing and reducing the need for waivers from federal Buy American laws. Importantly, the guidance also requires federal agencies to designate a Senior Accountable Official (SAO) for domestic sourcing. The SAO will coordinate with Celeste Drake, the nation’s first Made in America Director, to implement a holistic approach to advance the policy set forth in the EO, including by working to increase opportunities for U.S. manufacturing and to reduce waivers.