December 7, 2021
Congress Expands Buy America Requirements in the
Infrastructure Investment and Jobs Act (P.L. 117-58)
Domestic content preference laws, which require that
broadband infrastructure; and real property and buildings.
certain goods purchased with federal funds be
Other projects may be covered; for example, the IIJA
manufactured primarily in the United States, have received
authorizes federal funding for an expanded clean school bus
increased attention from both Congress and the executive
program. Although the program authorized in the IIJA to
branch in recent years. The Infrastructure Investment and
fund purchases of electric school buses by local school
Jobs Act (IIJA; P.L. 117-58), enacted in November 2021,
districts contains no explicit Buy America references, EPA
made changes to “Buy America” requirements for federally
may determine that Buy America requirements will extend
funded infrastructure projects.
to these items as well.
Buy America
Buy America requirements previously applied to iron, steel,
“Buy America” refers to several statutes and regulations
and certain manufactured goods. The IIJA broadens
that apply to federal financial assistance used to support
coverage to include nonferrous metals, such as copper used
infrastructure-related projects, principally those involving
in electric wiring; plastic- and polymer-based products;
highways, public transportation, airports, aviation, and
glass, including optical fiber; and certain other construction
intercity passenger rail, including Amtrak. Buy America
materials, such as lumber and drywall. Congress did not
requirements also apply to certain federally funded water-
include cement and aggregates—comprising sand, gravel,
related infrastructure projects and, in these cases, are
and crushed stone—in the IIJA’s list of construction
administered by the Environmental Protection Agency
materials subject to Buy America. Industry groups asserted
(EPA). Buy America requirements as they relate to
that transporting these extremely heavy materials from
transportation date to the Surface Transportation Assistance
distant U.S. producers rather than closer Canadian or
Act of 1978 (P.L. 95-599) and are distinct from
Mexican producers would be costly and might have other
requirements under the Buy American Act of 1933, which
adverse effects including more damage to roads and
is specific to direct procurement by the federal government.
highways. Imported cement and aggregates accounted for
approximately 16% of total U.S. consumption in 2020;
Statutes containing differing Buy America requirements
however, this figure is not representative of the materials
applicable to each transportation mode are administered by
use in federally funded projects.
various Department of Transportation (DOT) agencies.
Each agency subject to the law maintains its own
To be considered “produced in the United States” under the
regulations and monitors grantees’ performance. The
IIJA, manufactured goods must contain greater than 55%
Federal Transit Administration, for example, addresses
domestic content and be manufactured in the United States.
different issues in its Buy America requirements from other
In the case of construction materials all manufacturing
DOT agencies, such as the Federal Highway
processes must occur in the United States. The law directs
Administration. EPA has separate requirements, and
the Office of Management and Budget (OMB) to define the
relevant manufacturing processes as they relate to
implementing the IIJA will require agencies in certain other
construction materials within 180 days of enactment. The
federal departments, such as the Department of Energy and
IIJA instructs OMB to ensure that construction materials
the Department of Commerce, to develop Buy America
and associated inputs originate in the United States, as well
regulations of their own.
as to “seek to maximize the direct and indirect jobs
benefited or created in the production of the construction
Compliance is the responsibility of recipients of federal
material.”
grants covered by Buy America statutes, such as a state
government seeking to use federal funds to cover part of the
Executive Order 14005 and the IIJA
cost of rebuilding a highway bridge or local governments
The IIJA and Executive Order 14005 (E.O.) each contain
using federal funds to replace water pipes and sewage
similar language that addresses domestic content
systems. Grantees may obtain waivers of requirements to
requirements. E.O. 14005, signed by President Biden in
use domestic products in certain circumstances.
January 2021, established a Made in America Office within
OMB with several responsibilities, including increased
Expanded Requirements
enforcement of and compliance with domestic preference
Buy America requirements traditionally extend to public-
statutes. The statute establishes a centralized system in
works transportation and water-related infrastructure. The
which OMB is to serve as the final authority in reviewing
IIJA expands Buy America coverage to other infrastructure
waiver requests for all projects using federal funds;
projects funded by federal grants, including transmission
previously, the various agencies that administer Buy
facilities; structures and equipment of electric utilities;
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link to page 2
Congress Expands Buy America Requirements in the Infrastructure Investment and Jobs Act (P.L. 117-58)
America requirements have been responsible for
greater domestic production of rail cars and transit buses
considering waiver requests from their grantees.
than would occur without the requirements. These
industries are relatively small, and the majority of sales are
The IIJA directs the Secretary of Transportation to enter
to private railroads not covered by Buy America.
into an agreement with the Secretary of Commerce and to
consult with the Director of the Hollings Manufacturing
Figure 1. U.S. Steel Manufacturing Employment
Extension Partnership to determine whether a domestic
entity could supply the iron, steel, manufactured product, or
construction material needed for an infrastructure project
prior to granting a Buy America waiver. In addition, both
the IIJA and E.O. 14005 instruct all federal agencies to
work with the Director of the Hollings Manufacturing
Extension Partnership to identify American firms that can
supply goods and materials that meet Buy America
requirements, as well as develop and sustain a domestic
supply base of such goods and materials.
Waivers allowed under prior Buy America laws are also
authorized under the IIJA, including where Buy America
requirements would be inconsistent with public interest;
products and materials are not domestically available in
sufficient quantities and/or of satisfactory quality; and if the
domestic products/materials raise the cost of the project by

a specified threshold. Prior to a waiver being granted, the
Source: CRS analysis of Bureau of Labor Statistics, Current
issuing agency must make the proposed waiver publicly
Employment Statistics.
available on a website designated by OMB and must afford
the public a specified amount of time to comment. General
Potential Effects and Issues
applicability waivers must be reviewed every five years to
The broadening of Buy America coverage under the IIJA
determine whether or not a waiver should be continued.
may impact supply chains across multiple industries,
Additionally, prior to granting a waiver, both the IIJA and
including among suppliers to the construction industry.
E.O. 14005 direct federal agencies to assess whether the
Some firms that manufacture certain construction materials
cost advantage of a foreign product is the result of unfair
contend that they rely on imported components or other
trade practices, such as dumping or subsidization.
inputs, and assert that broadening Buy America coverage
Effects on Manufacturing and
may adversely affect their domestic manufacturing
Employment
activities. Barring import competition for a broader range of
procurement funded by federal grants also has the potential
Buy America has several objectives that range from
to increase the market power of domestic producers in
shielding U.S. manufacturing and employment from import
industries that are already highly concentrated, possibly
competition to maintaining a domestic industrial base of
leading to higher project costs.
critical goods and materials. Assessing how well Buy
America has accomplished these purposes is difficult—as is
Oversight of expanded Buy America requirements
measuring the economic costs and benefits of Buy America
mandated in the IIJA is likely to prove complicated due to
restrictions.
other provisions in the law. The IIJA increases the amount
of federal infrastructure funding provided directly to local
Steel has been a particular focus of Buy America laws. Data
entities, such as counties or municipal bus systems, rather
on the quantity of steel used each year in projects subject to
than passing through state governments or metropolitan
Buy America requirements are not available, so it is not
planning organizations. This may also extend to
possible to calculate accurately the share of domestic steel
nontransportation infrastructure projects, such as tribal
production covered by the laws.
broadband deployments, where eligible entities include
Employment in steel manufacturing has declined 47%
tribal governments, tribal colleges or universities, or native
between 1990 and 2020; however, it has remained
corporations not previously engaged in overseeing Buy
moderately stable since 2009 (Figure 1). Domestic
America requirements. Some jurisdictions and
producers’ share of the U.S. steel market has fluctuated
nongovernmental organizations may lack the staff and legal
between 2000 and 2020, ranging from approximately 70%
expertise to comply with the Buy America regulations of
to 90%, and experienced the market’s highest levels of
various federal agencies. This may complicate enforcement,
import competition during 2014-2015. Steel produced in
as specific procurement contracts often require complex
Canada and Mexico is entitled to duty-free access to the
determinations of whether a bidder has adhered to federal
U.S. market under the United States-Mexico-Canada trade
law and can lead to protracted legal challenges.
agreement. Some manufacturers contend that Buy America
requirements hinder the integration of the three economies
Christopher D. Watson, Analyst in Industrial
that the agreement is intended to promote.
Organization and Business
One of the primary manufacturing industries affected by
IF11989
Buy America is rolling stock, and has likely resulted in
https://crsreports.congress.gov

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Congress Expands Buy America Requirements in the Infrastructure Investment and Jobs Act (P.L. 117-58)


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https://crsreports.congress.gov | IF11989 · VERSION 1 · NEW

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