Legislative Update
September 26, 2003

House Strikes Buy America Provision from Transportation Appropriations Bill.

On September 4, 2003, the full House struck a proposed provision imposing cumbersome new Buy America rules on transit procurements from the House Transportation, Treasury, and Independent Agencies Appropriations bill. A member of the House Transportation and Infrastructure (“T&I”) Committee raised a “Point of Order” against the provision citing objections that the provision would “significantly slow the purchase and construction of transit system components and systems” and could unwittingly result in more foreign-made products being purchased by transit agencies. The Point of Order also asserted that the proposed provision was legislative in nature and, therefore, was improperly included in the appropriations bill. The Appropriations Committee conceded the Point of Order and the provision was stricken from the bill.

The comparable Senate Appropriations bill did not include any language attempting to make substantive changes in Buy America rules. However, the Report accompanying the bill included language instructing the Department of Transportation Inspector General to “review” recent Federal Transportation Administration (“FTA”) Buy America decisions.

Comment: Possible changes to the Buy America rules imposed on transit procurements funded by FTA grants will likely be considered by the House and Senate in connection with the reauthorization of the Transportation Equity Act for the 21st Century (“TEA-21”).

The Bush Administration’s reauthorization proposal, dubbed the “Safe, Accountable, Flexible and Efficient Transportation Equity Act” (“SAFETEA”), includes a Buy America provision intended to ease the paperwork and regulatory burden on transit agencies and that would also make FTA rules consistent with Federal-aid highway rules. However, it is expected that companies dedicated to more onerous Buy America restrictions will be working against the Administration’s proposal and in favor of the language similar to that stricken from the House Transportation Bill. The SAFETEA proposal can be viewed at: http://www.fhwa.dot.gov/reauthorization/safetea.htm.

Both the House and Senate currently have bills pending to extend TEA-21 programs on a temporary basis pending consideration of a long-term reauthorization bill. House and Senate staff are currently working on long-term reauthorization bills.