Understanding Build America, Buy America (BABA) Requirements

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Build America, Buy America (BABA) is a policy that ensures infrastructure projects in the US use domestically produced iron, steel, and manufactured products. It aims to support American manufacturing, national security, high-paying jobs, community investment, economic prosperity, and innovation. Non-Federal entities receiving Federal Financial Assistance from HUD after the effective date must comply with BABA requirements. The policy does not apply to certain funds obligated before specific dates or used for non-construction purposes.

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U.S. Department of Housing and Urban Development Build America, Buy America (BABA) Virtual Stakeholder Call October 26, 2023 1 Pre-decisional Not for distribution

Build America, Buy America (BABA) BABA Basics BABA Basics BABA was enacted on November 15, 2021, as part of the Infrastructure Investment and Jobs Act. In general, BABA requires agencies to ensure Federal Financial Assistance obligated after the effective date that funds infrastructure projects applies a domestic content procurement preference, meaning that all iron, steel, manufactured products, and construction materials used in the infrastructure project must have been produced in the United States, unless the Federal agency waives the application of the preference. This is called the Buy American Preference (BAP). Goals of BABA Goals of BABA Bolster America s domestic manufacturing and supply chain Protect national security Support high-paying jobs Increase community investment Create economic prosperity and spur innovation 2 Pre-decisional Not for distribution

Does BABA apply to me? Questions? Contact BuildAmericaBuyAmerica@hud.gov BABA requirements apply to Non-Federal Entities who have received Federal Financial Assistance obligated by HUD after the effective date for BABA implementation. HUD has announced a phased implementation schedule that began November 15, 2022. What is Federal Financial Assistance ? Which Non-Federal Entities? What is an Infrastructure Project ? The construction, alteration, maintenance, or repair of: structures, facilities, and equipment For: roads, highways, and bridges; public transportation; dams, ports, harbors, and other maritime facilities; intercity passenger and freight railroads; freight and intermodal facilities; airports; water systems, including drinking water and, wastewater systems; electrical transmission facilities and systems; utilities; broadband infrastructure; and buildings and real property. As defined in 2 CFR 200.1: Grants; Cooperative agreements; Non-cash contributions or donations of property (including donated surplus property); Direct appropriations; Food commodities; Loans; Loan Guarantees; Interest subsidies; Insurance, and Other financial assistance As defined in 2 CFR 200.1: State; Local government; Indian tribe; Institution of Higher Education (IHE); Nonprofit organization that carries out a Federal award as recipient or subrecipient. 3 Pre-decisional Not for distribution

Does BABA apply to me? Questions? Contact BuildAmericaBuyAmerica@hud.gov BABA does NOT apply to: BABA does NOT apply to: Funding obligated HUD or by operation of law before November 14, 2022 or the specific implementation date announced by HUD for each program. Funds used for disaster or emergency response expenditures, such as CDBG- DR grants. Amounts received as reimbursement for services or payments for activities that are NOT construction, alteration, maintenance or repair , e.g., rental assistance payments and purchase money mortgages/financing. 4 Pre-decisional Not for distribution

When will BABA Apply? Questions? Contact BuildAmericaBuyAmerica@hud.gov HUD has issued a Phased Implementation Plan and associated waiver indicating when BABA will apply to various programs and grantees. FY23 Q1 FY23 Q2 FY23 Q3 FY23 Q4 FY24 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY25 Q1 Program FY25 Obligation Date (Varies) Construction materials Not Listed Manufactured products CDBG Formula Grants 11/15/22 Iron and steel FY24 Obligation Date (Varies) Construction materials Specifically-Listed 8/23/24 2/22/23 Iron and steel All construction materials Manufactured products Healthy Homes* FY25 Obligation Date (Varies) Construction materials Not Listed Manufactured products 8/23/23 Iron and steel Recovery Housing Program ( RHP ) Grants FY24 Obligation Date (Varies) Construction materials Specifically-Listed 8/23/24 2/22/24 All other HUD FFA** All construction materials Manufactured products Iron and steel Iron and steel 8/23/24 All construction materials Manufactured products HOME*** *Choice Neighborhood, Lead Hazard Reduction, and Healthy Homes Production Grants **All other HUD FFA except HOME, Housing Trust Fund, and Public Housing FFA used for maintenance projects ***HOME, Housing Trust Fund, and Public Housing FFA used for maintenance projects 5 Pre-decisional Not for distribution

Finding American-Made Products Questions? Contact BuildAmericaBuyAmerica@hud.gov MadeInAmerica.gov Working with trade associations and local manufacturers/stores Resources for finding American-made products include: Hollings Manufacturing Extension Partnership (MEP) 6 Pre-decisional Not for distribution

HUD General Waivers Questions? Contact BuildAmericaBuyAmerica@hud.gov HUD has issued several general applicability waivers that postpones BABA requirements for most grantees. General waivers include: Exigent Circumstances This waiver applies when there is an urgent need by a recipient to immediately complete an infrastructure project because of a exigent circumstances, or a threat to life, safety, or property of residents and the community. This waiver is currently in effect as of November 23, 2022. Phased Tribal Small Grants De Minimis Implementation This waiver established a phased implementation schedule for the application of the BAP to HUD programs through FY2025. HUD s Phased Implementation Schedule can be viewed below. Consultation This waiver is effective for Tribal recipients through May 23, 2024. HUD issued a public interest waiver for the BAP as it applies to Tribal recipients to allow time for HUD to consult with Tribally Designated Housing Entities, and other Tribal Entities on how to apply the BAP. BABA requirements do not apply to infrastructure projects whose total cost is equal to or less than the current Simplified Acquisition Threshold of $250,000. This waiver is currently in effect as of November 23, 2022. BABA requirements do not apply for a De Minimis portion of an infrastructure project, meaning a cumulative total of no more than 5 percent of the total cost of the iron, steel, manufactured products, and construction materials, up to a maximum of $1 million. This waiver is currently in effect as of November 23, 2022. 7 Pre-decisional Not for distribution

What If I Cant Find U.S. Products? Questions? Contact BuildAmericaBuyAmerica@hud.gov Apply for a Project/Product Specific BABA Waiver, If Needed If a general waiver does not apply, HUD can issue project-specific waivers to the Buy American Preference if there is a finding that a waiver falls into one of the following three categories: 1 2 3 Non-Availability Waivers Unreasonable Cost Waivers Public Interest Waivers 8 Pre-decisional Not for distribution

Questions? Contact BuildAmericaBuyAmerica@hud.gov Waivers Waivers indicate a market need All waivers are posted for public comment on the Federal Register before approval Approved waivers are posted to the Made In America website Identify New Opportunities Waivers are temporary Waivers are time-limited, targeted, and conditional Purchase of U.S.-made materials is the goal 9 Pre-decisional Not for distribution