Build America, Buy America

The U.S. Department of Agriculture (USDA), the Department of Housing and Urban Development (HUD), and other federal agencies are subject to a “Build America, Buy America” (BABA) requirement in the Infrastructure Investment and Jobs Act of 2021, which mandates that iron, steel, manufactured products, and construction materials used in infrastructure projects be American made. The provision applies to most federally funded infrastructure projects; it is not limited to projects funded through the 2021 Act.

HAC Comments to USDA, July 2022

On July 29, 2022, the Housing Assistance Council (HAC) submitted comments to the U.S. Department of Agriculture (USDA), which proposed to establish waivers from Buy America requirements for purchases of de minimis, small grants, and minor components of infrastructure projects.

Key Takeaways

• Housing and community facilities should not be considered public infrastructure under the Build America, Buy America Act.
• If housing and community facilities are considered public infrastructure, it would be in the public interest to waive the Buy America preference for USDA’s programs to finance these construction projects so that scarce funds and staff resources can be devoted to addressing the current housing crisis.
• Waivers for purchases of de minimis, small grants, and minor components of infrastructure projects would also be in the public interest.

HAC Comments to HUD, July 2022

HAC expressed concern about the impact of “Buy America” requirements on affordable housing in comments it submitted to the U.S. Department of Housing and Urban Development (HUD) on July 15, 2022.

Key Takeaways

• Buy America preferences should not apply to assisted housing. HUD’s priority should be to address the affordable housing crisis. Furthermore, the law defines infrastructure as projects that benefit the general public, while assisted housing is available to only a subset of the general population.
• HUD should not apply Buy America preferences to owner-occupied housing because the Office of Management and Budget has specifically stated that private homes are not considered to be infrastructure.
• HUD should not apply Buy America preferences when HUD assistance is used for infrastructure that is built solely to support affordable housing, as is the case with the Self-Help Homeownership Opportunity Program (SHOP).
• HUD should not apply Buy America preferences to housing that receives less than $250,000 in federal funding, to developments with fewer than eight units, or to situations when HUD funding covers only a small portion of the per unit development cost.
• HUD should issue expedited waivers for materials that experience price spikes.
• HUD should provide guidance to help reduce administrative burdens on entities that receive HUD funding.