On November 4, 2022, the U.S. Department of Transportation (“DOT”) published two proposed waiver notices with request for comments related to the Bipartisan Infrastructure Law’s Build America, Buy America Act (“BABA”). Both notices stated that DOT’s existing temporary waiver for construction materials would not be extended past its expiration on November 10, 2022. One notice proposes a public interest waiver for certain narrow categories of contracts and solicitations to continue transitioning the construction materials standard. The other notice proposes a public interest waiver for de minimis costs, small grants, and minor components. Comments are due November 20, 2022 for both notices.
On July 28, 2022, the United States Department of Transportation (“DOT”) published a Request for Information (“RFI”) on the implementation of the Infrastructure Investment and Jobs Act’s Build America, Buy America Act (“BABA”). As discussed in our previous post, BABA expanded Buy America preferences to cover all infrastructure projects and sets new domestic content standards for federal financial assistance programs. The RFI focuses specifically on implementing these domestic content standards for construction materials, which were not subject to the Buy America regime prior to BABA. Given the wide range of products that might conceivably constitute a “construction material,” industry participants would be wise to closely monitor both the RFI and DOT’s implementation progress and to take steps to ensure that policymakers understand their views on the subject.…
On April 18, 2022, the Office of Management and Budget (“OMB”) published a memorandum entitled “Initial Implementation Guidance on Application of Buy America Preference in Federal Financial Assistance Programs for Infrastructure” (“OMB Guidance”). OMB M-22-11. The OMB Guidance supplements the Build America, Buy America Act (“BABA”) provisions of the Infrastructure Investment and Jobs Act (“IIJA”), which was enacted in November 2021. In addition, OMB issued a Notice of Listening Sessions and Request for Information (“RFI”) on April 21, 2022 seeking public input on BABA implementation. Public comments are due by May 23, 2022.
Continue Reading Infrastructure Update: OMB Issues New Buy America Guidance for Federal Infrastructure Projects
The American Rescue Plan, signed into law last month, includes $1.9 trillion in economic stimulus, healthcare, and related funding. And just last week the Biden administration released an infrastructure proposal, the American Jobs Plan, that includes $2.3 trillion in transportation, connectivity, power, and other critical infrastructure investments.
Contractors are right to view these plans as massive opportunities — but should be cognizant of the regulatory strings that often attach to government spending. In general, these can include Federal Acquisition Regulation (FAR) and agency-specific FAR supplements for federal procurements, as well as the nonprocurement uniform requirements (2 C.F.R. Part 200) and related agency-specific regulations that attach to Federal grant funds even when disbursed by state or local entities.
Now, some Congressional members are seeking to add new restrictions that would significantly overhaul the existing domestic preference regime for Federal procurements — mere weeks after the promulgation of new Buy American regulations and the release of a new Executive Order to further tighten the application of these rules.…
On Monday, the U.S. Court of Appeals for the Federal Circuit issued an opinion in Acetris Health, LLC v. United States, No. 2018-2399 (Fed. Cir. Feb. 10, 2020) (“Acetris”), that would permit pharmaceutical manufacturers to source a drug’s active pharmaceutical ingredient (“API”) from India, China and other non “designated countries” and yet still offer the end product for sale to the U.S. Government. Under the Trade Agreements Act (“TAA”), if a drug’s API was sourced from outside of the United States or a designated country, at least some Government agencies previously had taken the position that the U.S. Government could not purchase it. In Acetris, the Federal Circuit explained that the TAA inquiry should turn not on where the API (or some other component) is sourced, but instead on where the pill (or other end product) is manufactured. Consistent with this approach, the court held that a pill manufactured in the United States was compliant with the TAA and implementing regulations even though the pill’s API was sourced from India.
Although the full implications of the Acetris decision are not yet clear, there is no doubt that the ruling alters the TAA compliance landscape and offers broader lessons outside of the pharmaceutical manufacturing context. Consequently, the decision warrants close attention by contractors seeking to maximize supply chain efficiency.
Continue Reading A New Path to TAA Compliance: U.S.-Made End Products in Acetris
A long-standing dispute over the approach to country of origin determinations under the Trade Agreements Act (“TAA”) may soon be resolved, as the Federal Circuit recently heard oral argument in one of two cases presently examining key aspects of this statute. Among other questions presented, the court may decide the standard for determining whether a product may be considered a U.S.-made end product — a question that could have far reaching implications for product manufacturers across all industries.
Continue Reading How Much Is Enough? Federal Circuit Appeal May Decide Level of U.S. Manufacturing Required Under the TAA
(This article was originally published in Law360 and has been modified for this blog.)
The Government Accountability Office (GAO) recently issued a bid protest decision regarding the application of the Berry Amendment’s domestic sourcing requirement to a U.S. Department of Defense (DOD) solicitation for leather combat gloves with touchscreen capability. In that decision, the GAO found that the nonavailability exception to the Berry Amendment applied to the glove’s kidskin leather even though the agency determined, through market research, that this type of leather was available domestically. Importantly, this decision provides an opportunity for stakeholders to consider the nuances associated with the Berry Amendment’s nonavailability exception and to reflect upon the complex regulatory landscape of domestic sourcing requirements.…
Last year, we wrote about a trial court’s decision to dismiss a False Claims Act (“FCA”) complaint regarding alleged Trade Agreements Act (“TAA”) non-compliances because the relator failed to plead fraud with “particularity” under Rule 9(b). That decision offered a sweeping rebuke of speculative FCA claims, and emphasized why it can be difficult to present a valid FCA claim based on a potential violation of a complex regulatory scheme like the TAA.
Last month, the United States Court of Appeals for the Seventh Circuit unanimously affirmed that decision in United States ex rel. Berkowitz v. Automation Aids, Inc., — F.3d — , 2018 WL 3567836 (7th Cir. July 25, 2018). In doing so, the Seventh Circuit provided additional guidance about various topics, including the Rule 9(b) standard for implied certifications and the power of the materiality defense. Our takeaways are below.
Continue Reading Alleged Sales of Non-TAA-Compliant Products Under GSA Schedule Contracts Are Not False Claims, 7th Circuit Holds
[A modified version of this blog post was published in Law360.]
Last month, Senators Dan Sullivan (R-AK) and Maria Cantwell (D-WA) introduced legislation to “improve the requirement to purchase domestic commodities or products” under the National School Lunch Program (the “NSLP”) and the School Breakfast Program (the “SPB”). Even if this legislation fails to make it out of Committee, it signals a continued trend to strengthen the “Buy American” requirement under these programs.…
Contractors that must comply with the government’s domestic preference laws should take note of United States ex rel. Folliard v. Comstor Corp., __ F. Supp. 3d __, 2018 WL 1567620 (D.D.C. 2018) — a recent decision dismissing a country-of-origin fraud lawsuit initiated by serial relator Brady Folliard.
Continue Reading Alleged TAA Non-Compliance Is Not “Material” Under The False Claims Act, Federal Court Holds