Overview
This section establishes the domestic sourcing requirements for construction projects funded by the Recovery Act and the Buy American statute, mandating that iron, steel, manufactured goods, and unmanufactured materials be produced or mined in the United States. It outlines specific manufacturing standards for metal-heavy materials while providing allowances for trade agreements and designated countries.
Key Rules
- Recovery Act Restriction: No Recovery Act funds may be used for public construction projects unless the work is located in the U.S. and uses domestic iron, steel, and manufactured goods.
- Manufactured Goods: All manufactured construction materials must be manufactured in the United States.
- Iron and Steel Standards: For construction materials consisting predominantly of iron or steel, every manufacturing process (excluding the refinement of steel additives) must occur within the U.S.
- Component Exceptions: Origin restrictions do not apply to components or subcomponents of construction materials that are not predominantly made of iron or steel (e.g., a steel lock on a wooden window frame).
- Trade Agreements: When trade agreements apply, manufactured construction materials may be sourced from "Recovery Act designated countries" if they are wholly produced or substantially transformed there.
- Unmanufactured Materials: Per the Buy American statute, unmanufactured construction materials must be mined or produced in the U.S., or in a designated country if trade agreements are applicable.
- Direct Government Purchases: Domestic sourcing requirements apply equally to materials purchased directly by the Government for incorporation into a project.
Practical Implications
- Contractors must perform rigorous supply chain due diligence, particularly for "iron or steel" products, to ensure that every stage of production—not just the final assembly—occurs domestically.
- Procurement officers and contractors must verify the specific funding source of a project, as Recovery Act requirements may impose stricter domestic sourcing "all-or-nothing" standards than standard Buy American Act provisions, unless a trade agreement exception is explicitly triggered.