Tips Determining Buy American

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Q: A grantee is not sure if a product was made in America. What should the grantee do to verify the manufacturing origins?

A: Grantees should contact the product’s manufacturer, distributors, and suppliers to determine the country of origin. In addition, trade associations may be a good source of information. EERE has published guidance on documenting compliance with the Recovery Act Buy American provisionsPDF.

Q: Do I need to track the country of origin of every screw, bolt, wire, switch and other small piece of construction equipment used in our project?

A: No. EERE has issued a waiver for incidental items that comprise in total a de minimis amount of the total cost of the iron, steel, and manufactured goods used in a project; that is, any such incidental items up to a limit of no more than 5% of the total cost of the iron, steel, and manufactured goods used in and incorporated into a project.

This means that recipients do not need to substantiate a domestic origin for the bottom 5% (based on cost) of incidental manufactured goods in each project.

Q: A Japanese solar energy company opens a manufacturing plant in the United States. The components and subcomponents of the manufactured good come from all over the world. Would these PV modules be Buy American compliant?

A: It is possible. There is no requirement with regard to the origin of components or subcomponents in manufactured goods, so long as the final manufacturing occurs in the United States. However, the work performed in the United States must constitute substantial transformation.

Q: A company imports a manufactured good from abroad, repackages it at their facility in the U.S., and sells it under a U.S. brand name. Is this product compliant with the Buy American provisions?

A: No. The iron, steel, or manufactured goods must be produced or manufactured in the United States. A simple repackaging, or a simple assembly, does not pass the test of substantial transformation and satisfy the definition of “manufacturing.”

Q: A State Energy Office is using SEP Recovery Act funds to pay for a large government building retrofit. It wants to purchase certain equipment manufactured abroad by a prominent U.S. company, and sold by a local distributor. Would this be compliant with the Recovery Act Buy American provisions?

A: No. The products must be manufactured in the United States.

Q: If domestically-available manufactured goods are substantially less energy-efficient than foreign goods (such as solar panels) could a subrecipient seek a nonavailability waiver based on the substandard quality of the U.S. made good?

A: A waiver may be granted for a manufactured good that is not available in sufficient and reasonably available commercial quantities of a satisfactory quality. If you believe that a domestically-available manufactured good is not of a satisfactory quality, you may decide to file a nonavailability waiver request.

Courtesy of US.Government 


 


 

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