Buy America Requirements for Federally Funded Rail Projects

Abstract

Federal grants for passenger and freight rail development typically have domestic preference conditions or "Buy America" requirements. Most recently, in 2008, Congress enacted a Buy America provision applicable to grants for the High-Speed Intercity Passenger Rail program administered by the Federal Railroad Administration. However, since 1978, passenger and freight rail development funds administered by Amtrak, the Federal Transit Administration, and even the Federal Highway Administration have also been conditioned on Buy America compliance. Although the various transportation grant Buy America provisions often appear similar on their face, there are significant differences in the way they are interpreted and administered by different Federal grant-making agencies. This has led to confusion and concern in the railroad industry, among manufacturers of rail cars and locomotives, railroad construction contractors, and rail development grant recipients (e.g., State Departments of Transportation) who procure rail construction and manufacturing services. The purpose of this paper is to somewhat alleviate the confusion and frustration in the railroad industry by providing guidelines for complying with the various Buy America provisions applicable to rail development, compiled into a single resource. The paper addresses the similarities and, most importantly, the differences among the various Buy America provisions. The paper also details the legislative and administrative history (and, in some cases, the judicial history) that helps explain most of the differences in the way the various Buy America provisions are administered.