Three federal provisions require materials produced in the United States to be used on federally funded projects: Buy America, Buy American, and Build America Buy America (BABA). 

• Buy America applies to Federal-aid projects (FHWA funded projects). This provision has existed since 1978 and applies to steel, iron and manufactured products.  In 1983 FHWA issued a nationwide general waiver for manufactured products.  In 2025, FHWA began a two-year phase-in process to terminate the general waiver for manufactured products.
• Buy American provisions apply to direct Federal procurement contracts (projects on Federal lands) using the Federal Acquisition Regulations. They do not apply to Federal-aid projects procured by KYTC.
• BABA was passed in 2021 as part of the Infrastructure Investment and Jobs Act (IIJA) and applies to all federal infrastructure projects. BABA has provisions for steel, iron, manufactured products, and construction materials; however, an important provision of BABA allows for the continuance of existing Buy America preferences if they meet or exceed the requirements of section 70914 of BABA.  Therefore, for FHWA funded projects, BABA provisions apply to construction materials and FHWA’s existing Buy America provisions continue to apply to steel, iron and manufactured products.

For Buy America applicability purposes, a project is defined by the environmental clearance (National Environmental Policy Act (NEPA)) document.  If FHWA funds are used in any phase of a project, Buy America provisions must be applied to all federally eligible phases of the project.  For example, if FHWA funds are used for the construction contract, Buy America provisions must be applied to federally-eligible utility work regardless if FHWA funds are used for the utility work. 

Buy America requirements differ depending on how the product is classified: iron or steel, manufactured products, or construction materials.  It is important that each product is properly classified and the correct requirements are applied.  In general, each product has one classification and only one set of requirements applies.  Products with multiple classifications are discussed separately at the end of this section.

3.1 Iron or Steel

Buy America provisions apply to iron or steel products that are permanently incorporated into the project.

• Iron or steel products are articles, materials, or supplies that consist wholly or predominantly of iron or steel or a combination of both.
• Predominantly iron or steel means that the cost of the iron and steel content exceeds 50 percent of the total cost of all its components.
• For iron or steel products to meet Buy America criteria, all manufacturing processes of the iron or steel components, from the initial melting stage through the application of coatings, must occur in the United States. Buy America requirements do not apply to the non-iron/steel components of an iron or steel product.
• Permanently incorporated means the product remains in place at the end of the project. Temporary products such as scaffolding and sheet piles are not subject to Buy America if they are removed at the end of the project.
• Exceptions:
  • Minimal use: Buy America provisions allow a minimal use of foreign iron or steel products to be permanently incorporated on each project. The amount of foreign iron or steel products allowed is $2500 for projects with a total contract cost of $2,500,000 or less and one-tenth of one percent (0.1 percent) of the total contract cost for projects with a total contract cost greater than $2,500,000.  This minimum use threshold is typically applied contract by contract.

• Small Grants Waiver: This waives the application of FHWA’s Buy America requirements for steel, iron, and manufactured products and BABA’s requirements for construction materials on projects with less than $500,000 of federal funds. The waiver applies when the total amount of Federal financial assistance applied to the “project” is less than $500,000. Keep in mind that federal funds applied to change orders and overruns count towards the $500,000 threshold and the “project” is defined by the environmental clearance document and may include multiple phases and contracts.
• Nationwide waivers: FHWA has granted two nationwide waivers: 1) on February 9,1994 for ferryboat equipment and machinery parts, and 2) on March 24,1995 for pig iron and processed, pelletized, and reduced iron ore.
• Public interest waivers: A waiver of Buy America requirements may be granted where application of Buy America provisions would be inconsistent with the public interest or where domestically produced products of a satisfactory quality are not available. These waivers typically take over a year to review and are rarely approved.  Approximately 1-2 waivers of this type are approved per year nationwide.

3.2 Manufactured Products

Buy America provisions apply to manufactured products that are permanently incorporated into the project.

• A manufactured product is defined as an article, material, or supply that has been processed into a specific form and shape, or combined with other articles, materials, or supplies to create a product with different properties than the individual articles, materials, or supplies.
• A product that meets both the criteria for a manufactured product and an iron or steel product is to be treated as an iron or steel product and not a manufactured product.
• A product that meets both the criteria for a manufactured product and a construction material is to be treated as a construction material and not a manufactured product.
• In general, each product has one classification and only one set of requirements applies. Products with multiple classifications are discussed below.
• For manufactured products to meet Buy America criteria, they must be manufactured in the United States (“final assembly requirement”) and have greater than 55 percent of the manufactured product’s components, by cost, be mined, produced, or manufactured in the United States (“55 percent requirement”).
• Permanently incorporated means the product remains in place at the end of the project. Temporary products such as scaffolding and sheet piles are not subject to Buy America if they are removed at the end of the project.

• Exceptions to Manufactured Product Requirements:
  • BABA section 70917 (c) states that aggregates, wet concrete and asphalt mixtures delivered to a job site without final form for incorporation into a project are not manufactured products. This exception does not apply to precast concrete products.
  • De Minimis Costs Waiver: this waiver allows the use of a small amount of non-compliant manufactured products and construction materials when the total value of such non-compliant products is no more than the lesser of $1,000,000 or 5 percent of total applicable project costs. Applicable project costs only include the cost of materials subject to Buy America requirements (steel, iron, manufactured products, and construction materials).
  • Small Grants Waiver: This waives the application of FHWA’s Buy America requirements for steel, iron, and manufactured products and BABA’s requirements for construction materials on projects with less than $500,000 of federal funds. The waiver applies when the total amount of Federal financial assistance applied to the “project” is less than $500,000. Keep in mind that federal funds applied to change orders and overruns count towards the $500,000 threshold and the “project” is defined by the environmental clearance document and may include multiple phases and contracts.
  • Nationwide waivers: FHWA granted a nationwide waiver of all Manufactured Products in 1983. That waiver has been terminated, and the requirements are being phased in. The “final assembly requirement” became effective on October 1, 2025, and the “55 percent requirement” will become effective on October 1, 2026.
  • Public interest waivers: A waiver of Buy America requirements may be granted where application of Buy America provisions would be inconsistent with the public interest or where domestic products of a satisfactory quality are not available. These waivers typically take over a year to review and are rarely approved. Approximately 1-2 waivers of this type are approved per year nationwide.

3.3 Construction Materials

• Products considered to be “construction materials” per Section 184.6 of the BABA guidance and their standard for being “produced in the United States” are listed below:
• Non-ferrous metals: The entire manufacturing process, from initial smelting or melting through final shaping, coating, and assembly, must occur in the United States.
• Plastic and Polymer-based products: All manufacturing processes, from initial combination of constituent plastic or polymer-based inputs, or, where applicable, constituent composite materials, until the item is in its final form, must occur in the United States.
• Glass: All manufacturing processes, from initial batching and melting of raw materials through annealing, cooling, and cutting, must occur in the United States.
• Fiber Optic Cable (including drop cable): All manufacturing processes, from the ribboning (if applicable), through buffering, fiber stranding and jacketing, must occur in the United States. All manufacturing processes also include the standards for glass and optical fiber, but not for nonferrous metals, plastic and polymer-based products, or any others.
• Optical Fiber: The entire manufacturing process, from the initial preform fabrication stage through the completion of the draw, must occur in the United States.
• Lumber: All manufacturing processes, from initial debarking through treatment and planing, must occur in the United States.
• Drywall: All manufacturing processes, from initial blending of mined or synthetic gypsum plaster and additives through cutting and drying of sandwiched panels, must occur in the United States.
• Engineered Wood: All manufacturing processes, from the initial combination of constituent materials until the wood product is in its final form, must occur in the United States.
• Construction materials consist of only one of the above listed items. Items considered to be a construction material that are combined with other materials before they arrive on the work site should be considered either a manufactured product or an iron or steel product, as appropriate. In general, each product has one classification and only one set of requirements applies.  Products with multiple classifications are discussed below.
• Permanently incorporated means the product remains in place at the end of the project. Temporary products such as scaffolding and sheet piles are not subject to Buy America if they are removed at the end of the project.
• Exceptions to Construction Materials Requirements:
  • De Minimis Costs Waiver: this waiver allows the use of a small amount of non-compliant manufactured products and construction materials when the total value of such non-compliant products is no more than the lesser of $1,000,000 or 5 percent of total applicable project costs for the project. Applicable project costs only include the cost of materials subject to Buy America requirements (steel, iron, manufactured products, and construction materials). 
  • Small Grants Waiver: This waives the application of FHWA’s Buy America requirements for steel, iron, and manufactured products and BABA’s requirements for construction materials on projects with less than $500,000 of federal funds. The waiver applies when the total amount of Federal financial assistance applied to the “project” is less than $500,000. Keep in mind that federal funds applied to change orders and overruns count towards the $500,000 threshold and the “project” is defined by the environmental clearance document and may include multiple phases and contracts.
  • Public interest waivers: A waiver of Buy America requirements may be granted where application of Buy America provisions would be inconsistent with the public interest or when domestic products of a satisfactory quality are not available. These waivers typically take over a year to review and are rarely approved. Approximately 1-2 waivers of this type are approved per year nationwide.

Under BABA Section 70917(c) and the BABA Guidance, construction materials do not include cement and cementitious materials; aggregates such as stone, sand, or gravel; or aggregate binding agents or additives (known as “Section 70917(c) materials”).

BABA section 70917 (c) also states that if these materials are combined as an unsettled mixture without final form when they reach the work site (i.e., wet concrete or hot mix asphalt), the unsettled mixture would not be considered a manufactured product. 

5.1 Precast Concrete Products

The steel or iron components in precast concrete products must meet FHWA’s Buy America steel and iron provisions even if the precast product is classified as a manufactured product or a steel and iron product.

• If the cost of the steel and iron in a precast product does not exceed 50 percent of the total cost of components, the precast product is considered a manufactured product. Buy America manufactured product provisions apply to the precast product AND Buy America steel and iron provisions apply to the steel and iron components of the precast product.
• If the cost of the steel and iron components of the precast product exceeds 50 percent of the total cost of all its components, the precast product is considered a steel and iron product. FHWA’s Buy America steel and iron provisions apply to the precast product.

5.2 ITS/Electronic Hardware System Products

• The cabinets or enclosures of ITS and electronic hardware systems that are predominantly steel or iron must meet FHWA’s Buy America steel and iron provisions even if the ITS/electronic hardware product is classified as a manufactured product or a steel and iron product.

  • If the cost of the steel and iron components of the ITS/electronic hardware product does not exceed 50 percent of the total cost of components, the ITS/electronic hardware product is considered a manufactured product. Buy America manufactured product provisions apply to the ITS/electronic hardware product AND Buy America steel and iron provisions apply to the steel and iron cabinets or enclosures of the ITS/electronic hardware product.
  • If the cost of the steel and iron components of the ITS/electronic hardware product exceeds 50 percent of the total cost of all its components, the precast product is considered a steel and iron product. Buy America steel and iron provisions apply to the ITS/electronic hardware product.

FHWA Buy America-Related Questions and Answers: https://www.fhwa.dot.gov/construction/contracts/buyam_qa.cfm

FHWA Buy America Waiver Requests: https://www.fhwa.dot.gov/construction/contracts/waivers.cfm