E9-31404. Notice of a Project Waiver of Section 1605 (Buy American Requirement) of the American Recovery and Reinvestment Act of 2009 (ARRA) to Valley City, ND

AGENCY:

Environmental Protection Agency (EPA).

ACTION:

Notice.

SUMMARY:

The EPA is hereby granting a project waiver of the Buy American requirements of ARRA Section 1605 under the authority of Section 1605(b)(2) [manufactured goods are not produced in the United States of a satisfactory quality] to Valley City, ND for the Zenon ZeeWeed 1000 membrane filter manufactured by General Electric Water & Process Technologies for a capacity of 4 MGD. This is a project-specific waiver and only applies to the use of the specified product for the ARRA-funded project being proposed. Any other ARRA project that may wish to use the same product must apply for a separate waiver based on project-specific circumstances. These membrane filters are manufactured in Canada, and meet Valley City's performance specifications and requirements. The Acting Regional Administrator is making this determination based on the review and recommendation of EPA Region 8's Technical & Financial Services Unit. Valley City has provided sufficient documentation to support its request. The Assistant Administrator of the Office of Administration and Resources Management has concurred on this decision to make an exception to Section 1605 of ARRA. This action permits the purchase of the Zenon ZeeWeed 1000 membrane filter for the Surface Water Treatment Plant upgrades being implemented by Valley City that may otherwise be prohibited under Section 1605(a) of the ARRA.

DATES:

Effective Date: December 9, 2009.

FOR FURTHER INFORMATION CONTACT:

Jody Ostendorf, ARRA Coordinator, [phone], or Brian Friel, SRF Coordinator, [phone], Technical & Financial Services Unit, Water Program, Office of Partnerships & Regulatory Assistance, U.S. EPA Region 8, 1595 Wynkoop St., Denver, CO 80202.

SUPPLEMENTARY INFORMATION:

In accordance with ARRA Section 1605(c) and pursuant to Section 1605(b)(2) of Public Law 111-5, Buy American requirements, EPA hereby provides notice that it is granting a project waiver to Valley City for the Zenon ZeeWeed 1000 model of submerged membranes which are manufactured in Canada.

Section 1605 of the ARRA requires that none of the appropriated funds may be used for the construction, alteration, maintenance, or repair of a public building or public work unless all of the iron, steel, and manufactured goods used in the project are produced in the United States, or unless a waiver is provided to the recipient by the head of the appropriate agency, here EPA. A waiver may be provided if EPA determines that (1) applying these requirements would be inconsistent with the public interest; (2) iron, steel, and the relevant manufactured goods are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality; or (3) inclusion of iron, steel, and the relevant manufactured goods produced in the United States will increase the cost of the overall project by more than 25 percent.

This manufactured good will be used as part of Valley City's Surface Water Treatment Plant renovation. Valley City states that only ZeeWeed 1000 submerged membranes meet the specific needs of this project, which requires a technology that can be installed into an existing basin previously used for pretreatment purposes. This basin will be retrofitted to house the ZeeWeed 1000 modules, thus taking advantage of the product's small footprint relative to other alternatives. The City provided a copy of the contractor's specifications that state the product must be manufactured by Zenon Environmental, Inc. or equivalent, and the product must meet certain performance standards for pH, turbidity, temperature, alkalinity, hardness, sodium, sulfate, chloride, iron and manganese.

The City also provided a letter from an engineer with the State of North Dakota asserting a lack of domestic alternatives to the Zenon ZeeWeed 1000 submerged membranes. The letter states, “that the Zenon ZeeWeed 1000 membrane filter will be required to be used in Washburn and Valley City water treatment plant renovations because:

1. The Washburn and Valley City water treatment plant renovation projects will be using the existing infrastructure (existing filter bays) which require using the compact immersed vacuum membrane filters. Membrane filters for this waiver are as defined in the EPA Membrane Filter Guidance Manual for compliance under the LT2ESWTR. Zenon is the only manufacturer of immersed vacuum membranes that meet the required specifications. The Zenon ZeeWeed 1000 membrane cartilages are manufactured in Canada, but all the piping, pumps, etc. will be manufactured and assembled in America.

2. The Zenon ZeeWeed 1000 membrane meets the requirements of the LT2ESWTR of 3.5 log removal of Giardia and 4.0 log removal of Cryptosporidium.

3. To the best of our knowledge, there are no current domestic membrane manufacturers that meet the specifications of the ZeeWeed 1000 membrane. Any domestic alternative membrane process would require extensive renovation and/or building addition resulting in substantial cost increases.”

Given this requirement by the State and in light of the reasonableness of the retrofit specification, Valley City did not have a basis to use an alternative compliance technology within the ARRA time requirements for SRF projects to be under contract or construction by February 17, 2010.

The April 28, 2009 EPA HQ Memorandum, “Implementation of Buy American provisions of Public Law 111-5, the `American Recovery and Reinvestment Act of 2009',” defines reasonably available quantity as “the quantity of iron, steel, or relevant manufactured good is available or will be available at the time needed and place needed, and in the proper form or specification as specified in the project plans and design.”

The applicant met the procedures specified for the availability inquiry as appropriate to the circumstances by conducting on-line research and contacting suppliers, and all sources indicated that submerged ultrafiltration membrane treatment systems are only manufactured outside of the U.S. Therefore, based on the information provided to EPA and to the best of our knowledge at this time, Zenon ZeeWeed 1000 submerged membranes are not manufactured in the United States, and no other U.S. manufactured product can meet Valley City's performance specifications and requirements.

The purpose of the ARRA is to stimulate economic recovery in part by funding current infrastructure construction, not to delay projects that are “shovel ready” by requiring cities such as Valley City to revise their standards and specifications and to start the bidding process again. The imposition of ARRA Buy American requirements on such projects otherwise eligible for ARRA State Revolving Fund assistance would result in unreasonable delay and thus displace the “shovel ready” status for this project. To further delay project implementation is in direct conflict with a fundamental economic purpose of the ARRA, which is to create or retain jobs.

EPA's national contractor prepared a technical assessment report dated December 2, 2009 based on the submitted waiver request. The report determined that the waiver request submittal was complete, that adequate technical information was provided, and that there were no significant weaknesses in the justification provided. The report confirmed the waiver applicant's claim that there are no comparable domestic products that can meet the project specifications.

The Technical & Financial Services Unit has reviewed this waiver request and has determined that the supporting documentation provided by Valley City is sufficient to meet the criteria listed under Section 1605(b) of the ARRA and in the April 28, 2009, “Implementation of Buy American provisions of Public Law 111-5, the `American Recovery and Reinvestment Act of 2009' Memorandum”: Iron, steel, and the manufactured goods are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality. The basis for this project waiver is the authorization provided in Section 1605(b)(2) of the ARRA. Due to the lack of production of this product in the United States in sufficient and reasonably available quantities and of a satisfactory quality in order to meet Valley City's performance specifications and requirements, a waiver from the Buy American requirement is justified.

The March 31, 2009 Delegation of Authority Memorandum provided Regional Administrators with the authority to issue exceptions to Section 1605 of the ARRA within the geographic boundaries of their respective regions and with respect to requests by individual grant recipients. Having established both a proper basis to specify the particular good required for this project, and that this manufactured good was not available from a producer in the United States, Valley City is hereby granted a waiver from the Buy American requirements of Section 1605(a) of Public Law 111-5 for the purchase of Zenon ZeeWeed 1000 submerged membranes using ARRA funds as specified in the City's request of September 16, 2009. This supplementary information constitutes the detailed written justification required by Section 1605(c) for waivers “based on a finding under subsection (b).”

Authority: Public Law 111-5, section 1605.

Dated: December 28, 2009.

Carol Rushin,

Acting Regional Administrator, Region 8.