E8-25063. Notice of Buy America Waiver Request by the Massachusetts Bay Transportation Authority for Final Assembly of Rail Rolling Stock

AGENCY:

Federal Transit Administration (FTA), DOT.

ACTION:

Notice of Buy America waiver request and call for comment.

SUMMARY:

The Massachusetts Bay Transportation Authority (MBTA) has asked the Federal Transit Administration (FTA) to waive its Buy America requirements on the basis of public interest to permit Vossloh España S.A. (Vossloh) to manufacture and assemble two pilot locomotives in Spain. MotivePower, Inc., a domestic competitor to Vossloh has asked FTA to deny MBTA's request. FTA seeks public comment before deciding whether to grant MBTA's request. This Notice sets forth MBTA's arguments for and MotivePower's arguments against a public interest waiver and seeks comment thereon.

DATES:

Comments must be received by October 28, 2008. Late-filed comments will be considered to the extent practicable.

ADDRESSES:

Please submit your comments by only one of the following means, identifying your submissions by docket number FTA-2008-0047. All electronic submissions must be made to the U.S. Government electronic site at http://www.regulations.gov. Commenters should follow the instructions below for mailed and hand-delivered comments.

(1) Web site: http://www.regulations.gov. Follow the instructions for submitting comments on the U.S. Government electronic docket site;

(2) Fax: [phone];

(3) Mail: U.S. Department of Transportation, 1200 New Jersey Avenue, SE., Docket Operations, M-30, Room W12-140, Washington, DC 20590-0001.

(4) Hand Delivery: Room W12-140 on the first floor of the West Building, 1200 New Jersey Avenue, SE., Washington, DC 20590, between 9 a.m. and 5 p.m., Monday through Friday, except Federal holidays.

Instructions: All submissions must make reference to the “Federal Transit Administration” and include docket number FTA-2008-0047. Due to security procedures in effect since October 2001, mail received through the U.S. Postal Service may be subject to delays. Parties making submissions responsive to this notice should consider using an express mail firm to ensure the prompt filing of any submissions not filed electronically or by hand. Note that all submissions received, including any personal information therein, will be posted without change or alteration to www.regulations.gov. For more information, you may review DOT's complete Privacy Act Statement in the Federal Register published on April 11, 2000 (65 FR 19477), or visit http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT:

For questions please contact Jayme L. Blakesley at [phone] or [e-mail].

SUPPLEMENTARY INFORMATION:

The purpose of this notice is to seek public comment on whether the Federal Transit Administration should waive its Buy America requirements of 49 CFR Part 661 for two prototype locomotives to be manufactured and assembled in Spain by Vossloh España S.A. (Vossloh) for the Massachusetts Bay Transportation Authority (MBTA).

The Massachusetts Bay Transportation Authority (MBTA) is procuring 28 new diesel electric locomotives. These locomotives will replace the older portion of its commuter rail locomotive fleet as well as to meet the increasing demand on [its] commuter rail system. MBTA has asked for delivery of these locomotives to commence in 2011, at which time fifty-four percent of its fleet of eighty locomotives will have reached its useful life of twenty-five years.

Two parties submitted proposals—MotivePower, Inc. (MotivePower) and Vossloh España S.A. (Vossloh). These parties prepared and submitted their Best and Final Offers (BAFO) on May 6, 2008. Vossloh's BAFO was for a new-design locomotive. With its BAFO, Vossloh certified non-compliance with the Federal Transit Administration's (FTA) Buy America requirements for the assembly of pilot locomotives. Vossloh asked MBTA to petition FTA for a waiver of its Buy America requirements.

By letter dated September 3, 2008, MBTA forwarded Vossloh's request for a public interest waiver from the requirements of 49 U.S.C. 5327(j) and the applicable Buy America regulations at 49 CFR part 661. Specifically, MBTA has asked FTA to allow Vossloh to assemble two pilot locomotives in Spain.

Without the waiver, Vossloh estimates that the geographic separation between the design-engineering department in Spain and the final assembly facility in Mayfield, Kentucky, would result in an unacceptable increase in labor costs to Vossloh. A waiver for final assembly of two pilot locomotives would limit the cost, advance the schedule, and therefore reduce Vossloh's bid price for the entire procurement.

Vossloh and MBTA believe that such a waiver is in the public interest because it will enable Vossloh “to submit a competitive bid with respect to price and schedule,” and because it will “expand the competitive range to include Vossloh as a compliant bidder.”

With certain exceptions, FTA's “Buy America” requirements prevent FTA from obligating an amount that may be appropriated to carry out its program for a project unless “the steel, iron, and manufactured goods used in the project are produced in the United States. 49 U.S.C. 5323(j)(1). One such exception is if applying the Buy America requirements “would be inconsistent with the public interest.” 49 U.S.C. 5323(j)(2)(A). Before granting such waiver, FTA must issue a detailed written statement justifying why the waiver is in the public interest, and must publish this justification in the Federal Register, providing the public with a reasonable time for notice and comment of not more than seven calendar days. 49 CFR 661.7(b). This notice satisfies the aforementioned requirement.

MotivePower, Inc. (MotivePower), a competitor to Vossloh, has written several letters opposing MBTA's request for a Buy America waiver. If awarded the contract, MotivePower would perform final assembly at its Boise, Idaho, facilities. According to MotivePower, a Buy America waiver in favor of Vossloh would jeopardize up to 200 current full time employees in its Boise, Idaho, facility and additional jobs in its supplier plants located across the country. MotivePower distinguishes between this procurement for passenger locomotives and those of light rail vehicles for which FTA has granted waivers in the past. Unlike the market for light rail vehicles, MotivePower states that “domestic capacity and engineering know how [with respect to passenger locomotives] has, quite fortunately, not yet been lost to foreign competition.”

Before deciding whether to grant MBTA's request, FTA seeks comment from all interested parties. In the interest of transparency, FTA has published copies of MBTA's request and the letters it received from MotivePower. Interested parties may access these materials by visiting the docket site at http://www.regulations.gov,, docket number FTA-2008-0047. Please submit comments by October 28, 2008. Late-filed comments will be considered to the extent practicable.

Issued this 15th day of October, 2008.

Severn E.S. Miller,

Chief Counsel.