01-9530. Notice of Granted Buy America Waiver

AGENCY:

Federal Transit Administration (FTA), DOT.

ACTION:

Notice of granted Buy America Waiver.

SUMMARY:

This waiver allows construction contractors to use Omer heavy-duty parallelogram lifts in vehicle garages without violating the Buy America regulations. It is predicated on the grounds that sufficient competition among suppliers is in the public interest and was granted on February 14, 2001, for the period of two years, or until such time as a second domestic source for the lift becomes available, whichever occurs first. This notice shall insure that the public, particularly potential manufacturers, is aware of this waiver. FTA requests that the public notify it of any relevant changes in the domestic market.

FOR FURTHER INFORMATION PLEASE CONTACT:

Meghan G. Ludtke, FTA Office of Chief Counsel, Room 9316, [phone] (telephone) or [phone] (fax).

SUPPLEMENTARY INFORMATION:

The above-referenced waiver follows:

February 14, 2001.

H. Dean Bouland, Esq.,

Bouland & Brush, LLC, 201 North Charles Street, Suite 2400, Baltimore, Maryland 21201-4105.

Dear Mr. Bouland: This letter responds to the request of your client, Steril-Koni, U.S.A., Inc., for a two-year public interest component waiver from the Buy America regulations for the Omer heavy-duty parallelogram bus lift, which your client currently distributes in the U.S. According to the information you have provided, Steril-Koni supplies these lifts to vehicle garage manufacturers as part of an overall construction contract. Steril-Koni requests this waiver on the grounds that there are only two suppliers marketing such lifts in the U.S. and that sufficient competition of suppliers is in the public interest. For the reasons below, I have determined that a temporary component waiver is in the public interest.

The Federal Transit Administration's (FTA) requirements concerning domestic preference for federally funded transit projects are set forth in 49 U.S.C. 5323(j). However, section 5323(j)(2)(A) states that those requirements shall not apply if doing so would be inconsistent with the public interest. See also, 49 CFR 661.7(b). The implementing regulation allows a bidder or supplier to request a public interest waiver “for a specific item or material that is used in the production of a manufactured product.” 49 CFR 661.7(g) and 661.9(d). FTA's rule looks at the end product being acquired in a given case. Where the procurement contract is for a garage or maintenance facility, the vehicle lift to be installed in the garage would be a component of that construction contract. See 43 FR 57146 (1978), 46 FR 5809 (1981), 56 FR 928 (1991), and FTA Best Practices Procurement Manual, section 8.1.4 (1/98).

Your client explains that while there are many vehicle lifts on the market, the heavy-duty parallelogram lift has unique features and is not widely produced. Such a lift has a capacity of at least 20,000 lb., as well as an open floor design allowing maximum accessibility to the vehicle from the front, back, and sides. Your client has provided documentation from the Automotive Lift Institute that indicates there are only two suppliers marketing heavy-duty parallelogram bus lifts in the U.S., Steril-Koni and Rotary. Rotary is a U.S. manufacturer and Steril-Koni imports the product from Italy and assembles it in Baltimore, Maryland, using a U.S. labor force. Steril-Koni states that because of this manufacturing process general contractors wishing to purchase its lifts for use in vehicle garages may not do so unless they certify non-compliance with Buy America. Therefore, in order to certify compliance, Steril-Koni believes most contractors are inclined to purchase the lifts from Rotary. Steril-Koni asserts that this situation gives Rotary a monopoly in the U.S. market, and that such a monopoly will have the effect of increasing the price of the lifts, which would not be in the public interest. To support your client's position, you note that, in 1984, FTA granted a public interest waiver to Chrysler Corporation for 15 passenger vans. The vans were produced by only Chrysler and Ford Motor Company, and FTA grantees using federal funds were forced to purchase the vans from Ford, the only party able to certify compliance with Buy America. FTA determined that it was in the public interest to have competition in the market place and granted the waiver. 49 FR 13944 (1984).

FTA has reviewed the U.S. market for heavy-duty parallelogram lifts and has found that there are only two suppliers active in the U.S. market, of which only one can certify compliance with Buy America. In this circumstance, FTA concludes that the grounds for a public interest component waiver exist. Pursuant to the provisions of 49 U.S.C. 5323(j)(2)(A), a waiver is hereby granted for the foreign manufacture of the Omer heavy-duty parallelogram lifts for the period of two years, or until such time as a second domestic source for this type of lift becomes available, whichever occurs first. In order to insure that the public is aware of this waiver, particularly potential manufacturers, it will be published in the Federal Register.

If you have any questions, please contact Meghan G. Ludtke at [phone].

Very truly yours,

Gregory B. McBride,

Deputy Chief Counsel.

Issued on April 12, 2001.

Hiram J. Walker,

Acting Deputy Administrator.