E8-11403. Notice of Proposed Buy America Waiver for the National Fuel Cell Bus Technology Development Program

AGENCY:

Federal Transit Administration (FTA), DOT.

ACTION:

Notice of proposed Buy America waiver and request for comment.

SUMMARY:

The Federal Transit Administration (FTA) proposes to waive its Buy America requirements for projects funded under the National Fuel Cell Bus Technology Development Program (Fuel Cell Bus Program). This Notice sets forth FTA's justification and seeks comment thereon. The purpose of the Fuel Cell Bus Program is to facilitate the development of commercially viable fuel cell bus technology and related infrastructure.

DATES:

Comments must be received by May 29, 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-2008-0024. 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-2008-0024. 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 http://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 program questions please contact Christina Gikakis at [phone] or [e-mail]. For legal questions please contact Jayme L. Blakesley at [phone] or [e-mail].

SUPPLEMENTARY INFORMATION:

This Notice sets forth the Federal Transit Administration's (FTA) justification for proposing to waive its Buy America requirements for projects funded under the National Fuel Cell Bus Technology Development Program (Fuel Cell Bus Program) and seeks comment thereon.

The National Fuel Cell Bus Technology Development Program

Section 3046 of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users (SAFETEA-LU), Public Law 109-59, instructed FTA “to establish a national fuel cell bus technology program [Fuel Cell Bus Program] to facilitate the development of commercially viable fuel cell bus technology and related infrastructure.”

By notice dated April 14, 2006, FTA solicited applications to the Fuel Cell Bus Program and restated the statutory criteria for evaluating applications. These criteria included the ability of the project “to contribute significantly to furthering fuel cell technology as it relates to transit bus operations, including hydrogen production, energy storage, fuel cell technologies, vehicle systems integration, and power electronics technology,” and to advance “different fuel cell technologies, including hydrogen-fueled and methanol-powered liquid-fueled fuel cell technologies, that may be viable for public transportation systems.” 71 FR 19612 (April 14, 2006).

FTA selected three consortiums to participate in the Fuel Cell Bus Program: The Center for Transportation and the Environment in Atlanta, the Northeast Advanced Vehicle Consortium in Boston, and Westart/CALSTART in Pasadena. These consortia will develop fourteen projects. Of these, eight are development and demonstration projects, two are component technology development, and four support analysis, outreach and coordination.

The Fuel Cell Bus Program seeks to develop commercially-viable fuel cell buses by demonstrating that buses powered by fuel cell technology can achieve several technical targets, including a four to six year (20,000 to 30,000 hour) fuel cell durability, cost of less than five times that of an equivalent diesel, greater than 90% reliability, twice the fuel efficiency of a comparable bus, emissions below the 2010 Environmental Protection Agency standards and vehicle performance comparable to a diesel bus.

Public Interest Waiver

The purpose of this notice is to seek public comment on whether FTA should waive its Buy America requirements for all projects funded under the Fuel Cell Bus Program.

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). After considering all appropriate factors on a case-by-case basis, 49 CFR 661.7(b), if FTA determines that the conditions exist to grant a public interest waiver, FTA will issue a detailed written statement justifying why the waiver is in the public interest, and will 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).

Because the U.S. market for fuel cell bus technology and related infrastructure is not fully developed, participants in the Fuel Cell Bus Program have inquired whether FTA could waive its Buy America requirements. According to one participant, “[a] successful Fuel Cell transit bus must meet and be consistent with the public transit market's ability to incorporate and afford such technology on a mass scale. * * * At this stage of technology development more engineering data is necessary to accurately specify a fuel cell for a competitive bid. [Requiring participants to comply with FTA's Buy America requirements] would significantly delay the development effort, would be extremely expensive, and would result in a huge set back to the overall development of Fuel Cell technology. [Allowing participants to use all available technology, regardless of origin,] is the fastest, soundest method to perfect the technology, assure future competition, and hasten the advent of fuel cell buses in transit.”

In order to develop commercially viable fuel cell buses, FTA's Fuel Cell Bus Program must examine all current technologies. But at this time, because fuel cell technologies for transit are still in the developmental and technical validation phase, it is impossible to determine which configurations are most likely to reach commercialization. As development continues, the industry will require objective demonstrations and evaluations of different bus propulsion systems. Permitting participants to use foreign and domestic suppliers will allow FTA to evaluate which technologies are closest to successful deployment. If certain technologies are omitted from the program because they are of foreign origin, it will severely affect FTA's ability to fully analyze fuel cell bus technology.

FTA believes that a limited waiver of its Buy America requirements for manufactured products and rolling stock procured through its Fuel Cell Bus Program is necessary because of the technical difficulties and increased costs associated with new technology.

There are several benefits to waiving FTA's Buy America requirements on a program-wide basis. FTA selected projects to include all significant technologies within a centrally-managed program. By granting a waiver for the entire program, FTA can decrease the start-up time for individual projects. Otherwise, each project would have to apply for waivers on a case-by-case basis. This is impractical in a research setting. Research projects often encounter unexpected problems that require changes to the scope of work. The continued development of Fuel Cell technology will result in more choices for FTA grantees and better, more environmentally friendly, buses for the riding public. Successful demonstrations through the Fuel Cell Bus Program will increase awareness of fuel cell technology and foster a domestic industry by identifying and mitigating barriers and uncertainties in the market. A limited waiver to support research and development would increase and improve domestic technical expertise. Moreover, a fully-inclusive public interest waiver will allow Fuel Cell Bus Program participants to collaborate to achieve the program goals in an appropriate timeframe. By reducing risk and expanding expertise, the Fuel Cell Bus Program will improve the availability of capital for a self-sustaining domestic fuel cell industry.

For the foregoing reasons, FTA proposes to waive its Buy America requirements for all projects funded through its Fuel Cell Bus Program. Quick and successful deployment of fuel cell bus technology and infrastructure is in the public interest. Fuel cell technology will benefit the environment by lessening carbon emissions, decreasing the use of petroleum and other fossil fuels. Allowing foreign technologies will allow the project teams to focus on commercial viability instead of having to make fundamental advances independent of existing technology. Ultimately, this will lead to increased domestic demand for fuel cell bus technology and infrastructure, resulting in a sustainable U.S. market.

FTA seeks comment from all interested parties. Please submit comments by May 29, 2008. Late-filed comments will be considered to the extent practicable.

Issued this 15th day of May, 2008.

Severn E.S. Miller,

Chief Counsel.