The Build America Buy American (BABA) Act is a federal law that requires the use of American-made iron, steel, and other manufactured products in certain federally funded construction projects. This act was enacted with the goal of boosting the domestic economy and supporting American workers and industries.
For contractors participating in BABA-covered projects, it's important to understand the requirements and make sure that you are in compliance. Here are some key points to keep in mind:
All iron and steel items used in covered projects must be produced in the United States. This means that all manufacturing processes, from the initial melting stage through the application of coatings, must occur within the United States.
All manufactured products used in covered projects must be produced in the United States. In order to meet this requirement, the manufactured product must have been manufactured in the United States, and the cost of the components of the manufactured product that are mined, produced, or manufactured in the United States must be greater than 55 percent of the total cost of all components of the manufactured product.
All construction materials used in covered projects must be manufactured in the United States. This means that all manufacturing processes for the construction material must occur within the United States.
It's important to note that these requirements apply to all covered projects, regardless of the size of the contract. This means that even if you are a small contractor working on a relatively small project, you are still required to adhere to these guidelines.
In order to comply with the BABA Act, contractors must be diligent in tracking the source of their materials and be able to provide evidence of their origin upon request. This may involve maintaining detailed records of your purchasing, including invoices and other documentation.
One way to ensure compliance is to work with suppliers who are familiar with the BABA Act and can provide materials that meet the requirements. Many suppliers have processes in place to ensure that their products are compliant with the act, and working with these suppliers can help streamline the compliance process.
In addition to tracking the source of your materials, it's also important to have processes and procedures in place to respond to any audits or inquiries that may arise. If you are unable to provide evidence of compliance, you risk losing the ability to bid on federally funded contracts and may even face financial penalties.
Overall, the BABA Act is an important law that supports American industries and workers. By understanding the requirements and taking steps to ensure compliance, contractors can avoid any delays or complications and continue to participate in federally funded projects.
Learn how you can maintain compliance with DTI's supply compliance solution.