By: Lindsay Simmons
Federal law requires government agencies, when acquiring goods and services, to give preferences to American firms.
On January 25, 2021, President Biden, as one of his first acts in office, issued “Ensuring the Future is Made in All of America by All of America’s Workers”, an Executive Order aimed at strengthening current Buy America provisions and goals. Specifically, the Executive Order:
- Directs agencies to close loopholes in how domestic content is measured;
- Increases domestic content requirements for federal acquisitions;
- Appoints a new Director of Made-in-America at the Office of Management and Budget to oversee the implementation of the Executive Order;
- Increases oversight of potential waivers to domestic preference laws — to crack down on unnecessary waivers;
- Directs the General Services Administration to publish relevant waivers on a public website;
- Requires the Federal Acquisition Regulatory Council to consider amending the Federal Acquisition Regulation to replace the “component test” used to identify domestic end products and domestic construction materials, increase domestic content requirements for end products and construction materials, and increase price preferences for domestic end products and construction materials;
- Requires agencies to assess whether a significant portion of the cost advantage of a foreign-sourced product results from the use of dumped or injuriously subsidized steel, iron or manufactured goods;
- Connects new businesses to contracting opportunities by requiring supplier scouting by agencies;
- Directs a cross-agency review of all domestic preferences, requires agencies to report on their implementation of current Made in America laws, and requires agencies to make recommendations for achieving the President’s new Made in America goals on a bi-annual basis.
While this Executive Order does not make any immediate changes to the specific domestic preference laws, it does require agencies to strengthen their domestic preference rules and calls for actions within 180 days. As a result it will be important for government contractors to ramp up their efforts to identify the source of all items in their supply chain and, perhaps, to take a new look at manufacturing products in the United States.
Lindsay Simmons is responsible for the contents of this article @JacksonKelly.com