Efforts to apply domestic procurement rules to state-level spending underway in Kentucky and Oklahoma
Buy America, a longstanding practice by the federal government and many state governments, has enjoyed bi-partisan support for decades and is well-understood by contracting officers and bidders on public projects.
That’s because they’re so well-established. Federal Buy America laws date back to 1933. They were expanded in the 1940s to cover defense procurement, and again in the 1980s by former President Ronald Reagan to cover highway and transit spending. In 2021, Congress passed the Build America Buy America Act (BABA) as part of the $1.2 trillion infrastructure package, aiming to ensure that the U.S. reinvests infrastructure tax money back into American workers, manufacturers, and communities. The federal government also has a new Made in America Office at the Office of Management and Budget that is working to coordinate this effort.
That all covers buckets of federal spending. But dozens of states have their own Buy America laws roughly on the same rules: They create a procurement preference for American-made goods when they are available in a sufficient quality and quantity and are competitively priced in the global marketplace. When U.S. companies and their workers are given the first shot at supplying the steel, iron, and manufactured goods used in our bridges, sewer systems, schools, and other public works projects, governments rarely look elsewhere. Dozens of states have now put Buy America laws on the books for the first time or are improving their existing laws. In the last decade, Colorado, Illinois, Maryland, New Jersey, New Hampshire, New York, Pennsylvania and Texas all joined the Made in America movement, and other states are close behind.
Recently, both Kentucky and Oklahoma have introduced bipartisan efforts to assure their taxpayer-funded state procurement dollars support domestic manufacturing.
In Kentucky, Rep. Patrick Flannery (R-Olive Hill) has filed HB 345, the Kentucky Buy American Act – along with five Republican colleagues and three Democrats – to make sure American products and goods are being used in state and local infrastructure projects.
In Oklahoma. Sens. Carri Hicks (D) and Judd Strom (R) recently won unanimous approval from the Senate’s Retirement and Government Resources Committee for Senate Bill 168 to encourage greater use of American-made products, including iron, steel, and aluminum.
The intent of these domestic preference bills is to cover state funds with Buy America preferences, just like those that state transportation departments have implemented on federally funded projects since 1982, and have been applied to the federal dollars that states have received since the implementation of BABA, which was enacted with the Infrastructure Investment and Jobs Act (IIJA) in 2021.
To put it simply: Applying domestic preferences to taxpayer-funded procurement is not a new practice for the states; rather, it’s the application of a tried-and-true practice. States have been following federal Buy America procurement preferences for over 40 years and, since the IIJA was enacted, the federal government has expanded Buy America coverage to nearly all federal procurement funds sent to the states.
Bipartisan legislation like that in Kentucky and Oklahoma this year simply asks state procurement officers to apply these well-known practices to projects fully funded by state taxpayer dollars, in a manner consistent with their obligations under any international trade agreements the state is party to. If state procurement staff are already following federal law, they should be either familiar with this practice or are already training on the application of BABA’s expansion rules.
This is also a policy that is popular with the American public. According to polling conducted in 2019 by bipartisan pollsters, 80% of likely 2020 general election voters indicated their support for Buy America laws: 75% among Democrats, 77% among independents, and 88%of Republicans. This same polling revealed that by a margin of 4 to1, voters want taxpayer funded projects built following “Buy America” rather than the “lowest bidder.” Even when private funding is used, 75% want “Buy America” like any other public project. Voters also favor proposals to strengthen Buy America Laws, specifically ensuring all projects and products are covered.
Unlike their foreign competitors from places like China, India, and Russia, U.S. manufacturers are heavily regulated and don’t rely on subsidies from their government to make them more competitive. State procurement policies should not be divorced from their public policies, and taxpayer dollars should not be used to bolster foreign state-owned enterprises reward companies that have moved their investments, operations and jobs away to foreign countries that lack (or completely disregard) reasonable environmental and workplace safety regulations. They should reward U.S. manufacturing companies and a U.S. workforce.