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[Federal Register Volume 89, Number 236 (Monday, December 9, 2024)]
[Notices]
[Pages 97703-97705]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-28820]

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary

[Docket No.: DOT-OST-2024-0130]

Public Interest Waiver of the Application of Certain Domestic 
Preference Requirements and Policies for Transit-Oriented Development 
Housing Projects

ACTION: Notice; request for comment.

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SUMMARY: In order to expeditiously deliver projects and provide 
meaningful infrastructure results while ensuring the appropriate 
application of domestic content standards, the U.S. Department of 
Transportation (DOT) is proposing a waiver of the domestic preference 
requirements to transit-oriented development (TOD) projects that 
receive credit assistance through the Build America Bureau (the Bureau) 
under the Transportation Infrastructure Finance and Innovation Act 
(TIFIA) and Railroad Rehabilitation and Improvement Financing (RRIF) 
credit programs.

DATES: Comments must be received by December 24, 2024.

ADDRESSES: Comments on this notice may be submitted to the U.S. 
Government electronic docket site at https://www.regulations.gov, 
Docket: DOT-OST-2024-0130.

    Note:
    All submissions received, including any personal information 
therein, will be posted without change or alteration to https://www.regulations.gov. For more information, you may review DOT's 
complete Privacy Act Statement published in the Federal Register on 
April 11, 2000 (65 FR 19477).

FOR FURTHER INFORMATION CONTACT: For questions about this notice, 
please contact Duane Callender, US Department of Transportation, Build 
America Bureau, at 202-366-2300 or [email protected]. For legal 
questions, please contact, Jessica Pettrone, DOT Office of the General 
Counsel, at 202-366-8560 or [email protected].

SUPPLEMENTARY INFORMATION:

Background

    DOT has a longstanding policy of requiring all projects, including 
TOD projects, receiving TIFIA and RRIF credit assistance to comply with 
domestic steel, iron, and manufactured products content requirements, 
collectively known as ``Buy America'' requirements,\1\ even where not 
covered by a specific Buy America statute. DOT has consistently 
required for-profit borrowers to comply with Buy America requirements 
on projects receiving credit assistance since TIFIA's inception in 1998 
and since 2010 for RRIF, whether or not appropriated funds were used 
for the cost of the credit assistance. Accordingly, because Buy America 
is applied to all projects receiving TIFIA or RRIF credit assistance, 
DOT, in an effort to ensure transparency and maintain consistency in 
the application of Buy America standards for all recipients (one rule 
for all projects and borrowers), proposes to apply this waiver to both 
projects with for-profit borrowers that do not use any appropriated 
funds for the cost of the loan, to which Buy America requirements are 
applied as a matter of policy, as well as to projects with non-Federal 
entity borrowers (whether or not such loans use appropriated funds), to 
which Buy America requirements apply as a matter of law. DOT proposes a 
waiver of the Buy America manufactured products requirement for TIFIA 
and RRIF TOD projects that include any housing elements (TOD Housing 
Projects) and that enter into creditworthiness review on or before 
December 31, 2025.
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    \1\ As described in more detail below, after the enactment of 
the Infrastructure Investment and Jobs Act in 2021 (Pub. L. 117-58), 
Buy America requirements now include domestic construction material 
requirements.
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    On November 15, 2021, President Biden signed the Bipartisan 
Infrastructure Law (BIL), enacted as the Infrastructure Investment and 
Jobs Act (IIJA). Public Law 117-58. BIL reauthorized Federal surface 
transportation programs and invested billions in transformational 
projects that are creating good-paying jobs, growing the economy, and 
making our transportation system safer and more resilient. TOD projects 
are eligible for both TIFIA (23 U.S.C. 601(a)(12)(E)) and RRIF (49 
U.S.C. 22402(b)(1)(F)) financing, subject to all other eligibility 
criteria, and compliance with all applicable Federal requirements and 
creditworthiness standards.\2\
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    \2\ Eligible TOD projects can take many forms, including joint 
development; public infrastructure; and economic development, 
including commercial and residential development. One of the key 
parameters of the programs, among others, is that TOD projects must 
be within walking distance of a qualifying transit or passenger rail 
station. See https://www.transportation.gov/buildamerica/TOD.
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    Transportation and land use reforms are central strategies to 
achieving many of the Biden-Harris administration goals, including 
reaching net-zero greenhouse gas emissions by 2050; addressing the 
housing supply and affordability crises throughout the country; and 
advancing equity, fair

[[Page 97704]]

housing, and environmental justice.\3\ Providing long-term, low-
interest direct loans through the TIFIA and RRIF credit programs to TOD 
projects is one of the primary tools available to DOT to help achieve 
this mission.
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    \3\ https://www.whitehouse.gov/briefing-room/statements-releases/2022/05/16/president-biden-announces-new-actions-to-ease-the-burden-of-housing-costs/.
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    Over the last three years, DOT has taken several concrete steps to 
date to facilitate TOD financing under the TIFIA and RRIF credit 
programs. DOT has published TOD guidance \4\ and a policy statement \5\ 
and authorized TOD projects' eligibility to borrow up to the maximum 
allowed under TIFIA to promote the creation of more walkable, mixed-use 
spaces near transit that support vibrant, sustainable, and equitable 
communities.\6\ Additionally, the Bureau has worked on outreach to 
developers and created several tools including the TOD Eligibility Map 
\7\ and has conducted webinars to help educate potential borrowers 
about the opportunities and requirements of the programs.
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    \4\ https://www.transportation.gov/buildamerica/TOD.
    \5\ https://www.transportation.gov/buildamerica/sites/buildamerica.dot.gov/files/2023-10/TOD%20Policy%20Statement.pdf
    \6\ https://www.transportation.gov/buildamerica/TIFIA49.
    \7\ https://www.transportation.gov/buildamerica/about/resources-mode/interactive-map-tifia-and-rrif-tod-eligibility.
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    The BIL also includes the Build America, Buy America Act (BABA) at 
div. G, sec. 70901-52. BABA greatly strengthens Made in America 
standards by expanding the coverage and application of Buy America 
preferences in Federal financial assistance programs for 
infrastructure. The Act requires that the head of each covered Federal 
agency shall ensure that ``none of the funds made available for a 
Federal financial assistance program for infrastructure . . . may be 
obligated for a project unless all of the iron, steel, manufactured 
products, and construction materials used in the project are produced 
in the United States.'' BIL sec. 70914(a).
    BABA applies to Federal financial assistance, which term includes 
``all expenditures by a Federal agency to a non-Federal entity for an 
infrastructure project.'' BIL sec. 70912(4)(B). ``Non-Federal entity,'' 
as defined in 2 CFR 200.1, does not include for-profit entities. 
Therefore, BABA by its terms does not apply to Federal financial 
assistance to for-profit entities.\8\ However, in accordance with the 
Office of Management and Budget (OMB)'s Guidance Memorandum M-24-02, 
Guidance on Application of Buy America Preference in Federal Financial 
Assistance Programs for Infrastructure, Federal agencies may consider 
applying domestic preference requirements to for-profit entities, 
consistent with their legal authorities. DOT has a longstanding policy 
of requiring all projects, including TOD projects, receiving TIFIA or 
RRIF credit assistance to comply with domestic steel, iron, and 
manufactured products content requirements, collectively known as ``Buy 
America'' requirements,\9\ even where not covered by a specific Buy 
America statute, including chapter 83 of title 41, United States Code 
(Buy American), because no appropriated funds are used for the cost of 
the loan. DOT has consistently required for-profit borrowers to comply 
with Buy America requirements on projects receiving credit assistance 
since TIFIA's inception in 1998 and since 2010 for RRIF, whether or not 
appropriated funds were used for the cost of the credit assistance. 
Accordingly, because Buy America is applied to all projects receiving 
TIFIA or RRIF credit assistance, DOT, in an effort to ensure 
transparency and maintain consistency in the application of Buy America 
standards for all recipients (one rule for all projects and borrowers), 
will apply this waiver to both projects with for-profit borrowers that 
do not use any appropriated funds for the cost of the loan, to which 
Buy America requirements are applied as a matter of policy, as well as 
to projects with non-Federal entity borrowers (whether or not such 
loans use appropriated funds), to which Buy America requirements apply 
as a matter of law. DOT is proposing a waiver of the Buy America 
manufactured products requirement for TOD Housing Projects that enter 
into creditworthiness review on or before December 31, 2025.
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    \8\ See OMB Memorandum M-22-11 Initial Implementation Guidance 
on Application of Buy America Preference in Federal Financial 
Assistance Programs for Infrastructure (April 18, 2022), p. 2 
(``for-profit organizations are not considered non-Federal 
entities''); OMB Memorandum M-24-02 Implementation Guidance on 
Application of Buy America Preference in Federal Financial 
Assistance Programs for Infrastructure (October 25, 2023), p. 4 
(restating the guidance on for-profit entities from M-22-11); and 88 
FR 57750, 57774 (October 23, 2023) (``Thus--although OMB does not 
require them to do so--Federal agencies are allowed, under the 
existing structure of part 200, to apply part 200, including the 
domestic preferences at Sec.  200.322, to for-profit entities'').
    \9\ As noted above, after the enactment of BABA, Buy America 
requirements now include domestic construction material requirements 
per BIL sec. 70914(a).
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    TOD projects are a class of eligible capital projects under the 
TIFIA and RRIF credit programs administered by the Bureau. The Bureau 
recently provided guidance on Federal requirements for TOD projects 
receiving TIFIA or RRIF credit assistance.\10\ Pursuant to that 
guidance, the Bureau reiterated the DOT's longstanding policy of 
requiring all projects, including TOD projects, receiving TIFIA and 
RRIF credit assistance to comply with domestic steel, iron, and 
manufactured products content requirements, collectively known as ``Buy 
America'' requirements, even where not covered by a specific Buy 
America statute, including Buy American requirements because no 
appropriated funds are used for the cost of the loan.
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    \10\ https://www.transportation.gov/buildamerica/about/resources-mode/tod-project-federal-requirements-guidance.
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Waiver

    DOT is proposing to issue a public interest waiver of the Buy 
America requirements for manufactured products that apply to Bureau-
financed TOD Housing Projects that enter into creditworthiness review 
on or before December 31, 2025. For these projects, DOT would continue 
to apply domestic steel, iron, and construction materials content 
requirements.
    To ensure transparency and maintain consistency in the application 
of Buy America standards for all recipients (one rule for all projects 
and borrowers), this waiver will apply to both TOD Housing Projects 
with for-profit borrowers and those with non-Federal entity borrowers.
    To continue to support the goals of Buy America policies, DOT will 
work closely with TOD Housing Project borrowers to better understand 
and document the sources of materials and products used in such 
projects. This research will assist DOT in refining its domestic 
preference requirements policy for TOD projects entering enter the 
Bureau's creditworthiness review phase after January 1, 2026, and to 
further support both the delivery of housing and domestic 
manufacturing.
    Under OMB Memorandum M-24-02, agencies are expected to assess 
``whether a significant portion of any cost advantage of a foreign-
sourced product is the result of the use of dumped steel, iron, or 
manufactured products or the use of injuriously subsidized steel, iron, 
or manufactured products'' as appropriate before granting a public 
interest waiver. DOT's analysis has concluded that this assessment is 
not applicable to this waiver.
    DOT will consider all comments received in the initial 15-day 
comment

[[Page 97705]]

period during our consideration of the proposed waiver. Comments 
received after this period, but before notice of our finding is 
published in the Federal Register, will be considered to the extent 
practicable.

    Issued in Washington, DC.
Polly E. Trottenberg,
Deputy Secretary.
[FR Doc. 2024-28820 Filed 12-6-24; 8:45 am]
BILLING CODE 4910-9X-P
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