[Federal Register Volume 74, Number 124 (Tuesday, June 30, 2009)]
[Notices]
[Pages 31291-31292]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-15480]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-5311-N-03]


Buy American Exception Under the American Recovery and 
Reinvestment Act of 2009

AGENCY: Office of the Assistant Secretary for Public and Indian 
Housing, HUD.

ACTION: Notice.

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SUMMARY: In accordance with the American Recovery and Reinvestment Act 
of 2009 (Recovery Act), and implementing guidance of the Office of 
Management and Budget (OMB), this notice advises that an exception to 
the Buy American requirements of the Recovery Act was determined 
applicable to the Boston Housing Authority's construction of a project 
using Recovery Act funds.

FOR FURTHER INFORMATION CONTACT: Dominique G. Blom, Deputy Assistant 
Secretary for Public Housing Investments, Office of Public Housing 
Investments, Office of Public and Indian Housing, Department of Housing 
and Urban Development, 451 7th Street, SW., Room 4210, Washington, DC 
20410-4000, telephone 202-402-8500 (this is not a toll-free number). 
Persons with hearing- or speech-impairments may access this number 
through TTY by calling the toll-free Federal Information Relay Service 
at 800-877-8339.

SUPPLEMENTARY INFORMATION: Section 1605(a) of the Recovery Act imposes 
a ``Buy American'' requirement on Recovery Act funds used for a project 
for the construction, alteration, maintenance, or repair of a public 
building or public work unless all of the iron, steel, and manufactured 
goods used in the project are produced in the United States. Section 
1605(b) provides that the Buy American requirement shall not apply in 
any case or category in which the head of Federal department or agency 
finds that: (1) Applying the Buy American requirement would be 
inconsistent with the public interest; (2) iron, steel, and the 
relevant manufactured goods are not produced in the U.S. in sufficient 
and reasonably available quantities or of satisfactory quality, or (3) 
inclusion of iron, steel, and manufactured goods will increase the cost 
of the overall project by more than 25 percent. Section 1605(c) 
provides that if the head of a Federal department or agency makes a 
determination pursuant to section 1605(b), the head of the department 
or agency shall publish a detailed written justification in the Federal 
Register.
    In accordance with section 1605(c) of the Recovery Act and OMB's 
implementing guidance published on April 23, 2009 (74 FR 18449), this 
notice advises the public that, on June 11, 2009, HUD granted the 
Boston Housing Authority, upon its request, an exception to 
applicability of the Buy American requirements with respect to work, 
using Recovery Act funds, in connection with the construction of units 
for Phase 1B of the Washington Beech HOPE VI project. Although a final 
determination of applicability of the Buy American requirements to 
housing had not been made at the time that HUD granted the exception, 
given the compelling exigencies presented by BHA in its waiver request 
(as described in this notice), HUD considered the waiver request on the 
assumption of the applicability of the Buy American requirements to the 
Phase 1B project. The exception was granted by HUD on the basis that 
applicability of the Recovery Act Buy American requirements would be 
inconsistent with the public interest.
    BHA received Recovery Act funds in the amount of $10 million for 
construction of Phase 1B units of the Washington Beech HOPE VI project. 
An award of the HOPE VI funds to BHA predated BHA's award of the 
Recovery Act funds. BHA notified HUD that it had procured Trinity 
Financial as its development partner in 2007 for the HOPE VI grant 
awarded for the construction of the Phase 1B units. Because the award 
of the HOPE VI grant to BHA was made prior to passage of the Recovery 
Act's requirements, the requirements of section 1605(a) were not 
included in BHA's procurement process. Trinity Financial secured and 
selected a general contractor, CWC Builders, Inc., to build the units 
in Phase 1B. This construction contract between Trinity Financial and 
CWC was also negotiated prior to the passage of the Recovery Act, and 
accordingly section 1605 requirements were not included in the 
contract. The contract requires CWC Builders to obtain all structural 
steel as soon as possible to meet the construction deadlines for the 
Phase 1B project.
    In addition to these contracts entered into prior to the Recovery 
Act, Washington Beech Phase 1B will be developed by a limited 
partnership that includes a tax credit investor, RBC Tax Credit Equity, 
LLC (RBC). Prior to passage of the Recovery Act, Trinity Financial 
received a commitment from RBC to provide equity through the Low-Income 
Housing Tax Credit (LIHTC) program. RBC informed Trinity Financial and 
BHA that if the funding transaction for Phase 1B did not close and 
documents were not recorded by June 15, 2009, RBC would withdraw its 
offer to purchase the Phase 1B credits. Such withdrawal would place 
Trinity Financial in the situation of having to renegotiate the tax 
credit contribution or find another equity investor. BHA advised that 
delay at this juncture would imperil the availability of the tax 
credits and jeopardize the ability to complete construction of the 
Phase 1B units by the deadline of July 28, 2010. BHA also advised that, 
in accordance with the contracts entered into prior to enactment of the 
Recovery Act, CWC Builders are ready to begin construction immediately 
upon the closing that was scheduled to take place on June 15, 2009. BHA 
advised that if there is a delay in the start of construction, jobs 
planned by the construction would be lost.
    HUD determined that application of the Buy American requirements to 
the Phase 1B units, given the actions and contracts that occurred prior 
to enactment of the Recovery Act would be inconsistent with the public 
interest. The exception granted is for Phase 1B units only. It is not 
applicable to future construction phases at the Washington Beech HOPE 
VI project.


[[Page 31292]]


    Dated: June 23, 2009.
Dominique G. Blom,
Deputy Assistant Secretary for Public Housing Investments.
[FR Doc. E9-15480 Filed 6-29-09; 8:45 am]
BILLING CODE 4210-67-P