Document ID: FRA-2012-0033-0003
Agency: fra
Document Type: Notice
Title: Buy American Waivers: National Railroad Passenger Corp., and California High-Speed Rail Authority for the Non-Domestic Final Assembly of Four Prototype Tier III High-Speed Rail Trainsets
Posted Date: 2014-12-02T05:00Z

[Federal Register Volume 79, Number 231 (Tuesday, December 2, 2014)]
[Notices]
[Pages 71504-71505]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-28365]

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DEPARTMENT OF TRANSPORTATION

Federal Railroad Administration

[Docket No. FRA-2012-0033]

Notice of Intent To Grant Buy America Waivers to National 
Railroad Passenger Corporation and California High-Speed Rail Authority 
for the Non-Domestic Final Assembly of Four ``Prototype'' Tier III 
High-Speed Rail Trainsets

AGENCY: Federal Railroad Administration (FRA), United States Department 
of Transportation (DOT).

ACTION: Notice of intent to grant Buy America waivers.

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SUMMARY: FRA is issuing this notice to advise the public that it 
intends to grant the National Railroad Passenger Corporation (Amtrak) 
and California High-Speed Rail Authority (Authority) waivers from FRA's 
Buy America requirement for the non-domestic final assembly of up to 
four (two for Amtrak; two for the Authority) ``prototype'' Tier III 
high-speed rail (HSR) trainsets in connection with the procurement of 
HSR trainsets. These waivers apply only to the final assembly of up to 
two prototype HSR trainsets each for Amtrak and the Authority. Each 
waiver is subject to the following condition: Before issuing a ``Notice 
To Proceed'' to any selected supplier, Amtrak and the Authority each 
must certify and provide support to FRA that its selected supplier 
still has not established domestic manufacturing facilities capable of 
assembling the prototypes and delivering them within a reasonable time. 
All components used in the prototypes must still be domestically 
manufactured or separate waivers for components requested and granted 
before assembly of the prototypes can commence.

DATES: Written comments on FRA's determination to grant Amtrak's and 
the Authority's Buy America waiver requests should be provided to the 
FRA on or before December 17, 2014.

ADDRESSES: Please submit your comments by one of the following means, 
identifying your submissions by docket number FRA-2012-0033. All 
electronic submissions must be made to the U.S. Government electronic 
site at http://www.regulations.gov. Commenters should follow the 
instructions below for mailed and hand-delivered comments.
    (1) Web site: http://www.regulations.gov. Follow the instructions 
for submitting comments on the U.S. Government electronic docket site;
    (2) Fax: (202) 493-2251;
    (3) Mail: U.S. Department of Transportation, 1200 New Jersey Avenue 
SE., Docket Operations, M-30, Room W12-140, Washington, DC 20590-0001; 
or
    (4) Hand Delivery: Room W12-140 on the first floor of the West 
Building, 1200 New Jersey Avenue SE., Washington, DC 20590, between 9 
a.m. and 5 p.m., Monday through Friday, except Federal holidays.
    Instructions: All submissions must make reference to the ``Federal 
Railroad Administration'' and include docket number FRA-2012-0033. Due 
to security procedures in effect since October 2001, mail received 
through the U.S. Postal Service may be subject to delays. Parties 
making submissions responsive to this notice should consider using an 
express mail firm to ensure the prompt filing of any submissions not 
filed electronically or by hand. Note that all submissions received, 
including any personal information therein, will be posted without 
change or alteration to http://www.regulations.gov. For more 
information, you may review DOT's complete Privacy Act Statement in the 
Federal Register published on April 11, 2000 (65 FR 19477), or visit 
http://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Mr. John Johnson, Attorney-Advisor, 
FRA Office of Chief Counsel, 1200 New Jersey Avenue SE., Mail Stop 25, 
Washington, DC 20590, (202) 493-0078, John.Johnson@dot.gov.

SUPPLEMENTARY INFORMATION: 
    FRA is issuing this notice to advise the public that it intends to 
grant Amtrak's and the Authority's requests for waivers from FRA's Buy 
America requirement, 49 U.S.C. 24405(a), for the non-domestic final 
assembly of up to four (two for Amtrak; two for the Authority) 
``prototype'' Tier III high-speed rail (HSR) trainsets in connection 
with the procurement of HSR trainsets. These ``prototype'' Tier III HSR 
trainsets will be delivered to Amtrak and the Authority for use in 
passenger (revenue) service. Please note that the Federal Transit 
Administration (FTA) would use the term ``pilot'' to describe these 
vehicles. Because some time may elapse between granting these waivers 
and construction of prototype HSR trainsets, each waiver has the 
following condition: Before issuing a ``Notice To Proceed'' to any 
selected supplier, Amtrak and the Authority each must certify and 
provide support to FRA that its selected supplier still has not 
established domestic manufacturing facilities capable of assembling the 
prototypes and delivering them within a reasonable time. In addition, 
all components used in the prototypes must still be domestically 
manufactured or separate waivers for components requested and granted 
before assembly of the prototypes can commence.
    The larger projects underlying these waiver requests are Amtrak's 
and the Authority's plans to advance HSR on the Northeast Corridor and 
in California, respectively. In near identical waiver requests Amtrak 
and the Authority asserted that the projects require the purchase and 
use of high-quality, service-proven FRA Tier III Next Generation 
Trainsets, including two prototype HSR trainsets for each project.
    FRA's Buy America requirement for rolling stock, including HSR 
trainsets, requires domestic final assembly of the trainsets and that 
all of the components be manufactured in the United States. More 
information about FRA's Buy America requirement is available at http://www.fra.dot.gov/Page/P0185. Section 24405(a)(2) also permits the 
Secretary of Transportation (delegated to the FRA Administrator) to 
waive the Buy America requirements if the Secretary finds that: (A) 
applying paragraph (1) would be inconsistent with the public interest; 
(B) the steel, iron, and goods manufactured in the United States are 
not produced in sufficient and reasonably available amount or are not 
of a satisfactory quality; (C) rolling stock or power train equipment 
cannot be bought or delivered to the United States within a reasonable 
time; or (D) including domestic material will increase the cost of the 
overall project by more than 25 percent.
    FRA believes a waiver is appropriate under 49 U.S.C. 24405(a)(2)(C) 
because domestically-produced HSR trainsets meeting the specific 
technical, design, and schedule needs of Amtrak and the

[[Page 71505]]

Authority are not currently available in the United States. There is no 
assembly or testing facility for HSR trainsets operating at speeds 
greater than 160 mph in the United States. Moreover, FRA estimates that 
it could take HSR trainset manufacturers a minimum of one-and-a-half to 
two years to establish the required facilities to support a domestic 
HSR trainset assembly capability. This includes any HSR trainset 
manufacturers that currently have passenger railcar manufacturing 
facilities in the United States. For example, in addition to acquiring 
specialized machinery and training and hiring the workforce, these 
manufacturers' plants are currently customized for steel railcars, and 
HSR trainsets use aluminum, which requires different manufacturing 
techniques.
    In addition, Tier III HSR is a significant new technology for the 
U.S. market, and safety is a significant factor. Allowing final 
assembly of the prototype HSR trainsets at the manufacturer's existing 
non-domestic facilities is necessary to ensure that expected safety 
benefits of ``service-proven'' systems are secured, to enable training 
of domestic workers, and to assure successful technology transfer. For 
example, rather than attempting to establish new manufacturing and 
assembly processes at a domestic facility while simultaneously 
integrating and testing HSR trainset designs, the selected 
manufacturer(s) can focus on identifying and remedying any defects in 
the designs specific to Amtrak and the Authority and their operations 
in the United States. FRA concludes that integrating manufacturing, 
assembly, and labor resources into the prototype production, among 
other suggested actions by Amtrak and the Authority, will facilitate 
the development of domestic HSR production facilities. This same 
``human technology transfer'' has been successful in other global HSR 
installations in South Korea, China, Taiwan, and Spain.
    On March 14, 2014, FRA published on its Web site public notice of 
Amtrak's and the Authority's waiver requests. FRA received 13 online 
comments and one mailed response to this notice. None of the commenters 
identified a domestic source for HSR trainsets. Of the 14 comments, 10 
commenters indicated they were against granting the waiver; four were 
for granting the waiver. Of the 10 comments ``against,'' four were not 
responsive to the notice. Of the six remaining dissenters, they mainly 
disagreed with Amtrak's and the Authority's argument that HSR trainsets 
cannot be delivered in a reasonable time because Amtrak and the 
Authority could wait for domestic assembly. While this is theoretically 
possible, significant capacity and technology transfer problems are 
probable, and FRA believes that the one-and-a-half to two-year minimum 
delay could negatively impact the schedules proposed by Amtrak and the 
Authority. In addition, as noted above, FRA believes that allowing the 
prototypes to be assembled at the manufacturers' non-domestic factories 
will facilitate the successful technology transfer and training of U.S. 
workers. Finally, because FRA is limiting the waivers to final assembly 
of up to four prototypes with the expectation that the training of 
domestic resources will occur simultaneously, FRA is not delaying or 
preventing the establishment of the selected supplier's domestic 
assembly facilities. FRA finds that this delay to provide ``service-
proven'' systems makes the prototypes not available within a 
``reasonable time.'' Therefore, waivers are appropriate.
    FRA will publish the letters granting Amtrak's and the Authority's 
waiver requests on its Web site at: http://www.fra.dot.gov/eLib/Details/L16035 and http://www.fra.dot.gov/eLib/Details/L16036, 
respectively.

    Issued in Washington, DC on November 26, 2014.
Melissa L. Porter,
Chief Counsel.
[FR Doc. 2014-28365 Filed 12-1-14; 8:45 am]
BILLING CODE 4910-06-P