EPA Finalizes Waiver for Build America, Buy America Requirements for Certain WIFIA Projects

On June 22, EPA finalized a waiver for the requirements under Build America, Buy America (BABA). The Agency proposed to waive BABA requirements for Water Infrastructure Finance and Innovation Act (WIFIA) borrowers that initiated project design plans prior to May 14, 2022 – the day that BABA went into effect.

From EPA’s waiver: “initiated project design planning” means efforts made by the utility owner to evaluate and identify both technologically and financially viable options for capital improvement projects. These efforts can be in various forms of technical documents describing design concepts, alternatives analyses, and long-term facility or system plans. Examples include preliminary engineering reports, master plans, basis of design reports, and technical design memorandum.

EPA was concerned that water systems may decide to not use WIFIA funds and instead opt for more expensive sources of financing if a waiver was not granted. Additionally, the Agency argued that requiring borrowers that have already begun project design to comply with BABA “may lead to significant cost and schedule increases for much needed infrastructure” and that this conflicts with the Bipartisan Infrastructure Law’s goal of “investing in the nation’s water infrastructure and initiating construction in an expeditious and efficient manner.” EPA is clear that this waiver does not change the requirements for American Iron and Steel which were already in place.

ASDWA submitted comments supporting the waiver on May 20, 2022.