Article | July 27, 2012

'Buy American' Requirements To The SRF Federal-Aid Program: Why It's Good For All

By James L. Keffer, President, EBAA IRON SALES, INC.

A recent Water Online guest column gave a rather negative — and one-sided, I would assert — viewpoint to the “Buy American” requirement adopted by the U.S. House of Representatives’ Appropriations Committee to its FY 2013 Interior, Environment and Related Agencies Appropriations bill. If approved by Congress, this bill will ensure a preference is afforded to American-made products when using tax dollars to finance water and wastewater infrastructure projects through the Environmental Protection Agency’s Clean and Drinking Water State Revolving Fund (SRF) programs. Warnings that this common sense preference for taxpayer produced goods in taxpayer-financed government spending would devastate the SRF program and imperil the taxpayers, towns, and cities that rely on this program are patently misleading and contrary to the EPA submitted report entitled Implementation of the ARRA of 2009. This viewpoint is also not only wrong on the facts, but also tone deaf to the overwhelming majority of U.S. taxpayers who strongly support Buy American policies.

As a second generation, family-owned, U.S.-based manufacturer who strives to compete every day against opportunistic importers that take advantage of our unparalleled open market, we at EBAA IRON say regarding the Buy American requirements, “…it’s about time!”   House Interior Appropriations Subcommittee Chairman Mike Simpson (R-ID) and his colleagues deserve commendation for their efforts to bring the SRFs in line with other federal-aid infrastructure programs (e.g., the U.S. Department of Transportation and the U.S. Department of Defense) that have successfully applied Buy American domestic preferences for decades.  

Though the opposition may claim otherwise, the ARRA Buy American requirement worked.  It created and preserved American jobs and it did so without delaying the EPA’s ability to place all of the ARRA SRF funds under “contract or construction” before February 17, 2010.  This fact was affirmed by various noted speakers directly associated with the EPA who made presentations at both the May 2011 Council of Infrastructure Financing Authorities Federal Policy Conference and the November 2011 Council of Infrastructure Financing Authorities SRF National Workshop.  The plain fact of the matter then, as it is now, was that the ready supply of domestic materials and the availability of common sense waivers of the Buy American preference ensured EPA’s ARRA SRF funding was expeditiously distributed to the states’ high priority drinking water and waste water projects, creating good-paying American jobs in the process.

The United States governmental procurement policies should not be divorced from our public policies.  Taxpayer-financed federal aid programs — particularly those administered by the EPA, which heavily regulates our businesses — should give a common sense preference for the companies and workers who continue to invest and manufacture in the United States.  Congress has since acknowledged the benefits posed by this preference.  Even in the face of the strong opposition by lobbyists for foreign producers, the U.S. House approved two separate Buy American requirements in bills reauthorizing the SRFs (H.R. 1262, the Water Quality Investment Act and H.R. 5320, the Assistance, Quality, and Affordability Act of 2010 — the AQUA Act) since the 2009 stimulus.  

Indeed, the basis for Congressional support should be obvious: “Giving domestic products a preference on taxpayer funded projects creates jobs!”  In a recent study, the U.S. Department of Commerce estimated that for each job created in the local water and sewer industry, 3.68 jobs are created in the national economy.  Domestic preference policies like Buy American multiply these job gains.  As demonstrated by a 2009 Alliance for American Manufacturing report, manufacturing employment gains from infrastructure investment can increase by up to 33 percent when the amount of domestic materials purchased are maximized with the inclusion of strong domestic sourcing provisions.

In closing, our country needs a strong manufacturing base to ensure a healthy American economy for all.  Just as importantly, our policymakers must increase the amount of available funds in the SRFs to meet critical water infrastructure needs that also benefits us all.  The recent Clean Water Funding position paper by the Association of Clean Water Administrators’ on job gains resulting from capital investments in water infrastructure suggests the solution to each lies in the others’ problem.  Applying a Buy American preference to SRF projects will go a long way in keeping more jobs here in the U.S.  Thus, supporting American manufacturers is our best means to create more U.S. jobs which can generate the much needed U.S. tax revenues that will ultimately finance the future water infrastructure needs of our country.

About the Author:
Jim Keffer is currently President of EBAA IRON SALES, INC., a U.S.-based iron foundry and manufacturer of specialty engineered iron fittings that are utilized on water and wastewater pipelines to protect the integrity and to ensure the continuous uninterrupted flow of service through these pipelines should internal stresses or external shifting forces occur.  Jim has been actively engaged in the waterworks industry for well over 35+ years.  Jim is an active member of AWWA, a past President of the American Foundry Society, and is currently a sitting Texas House of Representatives legislator who has already served six terms.  As a Texas legislator, Jim has authored or co-sponsored numerous pieces of legislation that has benefitted the needs of Water Utility purveyors in addition to supporting the concerns of the public consumer for having affordable as well as clean and safe drinking water and wastewater services.  During Jim’s tenure as a legislator he has served in previous Texas legislative sessions as Chair of Economic Development, Chair of the House Ways & Means and is currently Chair of Energy Resources.  Jim, a father of 3 boys and now a proud grandparent to 2, currently resides in Eastland, TX with his wife Leslie of the past 37 years.