NTIA Stands Firm on Buy America Rules, Says BEAD Projects Must Be American

WASHINGTON, February 9, 2023 – In a firm statement on Thursday, the National Telecommunications and Information Administration said it will stand behind the country’s domestic production preference laws when it comes to the manufacturing of fiber optic glass or cable products using federal funds.

It also said it believes broadband projects funded from its $42.5 billion Broadband Equity, Access and Deployment program “have time” to get “made in America” products, potentially closing the door on waivers for products some in the industry have said could increase the cost or make the timely completion of projects difficult for that program. The NTIA will allocate the BEAD money to the states by June 30.

The Infrastructure, Investment and Jobs Act includes a “Build America, Buy America” provision that requires at least 55 percent of the cost of products funded by the federal government for projects be made in the country. But the legislation includes an exemption opportunity from the domestic preference rule in certain cases.

“NTIA has done considerable research and does not currently see any need for waivers for fiber optic glass or cable,” the Commerce Department agency said in its Thursday statement.

The comments were in direct response to President Joe Biden’s State of the Union Address on Tuesday night, in which he announced “new standards” requiring “all construction materials used in federal infrastructure projects to be made in America,” with a specific mention of fiber optic cables.

“Our expectation is that industry will be able to produce enough quantity [of fiber] to satisfy the demand from the Broadband Equity, Access, and Deployment (BEAD) Program over the coming years,” the NTIA statement said, adding it will not be an agency that will “skirt” the BABA requirements.

The Commerce Department agency added it “believes that if it can be Made in America, it should be made in America – and it’s why we’ll strictly enforce ‘Build America, Buy America’ (BABA) requirements outlined in the Bipartisan Infrastructure Law and the Internet for All Notices of Funding Opportunity (NOFOs),” it added.

Broadband Breakfast reported that the Fiber Broadband Association sent a letter to Sen. John Thune, R-SD, about the need for BABA waivers on products that exclude optical fiber and fiber cable but that include other optical connectivity products, fiber optic adapters and connectors, and fiber cable assemblies and enclosures. If those have to be made in America, the industry association says costs would increase significantly.

Wednesday’s Broadband Breakfast Live Online event included a discussion on BABA.

BEAD projects can be made in America, NTIA says

The NTIA also said that it believes bidders for the $42.5 billion BEAD money will be able to satisfy their domestic production requirements, despite some in the industry requesting some form of BABA waiver because some of the products they need for build are produced overseas.

“The BEAD Program has different requirements, and manufacturers have time to re-shore or expand their operations,” the NTIA statement said. “Moving forward, NTIA will work with these businesses to ensure that they can produce the relevant products for the BEAD program domestically.

“We are carefully monitoring administration-wide initiatives like the new proposed Made in America policies from the Office of Management and Budget (OMB) to ensure that we meet our obligations,” the statement added.

The NTIA is currently considering a BABA waiver opportunity for its $1 billion Enabling Middle Mile Broadband Infrastructure Program, which includes certain project components. It also has an existing waiver in place for its Tribal Broadband Connectivity Program and the Connecting Minority Communities Pilot Program.