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Buy America and highway projects

Other Key Information

1. Buy America(n) Essentials

1.1 Sector Specific Information

1.2 Exceptions and Waivers

Most of the significant highway projects in the United States are funded by the Federal Highway Administration (FHWA). This funding brings with it Buy America restrictions that require all steel and iron materials used to be U.S.-made.

The FHWA, part of the Department of Transportation (DOT), is responsible for regulating and maintaining U.S. highway infrastructure. Canadian companies will generally interact with the FHWA in either a direct sale to the FHWA or as a subcontractor on an FHWA-funded project.

Direct procurement by the FHWA

The FHWA does execute procurements for highway projects on federal lands, research and development projects, and for normal supplies and services needed for its own use. Buy American requirements apply to these purchases. In these procurements, FHWA generally follows rules set forth in the Federal Acquisition Regulations (FAR) and implementing instructions contained in the Department of Transportation Acquisition Regulations (TAR).

Procurement by the FHWA (when the FHWA purchases something for its own use) is covered by the revised WTO Agreement on Government Procurement (GPA). Under the revised GPA, on purchases of goods or services Canadian firms will be treated as U.S. firms when the prime contract is worth more than $182,000 for goods and general services, and $7,008,000 for construction services. Be aware though that other programs, such as small business set asides, still may impede the participation of Canadian firms for procurements below US$250,000.

When the contract is less than the above dollar thresholds or where the FHWA is purchasing a good or service not covered by the revised GPA, the Buy American Act (41 U.S.C. Chapter 83) applies.

Federally funded highway projects

The vast majority of significant highway projects in the U.S. are procured by state or local governments with funding provided by the FHWA. Marketing efforts should be directed to local sources. To identify opportunities visit the FedBizOpps website.

Highway projects executed by state or local governments receiving FHWA funding must comply with specific Buy America requirements contained in Title 23, Part 635 of the U.S. Code of Federal Regulations (23 CFR Subpart 635.410). The Code requires that no Federal aid construction project be authorized unless:


Individual states must comply with this requirement unless:

These requirements do not apply if the cost of the iron and steel materials does not exceed 0.1% of the total contract cost, or US$2,500, whichever is greater.

More about Buy America restrictions

For your convenience, we have summarized below the related Buy America restrictions listed at 23 CFR Subpart 635.410, which are most relevant:

Canadian suppliers may find it difficult to provide iron and steel products for use in highway projects. Canadian products could be used if:

In the latter two cases, a waiver must be obtained by the prime contractors via the grantee from the regional federal highway administrator.

For more information:

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