Congress Considers "Buy American" for SRF Program

Nov. 1, 2012

By Dawn Kristof Champney, WWEMA President

It was the bottom of the ninth. Washington Nationals' outfielder Jayson Werth was at bat. The count was full. The score was even with the St. Louis Cardinals up one in the best of five in postseason play, the Nats having suffered defeats of 12-4 and 8-0 in games two and three. This was a must-win game for the Nats, a team that had waited 79 years for the chance to once again be in the World Series. The pitch was thrown and the crowds went into a frenzy as Werth slammed the homerun ball over the left field fence at Nationals Park. Game over, season saved … for now.

The pitching by both teams was exemplary as the men on the mound threw harder and with greater precision than witnessed during the regular season. It was the best that could be hoped for among these winning teams. Indeed, the playing field was level and each team exhibited enormous talent, giving a remarkable return on investment to their loyal fans.

If only business were like baseball where companies could compete on a level playing field, offering customers the best products at the lowest cost of ownership. Unfortunately, that is not always the case, especially when politics are involved. Case-in-point: Buy American. Both the U.S. House of Representatives and the U.S. Senate are currently considering making all future water and wastewater capital improvement projects comply with Buy American requirements as a condition of receiving financial assistance through the clean water and drinking water state revolving fund programs.

The House Appropriations Committee passed its version of the U.S. Environmental Protection Agency's fiscal year 2013 appropriations bill (H.R. 6091) on July 10. The Senate Appropriations Subcommittee on Interior, Environment, and Related Agencies released its draft text of the FY '13 measure on September 25. Each contains differing Buy American provisions that would essentially restrict municipalities from purchasing products unless they are "produced in the U.S."

It appears our legislators have ignored the chaos that a similar provision within the American Recovery and Reinvestment Act created during the stimulus program and have rejected the arguments put forth by every sector of the water and wastewater industry – from states and municipalities to manufacturers and service providers – that such a restrictive mandate would jeopardize the financial corpus of SRF programs as communities seek out other sources of funds that do not contain such onerous requirements, and would undermine the ability of communities to get the best products offering the greatest value from U.S. companies that may utilize global supply chains. Equally worrisome is the backlash it will create as other countries implement similar ‘buy national' requirements in retaliation, locking U.S. companies out of export opportunities.

This action by Congress could not come at a worse time, as the Administration has just unveiled its U.S. environmental technologies export initiative, putting federal resources behind what they consider to be a key industry that offers great potential for future export sales and jobs creation. WWEMA was instrumental in helping forge this initiative and will work tirelessly to ensure that nothing jeopardizes its success.

The members of our organization want to be able to "Sell American" and to do that, we need to remove barriers to trade, not create them. Where barriers do exists that prevent a level playing field, we need to employ other means to break them down. A classic example would be multilateral trade agreements that foster comparable environmental and labor requirements and tariff reductions.

Just last month the leaders of the Asia-Pacific Economic Cooperative (APEC) forum signed a historic agreement that will reduce tariffs on a list of environmental goods to five percent or less by 2015. APEC makes up 60 percent of world exports of these goods, many of which are used in water and wastewater applications and currently face tariffs as high as 20 percent. Reducing the tariffs will make U.S. goods more competitive in the 21 nations comprising APEC, assuming we are not locked out of them due to short-sighted, election-year politics.

About the Author: Dawn Kristof Champney is president of the Water and Wastewater Equipment Manufacturers Association, a 104-year old national trade organization representing the interests of companies that manufacture products for use in potable water and wastewater treatment applications. Circle No. 246 on Reader Service Card

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