Sen. Chris Murphy Reintroduces Buy American Bill After Pentagon Reporting Amendment Passes

U.S. Sen. Chris Murphy, D-Conn., reintroduced legislation on Oct. 14, 2015, to tighten federal Buy American rules. He did so after Congress passed his amendment requiring the Pentagon to report large purchases of foreign-made goods made under the overseas exemption.

The amendment

The amendment requires the Defense Department to report contracts worth more than $5 million for foreign-made equipment that will be used only outside the USA. Goods bought for use overseas are exempt from Buy American laws. Murphy’s office said the Pentagon uses exemptions less often when it has to report them.

According to Murphy’s office, 83% of 2014 spending under Buy American Act waivers and exceptions, about $5.4 billion, used the outside-the-country exception.

What the bill would do

• Allow the overseas exemption only if the USA-made item would cost at least 50% more than the foreign one, or if it is needed urgently for national security.
• Raise the USA content a product needs to qualify as domestic under the law from 50% to 60%.
• Require a jobs impact analysis when the public interest waiver is used.
• Offer loans and loan guarantees to companies that are the sole supplier of an item the government buys, or that want to start making an item not currently made in the USA.

It was the third time in six years Murphy had introduced the bill. He called the Pentagon’s use of waivers an “outrageous misuse” that hurts the defense industrial base, and he cited a spot check finding that some Navy bases were inconsistent in following Buy American laws and stricter textile rules.