BABA at the Bar
By Wayne Hofmann
An engineer, a contractor and a utility owner walked into a bar.
They had just finished a long day reviewing plans at the construction site, and they were all feeling a little drained. They ordered their drinks and saddled up to the bar.
Before long, the conversation drifted to their new favorite bar topic: the Buy American Build America (BABA) Act.
“I just cannot make heads or tails of this program,” proclaimed Mary the engineer. “Everything we put in this project was sourced from the United States. I’m busy enough, how can I keep track of where everything is coming from? It is like they don’t want us to build anything.”
Joe, the contractor, added, “You think you have it bad? We need to make sure that all our subcontractors are compliant too. Have you ever tried to herd subcontractors? If we can’t get them to comply, we risk losing our funding.”
The utility owner, Jim, chimed in. “Wait, don’t you mean my funding? You guys need to figure this out because I cannot have you making this project more expensive. We already have a tight budget.”
Joe wryly replied, “It might cost a little more upfront, but it is worth it to support American industries and jobs, right?”
Mary groaned. “That’s all well and good,” she said. “But the only place I can get this special water valve is from a little manufacturing shop in Austria. It is the best there is and we must have it!”
“Yes, it is a great valve, I agree,” mused Jim.
The bartender overheard their conversation and interjected, “You guys always come in here and start complaining about this BABA thing within 10 minutes. Don’t you have any solutions?”
The group looked at each other and grumbled.
“You just don’t understand,” Mary explained, “Sure, it is great to support America companies, but we need this valve!”
Suddenly, Fred the materials supplier walked in. “Hey everyone, sorry I’m late.”
“YOU ARE ALWAYS LATE,” the group bellowed in unison.
“I know, it always feels like I’m disappointing you. I was stuck at the shop on the phone with this shop in Austria about these valves I need—it is going to take them six more months to get here,” Fred complained.
“Oh no!” Mary cried.
The bartender chuckled. “Boy, I thought I had problems! This sounds challenging, but haven’t you thought of any solutions? Isn’t that your job?” he asked.
“Look buddy,” Jim the utility owner said, “you plan these projects for years and years, only to find out you cannot use some of the materials you have been relying on for so long. And then the rules change!”
“That is right,” noted Mary the engineer. “But, I did hear you can get a waiver if you have been planning or designing a project before May 14, 2022. You have some of those, right, Jim?”
“You know, just about everything we are working on right now is in our capital improvement plan,’ Jim said. “If we can show these projects were planned quite a while ago, we could get a waiver.”
“Great idea!” exclaimed Mary. “Plus, we can use that precious valve!”
Fred the supplier spoke up. “That is a great valve, but we’re getting this new one that’s made in Youngstown,” he said. Great story, small American manufacturer that is partnering with a company overseas. I’ll send you the specs.”
“Why didn’t you tell me about that at the supplier expo?” Joe the contractor asked. “I walked that entire exhibit hall and not a single booth had ‘Made in America’ stickers on any of the fancy materials you suppliers are selling. Seems like a great differentiator!”
“You know, you are right,” Fred said. “I’m sending marketing an email right this second — don’t tell anyone else!”
“Seems silly that a little valve can throw a project sideways,” said Jim. “It is not even that big of an expense relative to the rest of the project.”
“You know, you are onto something there,” Joe thought. “The valve is only about 3 percent of the project as I recall. I can check, but if we can source the rest of the materials domestically, we might be able to get that 5 percent EPA waiver I heard about at the conference last month.”
“Look at that,” noted the bartender. “You’re coming up with some good ideas! This calls for another round!”
Wayne Hofmann is client funding manager at Wade Trim. This article originally appeared in Water Finance & Management. Tags: Buy American Build America Act