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Steel wants Buy America waiver nixed

Sep 17, 2013 | 04:17 PM |

Tags  Nucor, American Iron and Steel Institute, Steel Manufacturers Association, Buy America, Buy America waiver, Federal Highway Administration, FHWA, Kelley Drye & Warren

NEW YORK — Nucor Corp., the United Steelworkers union and other steel interests are calling on the Federal Highway Administration (FHWA) to retract a rule limiting the application of Buy America laws.

The FHWA said in a December memo that Buy America laws, which require government-funded transportation projects to use steel that has been produced in the United States, don’t need to be applied to certain steel and iron products used in transportation construction. This includes steel and iron components necessary to encase, assemble and construct primary construction products such as clamps, fittings, sleeves, washers, bolts, nuts, screws, tie wire, spacers, lifting hooks and faucets, among others.

An appeal to repeal the waiver is awaiting scheduling in U.S. District Court for Columbia.

Charlotte, N.C.-based Nucor, the USW and several iron foundries filed a petition to review the memo in February, arguing that it was wrongfully filed and would hurt the U.S. steel industry.

The FHWA’s change to Buy America provisions "significantly undermines the Buy America program by exempting an entire category of steel and iron products from coverage," Nucor said in a Sept. 6 letter to the FHWA. "This change, or any other weakening of existing Buy America laws, is detrimental to Nucor and its workers, as well as to other U.S. manufacturing companies."

The Steel Manufacturers Association, the American Iron and Steel Institute and others have also written letters to FHWA in protest, saying U.S. businesses will be hurt if the waiver isn’t retracted.

Several steel producers, including Nucor, argued in letters to the FHWA that the waiver would damage their businesses by allowing contractors to buy steel products made overseas.

The waiver has been in effect for less than a year and it is unclear how much it has affected U.S. companies’ bottom lines. However, Dustin Painter, counsel at Washington-based Kelley, Drye & Warren LLP, which filed the petition for review, said U.S. companies would know the effects by year-end.

"The concern is that (FHWA) has done something that for the first time is carving out whole segments of the iron and steel industry as not being subject to the Buy America Act," Painter said. "It’s a significant market for these products, and frankly some of these industries have already been harmed so much over the years by subsidized foreign competition."

The petition was transferred to a Washington court earlier this month.

Opposing parties said they will continue litigating to push FHWA to retract the waiver if the agency doesn’t do so on its own.

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