Applying Buy America requirements to utility relocation agreements has the potential to “create substantial delays and increased costs for transportation projects across the country with attendant adverse effects on jobs and the economy,” according to a recent letter from APTA and nine other affected organizations to Sec. Anthony Foxx.

The requirements reflect the FTA’s re-interpretation of existing Buy America requirements in the past year, despite a long-standing DOT practice that treats such relocation agreements as real estate transactions. The letter calls on DOT to “resolve the uncertainty” resulting from the policy shift.

“Since utilities and the companies that make the materials used in utility relocation have not been subject to Buy America historically, we believe that a transition period is needed,” the letter says. “During this transition period, the process of compliance for utility relocation can be clarified, waivers can be issued where appropriate, and education and training of affected industries can occur. Most importantly, transportation projects can move forward. We believe utility relocations should not be subject to Buy America requirements during this transition period.”

Utility relocation agreements occur when utility companies must move their infrastructure to accommodate the construction of transportation projects supported by federal funds. However, DOT has asserted that the new policy applies even when the relocation is funded with non-federal dollars. The letter states that transportation agencies “are being asked immediately to comply with new requirements without the benefit of clear guidance and a rulemaking to explain how utilities will demonstrate Buy America compliance.”

Rather, the signing organizations suggest that DOT develop a “reasonable framework” to allow utility companies to comply without disrupting existing transportation projects.

Others who signed the letter include the ­American Association of State Highway and Transportation Officials and the Edison Electric Institute.

To see the letter, click here.

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