The order seeks to close existing loopholes and creates a new oversight regime, including a GSA-hosted website to post waivers publicly.
An executive order signed Monday pushes federal agencies to buy more American-made products and services, and comes with new reporting requirements, a new top-level oversight position and a new website.
Since being inaugurated last week, the Biden administration has been issuing a slew of executive orders—many with direct consequences for federal agencies and contractors. Included in Monday’s signings was an order strengthening existing laws that favor U.S.-based manufacturers in federal contracts.
“With this order, President Biden is ensuring that when the federal government spends taxpayer dollars they are spent on American-made goods by American workers and with American-made component parts,” according to a factsheet released ahead of the order. “This executive order fulfills President Biden’s promise to make Buy American real and close loopholes that allow companies to offshore production and jobs while still qualifying for domestic preferences.”
The factsheet notes federal agencies spend $600 billion annually in contract spending. Independent analysis suggests 2020 spending could have been as high as $630 billion.
The new executive order builds on existing laws—namely the Buy American and Buy America statutes, passed in 1933 and 1982, respectively—and instructs agencies to close loopholes that have made those laws ineffective over time.
Current federal acquisition laws require agencies to meet a “domestic content threshold,” wherein a set percentage of a product’s makeup was manufactured in the U.S. However, if the price difference between domestic- and foreign-made products is large, agencies can justify purchasing the lower-cost products.
The order signed Monday “directs an increase in both the threshold and the price preferences for domestic goods,” the factsheet states.
In order to establish a baseline of how agencies operate today, the order requires agencies to submit a report on current policies and metrics, as well as a roadmap for meeting the new administration’s goals. Agencies will have to submit those reports twice yearly going forward.
The order appears to extend to agency gift shops, as well.
“This review includes a requirement that agencies submit recommendations for ways to ensure items offered to the general public on federal property are Made in America — to the fullest extent possible—and to consider service industries in addition to manufacturing,” the factsheet states.
The order also establishes a central oversight mechanism, including a review board to approve waivers from specific requirements—and a General Services Administration-built website to publish those waivers publicly—and a new director of Made-in-America position in the Office of Management and Budget.
“The EO will tighten and make public the waiver process so that American workers and manufacturers can see how federal dollars are spent and where they’re going,” White House Press Secretary Jen Psaki said Monday during a press briefing.
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