Construction and engineering groups praised the strong support for continued heavy infrastructure funding that President Joe Biden voiced in his State of the Union address. But he prompted some industry unease in announcing that a potentially broader Buy American mandate for projects is coming soon from his administration.
In his Feb. 6 speech before a joint session of Congress, Biden repeated a comment he had made before— that the U.S. had once ranked first among countries for infrastructure but has since dropped to No. 13.
“But now we’re coming back,” Biden declared, pointing to the enactment of the $1.2-trillion Infrastructure Investment and Jobs Act (IIJA) in November 2021. The five-year measure is now in its second year on the books and Biden said that so far it has funded "more than 20,000 projects."
The White House provided more speech detail in a Feb. 8 fact sheet, stating that federal agencies have announced nearly $200 billion in IIJA funding for those projects or grant awards.
It also said the project total includes the launch of more than 3,700 bridge repairs and replacements and the start of upgrades for more than 69,000 miles of roadway.
“And folks, we’re just getting started," Biden said.
The President teased Republicans who voted against the IIJA but who also asked him to fund projects in their districts, he said. “I promised I’d be a president for all Americans," Biden said. "We’ll fund these projects, and I’ll see you at the groundbreaking.”
Industry groups praised the attention Biden paid to infrastructure. Maria Lehman, president of the American Society of Civil Engineers, said in a statement that the group “is encouraged that infrastructure remains a top priority for the Biden administration.”
She said in a statement that the positive “return on investment” from the 20,000 projects is clear.
The American Council of Engineering Cos., said in a statement that engineering firms are working to turn the infrastructure law's financial resources into “tangible results for the American people.”
But ACEC also said that “the country’s positive job numbers are tempered by the lack of engineers available to do all the work.”
The group urged Biden and Congress to work to address the engineering workforce shortage, through such actions as immigration reform legislation and more STEM education.
Terry O'Sullivan, general president of the Laborers' International Union of North America, said the administration "is delivering for working men and women through historic investments that are creating good, family-supporting jobs..."
Associated Builders and Contractors President and CEO Michael Bellaman was critical of Biden policies, saying that as his term continues, “he can either continue with his anti-competitive executive orders or work with Republicans in Congress to find a better path forward through bipartisan solutions.”
In particular, Bellaman pointed to the administration’s support of project labor agreements on federally funded projects and of the Protecting the Right to Organize, or PRO Act, for which Biden reiterated his backing in his address.
But Bellaman also welcomed that Biden addressed mental health in his speech and added that ABC “stands ready to work with this administration to prioritize total human health.”
David Long, National Electrical Contractors Association CEO, said in a statement said that the recent rise in infrastructure spending “presents real change” for member firms.
But Long also cautioned that issues related to the supply chain, high inflation, taxes and workforce shortages remain to be tackled.
Awaiting Buy America Guidance
But construction industry officials also took keen notice of the new Buy America standards.
Biden said that a Buy America provision has been in effect since 1933. "But for too long past administrations—Democrat and Republican—fought to get around it," he said. "Not any more—Tonight I'm also announcing new standards requiring all construction materials used in federal infrastructure projects to be made in America."
Biden specifically mentioned "lumber, glass, drywall and fiber-optic cable," in noting what would be subject to the requirements.
The Associated General Contractors of America supports increasing U.S. manufacturing to help address supply-chain problems stemming in part from the pandemic and the war in Ukraine, Jimmy Christianson, vice president-government relations said in an interview.
But he added that seeking to shut down current processes for getting waivers from Buy America requirements for certain materials "will delay projects."
Christianson also said various state departments of transportation and other public-sector owners continue to have "differing interpretations" of how to implement current Buy America provisions.
The Office of Management and Budget issued a Buy America guidance document last April and, following up on Biden's comment, a new agency memo is expected soon that will "try to better define what is and is not made in America," Christianson says.
In particular, he says that for federal-aid highway projects, there is "a big push" from Buy America advocates to drop a waiver for "manufactured products" from the domestic-preference requirement. That waiver took effect in 1983.
The IIJA has a number of provisions aimed at broadening the application of Buy America. But the statute specifically excludes cement, cementitious materials, aggregates and asphalt binder from Buy America requirements.
The National Stone, Sand & Gravel Association successfully pushed to have that exclusions provision included in the IIJA.
Group President and CEO Michael Johnson said in a Feb. 8 statement: “This action to create the exclusion and ultimately include it in the [IIJA] law, as written by Congress, demonstrates the clear intent to exclude these materials."
Johnson added, “Regardless of [the president’s] comments, the Biden administration still must follow the law as intended.”
In his speech, Biden did not mention aggregates, cement, binder and the other products covered by the association-backed IIJA exclusion.
But AGC's Christianson says it's unclear how OMB will treat concrete, even though cement is clearly excluded from Buy America requirements.
Canadian Lumber Watching Buy America Guidance
Canada's lumber industry also is interested in the coming Buy America guidance.
Linda Coady, president of the BC Lumber Trade Council, said in a Feb. 8 statement that Biden's statement about a new Buy America guidance announcement is "concerning."
Coady said that the lumber council is "seeking to better understand what this means for Canadian producers" and added that "our focus remains on working on both sides of the border to maximize the opportunity Canada has in providing the sustainably produced, low-carbon lumber products we know American homebuilders, consumers and construction workers want and need."
Coady said that in 2021 U.S. lumber demand was more than 50 billion board feet and U.S. producers supplied 35 billion board ft.
The 15-billion-board ft difference was mainly filled by Canadian lumber, Coady added.
Story updated on 2/9/2023 with comments from Canadian lumber council.