The U.S. Government Accountability Office (GAO) found deficiencies in the administration’s website that provides information on waivers of Buy American laws in a December 2023 report. In Opportunities Exist to Improve the Reporting of Waivers to Domestic Preference Laws, the government watchdog highlighted the failure of the Buy American website to include information on waivers based on unreasonable costs of domestic products, as well as the difficulties of users in navigating the website. GAO also pointed to the disagreement between the General Services Administration (GSA), which maintains the website, and the Office of Management and Budget (OMB), which determines its content and function, on website updates. This post examines key elements of the GAO report.
Under the Buy American Act of 1933 and other domestic preference laws, federal agencies are allowed to waive the requirement to purchase US-made goods and buy foreign goods under certain conditions. The most common waivers are the nonavailability or unreasonable cost of domestic products, urgent needs, and public interest. GAO described the latter as an agency’s determination that the “domestic preference would be inconsistent with the public interest on a variety of bases, such as grants below a certain dollar threshold or to fulfill international trade obligations.”
The Biden administration made curtailing the use of waivers and their transparency central aims of its procurement policy, beginning with the president’s “Made in America” order in 2021. In that order, Biden established the Made in America Office within OMB and designated it as the final arbiter of waiver requests. GSA inaugurated the Made in America website in October 2021.
In the Infrastructure Investment and Jobs Act, Congress also required GSA to establish a website for agencies to post waivers and directed GAO (its audit, evaluation, and investigative arm) to review it. That directive was the impetus for its report.
GAO found that as of June 2023, 17 federal agencies had reported issuing 745 waivers, with five agencies accounting for nearly 85% of total: Departments of Commerce, Defense, Health and Human Services, the Interior, and Veterans Affairs. Of the reported waivers: 654 were for nonavailability, 87 for public interest, and 24 for urgent needs.
GAO identified several key deficiencies that need to be resolved, including:
-Errors in agencies' reporting of waivers,
-Inability of agencies to report unreasonable cost waivers because GSA needs OMB’s direction to add that function,
-Failure to provide results of routine data audits to identify data errors and violations of domestic preference laws after contract awards, as required by the infrastructure act, and
-Difficulties faced by users in navigating the website and identifying relevant waivers.
To remedy these deficiencies, GAO made nine recommendations, two to GSA and seven to OMB. GSA concurred with the recommendations that it work with industry on ways to improve the website and develop an agreement with OMB on future website development.
In contrast to GSA’s acceptance of its recommendations, GAO noted that “OMB generally disagreed or did not comment” on those directed at it. For example, OMB did not comment on recommendations related to establishing federal agency links on the website, establishing a date for providing agencies with the capability of reporting unreasonable cost waivers, and developing an agreement with GSA on future website development. GAO concluded it did not know whether OMB intends to implement these recommendations.
GAO sent its report to appropriate congressional committees as well as OMB and GSA.
Jean Heilman Grier
February 8, 2024
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