New Jersey Transit

Catherine A. Regan-DeCicco, Senior Director
Capital Programming and Administration
New Jersey Transit
One Penn Plaza East
Newark, New Jersey 07105-2246

Dear Ms. Regan-DeCicco:

This responds to your recent letter to our Region 2 office in which you raise concerns expressed by EIC Associates, Inc. (EIC), a bidder on your Newark-Elizabeth Rail Link Tunnel Construction project. In short, EIC certified non-compliance with Buy America and now requests that it be awarded the contract as the apparent low bidder, despite that certification. EIC claims that (1) it certified non-compliance responsibly, because there was a possibility that it could not comply, and certifying such reserved its right to request a waiver if needed; and (2) the project contains "important ‘design-build’ aspects" not addressed in the bid documents which should have changed the Buy America certification requirements.

EIC argues that the only way for it to truthfully respond to the Buy America portion of the bid documents was to certify non-compliance because it did not know which materials it would ultimately use. Further, EIC claims that there was no discussion or explanation of the implications of a certification of non-compliance in the bid documents, the statute, or the regulations.

49 C.F.R. 661.6 provides sample certification language used by New Jersey Transit (NJT) in this case. The certificate for non-compliance states that, "[t]he bidder hereby certifies that it cannot comply with the requirements of [Buy America], as amended…" Emphasis added. A certification of non-compliance means that the bidder cannot comply and the only proper response to that certification is to request a waiver if one is justified, and if not, as is the case here, reject the bid. 49 C.F.R. 661.13(c) states that, "[w]hether or not a bidder or offeror certifies that it will comply with the applicable requirement, such bidder or offerer is bound by its original certification and is not permitted to change its certification after bid opening." [1]

The regulation does not prescribe when a waiver must be requested, per se, but it does require certification, state the grounds for a waiver, and, absent a waiver, prohibit federal participation in contracts that do not comply with Buy America. 49 C.F.R. 661.5 and 661.7. In this case, there are no grounds for a waiver, and therefore, one should not be requested. All bidders were faced with the necessary decisions concerning materials and compliance or non-compliance. All other bidders certified compliance with Buy America, thereby telling NJT that they would and could comply because the materials necessary for the project were available domestically. These bidders were able to determine what materials would be used, and certified and priced their bids accordingly. EIC is bound by its stated position that it cannot comply with Buy America.

The second argument raised by EIC concerns the "design-build aspects" of this contract. The Federal Transit Administration (FTA) has provided guidance to grantees conducting design-build procurements on its Buy America website. This guidance, in short, says that a grantee should request a public interest waiver for the procedural requirements of Buy America that would permit bidders to submit their certifications after award and after the design portion of the project is complete. EIC argues that this process should have been followed here because of the "design-build aspects" of this project. NJT has assured this office that the subject project is not a design-build and was not advertised as such. As presented to the bidders, it was 100 percent designed by the joint venture of BRW and Parsons Brinkerhoff Quade and Douglas.

It should also be noted that EIC had ample opportunity to ask these questions of NJT at the December 10, 2002, Pre-Bid conference, or directly of the procurement staff, by letter, as discussed in NJT’s November 25, 2002, procurement cover letter. EIC could have reviewed the regulations cited in the solicitation and FTA’s web site, or contacted FTA directly with these questions.

If you have any questions, please contact Meghan Ludtke at (202) 366-1936.

Very truly yours,


(Signed)
Gregory B. McBride
Deputy Chief Counsel

cc: Letitia Thompson, Regional Administrator


[1] The Buy America website also contains guidance on this issue, which provides, in part, that "grantees must review all Buy America certifications before contract award and request a waiver, if one is necessary, before award in order to ensure FTA participation in the contract." FAQ, Question 6.

Certification of non-compliance and contract award. Low bidder who certified non-compliance seeks guidance on whether or not it can still win award. Bidder argues that the only way for it to truthfully certify was non-compliance because it did not know which materials it would ultimately use. Bidder also claimed that there was no discussion or explanation of the implications of a certification of non-compliance in the bid documents, the statute, or the regulations. March 6, 2003