Swecoin U.S., Inc.

Ms. Elaine A. Bresnick, President
Swecoin U.S., Inc.
562 California Street
Newton, MA 02460

Dear Ms. Bresnick:

This letter responds to your correspondence of October 8, 2004, in which you request a Buy America non-availability component waiver for the Swecoin TTPM2 magnetic ticket printer/encoder unit which is manufactured in Sweden for use in fare collection systems.  You argue that the TTPM2 printer/encoder, or its functional equivalent, is not available from a United States source.  However, based on my review of market information, I have found this not to be the case.  For the reasons below, I have determined that a waiver is not appropriate here.

FTA's requirements concerning domestic preference for federally funded transit projects are set forth in 49 U.S.C. §5323(j).  However, Section 5323(j)(2)(B) states that those requirements shall not apply if the item or items being procured are not produced in the U.S. in sufficient and reasonably available quantities and of a satisfactory quality.  The implementing regulation also provides that a waiver may be requested "for a specific item or material that is used in the production of a manufactured product."  49 C.F.R. 661.7(g). The regulations allow a bidder or supplier to request a waiver only if it is being sought under this section.  See, 49 C.F.R. 661.7(g) and 49 C.F.R. 661.9(d).

You state that the TTPM2 printer/encoder has the following features and characteristics which make it unique and not domestically available.  1) the ability to magnetically encode, thermally print and dispense a magnetic ticket, as well as to retrieve, validate, and re-print as required an existing deployed magnetic ticket, and the ability to capture and internally dispense invalid or corrupt tickets; 2) compact size (TTPM2 measures 196 mm wide x 160mm tall x 265mm deep); dual track feature which permits two different media types to be loaded simultaneously (such as weekly pass ticket media on one track and daily pass ticket media on the second track); 3) superior operating reliability (backed up by a 1-year warranty including parts and labor) and operating range performance (0 to –50 degrees centigrade operating temperature range). 

You further state that with the exception of Boca Systems, the manufacturers of magnetic ticketing systems are located outside the United States.  While acknowledging that Boca Systems is “capable of providing an OEM engine,” you assert that Boca Systems can only provide a “custom developed product” with the features of “re-encoding/re-printing of magnetic tickets” found in the Swecoin TTPM2, and that, therefore, the Boca Systems device would not be “widely available.”  You then argue that due to its dimensions, the Boca Systems product would be “impractical” for incorporation into typical fareboxes.  However, even assuming these assertions to be true, you have failed to demonstrate that Boca Systems, which manufactures in Florida, is unable to provide a product that is functionally equivalent to the Swecoin TTPM2. 

Moreover, FTA requested comment on this matter and received a response from Cubic Transportation Systems, Inc., who assert that they manufacture a product in the United States called the Universal Ticket Transport which provides similar functionality to the Swecoin TTPM2.  In particular, the Cubic device magnetically encodes, prints and dispenses multiple tickets for use in fare collection systems.  It features a dual head for handling two different media types interchangeably.  The Cubic device also captures invalid and corrupt tickets.  In addition, Cubic provided information about another manufacturer called Xico, Inc., of Chatsworth, California, which makes a product called the Series 8900 Issuer that is able to meet the same requirements of the Swecoin TTPM2, including thermal printing.

Based on the above-referenced information, I have determined that the grounds for a "non-availability" waiver do not exist.  If you have any questions, please contact Joseph Pixley at (202) 366-1936.

Very truly yours,

Gregory B. McBride
Deputy Chief Counsel

Denial of non-availability component waiver for magnetic ticket printer/encoder.

November 29, 2004