Dear Mr. Hamm:
This is in response to your letters of January 4, and March 1, 2002, regarding your proposals for testing buses to meet your Bus Rapid Transit (BRT) system deployment needs at the Lane Transit District (LTD).
Your letter of January 4 requested our interest in assisting LTD in a possible on-site test of Neoplan, USA vehicles that would take advantage of Neoplanís involvement in providing BRT buses to the Massachusetts Bay Transportation Authority. Subsequent to this letter we understand that you made a decision to pursue the acquisition of foreign-made vehicles for your proposed BRT system.
Your letter of March 1, 2002, requested that all applicable waivers and exemptions be applied to the purchase of up to 10 Phileas vehicles manufactured in the Netherlands by Advanced Public Transport Systems. You stated in this letter that these exemptions would form the basis of a demonstration program to further the development of a comprehensive BRT deployment effort in the U.S. You further offered LTDís facilities as a site to conduct tests on the Phileas vehicle. The results of these tests would be shared with the Federal Transit Administration (FTA) and others interested in BRT deployments that involve vehicles with characteristics similar to those of the Phileas bus.
I share your interest in working with others in the transit industry to create the best climate for introducing new vehicle technology into the U.S. market to meet the needs of proposed BRT systems. We applaud your proposed efforts to create an on-site test bed to address the new vehicle technology introduction issue, and we look forward to working with you on this effort.
Section 5323(j) (2) (C) of the Federal transit laws (49 U.S.C. 5301, et seq.) sets forth the Buy America requirements for the procurement of rolling stock. This section provides that when rolling stock is procured with FTA funds, the cost of the components and subcomponents produced in the United States must be at least 60 percent of the cost of the components, and the rolling stock and must undergo final assembly in the U.S. You request a non-availability waiver under 49 U.S.C. 5323(j)(2)(B) and the implementing regulation for the sole source procurement of ten Phileas BRT vehicles. The regulation provides that the Buy America requirements may be waived, "if the grantee provides sufficient information which indicates that the item to be procured is only available from a single source, or that the item to be procured is not produced in sufficient and reasonably available quantities of a satisfactory quality in the United States." 49 C.F.R. Section 661.7(c)(2).
We do not believe LTD has provided sufficient justification of the sole source to warrant a non-availability Buy America waiver as requested. According to the information you have provided, the single element that Civis failed to meet in the Request For Information (RFI) was the MPG fuel economy measure. However, the RFI did not solicit MPG ratings. In the RFI, Civis seems to meet or exceed all of the listed criteria.
Therefore, FTA recommends that LTD conduct a competitive procurement for this vehicle, then request a non-availability waiver if the competition proves that there is no U.S. source. 49 C.F.R. 661.7(c)(1) provides that "[i]t will be presumed that the conditions exist to grant this non-availability waiver if no responsive and responsible bid is received offering an item produced in the United States." The competition may show that Phileas is the only manufacturer capable of supplying the vehicle, that Irisbus is also able to manufacture it, or that there is a U.S. manufacturer. Regardless of the result, the competitive procurement will ensure fair and open competition, and then a Buy America waiver will be justified if the facts support it.
The type of bus testing to be required for your BRT vehicle purchase will be determined by the specific vehicles selected through the procurement process. I recommend that LTD contact FTA once the selection has been made to determine the applicability of testing to that particular model.
Thank you for your interest and involvement in our BRT Demonstration Program. I fully look forward to continuing our close relationship with you and your management team as we address the significant issues facing our industry in meeting the mass transit needs of our country.
Jennifer L. Dorn