ALSTOM Transportation Inc.

Keith Stentiford
Customer Director
ALSTOM Transportation Inc.
1 Transit Drive
Hornell, NY 14843

Re: Request for Buy America Waiver

Dear Mr. Stentiford:

On June 18, 2008, the Federal Transit Administration (FTA) denied your request for a Buy America non-availability waiver for an “Arpege” Truck Axle Bridge for use in Low Floor Light Rail Vehicles (LRVs) that Alstom Transportation Inc. (Alstom) intends to supply to the Metropolitan Transit Authority of Harris County, Texas (Houston METRO). I write in response to your subsequent request for reconsideration. For the reasons below, FTA must deny your request.

Under 49 U.S.C. 5323(j), FTA may not obligate funds for a project unless all iron, steel, and manufactured products used in the project are produced in the United States.[1] FTA may waive its Buy America requirements if the materials for which a waiver is requested are not produced in the United States in sufficient and reasonably available quantities and of a satisfactory quality.[2]

According to your letters, Alstom plans to respond to a request from Houston METRO by offering its Citadis 100% Low Floor LRVs. Houston METRO is requiring that manufacturers offer an existing LRV with considerable revenue service experience. For the LRV’s truck systems, Houston METRO is explicitly requiring equipment that is “identical” to a supplier’s existing equipment. Therefore, you claim that because the axle bridge is an essential structural and mechanical drive component of the Arpege truck, Alstom cannot meet Houston METRO’s requirement of identical truck systems without the use of a domestically-manufactured axle bridge that is identical to the Renault axle bridge.

FTA notes, however, that Renault, not FTA, has made the decision not to release the axle bridge design specifications to potential competitors in the United States. Your letter indicates that Renault has precluded Alstom from releasing Renault’s proprietary design for the axle bridge to any third-party U.S. manufacturer. It is for this reason alone that Alstom cannot manufacture the axle bridge in the United States, although it can be inferred from your letters that Alstom is capable of obtaining comparable axle bridges manufactured elsewhere.

Renault’s unwillingness to release its proprietary design to a third party is not sufficient basis for a non-availability waiver, particularly when it appears that Alstom is capable of obtaining an axle bridge that would comply with Houston METRO’s specifications, albeit not from a domestic third-party source. I should note that FTA’s Buy America requirements allow rolling stock to consist of up to 40% non-domestic content, which could include axle bridges manufactured or assembled outside the United States. With this flexibility, FTA believes that Alstom can submit a bid to Houston METRO that complies with FTA’s Buy America requirements.

After careful review of the additional information submitted by Alstom, and for the foregoing reasons, FTA must deny your request a second time. Feel free to contact Jayme L. Blakesley at (202) 366-0304 or jayme.blakesley@dot.gov with any questions.

Sincerely,

SevernE.S. Miller

Chief Counsel


[1] 49 CFR 661.5(a).

[2] 49 CFR 661.7(c).

Denial of request for reconsideration of decision not to grant a Buy America waiver for an "Arpege" Truck Axle Bridge for use in low floor light rail vehicles. November 25, 2008