The National Telecommunications and Information Administration (NTIA) has issued guidance around waivers to the Build America Buy America (BABA) requirement for equipment and supplies needed for federally funded infrastructure projects. BABA rules require that supplies like iron, steel and other materials be made in the United States, which is intended to support the U.S. economy and jobs; and to re-shore manufacturing work lost to countries like China and Mexico.
However, the hundreds of broadband infrastructure projects planned to move forward across the country — funded, in part, by the 2021 Infrastructure Investment and Jobs Act — often require complex electronic components that are part of a global supply chain, with a manufacturing process not easily restarted stateside. The federal guidance, generally, could help smooth the way to import routers, switches and other devices.
“This is one of at least a handful of things that had to get solved before the states could move forward with their plans, and the service providers can move forward with their plans,” David Stehlin, CEO for the Telecommunications Industry Association (TIA), told Government Technology about NTIA’s waiver requirements, which were released Feb. 23.
Some major supplies needed for broadband projects are made in the United States, like fiber-optic cable, Stehlin said. But other items like vaults, cabinets and metal enclosures can originate elsewhere, including in Mexico.
“But the biggest area is things that are electronics. So, anything that has a chip in it is going to be a problem, because chips for the most part have not been made in the United States,” he said. “We’re trying to fix that problem now. But we’re still a few years away from it taking effect.”
BABA rules, the TIA CEO said, have been in place for decades, and “some programs have used the rules, and some have not used the rules.”
Still other broadband programs have not had BABA requirements — but for those projects being developed as part of the Broadband Equity, Access, and Deployment (BEAD) program, Build America Buy America is required. BEAD is making more than $42 billion available to develop broadband in unserved areas.
And accessing high-quality equipment is essential for these projects to move forward, Karen Lightman, executive director of Metro21: Smart Cities Institute at Carnegie Mellon University, told GT.
“The equipment piece is so critical. And if we think about higher levels of sophistication — we want the state-of-the-art — it’s not necessarily manufactured in the United States,” said Lightman, noting that restructuring supply chains is not something that can quickly be turned around.
“The way that the economy was, pre-pandemic, absolutely global supply chain. And the pandemic showed us how fragile that is. But this global supply chain had been decades in the making, since like the ’90s,” she added.
BEAD funding flows from the federal government to the states, which then issue RFPs and take the lead in managing the projects. States will have four years from the end of 2024 to use the funding, said Stehlin.
“So, they’re on the clock,” he said. “But we still have a number of these things that we have to resolve.”
