Decision To Rescind Buy America Waiver for Minivans and Minivan Chassis |
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Peter Rogoff
Federal Transit Administration
December 3, 2012
[Federal Register Volume 77, Number 232 (Monday, December 3, 2012)]
[Notices]
[Pages 71673-71678]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-29129]
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DEPARTMENT OF TRANSPORTATION
Federal Transit Administration
[Docket No. FTA-2012-0029]
Decision To Rescind Buy America Waiver for Minivans and Minivan
Chassis
AGENCY: Federal Transit Administration, DOT.
ACTION: Decision on request to rescind Buy America waiver.
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SUMMARY: On June 21, 2010, the Federal Transit Administration waived
its Buy America final assembly requirement for minivans and minivan
chassis after confirming that no manufacturer was willing and able to
supply minivans or minivan chassis that were assembled in the United
States. Now, FTA rescinds the waiver after confirming that the Vehicle
Production Group has started producing a substantially similar vehicle,
the MV-1, in the United States.
FOR FURTHER INFORMATION CONTACT: Mary J. Lee at (202) 366-0985 or
mary.j.lee@dot.gov.
SUPPLEMENTARY INFORMATION:
I. Background
The Vehicle Production Group (VPG) petitioned the Federal Transit
Administration (FTA) to rescind the non-availability waiver it issued
on June 21, 2010 (75 FR 35123). The waiver exempted minivans and
minivan chassis from the Buy America final assembly requirement
outlined at 49 CFR part 661, stating that it would remain in effect
until such a time as a domestic source became available.
With few exceptions, FTA's Buy America requirements prevent FTA
from obligating an amount that may be appropriated to carry out its
programs for a project unless ``the steel, iron, and manufactured goods
used in the project are produced in the United States.'' 49 U.S.C.
5323(j)(1). For FTA-funded rolling stock procurements, the Buy America
requirements are two-fold: (1) At least 60 percent of the components,
by dollar value, must be produced in the United States; and (2) final
assembly must occur in the United States. 49 U.S.C. 5323(j).
An exception to, or waiver of, the Buy America rules is allowed if
``the steel, iron, and goods produced in the United States are not
produced in a sufficient and reasonably available amount or are not of
a satisfactory quality.'' 49 U.S.C. 5323(j)(2)(B).
On June 21, 2010, in response to formal requests from ElDorado
National, Kansas (ElDorado) and the Chrysler Group LLC (Chrysler), and
after ascertaining through notice and comment that no manufacturer of
minivans or minivan chassis performed final assembly in the United
States, FTA waived its Buy America final assembly requirement for
minivans and minivan chassis. 75 FR 35123.
When FTA waived the final assembly requirement for minivans, it
declined to define the term ``minivan.'' FTA's reluctance to define the
term stemmed from its understanding that (1) among the various
classifications used by Federal regulatory agencies, minivans like the
Chrysler Town and Country, and Dodge Caravan were not uniformly placed
in the same class of vehicles; \1\
[[Page 71674]]
and (2) interested parties understood the waiver would apply to the
type of vehicle produced by the parties that petitioned FTA--Chrysler
and ElDorado.\2\ Because there is no uniform definition or
classification for ``minivan,'' and FTA grantees understood that the
waiver would apply to vehicles similar to those produced by Chrysler
and ElDorado, FTA declined to create a new definition or
classification.
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\1\ There is no uniform definition or classification for
minivans. The closest things to a definition of a vehicle type, like
``minivan,'' are the classifications used by the National Highway
Traffic Safety Administration (NHTSA) and the Environmental
Protection Agency (EPA) to regulate safety and control emissions.
However, NHTSA's classifications do not uniformly group vehicles
from one regulation to the next. For example, under NHTSA's
Corporate Average Fuel Economy (CAFE) standards, most ``minivans,''
like Chrysler's Town and Country, fall under the class of ``light
trucks.'' However, when regulating safety, the same vehicle is
classified as a ``multipurpose passenger vehicle,'' which includes
vehicles built on a truck chassis (or with special features for
occasional off-road operation) that carry ten persons or less. See
49 CFR 571.3. These distinct classification systems highlight the
differences in vehicles based upon various factors, such as fuel
economy or passenger capacity, but each classification system uses
different factors.
\2\ Chrysler is the Original Equipment Manufacturer (OEM) of
specific model minivans. ElDorado modifies these same Chrysler model
minivans into wheelchair-accessible vehicles.
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Recently, an original equipment manufacturer called the Vehicle
Production Group (VPG) started producing a six-passenger vehicle called
the Mobility Vehicle 1 (MV-1). The MV-1 is a purpose-built, wheelchair-
accessible vehicle that is substantially similar to a minivan.
According to VPG sales materials, the MV-1 seats up to six adults, with
one full-size wheelchair. Wheelchairs enter the MV-1 via a ramp that
stows under the vehicle and deploys to the passenger side. It is
available with a Ford Modular 4.6 liter V8 engine and can be purchased
with an engine that runs on gasoline or compressed natural gas (CNG).
AM General LLC (AM General) assembles the MV-1 at its plant in
Mishawaka, Indiana. VPG certifies that the MV-1 complies with Buy
America requirements for both domestic content and final assembly.
Moreover, VPG maintains that it manufactures the MV-1 in sufficient
quantity to meet the current and future demand on FTA-funded projects.
Based on the fact that it produces the MV-1 in the United States,
VPG petitioned FTA to rescind the Buy America final assembly waiver it
issued on June 21, 2010, for minivans and minivan chassis.
Pursuant to VPG's request, FTA published a notice in the Federal
Register on August 3, 2012, calling for comments on VPG's request to
rescind the 2010 Buy America waiver for minivans and minivan chassis.
75 FR 35124. FTA sought comment from all interested parties regarding
the availability of domestically manufactured minivans and minivan
chassis in order to fully determine whether a waiver remained
necessary.
The August 3, 2012 notice established a deadline of September 4,
2012, for interested parties to submit comments. Following a request
from Chrysler, FTA published a second notice on August 28, 2012,
extending the comment deadline by one week, from September 4 to
September 11, 2012. 77 FR 52134.
II. Response to Public Comments
FTA received approximately 836 comments in response to its notice.
Of the 836 comments, three comments were posted to the docket in error,
and 88 comments were filed after the September 11, 2012 deadline. FTA
considered all comments submitted to the docket on or before September
19, 2012.
The commenters represent a broad spectrum of stakeholders from
throughout the United States and include elected officials, state and
local governments, transit and other local government agencies,
transportation providers, trade associations, vehicle manufacturers,
suppliers and retailers, a labor union, members of the disability
community, and numerous persons in their individual capacity.
The following is FTA's response to the substantive comments. FTA
responds to public comments in the following topical order: (A) General
Comments; (B) Definition of a ``Minivan''; (C) Minivan Use for
Paratransit Transportation Services; (D) Minivan Use for Vanpool
Services; (E) Competition and Price Concerns; (F) U.S. Employment; (G)
Safety Concerns; and (H) Miscellaneous Comments. Several commenters
raised issues that are outside the scope of FTA's request for comments.
FTA declines to address those concerns in this Decision.
A. General Comments
Many commenters expressed support for Buy America and its purposes,
including its intent to support U.S. manufacturing and employment. Most
commenters generally stated that these are difficult economic times and
highlighted FTA's role in assisting U.S. manufacturers.
Hundreds of employees from VPG, AM General, the International
Union, United Automobile, Aerospace, and Agricultural Implement Workers
of America (UAW), Amalgamated UAW Local 5, the Ford Motor Company, and
many other VPG suppliers submitted comments in favor of rescinding the
waiver. FTA also received favorable comments from retailers and
consumers, elected officials, and other interested persons.
Many other vehicle manufacturers, suppliers and retailers,
including Chrysler, ElDorado National-Kansas, Thor Industries, Inc.
(Thor Industries), the Braun Corporation (Braun), state government
agencies (including Alabama, Florida, Indiana, Illinois, Montana,
Nebraska, South Dakota, Virginia, and Wyoming Departments of
Transportation), transit agencies or other local transportation
providers, trade associations, an elected official, persons employed in
the transit industry, and other interested parties or persons opposed
or raised significant concerns about VPG's request to rescind the
waiver.
B. The Definition of ``Minivan''
The commenters opposing rescission of the waiver argued that the
MV-1 is not a ``minivan,'' and thus, minivans remain unavailable from a
U.S. source. These commenters asserted that minivans and the MV-1
differ in several respects--size, sliding side doors, passenger
capacity, wheelchair capacity, rear entry vs. side entry for
wheelchairs, seating arrangements, rear- vs. front-wheel drive, and
fuel economy. Chrysler, for example, stated that its customers ``will
not consider the MV-1 to be a suitable replacement for our minivans[,
which] * * * are front-wheel drive vehicles with a 6-cylinder engine.''
According to Chrysler, ``[t]he MV-1 is a rear-wheel drive vehicle with
an 8-cylinder engine, which is more like an SUV than a minivan.''
Chrysler further stated that:
As a paratransit vehicle, the MV-1 falls short of traditional
minivans.
Chrysler minivans converted for paratransit use have
more seating capacity than the MV-1. The Chrysler wheelchair
accessible minivan is typically configured to carry 4 ambulatory
passengers and 2 wheelchair passengers. The MV-1 configuration that
provides 2 wheelchair positions only have space for one ambulatory
person--the driver.
* * *
ElDorado also commented that the MV-1 is ``not a minivan'' but a
``Mobility Vehicle,'' the first of its kind. ElDorado reasoned that the
MV-1 cannot be a minivan, as most minivans do not come equipped with a
standard wheelchair ramp.
Thor Industries, the parent company to ElDorado, made a similar
comment and also stated that the MV-1 is not a minivan, but ``the first
`Mobility Vehicle' of its kind.'' Moreover, according to Thor
Industries, the MV-1 has significantly different features from
[[Page 71675]]
a ``typical ElDorado minivan.'' It provided a table to illustrate the
differences it perceived between ElDorado's Amerivan Minivan (built on
a Grand Dodge Caravan and Chrysler Town and Country chassis) and the
MV-1. Thor Industries claimed the Amerivan Minivan has the following
features that are lacking on the MV-1: one-touch automatic operation
for the door and ramp, sliding power ramp door, kneeling rear
suspension, removable driver seating for the wheelchair driver, a
removable ``co-pilot'' seat, driver/passenger transfer seat option,
three wheelchair securement locations, bus-tested at the Altoona Bus
Research and Testing Center (Altoona), seven airbags, integrated lap/
shoulder seat belts for the wheelchair user, driver/front passenger
advanced head restraints, front wheel drive, the ``lowest ground to
floor height in the industry,'' and ``dependable structure as proven by
Altoona and in-service record,'' a spare tire, various convenience or
comfort options, rear heat and air conditioning, a 6-cylinder engine
(compared to the MV-1's 8-cylinder engine), a fuel economy of 17 city
miles per gallon (mpg) (compared to the MV-1's 13 city mpg), 25 highway
miles per gallon (compared to the MV-1's 18 highway mpg), and a range
of 500 miles (compared to the MV-1's range of 350 miles).
Another commenter that claimed the MV-1 is not a minivan, Braun,
noted the following differences:
[The MV-1 is] limited to 5 ambulatory passengers with 1
wheelchair, or a driver and 2 wheelchair passengers'' while ``the
commercial Braun wheelchair accessible minivan is typically
configured to carry 4 ambulatory passengers and 2 wheelchair
passengers, and may also be reconfigured to carry 5 ambulatory and 1
wheelchair passengers. The unconverted Chrysler vehicle covered by
the waiver is a 7 passenger commuter vehicle configuration.
Other differences identified by Braun include the fact that the MV-
1 has no fixed front passenger seat nor an airbag for this seat, is
rear-wheel drive, utilizes a swing door for wheelchairs, ``which limits
access through the front passenger door,'' has a V-8 engine while
Chrysler minivans use a V-6 engine, and the MV-1 does not offer a rear-
entry option for wheelchairs.
VPG rebutted these claims in its comments, stating that FTA
classified the MV-1 as a minivan when FTA exempted the MV-1 from its
bus testing requirements at 49 CFR part 665, and ``[w]hatever it [the
MV-1] may be called in other contexts, for purposes of Buy America, it
has been indisputably established by FTA under due authority that the
MV-1 is qualified as a minivan.''
Regarding comments about the MV-1's seating capacity, VPG responded
that the MV-1 seats six (including the driver and 1 wheelchair) and
stated that Braun's installation of a 2 passenger flip seat to seat
seven passengers ``prevents wheelchair passengers from utilizing the
vehicle for its intended purpose, specifically, providing wheelchair
accessible transportation.'' In response to the MV-1's lack of a fixed
front seat, VPG commented that:
[The MV-1 was designed] without a fixed front seat in order to
permit the wheelchair passenger the opportunity to ride in proximity
to the driver, which our research informed us was the preferred
position of the wheelchair passenger, despite the fact that
``converted'' vehicles never allowed that freedom of choice and
perspective to a wheelchair-using passenger. We note, however, that
the MV-1 has multiple tracks for the restraint system, so that a
wheelchair passenger, when desired or required, can be separated
from the driver.
Braun responded to VPG's comments by stating that the MV-1 does not
have ``substantially similar attributes to'' a minivan based upon fuel
economy because:
* * * [I]t is evident that the VPG MV-1 has a [Gross Vehicle
Weight Rating or] GVWR rating of 6,600 lbs, falling between the 2005
Ford Econoline full size van and F-150 pickup truck. Since these two
vehicles were the only Ford trucks using this powertrain [4.6L V8
RWD 4-speed] in Model 2005 and the only Ford vehicles with
``substantially similar attributes'' as required under [the U.S.
Department of Energy's (DOE) Advanced Technology Vehicle
Manufacturing or] ATVM program rules, it can only be concluded that
these vehicles were used as the basis upon which DOE granted the
loan to VPG. Ford did not manufacture a minivan in 2005 that
employed the powertrain featured in VPG's loan application and in
the current production MV-1.
It can only be concluded based on the above comparison that the
VPG's loan was based on a comparison to a full size van and a pickup
truck, and never to a minivan. We maintain that the ``vehicles with
substantially similar attributes'' found in the ATVM technical
documentation were full size vans and/or pickup trucks, and not
minivans.
Braun also alleged that the MV-1 does not meet the National Highway
Traffic Safety Administration's (NHTSA) definition of a minivan. Braun
cited NHTSA's Final Rule for average fuel economy standards for light
trucks model years 2008-2011 (49 CFR part 523) published in 71 FR 17566
on April 6, 2006. Braun commented that:
NHTSA's 2008-2011 final rule tightened the minivan definition
[under 49 CFR 523.5(a)(5)(ii)] * * *
The reason NHTSA created the new minivan definition was clearly
explained in the final rule:
``Specifically, unlike the smaller passenger cars, all minivans
feature three rows of seats, thus offering greater passenger
carrying capability'' [footnote omitted.]''
In addition to furthering our goal of subjecting all minivans to
the CAFE standard for light trucks, the provision adopted today
limits the number of vehicles that will be reclassified as light
trucks.'' [Footnote omitted.]
The practical effect of NHTSA's rule change was to make certain
that vehicles with only two rows of seating as standard equipment
would no longer be classified as minivans and no longer be able to
compete under the non-passenger vehicle, or truck, CAFE standards.
Braun further stated that:
A careful examination of the MV-1 vehicle provides the following
information:
1. The MV-1 does not have three rows of seats that are standard
equipment,
2. Even if NHTSA were to determine that a single seating
position in the front of a vehicle (as provided in the MV-1)
constitutes a ``row'' and that a single rear-facing jump seat in the
middle constitutes a ``row,'' the middle jump seat is not standard
equipment on the MV-1.
3. The MV-1 does not have the ability to remove or stow seats to
create a flat-leveled surface for cargo-carrying purposes. The aft
seating of the MV-1 is fixed, and not removable or stowable.
4. Whereas all minivans produced and sold in the U.S. today
feature front-wheel drive unibody construction, the MV-1 is a rear-
wheel drive vehicle body-on-frame vehicle. Because of this, the
propeller shaft mates to the rear-drive differential at the rear
axle and the floor p[l]an rises under the aft vehicle seating to
accommodate this component. The MV-1 has a two-tier floor p[l]an for
both gasoline and CNG versions, it therefore is impossible to create
a flat, leveled surface to the rear of the automobile as clearly
specified under NHTSA's minivan definition.
Braun also cited www.fueleconomy.gov, which is maintained by DOE
using EPA fuel economy data, to show that the MV-1 is classified as a
``Special Purpose Vehicle 2WD'' and not as a minivan.
Finally, Braun supplemented its comments with a response that FTA
classified the MV-1 as an ``unmodified mass-produced van,'' and not a
minivan.
FTA Response: Neither FTA's authorizing legislation nor its
implementing regulations define the term ``minivan.'' NHTSA does
classify vehicles for purposes of regulating emissions and safety, but
these classifications do not uniformly group vehicles from one
regulation to the next. This is why, for purposes of various Federal
regulations, a minivan like Chrysler's Town and Country is not
[[Page 71676]]
always in the same class. For example, under NHTSA's CAFE standard,
most ``minivans'' fall under the class of ``light trucks.'' The MV-1 is
in a different class under the CAFE standard because it does not have
three rows of removable seats or seats that stow away into a flat or
level surface. See 49 CFR 523.5(a)(5). When regulating safety, however,
both the MV-1 and traditional ``minivans'' fall under the class of
``multipurpose passenger vehicles,'' which includes all vehicles that
carry ten persons or less and are constructed on a truck chassis (or
with special features for occasional off-road operation). See 49 CFR
571.3. These distinct classification systems highlight the differences
in vehicles based upon various factors, such as fuel economy or
passenger capacity, but each classification system uses different
factors. There is no uniform categorization.
Braun also cites DOE and EPA categories based upon fuel economy to
show that the MV-1 is a ``special purpose vehicle'' rather than a
``minivan.'' These categories and their corresponding data are listed
at www.fueleconomy.gov, which DOE maintains with data from EPA. EPA's
Web site, however, specifically states that ``[t]hese categories are
used for labeling and consumer information purposes and do not serve
any other regulatory purpose.'' \3\ Accordingly, the fact that the MV-1
may not fall under the ``minivan'' category for purposes of EPA's
comparisons of vehicles based upon fuel economy is immaterial to Buy
America.
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\3\ http://www.epa.gov/carlabel/gaslabelreadmore.htm. While EPA
has its own classification system for purposes of regulating vehicle
emissions (40 CFR part 86), this further shows that classifications
systems differ based upon specifications and features. See 49 CFR
86.1803-01.
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Thus, to avoid the confusion that may result from creating a new
vehicle classification system, FTA will not differentiate or define a
``minivan'' for purposes of Buy America. In applying or waiving Buy
America rules, FTA will make decisions based upon the performance or
functional specifications used by FTA grantees in actual procurements
in conformance with Federal requirements and guidance, including the
``Common Grant Rule'' (49 CFR parts 18 and 19) and the most recent
edition of FTA Circular 4220.1 ``Third Party Contracting Guidance.''
C. Minivan Use for Paratransit Transportation Services
Several commenters pointed out the differences between the MV-1's
accessibility features and the accessibility features of traditional
minivans. The comments noted performance problems (such as binding as a
result of ice and gravel collection) with under-floor ramps like those
equipped on the MV-1. They also questioned whether the MV-1 could, in
fact, accommodate more than one wheelchair at a time. Other commenters
stated that the MV-1 has smaller overall passenger capacity compared to
traditional minivans. One local transit agency responsible for
providing paratransit services commented that its fleet includes both
the MV-1 and the Dodge Caravan and, while both are useful in providing
paratransit services, they are very different vehicles and the MV-1's
rear facing seat is not useable for many of the services it provides.
FTA Response: As stated above, under FTA's Buy America law, a non-
availability waiver may be granted only if ``the steel, iron, and goods
produced in the United States are not produced in a sufficient and
reasonably available amount or are not of a satisfactory quality.'' 49
U.S.C. 5323(j)(2)(B). Therefore, as long as there is a domestic
manufacturer for a product, FTA cannot grant a non-availability waiver
or permit a non-availability waiver to stand. FTA finds here that there
is a U.S.-made vehicle--the MV-1--that can sufficiently meet the needs
for which the minivan non-availability waiver was issued. Procurement
decisions must be made based on performance or functional needs defined
in conformance with Federal regulations and guidance, including the
``Common Grant Rule'' and the most recent edition of FTA Circular
4220.1 ``Third Party Contracting Guidance.'' If the need arises for a
non-compliant vehicle under Buy America, recipients of FTA financial
assistance may petition FTA for waivers on a case-by-case basis. In
reviewing any waiver request, FTA only will consider waiving Buy
America if the petitioner can articulate and has included in its
procurement a performance or functional specification in conformance
with Federal requirements and guidance that failed to yield a compliant
bid or offer for a U.S.-produced vehicle.
D. Minivan Use for Vanpool Services
A significant number of commenters claim the MV-1 is solely a
paratransit vehicle and does not qualify for FTA funding for vanpool
services. The comments cite the Moving Ahead for Progress in the 21st
Century Act (MAP-21), Public Law 112-141, Sec. 20016 (to be codified
at 49 U.S.C. 5323(i)). MAP-21 changed the definition of ``vanpool
vehicle'' to mean a vehicle that has a ``* * * seating capacity of
which is at least 6 adults (not including the driver). * * *''
According to the comments, the MAP-21 definition excludes the MV-1
(with a seating capacity of only 6, including the driver) and includes
Chrysler minivans (with a slightly higher seating capacity). Therefore,
these commenters stated that, while the MV-1 may be acceptable for
paratransit service, the MV-1 would not qualify for FTA-funded vanpool
service.
FTA Response: While the definition of ``vanpool,'' now codified at
49 U.S.C. 5323(i)(2)(C)(ii), applies to certain FTA-funded vanpool
projects, FTA prefers to consider waiver requests for limited
circumstances and on a procurement-by-procurement basis rather than
waiving the Buy America requirements for an entire class of vehicles in
all circumstances. If an FTA recipient requests a waiver for a vanpool
purchase, FTA will review the procurement based upon established
requirements and guidance for third party procurements, including the
Common Grant Rule and the most recent edition of FTA Circular 4220.1
``Third Party Contracting Guidance.
E. Competition and Price Concerns
Most of the comments opposing rescission of the waiver stated that
such a rescission would eliminate competition of vehicle manufacturers
and suppliers and result in de facto sole-source procurements.
According to Chrysler, ElDorado, Braun, and other vehicle manufacturers
and suppliers, rescission of the waiver would create a public
transportation monopoly in favor of VPG and indicated their prediction
that prices would rise from the lack of competition. State DOTs, local
transit agencies, and other transit providers made similar comments.
FTA Response: This argument is similar to one presented by a
manufacturer of motor coaches in 2010 when it sought a public interest
waiver from FTA. As was the case with that request, by arguing that a
single Buy America-compliant manufacturer has cornered the market and
can thus control prices, the commenters ignore the FTA waiver that is
intended to address this concern. If limited competition results in a
product ceasing to be available to FTA-funded transit agencies at a
competitive price (measured by a greater than 25 percent differential
between foreign-produced and Buy America-compliant vehicles), the
appropriate action would be for the grantee to apply for a waiver based
on price-differential.
Claims about price inflation, however, appear to be unfounded.
Those in favor of rescinding the waiver stated that the
[[Page 71677]]
price of the MV-1 is similar to competing vehicles.
F. U.S. Employment
Commenters in support of rescinding the waiver stated that a
rescission would result in more U.S. jobs. Commenters opposing the
rescission of the waiver stated that a rescission would benefit only
VPG and AM General employees, and would negatively impact other vehicle
manufacturers and suppliers, including their U.S. employees. Thor
Industries, the parent company of ElDorado, commented that since the
waiver, ElDorado has been able to create new jobs, both directly and
indirectly through its distribution network. Thor Industries further
stated that a rescission of the waiver would result in a 39 percent
decrease in ElDorado's employment.
FTA Response: Buy America is the mechanism used by FTA to protect
and encourage U.S. manufacturing and U.S. jobs. The regulations do not
prohibit Chrysler, ElDorado and other manufacturers from adjusting
their business practices to perform final assembly in the United
States. If they took such action, they also would be able to certify
compliance with Buy America and offer their products to FTA's grantees.
G. Safety Concerns
Braun, among other commenters, raised safety concerns about the MV-
1, including whether the MV-1 meets the Federal Motor Vehicle Safety
Standards (FMVSS), and the number of airbags and seatbelts in the MV-1
compared to Chrysler minivans. Many commenters opposed to the
rescission also noted that the MV-1 has not undergone testing per FTA's
bus testing requirements at 49 CFR part 665.
VPG certified that the MV-1 has met all applicable FMVSS
requirements and received an exemption from FTA from the bus testing
requirements of 49 CFR part 665 because of its status as an unmodified,
mass-produced van.
FTA Response: All vehicles purchased with FTA funds must meet all
applicable safety requirements, which generally include certifying
compliance with FMVSS and FTA's bus testing regulations. The MV-1 has
satisfied these requirements.
H. Miscellaneous Comments
A number of parties submitted miscellaneous comments. These include
commenters that expressed concern that the MV-1 is rear wheel drive,
which typically does not perform as well as front-wheel drive in
extreme weather conditions such as snow or ice; not produced in
sufficient quantity; has an 8-cylinder engine, which consumes more fuel
than the Chrysler minivan and other similar vehicles with 6-cylinder
engines; and that there are too few MV-1 retailers. One commenter
requested information about the potential number of vehicles and the
amount of FTA funding that this request affects. Other commenters
stated that FTA should not make a decision that will only benefit one
U.S. company or ``artificially protect'' a company from competition.
FTA Response: FTA responds to the foregoing miscellaneous comments
with a general statement about Buy America waivers.
The purpose of Buy America is for the taxpayer resources used on
FTA-funded projects to preserve and encourage U.S. manufacturing jobs.
FTA advances this purpose by strictly enforcing Buy America rules that
require all steel, iron, and manufactured products on FTA-funded
projects to be produced in the United States. Thus, when considering
whether to grant (or rescind) a waiver, FTA seeks to grant the most
narrowly construed waiver possible. In this instance, the current
waiver is broadly construed; it applies to all minivans and minivan
chassis purchased with FTA funds. A more narrow approach is to rescind
the existing waiver and then consider waivers on a case-by-case basis
only. This approach will ensure that waivers are granted only when
absolutely necessary, and only when construed as narrowly as possible.
Under FTA's Buy America law, a non-availability waiver may be
granted only if ``the steel, iron, and goods produced in the United
States are not produced in a sufficient and reasonably available amount
or are not of a satisfactory quality.'' 49 U.S.C. 5323(j)(2)(B).
Therefore, as long as there is a manufacturer of the product in
question that fully complies with Buy America, FTA cannot grant a non-
availability waiver or permit a non-availability waiver to stand. FTA
finds here that there is a fully Buy America-compliant vehicle that
meets the needs for which the original minivan waiver was granted.
To the extent FTA is willing to consider waiver requests, they will
be limited to procurements that include specifications based on
performance or functional needs that cannot be met by a Buy America
compliant product. Specifications may not be exclusionary and must
conform to Federal requirements and guidance, including the Common
Grant Rule and the most recent edition of FTA Circular 4220.1 ``Third
Party Contracting Guidance.''
Thus, the prohibition against exclusionary and discriminatory
specifications notwithstanding, if the need arises for a non-compliant
vehicle, recipients may petition FTA for waivers on a case-by-case
basis. FTA will only consider waiving Buy America if the petitioner can
articulate and has included in its procurement a performance or
functional specifications in conformance with Federal requirements and
guidance that failed to yield a compliant bid or offer for a U.S.-
produced vehicle.
VPG, AM General, and Ford Motor Company responded to the commenters
that expressed concern about adequacy of VPG's supply and network. They
assert that the MV-1 can be produced in sufficient quantity. VPG and
Ford commented that there are sufficient dealerships throughout the
United States, including well-established automobile, bus, and mobility
dealers, in addition to VPG's retail outlets, that can offer needed
service and warranty. According to VPG, the high percentage of U.S.-
manufactured parts (approximately 75 percent U.S. content), including a
Ford engine, in its vehicles means these parts are readily available in
the United States.
FTA does not collect data specifically on ``minivans'' as FTA does
not define the term ``minivan.'' Rather, it measures the number of FTA-
funded purchases of ``vans, '' which includes minivan purchases, but
also includes other vehicle purchases falling within the ``van''
category. In Fiscal Year (FY) 2011, FTA awarded $133,298,132 for 3,279
vans.
Regarding comments from Chrysler and others that FTA should avoid
decisions that benefit a single entity, FTA notes that the current
waiver has served to the near-exclusive benefit of Chrysler since 2010.
Additionally, if Chrysler, ElDorado, or other manufacturers adjusted
current business practices to perform final assembly in the United
States, their vehicles also would be Buy America compliant.
III. Conclusion
FTA has determined that a Buy America waiver for minivans and
minivan chassis is no longer necessary because the Vehicle Production
Group now produces a substantially similar vehicle in the United
States, in accordance with FTA's Buy America rules. Therefore, FTA
hereby rescinds the waiver it issued on June 21, 2010.
[[Page 71678]]
Issued this 27th day of November, 2012.
Peter Rogoff,
Administrator.
[FR Doc. 2012-29129 Filed 11-30-12; 8:45 am]
BILLING CODE 4910-57-P