Drinking Water State Revolving Fund
American Iron and Steel Requirement
201 8 Annual Report Addendum

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I. Overview of the American Iron and Steel (AIS) Requirement
A. History of the AIS Requirement
Congress first introduced a domestic procurement
preference for the State Revolving Fund (SRF)
programs under the American Recovery and
Reinvestment Act (ARRA) of 2009, which provided the
SRF programs an additional $6 billion in funding.
ARRA included a "Buy American" provision that
required Clean Water State Revolving Fund (CWSRF)
and Drinking Water State Revolving Fund (DWSRF)
assistance recipients of these ARRA funds to use
domestic iron, steel, and manufactured goods.
In 2014, Congress introduced a new domestic
procurement preference for the SRF programs under
the Consolidated Appropriations Act (CAA) of 2014
(P.L. 1 1 3-76), which included the "American Iron and
Steel (AIS)" requirement. The AIS requirement states
that CWSRF and DWSRF assistance recipients must
use iron and steel products that are produced in the
United States for projects for the construction,
alteration, maintenance, or repair of public water
system or treatment works if the project is funded
through an assistance agreement executed beginning
January 17, 2014, through the end of Federal Fiscal
Year (FFY) 2014. Since the enactment of the CAA of
2014, the AIS requirement has been included for
DWSRF-funded projects in each subsequent
appropriation bills. On October 23, 201 8, the
President signed the "America's Water Infrastructure
Act of 201 8" (AWIA). Section 2022 of AWIA
amended Section 1452(a)(4)(A) of the Safe Drinking
Water Act (SDWA) to extend the AIS requirement
for projects receiving financial assistance from the
DWSRF through FFY 2023. For details see the
memorandum, Application of American Iron and Steel
Requirements for Drinking Water State Revolving
Fund Projects for Fiscgl Yegrs 201 9 Through 2023.
Exhibit 1 shows g timeline of the leggl guthorities of
the AIS requirement for the DWSRF program through
FFY 2018.
Exhibit 1: Timeline of AIS Legal Authority for the DWSRF Programs
2009 Congress passed the ARRA of 2009, which includes the "Buy American" provision and
was the first domestic procurement preference for SRF programs
2014 Congress passed the CAA of 2014 which included the AIS requirement for the DWSRF
program through September 30, 2014
2014 Congress passed the Consolidated and Further Continuing Appropriations Act of 2015
which included the AIS requirement for SRF programs through September 30, 2015
2015 Congress passed the CAA of 2016 which included the AIS requirement for the DWSRF
program through September 30, 201 6
2016 Congress passed the Further Continuing and Security Assistance Appropriations Act of 2017,
which included the AIS requirement for SRF programs through April 28, 2017
2017 Congress passed the CAA of 2018 and Supplemental Appropriations for Disaster Relief
Requirements Act of 2017, which included the AIS requirement for the DWSRF program through
2018 Congress passed the CAA of 201 8, which included the AIS requirement for the DWSRF program through
September 30, 201 8
2018 The President signed the "America's Water Infrastructure Act of 201 8" (AWIA), which extends the AIS
requirement for the DWSRF program through September 30, 2023
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Iron and Steel Products Covered by the AIS
Requirement
Under the AIS requirement, an iron or steel product is
considered one of the following products that is made
primarily of iron or steel and is permanently
incorporated into the public water system or
treatment works:
Lined or unlined pipes or fittings;
Manhole covers;
Municipal castings;
Hydrants;
Tanks;
Flanges;
Pipe clamps and restraints;
Valves;
Structural steel;
Reinforced precast concrete; and
Construction materials.
Primarily Iron or Steel, Permanently
Incorporated
Under the AIS requirement, a product is considered to
be made primarily of iron and steel if it is made up
, „ ¦
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of greater than 50% iron or steel, measured by
material cost. For example, the iron portion of a fire
hydrant would likely be the bonnet, body and shoe,
and the cost then would include the pouring and
casting to create those components. The other
material costs would include non-iron and steel
internal workings of the fire hydrant (i.e., stem,
coupling, valve, seals, etc). The assembly of the
internal workings into the hydrant body would not be
included in this cost calculation. If one of the listed
products is not made primarily of iron or steel, it does
not need to be produced in the United States.
However, if a product is listed above, made primarily
of iron or steel and permanently incorporated into the
project, then the product must be produced in the
United States, or otherwise be covered by a waiver
(discussed more in the Section II). For a product to be
produced in the United States all manufacturing
processes, excluding application of external coatings
of components, must take place domestically the EPA
has published an implementation memo and a series
of question and answer documents that address the
types of projects that must comply with the AIS
requirement and the types of products covered by the
AIS requirement.
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Project Highlight: Roswell, NM
The EPA visited the Water Main Replacement Project
for the City of Roswell, NM in February 2018. The
city of Roswell received $4.8 million in DWSRF
funding for the removal and replacement of portions
of 36-inch and 48-inch diameter concrete cylinder
water mains installed in the 1 960s. Due to corrosive
soil areas, the mains were leaking and failing as
evidenced by numerous breaks in recent years. The
city had previously spent $2 million in spot repairs.
Ductile iron pipe was used for the 36-inch water main
and fiberglass was used for the 48-inch water main.
The City disqualified the two lowest bidders on the
36-inch main project because they were not using
AlS-compliant pipe. However, the selected contractor
on the 36-inch main project was the low bidder on the
48-inch main project. The 36-inch diameter water
main was replaced in 2015. The 48-inch diameter
water main replacement project started in April 2017
and is now complete.
Project Highlight: Gainesboro, TN
The EPA visited the Town of Gainesboro, TN water
line and meter replacement project in February
2018. The project was broken into three contracts
under a single $648 thousand DWSRF loan. The first
contract was to replace service lines, the second to
replace distribution lines, and the third to install
meters. The meters include both zone meters to better
track distribution water loss and radio read customer
meters. The purpose of this project was to reduce
leaks in the distribution system, which were leading to
greater than 50 percent unaccounted-for water. At
the time of the site visit, AIS product certifications and
documentation were on file for all products
incorporated into the project and the certifications
were ali letters from the manufacturer's
representative. Also, the project engineer was
tracking de minimis items in a clear and
comprehensive manner. Following the criteria of the
national waiver, the products were low cost and
incidental items and were weil under five percent of
the material costs. Construction for this project began
June 2017and is now complete.
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II. Compliance with the AIS Requirement
A.	First and Foremost, Buy Domestic
DWSRF assistance recipients should procure domestic
iron and steel products to ensure compliance with the
AIS requirement. A state or assistance recipient can
contact the EPA if they are having difficulty locating
a domestic product and the EPA can help with product
research.
B.	Certification Letters
Manufacturers should provide certification letters to
verify that their iron or steel products comply with the
AIS requirement. These certification letters also
establish accountability and better enable assistance
recipients to take enforcement actions against
potential violators. A proper certification letter should
assert that all manufacturing processes for purchased
iron or steel products were domestically-performed.
The EPA recommends these letters contain the
following five key elements:
•	Products Delivered- The letter should list the
specific iron or steel product(s), including the
quantity, delivered to the project site.
•	Location of Manufacturer- The letter should
include the city and state of the manufacturing
facility where the product or process took
place (not its headquarters), multiple locations
are okay as long as all of them are in the U.S.
•	Reference to Specific Project- The letter
should include the name of the project or
jurisdiction where the product was delivered.
•	Signature of Company Representative- The
letter should include a signature from a
company representative on company
letterhead.
•	Reference to the AIS requirement- The letter
should include a reference to the EPA's AIS
requirement, especially if the letter also
references other domestic preference laws
(e.g. ARRA's Buy American requirement or the
Buy America Act).
C.	Waivers
The EPA has authority to waive the AIS requirement
and to issue waivers for a case or category of cases
where EPA finds (1) that applying these requirements
would be inconsistent with the public interest; (2) iron
and steel products are not produced in the U.S. in
sufficient and reasonably available quantities and of
a satisfactory quality; or (3) inclusion of iron and steel
products produced in the US will increase the cost of
the overall project by more than 25 percent. There
are two main types of waivers: national and project-
specific.
Rise in Domestic Manufacturing
The EPA has seen a steady rise in domestically
produced iron and steel products since the
inception of the AIS requirements in 2014.
Manufacturers have constructed new foundries
and continue to invest in their domestic
manufacturing capabilities. As a result, products
the EPA had previously approved waivers for due
to lack of domestic availability are now being
readily manufactured in the United States. The
EPA will continue to promote domestic
manufacturing through the AIS requirements.
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National Waivers
National waivers are readily available for use by
assistance recipients or manufacturers and, therefore,
do not require any approval by the EPA prior to use.
As of June 30, 201 8, the EPA has issued the following
five national waivers:
•	De Minimis Waiver- a public interest waiver
that allows SRF assistance recipients to use a
small percentage of incidental iron and steel
products of unknown or non-domestic origin in
their projects. For more details see the
memorandum, De Minimis Waiver Pursuant to
Section 436 of P.L. 1 13-76. Consolidated
Appropriations Act.
•	Plan and Specs Waiver- a public interest
waiver that allows assistance recipients to use
non-domestic iron and steel products for
eligible projects that had engineering plans
and specifications approved by an
appropriate state agency prior to and on
April 2014. For more details see the
memorandum, Plans and Specifications
Waiver of Section 436 of P.L. 1 13-76.
Consolidated Appropriations Act.
•	Minor components in Iron and Steel
Products (with Cost Ceiling)- an availability
waiver that allows iron and steel product
manufacturers to include a small percentage
of non-domestic, minor components in
otherwise AlS-compliant products. For more
details see the memorandum, National
Product Waiver for Minor Components in Iron
and Steel Products (with Cost Ceiling).
•	Short-Term Product Waiver for Stainless
Steel Nuts and Bolts Used in Pipe Couplings,
Restraints, Joints, Flanges, and Saddles- an
availability waiver that allows iron and steel
product manufacturers the use of non-
domestic stainless-steel nuts and bolts in the
specified products that are otherwise AlS-
compliant. This waiver has been extended
several times since originally approved in
2015. The final extension of this waiver is
currently in place until February 24, 2020;
upon expiration, the EPA has indicated the
waiver will not be renewed. For more details
see the memorandum, Final Extension of the
Short-Term Product Waiver for Stainless Steel
Nuts and Bolts Used in Pipe Couplings,
Restraints. Joints Flanges, and Saddles.
• Product Waiver for Pig Iron and Direct
Reduced Iron - an availability waiver that
allows iron and steel product manufacturers to
use non- domestic pig iron and direct reduced
iron in otherwise AlS-compliant products. For
more details see the memorandum, National
Product Waiver for Pia Iron and Direct
Reduced Iron.
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Project-Specific Waivers
Project-specific waivers are for the use of a specified
non-domestic product for a specific project. An
assistance recipient may request this waiver from the
EPA through their state SRF Program. Exhibit 2 shows
the multi-step decision process of a project-specific
waiver request. Waiver requests must be approved
by the EPA before a non-domestic iron or steel
product can be permanently incorporated into an
SRF-funded project. Because these waiver requests
are both project and product specific, any other
assistance recipient that wishes to use a similar
product must apply for a separate waiver based on
specific project circumstances. As of June 30, 2018,
the EPA approved 17 project-specific waivers for
DWSRF projects, with 6 being approved in SFY 201 8.
All approved and not approved project-specific
waiver requests can be found on the EPA AIS website.
D. Noncompliance
A DWSRF assistance recipient is in noncompliance
with the AIS requirement if a non-domestic iron or
steel product, not covered by an EPA-issued waiver,
is permanently incorporated into their project. If
there is potential noncompliance, it is the
responsibility of the state DWSRF program to work
with the assistance recipient on corrective measures
(i.e., requesting a project-specific waiver or
replacing the product with a practicable domestic
alternative). The EPA is available to assist the state
SRF program with assessing appropriate
enforcement action if the assistance recipient fails to
complete the corrective measures.
Exhibit 2: Decision Process for Project-Specific Waiver Request
Step 4: State SRF forwards
the waiver request to EPA
Headquarters
Step 9: EPA notifies State
SRF program and posts
the waiver decision memo
on the AIS website
Step 7: EPA HQ evaluates
market research and
public comments and
contacts manufacturers
directly
Step 8: EPA HQ approves
or does not approve the
request
Step 5: EPA HQ conducts
market research
Step 1: Assistance
recipients puts together a
project- specific waiver
request
Step 6: EPA HQ posts the
request on its website for
a 15 day public comment
period
Step 3: State SRF
determines if all
information was provided
Step 2: Assistance
recipents emails the
request to the State SRF
program
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Project Highlight: Arkansas City, KS
The EPA visited the City of Arkansas City, KS Water
Treatment Plant Project in April 2017. A $22 million
assistance agreement for Arkansas City, one of the
largest in Kansas at the time, included two projects:
1) Construction of a new 1.5 MG pre-stressed
concrete finished water storage tank; and 2)
Construction of a new 5.4 MGD reverse osmosis water
treatment plant and associated site work,
including mechanical, electrical, supervisory control
and data acquisition (SCADA) and process systems.
The project includes a significant amount of iron and
steel products. The City revised the design during the
bid phase to accommodate the lack of a domestic
alternative for one of the products needed. A bid
addendum was issued to allow alternative materials
for restrained joints. This change allowed the City to
avoid having to request a product specific waiver to
use a non-domestic product. The City was utilizing the
national de minimis waiver and had a list of the items
to-date that were covered by this waiver. At the time
of the site visit the new storage tank was complete
apart from testing and disinfection to put the tank into
service. Construction of the new water treatment plant
was underway and is now complete.
Project Highlight: Winnsboro, SC
The EPA visited the Broad River Raw Water Intake in
the town of Winnsboro, SC in May 2018. The Town
received $1 3 million in DWSRF funding to establish a
new intake on the Broad River to serve the water
treatment plant and includes a new intake and pump
station, as well as, a transmission main to transport
raw water to the treatment plant. Previously, the
water treatment plant relied on a reservoir that was
dependent on rainfall. During recent droughts, the
reservoir proved inadequate requiring the Town to
purchase water from other water systems at a
significant cost. The design for the project was
completed in Fall 2017 and construction began in
December 2017. The project is now complete. The
engineer collected the certification letters during the
submittal process and will keep copies for at least 3
years, a best practice recommended by the EPA. The
engineer will also provide the letters to the Town.
mm CITY BSD 4/9
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111. Oversight of the AIS Requirement
A. Project Site Visits
As a part of the EPA's oversight of the AIS
requirements, the EPA conducts informal project site
visits. These visits assess consistency of AIS
implementation and initiate one-on-one discussions
with assistance recipients to reiterate AIS
requirements, conduct preliminary review of project
AIS documentation and materials, and identify
potential areas of non-compliance for projects to
address prior to substantial completion. Following the
site visit, the EPA provides the state SRF program and
assistance recipient with observations and
recommendations for improving AIS documentation.
Exhibit 3 highlights all of the projects that have been
visited since the inception of the AIS requirement in
January 2014. As of June 30, 2018, the EPA has
conducted a total of 170 site visits at 46 of the 51
DWSRF programs, visiting 57 projects in 1 5 states
during SFY1 8. These projects range in size, cost, and
type. Of the projects visited in SFY1 8, the lowest total
project cost was approximately $215,000 and the
highest was $196 million; while the smallest
population served was one hundred and the largest
was one million.
Exhibit 3: Project Site Visit Map Since the Inception of the AIS Requirement (January 2014)
Counties with DWSRF AIS Project Site Visits
Counties with DWSRF Projects Since Inception
of AIS Requirement
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Common Observations
Generally, the EPA has observed domestic products
being purchased and installed at DWSRF-funded
project sites, and the visits continue to confirm that
most products covered by the AIS requirements are
readily available from domestic sources. Some
common observations include inadequate or missing
certification letters and unfamiliarity with or
inappropriate use of national AIS waivers, especially
the de minimis waiver.
B. Trainings
The EPA conducts trainings and outreach activities to
engage various groups through in-depth discussions
on AIS requirements and implementation. The
trainings are attended by SRF assistance recipients,
state SRF program staff, consulting engineers,
general construction contractors, suppliers, and
manufacturers. The EPA tailors the information
presented based on the target audience. During
SFY18, the EPA participated in 12 training and
outreach events, including manufacturer meetings,
state trainings, and national conference
presentations. The EPA offers these trainings on an
ongoing basis upon request.
For more information about the Drinking Water State
Revolving Fund, please contact us at:
Drinking Wafer State Revolving Fund Program
U.S. Environmental Protection Agency
1201 Constitution Avenue, NW (Mail code 4606M)
Washington, DC 20460
Internet: www.epa.aov/drinkinawatersrf
EPA 816-R-l9-009 July 2019
Looking to the Future
Since 2014, the EPA has provided billions of
dollars to states under the Drinking Water State
Revolving Fund program for drinking water
infrastructure system upgrades in thousands of
communities across the United States. With the
successful implementation of the AIS requirements
to date, an overwhelming majority of these
DWSRF projects have installed domestic products,
thus protecting American manufacturing jobs,
creating local construction jobs, and protecting
public health. The EPA will continue to promote
domestic manufacturing and conduct robust
oversight to ensure appropriate application of the
AIS requirements.
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