Federal infrastructure funding comes with binding conditions. Under the Build America, Buy America Act (BABA), any organization receiving federal financial assistance for an eligible infrastructure project must use materials produced in the United States.
Since taking effect on May 14, 2022, BABA compliance has shaped procurement decisions across transportation, energy, broadband, water systems, and public buildings, and failure to meet its requirements puts federal funding at risk.
This guide breaks down what BABA compliance means, which materials qualify, how the waiver process works, and what contractors, grantees, and manufacturers need to know to stay compliant on covered projects.
Note: To find more about Comnet's compliance certifications and domestic manufacturing credentials, visit comnet.net or contact the team directly.
BABA stands for the Build America, Buy America Act. It was enacted as part of the Infrastructure Investment and Jobs Act (IIJA), commonly called the Jobs Act, and signed into law on November 15, 2021.
The legislation established a domestic content procurement preference for all federal financial assistance obligated for eligible domestic infrastructure projects after May 14, 2022.
The core premise is straightforward: taxpayer-funded federal grants should support American-made materials and American workers. To enforce that principle, BABA requires that every covered federal award include Buy America preference terms and conditions within its agreement.
BABA compliance means that all iron, steel, manufactured products, and construction materials used in a covered federally funded infrastructure project are produced in the United States. This domestic content procurement preference applies across every material category used in covered projects, from structural steel to fiber optic cables in broadband networks.
Understanding what is BABA compliant is a prerequisite for any organization pursuing a federal award for an infrastructure project. BABA requirements do not apply retroactively, but every federal financial assistance obligated for covered projects after the effective date must include Buy America preference terms in the award agreement.
BABA applies to any organization receiving federal financial assistance for a covered domestic infrastructure project. This includes state agencies, local governments, public utilities, broadband providers, water authorities, transit agencies, and private organizations that serve as grantees or subrecipients of covered federal grants.
Grantees are ultimately responsible for their entire supply chain. If a contractor installs non-compliant materials, the grantee bears the consequences. BABA requirements flow down through contracts and subaward agreements, meaning every tier of the project must meet the same domestic content standards.
The relevant federal agency overseeing each award monitors grantee compliance and requires proper documentation to verify that all covered materials are produced in the United States.
BABA groups covered materials into distinct categories. Each has its own compliance threshold and specific requirements.
All iron and steel used in covered infrastructure projects must be produced in the United States. This covers the complete production process from the initial melting of raw materials through every manufacturing stage, including the application of coatings.
There are no partial domestic processing exemptions for this category, the standard is fully domestic production from start to finish.
For manufactured products, two conditions must be met. First, the final product must be manufactured in the United States. Second, more than 55% of the total cost of its components must come from parts that are mined, produced, or made in the U.S. Software costs, R&D expenses, and labor costs are not included in this calculation.
The components of the manufactured product are evaluated solely on material cost.
Construction Materials
All construction materials used in covered infrastructure projects must be manufactured entirely in the United States. This category is broad and includes:
All products and construction materials in this category must go through a fully domestic manufacturing process to be considered BABA compliant for the purposes of a covered project.
Composite building materials fall under the construction materials umbrella and are subject to the same full domestic manufacturing requirement. Additional categories covered under OMB guidance include cement, aggregates such as sand and gravel, and binding additives used in covered infrastructure projects. No material is permitted to fall into more than one product category, and each is evaluated against the specific requirements of its applicable classification.
BABA was designed to align federal infrastructure spending with domestic economic priorities. Federal grants are funded by taxpayers, and the Buy America Act establishes that those dollars should support American-made materials and American workers.
By requiring domestically produced iron, steel, manufactured products, and construction materials, BABA pushes organizations to develop supply chains that are less exposed to foreign disruptions.
Supply chain disruptions from international logistics failures and geopolitical instability have revealed how fragile dependence on foreign suppliers can be for critical infrastructure projects. BABA addresses this directly by incentivizing domestic sourcing across supply chains supporting federally funded work.
BABA drives demand for American-made materials, supporting domestic manufacturing employment and contributing to broader economic stability.
The rising domestic content thresholds are designed to deepen this impact over time and ensure supply chains increasingly favor materials produced in the United States.
Non-compliance with BABA triggers serious consequences. Organizations risk loss of federal financial assistance, project delays caused by required material replacement, audit findings, and, in cases where self-certification letters contain false statements, exposure to False Claims Act liability. To mitigate risks, integrate BABA requirements into procurement planning before materials are ordered, not after installation.
BABA applies broadly, but there are defined situations where it does not apply. Infrastructure projects with a total cost equal to or less than $250,000 are generally exempt. Projects consisting solely of improvements to a private residence for personal use are not considered public infrastructure for BABA purposes.
BABA also does not apply to disaster recovery infrastructure spending under certain HUD programs. Grantees working under HUD programs or similar agency-specific awards should always confirm BABA applicability with the relevant federal agency overseeing their specific award before assuming an exemption applies.
Confirming whether a product is BABA compliant requires more than checking a marketing label. A "Made in USA" claim does not automatically satisfy BABA domestic content requirements, the standards are legally distinct. To verify BABA compliant products, organizations should take the following steps.
Request a formal self-certification letter from the manufacturer that is specific to both the product and the project. Review the components of the manufactured product against the 55% domestic cost threshold. Confirm that construction materials, including fiber optic cables, polymer-based products, and composite building materials, have undergone fully domestic manufacturing. Check whether the relevant federal agency has issued general waivers covering the product category before pursuing individual waiver requests.
Proper documentation at each step is required documentation for demonstrating compliance during audits and compliance monitoring.
Grantees must maintain appropriate documentation to show that all iron, steel, manufactured products, and construction materials used in federally funded infrastructure projects are produced in the United States.
This required documentation includes:
Maintain all project compliance records for at least five years after project closeout. Gaps in documentation can trigger audit findings or funding claw-backs even where the underlying materials are genuinely compliant. Ensure compliance documentation is collected before materials are installed, not after.
Organizations working to identify domestic materials for covered projects can use several resources. The National Institute of Standards and Technology (NIST) operates the Hollings Manufacturing Extension Partnership (MEP) network, which connects grantees with qualified domestic manufacturers. The National Institute's MEP supplier scouting service is especially useful for smaller grantees without the resources to independently research supply chains across multiple product categories.
Trade associations, peer grantees, and experienced contractors who have previously worked on BABA-covered projects are also practical sources of information on domestic suppliers. Detailed guidance from each federal agency's program website, including specific requirements, approved waivers, and waiver requests in the active public comment period, should be the starting point for any compliance effort.
For contractors and integrators working on federally funded infrastructure projects, the sourcing of networking hardware is a BABA-relevant decision. Comnet manufactures hardened Ethernet switches, fiber optic media converters, BABA-compliant power over ethernet switches, network extenders, and industrial power supplies, with hardware, software, and firmware designed, developed, and tested in the United States. Comnet products are also NDAA (National Defense Authorization Act) and TAA (Trade Agreements Act) compliant. For organizations procuring networking infrastructure for transportation networks, power utility substations, or physical security systems under federal grants, Comnet's domestic manufacturing credentials provide a strong foundation for the sourcing documentation required on BABA-eligible projects.