Mr. John C. Segerdell
Director of Engineering Services
Sacramento Regional Transit District
P.O. Box 2110
Sacramento, California 95812-2110

Re: Light Rail Vehicle Procurement Request for Buy America Waiver for Second Pilot Car File: 304.7.0/131.7.01

Dear Mr. Segerdell:

This letter is in response to your September 16, 1999, request for waiver of the final assembly requirements of 49 C.F.R. 661.11(a) as they apply to the procurement by Sacramento Regional Transit District ("RT") of a second prototype Light Rail Vehicle ("LRV") to be assembled by CAF of Spain.

On April 15, 1999, you requested a waiver for two prototype LRV’s. You did not provide sufficient justification for waiver of the regulations for both vehicles. On August 12, 1999, after careful review and discussion with your office, your request for a waiver for one prototype vehicle was granted. Instead of denying your request for waiver for the second vehicle at that time, I gave you an opportunity to provide more information in an attempt to justify your request for the waiver on the second vehicle. On September 16, 1999, you submitted a request for "reconsideration" of the waiver for the two cars. I am treating that letter as a request for waiver of the Buy America regulations as to a second prototype LRV.

Section 5323(j)(2)(C) of the Federal transit laws (49 U.S.C. 5301, et seq.) sets forth the general requirements for the procurement of rolling stock. This section provides that all rolling stock procured with Federal Transit Administration (FTA) funds must have a domestic content of at least 60 percent and must undergo final assembly in the United States. You request a waiver under 49 U.S.C. 5323(j)(2)(A). This section provides that the general Buy America requirements may be waived if "their application would be inconsistent with the public interest." The regulations implementing this section provide that "[i]n determining whether the conditions exist to grant this public interest waiver, the [FTA] will consider all appropriate factors on a case-by-case basis . . . ." 49 C.F.R. 661.7(b).

FTA implements the Buy America requirements in a manner that takes into account the realities of the industry and the practical necessities of foreign assembly of one prototype vehicle under appropriate circumstances. The reasons listed in your first request supplied sufficient justification for such a waiver. However, you have not provided any further justification that would support the grant of a second waiver. Specifically, you have failed to articulate the public’s interest in this matter as is required by the governing statute. This second request also fails to discuss how these technical issues will affect the delivery schedule, or why the new cars cannot be coupled with existing vehicles. You have enumerated no disadvantage to "trainlining" one CAF LRV and one existing LRV. Your second request restates the reasoning present in your first waiver request; those arguments provided a sufficient basis for granting a waiver for one prototype vehicle, not two. Therefore, a waiver is hereby denied for the second prototype LRV.

If you have any questions, please feel free to contact Meghan G. Ludtke at (202) 366-4011.

Very truly yours,

(Signed)
Patrick W. Reilly
Chief Counsel

cc: Renee M. Marler