Ms. Myra D. Smith
Contract Administrator
Washington Metropolitan Area Transit Authority
600 Fifth Street, N.W.
Washington, D.C. 20001

Re: Request for Waiver IFB#YR-4615/MDS – Hollow Axles

Dear Ms. Smith:

This letter responds to your November 10, 1999, request for a waiver of the "Buy America" provision as it applies to the procurement by the Washington Metropolitan Area Transit Authority (WMATA) of hollow axles for use in the Rhor Railcars.

The Federal Transit Administration’s (FTA) general requirements concerning domestic preference for the procurement of manufactured products are set forth in 49 U.S.C. 5323(j). Under 49 U.S.C. 5323(j)(2)(D), these requirements shall not apply if including domestic material will increase the cost of the procurement by more than 25 percent. The implementing regulation, at 49 CFR 661.7(d), provides that a price-differential waiver will be granted if the amount of the lowest bid offering the item or material that is not produced in the United States multiplied by 1.25 is less than the amount of the lowest bid offering an item or material produced in the United States.

It is my understanding that WMATA received three responsive and responsible bids in response to the IFB published in the Washington Post and the Commerce Business Daily. The lowest bid was submitted by CAF who certified non-compliance with Buy America. ORX was the lowest domestic bidder, certifying compliance with Buy America and providing the lowest bid offering domestically produced axles. I understand that the bid from CAF, when multiplied by 1.25, is less than the bid of ORX. Based upon the information in your letter, it is apparent that the grounds for a price-differential waiver exist.

Therefore, under the provisions of 49 U.S.C. 5323(j)(2)(D), a waiver is hereby granted for the procurement of hollow axles as needed under this two-year contract and its options.

Please direct all inquiries to Meghan G. Ludtke, (202) 366-4011.

Very truly yours,

(Signed)
Patrick W. Reilly
Chief Counsel