FHWA Provides Q&A Site To Address Di Minimis, Small Grant Waivers
It appears that after the Department of Transportation’s Federal Highway Administration (FHWA) issued its limited waiver last August to the Build America, Buy America (BABA) Act requirements for de minimis costs and small grants, it stirred up a multitude of questions among its stakeholders. The agency now has responded by issuing a question-and-answer website to address these queries.
The website notes that the de minimis costs portion waives the application of the requirements of the BABA for construction materials under a single financial assistance award when the total value of the non-compliant products is no more than the lesser of $1 million, or 5% of total applicable costs for the project. This portion of the waiver does not waive FHWA’s Buy America requirements for steel or iron, and FHWA continues to apply its Buy America requirements to projects that would otherwise be covered by the de minimis portion of the waiver. It is important to note, however, that FHWA’s de minimis standard for iron and steel under 23 C.F.R. §635.410(b)(4) continues to apply.
The small grants portion waives the application of FHWA’s Buy America requirements for steel or iron and BABA’s requirements for construction materials under a single financial assistance award when the total amount of federal financial assistance applied to the project, through awards or subawards, is less than $500,000. The de minimis costs and small grants waiver applies only to awards that are obligated or subawards that are made on or after Aug. 16, 2023.
In response to a question asking how an entity applies the $500,000 small grants threshold, and whether it should use the engineer’s estimate amount, contract award amount or final project amount that may include change orders, FHWA explains that the $500,000 small grants threshold applies to the total amount of federal financial assistance provided for the project through awards or subawards, not just the total amount of a single award, project contract award amount or engineer’s estimate. For example, if the total amount of the federal financial assistance is 90% of the project costs, then, 90% of the total cost of the project must be below $500,000 for the waiver to apply.
In response to another question asking how the small grants waiver affects programs like the Recreational Trails Program, transportation enhancement activities, congestion mitigation and air quality improvement projects, bicycle programs, etc. where there are awards and subawards, the website explains that the total dollar amount of federal financial assistance for the grant awards or subawards must be below $500,000 for the small grants portion of the waiver to apply. It is important to note that the de minimis and small grants waivers are only applicable to subawards if the subawards are made by a pass-through entity for a specific project.
DOT stakeholders affected by this waiver should check out this website to see if responds to any questions they may have about their programs.
Join us for our following Thompson Grants events:
Federal Grants Forum | June 26-27, 2024 | Columbus, Ohio
Thompson Grants Workshop: Audits | July 18, 2024 | Virtual Event
