On behalf of the American Public Transportation Association (APTA), our 1,500 member organizations, and the millions of Americans that depend on public transportation, I write to express our strong opposition to increases in the domestic content requirements under current Buy America law. APTA opposes increases in the current domestic content requirement because we believe such a change may actually reduce U.S. job creation rather than support the creation of U.S. jobs as intended. APTA opposes the similar provisions in the Surface Transportation Reauthorization and Reform Act of 2015, which was introduced today, and the Senate-passed DRIVE Act, both of which would increase Buy America domestic content requirements for transit rolling stock.
We note that there is no empirical evidence demonstrating that increased domestic content will result in more U.S. jobs, and we urge Congress to review the potential impact of increased content standards before passing legislation that may well have the opposite effect. Before Congress considers legislation to change well-established domestic content rules, it should study whether such a change would actually increase or decrease U.S. jobs. We are concerned that increasing domestic content standards may actually reduce U.S. manufacturing jobs, increase costs for taxpayers, and adversely affect public transportation services.
We also support the stated goal – increasing jobs in the U.S. while supplying transit agencies with quality, affordable vehicles made with U.S. labor – but we question whether such increases will achieve that goal. Transit rolling stock manufacturers now employ thousands of U.S. workers across the country and thousands more Americans work for companies in their extended supply chain. APTA has consistently maintained that the single most effective policy to support these workers and grow employment in our industry is enactment of a long-term federal surface transportation bill, with significant growth in public transportation infrastructure investment.
On July 30, 2015, the Senate passed a long-term surface transportation authorization, H.R. 22. The bill includes a provision that changes the domestic content
rules for transit rolling stock from 60 percent to 65 percent by 2018 and 70 percent by 2020. We believe that increasing the domestic content requirements by nearly 17 percent would put downward pressure on jobs and could result in domestic suppliers leaving the transit market. We oppose Congressional action to increase the current standard, especially in the absence of impartial analysis to determine the effects for manufacturing jobs, vehicle costs, and competition in the marketplace.
While we believe an independent study should be conducted before making any statutory change in the law, we recognize that the bi-partisan House bill introduced today already increases content levels. We urge the committee to at least consider an amendment mandating a study to identify potential benefits and drawbacks. Our proposal would require an impartial, non-partisan organization, such as the Transportation Research Board, to conduct an analysis of the effects for transit manufacturing jobs, costs for rolling stock, availability of products, competition in U.S. markets, and other benefits or adverse consequences that would result from a change in Buy America content rules. Without having the best information available, we believe that a proposed change in policy will have unintended and harmful consequences.
We will continue to advocate for a long-term transportation authorization that significantly grows investment in public transportation infrastructure. We support
informed policy decisions and urge Congress to study the effects of raising domestic content requirements to verify whether such a change will actually spur job creation as intended. Thank you for your attention to this important matter.