President Joe Biden will propose on Wednesday a rule that seeks to raise the minimum percentage of U.S.-made components in products purchased by the federal government, the White House announced.
During a visit to a Mack truck factory in Pennsylvania, Biden will propose a new government rule to implement an executive order he signed in his first week in office, which was intended to boost government purchases of American products.
Currently, products purchased by the federal government must have a minimum of 55 % of their components made in the United States, and Biden’s proposed rule would immediately raise that percentage to 60 %.
That proportion would gradually increase to a minimum of 75 % by 2029, government sources said.
That change can go into effect without congressional approval if it passes a 60-day public review and comment period.
The White House said in a statement that the change “will create more opportunities for small and medium-sized manufacturing businesses and their employees, including some that are experiencing disadvantages, across the country.”
The new rule would also require contractors to demonstrate that the products they purchase for the government, such as official vehicles, meet the minimum U.S. component requirements, something they now resolve by simply assuring the executive branch that what they purchase meets the requirements, without providing proof.
In addition, the rule will allow prioritization of purchases of products crucial to the supply chain that have been in short supply during the pandemic, such as semiconductors and medical equipment.
In fiscal year 2020, American federal agencies purchased $665 billion in goods and services, an increase of $70 billion over 2019, in part to address the pandemic, according to Government Accountability Office (GAO) data.