T request to exempt Spain firm protested
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Politicians from Idaho and other states are protesting the MBTA's request to exempt a European company from federal "Buy America" requirements as it pursues a lucrative contract to build locomotives for the commuter rail system.
A decision on the matter by federal officials, expected within a few weeks, could be worth hundreds of millions of dollars to one of the two companies competing for the contract.
A spokesman for the Massachusetts Bay Transportation Authority said the agency has said it will decide whether to hire Vossloh España S.A., a Spanish unit of a German company, or Boise-based MotivePower Inc., shortly after the Federal Transit Administration rules on the exemption. MotivePower, a subsidiary of
The T will not reveal the companies' bids until its board votes on a contract. But the agency previously projected that the first 28 locomotives would cost $186 million, with an option to buy another 28 at an unspecified cost. The federal government is expected to pay 80 percent of those costs. The purchase is part of a longstanding promise to improve service for the 72,000 people who take the commuter rail daily.
Vossloh officials would not comment by telephone. In an e-mail, spokesman Juan José Sanchis said the company's proposal is compliant with the T's technical and legal requirements. Vossloh's US experience is limited, according to the company website, but the bid requirements make it likely they would use an experienced American company to provide the locomotive engine.
The company wants to build two pilot locomotives in its home plant and assemble the rest in Kentucky if it wins the contract, according to documents filed by the MBTA. Building the pilots in the United States, an ocean away from the company's design and engineering departments, "would result in an unacceptable increase in labor costs," the company wrote in its application.
The T agreed to a similar approach in purchasing train coaches from Rotem, a South Korean company, earlier this year. But in that case, foreign companies were the only option, because no American companies are in the coach-building business. The Federal Transit Administration has granted only one exemption to the "Buy America" requirement for locomotive contracts in recent years, in a case in which no American company made a bid.
This time, an American company is available and its supporters worry that the MBTA could be opening the door to more competition if it accepts the Vossloh bid. "Granting this waiver will cost hundreds of jobs," Senator Mike Crapo and Representative Mike Simpson, both of Idaho, wrote to the FTA.
Buy America requirements have their roots in the 1970s and 1980s, when Congress was concerned that US companies were losing ground to European and Asian competitors. They require transit agencies buying new equipment to demand American assembly and 60 percent American parts when using federal matching dollars. Agencies can get a waiver in certain circumstances, including cases when there are no domestic firms competing, the difference in price is more than 25 percent, or the waiver is in the "public interest."
Vossloh contends that its waiver is in the public interest because it could not otherwise submit a competitive bid. Without Vossloh, the T would be left with a single bidder.
MBTA spokesman Joe Pesaturo said the T filed the "Buy America" waiver at Vossloh's request, but has not taken a position on whether it should be granted or whether it would hire Vossloh if it is approved, he said.
"It's important that the T act in the best interest of taxpayers and fare-payers," Pesaturo said.
Noah Bierman can be reached at nbierman@globe.com.
