Buy American Provisions in Stimulus Contracts

At a Special Meeting of Council held on April 20, 2009 Halton Hills Council passed a Resolution calling for the United States Government to reconsider a recent Act passed by Congress which requires that steel and other manufactured products be made in the United States.

The Town was approached by Mr. John Hayward, President of Hayward Gordon Ltd., about this pressing issue which threatens 30% of his current business. The Government of the United States, in its effort to provide an infrastructure stimulus package, placed “Buy American” requirements for contracts using stimulus funds, which undermines the intent and spirit of free trade that has existed between Canada and the United States for decades.

Hayward Gordon Ltd., a 57 year old Canadian manufacturer of pumps and mixers that are used internationally in water and wastewater plants, recently moved to Halton Hills. They built new seven million dollar plant which employs over 70 local employees. The company also uses the services of local suppliers, contractors and trades people and is a vital part of the economic strategy in Halton Hills and the surrounding Region.

The United States Federal Government passed the American Recovery and Reinvestment Act (ARRA) which includes a 6 billion dollar program that provides funds for water and wastewater treatment projects including the construction of new plants and the upgrading of obsolete plants. The ‘Buy American’ provisions in this Act require the contractors to use American made steel and other components. As these contracts are at the municipal level, the provisions of the North American Free Trade Agreement and the General Procurement Agreement of the World Trade Organization against protectionism do not apply and therefore Canadian made products will be rejected.

In a presentation to Council Mr. Hayward stated that U.S. firms export over 7 billion dollars of product into the Canadian Environmental market and are being encouraged to bid openly on Canadian projects that are being funded under our own Federal and Provincial stimulus packages. These packages do not contain the protectionist provisions that the American legislation mandates.

Mr. Hayward further stated “If the US does not rescind the “Buy American” provisions Hayward Gordon Ltd. may have to open a facility in the United States”.

Mayor Bonnette stated “This is a local company that finds itself in a difficult position and while we support Free Trade we also feel it should be Fair Trade and I fully support this Resolution”. “This is not a Buy Canadian Resolution but rather a question of fairness; I think companies in other municipalities may find themselves in the same position and our support is justified.”

Councillor Clark Somerville will be presenting this Resolution to the Federation of Canadian Municipalities asking that organization to support Halton Hills’ position and that other Regions and Municipalities direct their purchases to companies located in countries which don’t restrict Canadian trade.

The Resolution was passed with unanimous support and will be forwarded to the Federal, Provincial and Regional Governments as well as other interested stakeholders.

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