Overview of the 'Buy American' Requirement for Foreign Contractors

In this paper I will discuss the various aspects of a Federal Contract Specialist position and what makes it different from many other government jobs. Some people think contracting is just shopping for a living, however, it requires great skill and attention to detail. Contract Specialists must be able to communicate effectively with their customers, vendors and other contracting personnel and they must be able to accurately interpret regulations and apply them appropriately. This position is a little bit customer service representative, a little bit personal shopper and a whole lot of legal assistant.

American and Indian culture are different in similar in many ways. In the video “30 Days: Outsourcing” we got to follow a man Chris Jobin, into India and see firsthand just what living in India is like. Upon arrival he starts to notice somethings are very different than what he is accustom to, but there are also some that are very similar. One of the very first things he sees when he arrives is all these new business buildings next to little shacks that people live in. Then when he gets to the house he is staying at, the family meets him at the door and does some ritual on him. After his initial first day, he notices that the main job in India, is the lowest job in America.

A basic definition for the procurement is “the way the building is realised” and “involves assembling and organising the skills and services of a team of construction professionals”. (the Construction Round Table, 1995). More precisely, the construction industry describes procurement as “a system that establishes the roles and relationships which make up a project organisation”; hence the overall organisation and communication structure for the management, administration and control of a project is established by the procurement system. (D.C.H Coles, 2010)

PURPOSE. This document provides historical information regarding the Davis-Bacon Act and present day implications of the Act. Davis-Bacon, established in 1931, sets a wage requirement for all construction contracts over $2,000 that are either partially or fully supported with government funds. While the Act has been controversial for many years, efforts to repeal the Act completely or to increase the dollar-value threshold have failed. Some argue that the Act increases cost to Government construction contracts and may reduce competition or eliminate it completely for small businesses (CBO, 1983). Regardless, under FAR 22.404, we are responsible for ensuring that the requirements of the Davis-Bacon Act are enforced and incorporated into our solicitations and contracts.

Contractors bid on U. S. Federal Construction projects and most contracts for federally assisted constructions exceeding $2,000 required to pay their employees the standard wage and benefit package that workers in the area performing similar work are earning the

Outsourcing is a method used by many corporations in which their products are manufactured in foreign countries often for cheaper labor.This method method of productions has it’s pros and cons.

Federal construction contracting practices, governed by the Federal Acquisitions Regulations (FAR), have a duty to uphold the integrity in the process of selecting sources to perform the requirements of the government through contracts. The duty is to the people of the union and those who pay into the system of government. The FAR and the institution of contract professionals within federal service take this duty very seriously and enact processes that uphold their obligations. Regarding infrastructure projects in the federal government, it is customary to see authorization from congress to a particular department to exhaust funds in support of a particular mission or requirement. Within the Department of Defense these funds are requested

Firms in the industry bid for public- or private-sector projects. Public-sector projects were publicly financed and usually designed to improve the existing infrastructure. Private-sector projects were privately financed projects. Public-sector projects were gov- erned by multiple requirements and legislation, such as federal and state laws governing wages. Contractors in the state of California were required to pay the prevailing wage rates on construction work greater than $25,000 and on alteration, demolition, repair, or maintenance work greater than $15,000.5 Private-sector projects were governed by fewer laws and requirements. For

Procurement intends to explore supply market opportunities and to implement resourcing strategies that deliver the best possible supply outcome to the organization, its stakeholders and clients (Kidd, 2005). Therefore, construction procurement exists to purchase a construction project as requirement of firms or organizational entities to achieve its goals. However, the choice to use external resources is the part of firms’ decision-making

The American Outsourcing Case is a compilation of factual information for the purpose of provoking debates. The authors present both the pros and cons of outsourcing, and avoid inserting their personal bias. The case clearly defines outsourcing and then focuses on outlining its existence in China, Mexico, and India. The evolution and U.S. involvement in the Maquiladoras of Mexico is described first. The implementation of NAFTA and the creation of Maquiladoras were major catalysts in the growth of free trade between the U.S. and Mexico. China, in an attempt to attract foreign investors, created Special Economic Areas, which designated geographic zones that were enabled to operate under their own laws. With great tax benefits

The need for financial stringency in public organizations due to budgetary pressures and tax resistance coupled with the need to Managing /balancing budget deficits and provide quality services with a reduction in revenue has always been a major challenge for public organizations. The need to save money and at the same time provide quality services, had forced government agencies to privatize and contract out. Recently, there is greater involvement of the private and nonprofit sector in public service delivery. More and more government functions in service delivery are now carried out by private and nonprofit organization. This is one part attributed to the belief that private organizations can provide services more efficiently and effectively than government operated services. And the other is the fact that it is cost effective and takes a lesser time frame. These two process are indeed unarguably beneficial to the government and private sector as well as the beneficiaries, but they can be also very daunting accompanied with huge challenges especially when not executed in the rightful manner. The case of the crummy contractor by Rainey depicts such a complex situation , where the process of contracting out was poorly conducted. The case highlights the demand for privatization and contracting-out and most importantly some of the challenges of privatization and contracting in government organization. it goes on further to identify some crucial pointed to be

Many small contractors are reluctant to adopt IBS system and prefer to continue using the conventional method of construction. This is due to poor financial holdup and are not able to set up their own manufacturing plants as it involves very intensive capital investment. In this case, financial matters become the main obstacle for small contractors to move forward with the IBS system (Rahman & Omar, 2006). Further, the incentives for IBS are not sufficient. IBS adoption requires more pull and push factors from the government. Due to the small profit margin, the alteration from conventional to IBS was not feasible, unless, more attractive incentive systems and assistances which can lure the conventionalist to IBS are in place (M. I. Din et al., 2007).In the viewpoint of components’ manufacture, IBS construction requires high initial investment capital for pre-casters to buy new machinery, mould, importing foreign technology and wages of skilled workers for installation process (IBS Steering Committee, 2006) (Thanoon et al. 2003) (M. I. Din et al., 2007).

There however are challenges in the industry occasioned by uncertainty on future spending on construction projects by the government. Moreover, the cost of doing business and the ability to increasingly make revenue have created a challenging environment for the construction firms. Therefore stakeholders in the construction industry are concerned with whether the government would increase its spending and whether the public construction projects will be available in the future since less than 10 percent are currently financing their clients.

When choosing a type of procurement it is based on the clients experienced and knowledge of construction that the client has and there requirements. Once this has been decided then the relevant contracts can be drawn up outlining the relevant responsibilities shared and risk taken into consideration and also meeting the correct legislation and the Housing Grants, Construction and Regeneration Act 1996. With regards to the Housing Grants, Construction and Regeneration

Firms must ensure legal protections of information, privacy of employees and customers, and safeguard trade secrets, as well as comply with global requirements that present legal issues of taxes, labor laws, and safety regulation requirements (Jones). For publicly held companies, SOX controls the reporting requirements of these companies (Hall, 2007). Other laws, such as HIPAA and identity theft laws, also apply to the legal requirements of outsourcing.