AGC calls on Washington to release details on ‘Buy America’ rules for construction materials and energy projects


Total construction spending decreased by 0.1 percent in January, as declines in single-family homebuilding and public construction offset marginal gains from private non-residential construction, according to an analysis by the Associated General Contractors (AGC) of America.

“Laws enacted more than six months ago created unprecedented funding and tax credits for a wide range of transportation, environmental, energy and manufacturing projects,” said Ken Simonson, the association’s chief economist. “But few contractors have actually won contracts yet.”

Construction spending, not adjusted for inflation, totaled $1.8 trillion at a seasonally adjusted annual rate in January, 0.1 percent below the December rate. Private residential construction decreased for the eighth consecutive month in January, by 0.6 percent. Spending on private non-residential construction increased 0.9 percent in January, while public construction investment declined 0.6 percent.

The biggest component in the non-residential sector manufacturing plants, increased 5.9 percent. Commercial construction—comprising warehouse, retail, and farm construction—decreased 3.1 percent in January. Highway and street construction decreased 1.0 percent. Spending on power construction rose 0.9 percent.

Among other categories that are expected to receive funding or tax credits under federal legislation, investment in transportation facilities rose 1.7 percent. Outlays for sewage and waste disposal construction declined 2.5 percent, while spending on water treatment infrastructure decreased 5.9 percent.

Association officials say a lack of guidance on projects eligible for tax credits and incomplete or contradictory information about “Buy America” requirements have held up billions of dollars in project awards. They urged the Biden administration to finalize rules for awarding projects under the Infrastructure Investment and Jobs Act.

“Contractors, developers, and state agencies have been hamstrung by the lack of clear or realistic guidance implementing under these laws,” said Stephen E. Sandherr, the association’s chief executive officer. “It is high time to put in place the rules that will enable these vitally needed projects to be built.”


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