American Iron and Steel (AIS)

AIS is the narrowest of the federal domestic procurement laws, but within its scope it is the strictest. It applies only to iron and steel products used on projects funded by EPA's Clean Water State Revolving Fund (CWSRF) and Drinking Water State Revolving Fund (DWSRF). Originally enacted in 2014 as a one-year appropriations provision, the Infrastructure Investment and Jobs Act made AIS permanent in 2021.

The standard is absolute: 100% domestic from the initial melting of raw materials through every manufacturing step including coating. No percentage test, no price preference, no middle ground. The iron ore has to be melted in the US, the steel has to be rolled and formed in the US, and any galvanizing, painting, or coating has to happen in the US.

If you work on water or wastewater infrastructure funded through the SRF, AIS is a fact of life. Getting it wrong means the same penalties as any BABA violation: rip-and-replace, funding clawbacks, and potential False Claims Act exposure.

AIS started as Section 436 of the Consolidated Appropriations Act of 2014 (P.L. 113-76). Congress included it as a one-year appropriations rider, meaning it had to be renewed each fiscal year. For seven years it was renewed annually, creating uncertainty for project planners who could not guarantee the requirement would exist when their multi-year projects reached procurement.

The IIJA ended that uncertainty. It made AIS permanent by codifying it directly into the Clean Water Act (Section 608) for CWSRF projects and into the Safe Drinking Water Act for DWSRF projects. The requirement also extends to projects funded through the Water Infrastructure Finance and Innovation Act (WIFIA), which provides low-interest federal loans for large-scale water infrastructure.

AIS covers products that are predominantly iron or steel, meaning iron or steel accounts for more than 50% of the total product cost. The following categories fall under AIS when used on covered projects:

All manufacturing processes from the initial melting stage through the application of coatings must occur in the United States. There is no partial credit. Every step in the chain has to happen domestically:

Initial melting. Raw ore, scrap, or virgin materials melted into semi-finished form such as ingots, billets, blooms, or slabs. This is where AIS draws the hardest line. You cannot import semi-finished steel and process it in the US. The melting has to start here.

Intermediate steps. Rolling, extruding, drawing, forging, and casting. These processes transform semi-finished forms into usable shapes like plate, sheet, bar, rod, tube, and pipe.

Final shaping. Cutting, drilling, welding, machining, and other fabrication steps that turn raw shapes into finished products.

Coating. Galvanizing, painting, epoxy lining, cement mortar lining, and any other protective coating. A domestically melted and fabricated pipe that gets sent to Mexico for epoxy lining does not comply with AIS.

AIS is a condition of receiving funding from two EPA State Revolving Fund programs. Understanding which program funds your project determines whether AIS applies.

Clean Water State Revolving Fund (CWSRF). Funds wastewater treatment facilities, stormwater management, nonpoint source pollution control, and estuary protection. Each state receives a federal capitalization grant and matches it with state funds. The state then provides below-market loans to local municipalities and utilities for eligible water quality projects.

Drinking Water State Revolving Fund (DWSRF). Funds drinking water system improvements including treatment plants, distribution systems, storage facilities, and source water protection. Same structure: federal capitalization grant, state match, below-market loans to local systems.

In both cases, state agencies administer the programs and are responsible for enforcing AIS on individual projects. EPA provides oversight and guidance but does not directly manage project-level compliance. If your project receives SRF funding through your state's program, AIS applies regardless of how much of the project cost comes from the SRF loan versus other sources.

On EPA SRF projects, both AIS and BABA apply simultaneously. For iron and steel products, EPA has confirmed the standards are functionally identical: both require 100% domestic manufacturing from melting through coating. Compliance with one satisfies the other for iron and steel.

But BABA adds requirements AIS does not cover. Manufactured products (pumps, motors, electrical panels, HVAC equipment) need 55% domestic component cost plus final assembly in the US. Construction materials (PVC pipe, glass, lumber, drywall) need 100% domestic manufacturing. So on a water project you follow AIS for the iron and steel, and BABA for everything else.

AIS compliance requires two types of documentation depending on the product:

Mill test reports (MTRs) for raw steel products. MTRs trace the steel from the initial melting facility through intermediate processing. They identify the heat number, the mill that performed the melt, and the chemical and mechanical properties of the steel.

Manufacturer certification letters for fabricated iron and steel products. These letters must identify the specific product, the project it is being supplied for, the manufacturing facility (city and state), and confirm that all processes from initial melting through coating occurred in the United States. Letters must be signed by an authorized company representative.

AIS provides two paths for using non-domestic iron and steel when compliant products are unavailable:

National waivers. EPA has issued national waivers for specific product categories where domestic production is insufficient to meet demand. These waivers apply automatically to all SRF-funded projects without individual project approval. Check EPA's current national waiver list before assuming a product requires domestic sourcing.

Project-specific waivers. For products not covered by a national waiver, individual projects can request waivers through their state SRF program. The request must document sourcing efforts showing that compliant products are unavailable or would increase the overall project cost by an unreasonable amount. Public notice is required before the waiver can be granted.

De minimis provision. AIS allows incidental amounts of non-domestic iron and steel if the cost is minimal relative to the overall project. This is not a blanket exemption. It covers minor items like screws or small fittings where domestic sourcing would be impractical, not major product categories.