FHWA Proposed Rulemaking Would Give States ‘Greater Flexibility’ to use Proprietary or Patented Materials
The Federal Highway Administration issued a notice of proposed rulemaking on Nov. 14 that it said will provide “greater flexibility” to state agencies to use “proprietary or patented materials” in Federal-aid projects.
[Photo by Utah DOT.]
Currently, FHWA requires that states wanting to use a specific proprietary or patented material in a project using federal funds verify that the item was secured through a competitive bid; that there isn’t another product that does exactly what the proprietary product does; or the item is used for research or a special type of construction.
FHWA said in its rulemaking proposal that it plans to “amend and replace” some requirements relating to patented and proprietary product approvals with a more “flexible general requirement” that enhances fairness, open competition, and transparency in the product selection process.
The agency also proposed in its rulemaking to rescind other requirements so as to encourage “further innovation” in the development of new highway transportation technology and methods, as well as potentially reducing costs.
“The existing regulation could do more to provide states further opportunity to consider the use of innovative, proprietary, or patented materials in Federal-aid projects,” the FHWA said in its regulatory filing. “The proposals contained in this NPRM would promote the benefits of innovation and new technology and afford the flexibility necessary to take advantage of technological advancements in highway transportation. Such added flexibility may also provide state DOTs an advantage by potentially obtaining highway materials or products at a lower price.”
The agency added that specifying a patented article in the solicitation materials may not, by itself, limit competition. “Rather, this practice might encourage various bidders to offer lower prices in the competition to deliver needed materials and ultimately lead to a more cost effective use of Federal funds in the long-term,” the FHWA said.
The agency also emphasized that most state DOTs “utilize new product evaluation processes and approved product lists” that provide fair and transparent procedures for the evaluation, selection, and use of materials, including patented and proprietary products.
“State DOTs are responsible for the effective and efficient use of Federal-aid funds, subject to the requirements of Federal law,” it said. “The FHWA believes, absent the current Federal patented and proprietary products requirements, state DOTs may implement material selection procedures that ensure fair and open competition while allowing for, and encouraging, innovation.”
The agency noted that comments on this NPRM must be received on or before January 14, 2019.