The Build America, Buy America (BABA) Act, signed into law as part of the Infrastructure Investment and Jobs Act in 2021, was designed to bolster American manufacturing by requiring federally funded infrastructure projects to use domestically produced materials. However, the legislation has inadvertently hindered the construction of affordable housing, exacerbating the nation's housing crisis.
Affordable housing developers report significant delays and escalating costs as they struggle to comply with BABA's stringent requirements. Nearly every component, from HVAC systems to ceiling fans, must bear the Made in the USA label. Yet, many essential products are no longer manufactured domestically, forcing developers to seek waivers from the Department of Housing and Urban Development (HUD).
Waiver Process at Near Standstill
The Trump administration's staffing cuts at HUD have left the agency ill-equipped to handle waiver requests efficiently. Developers say the approval process has slowed to a crawl, with some waiting over six months for decisions. 'We’ve sort of resigned ourselves that we’re just gonna build less units across the entire country during a housing crisis,' said Tyler Norod, president of Westbrook Development Corporation.
They need to be treating this like the fire that it is.
Meanwhile, Americans like Diana Lene, a 75-year-old Fargo resident, are left waiting for affordable housing. Lene, who relies on Social Security, struggles to make ends meet in her current apartment. 'I’m just trying to keep a roof over my head, but it’s getting more and more difficult,' she said.
Costs Mount for Developers
Developers are incurring substantial additional expenses to comply with BABA. Julie Hoebel, a Denver-based developer, spent over $60,000 on consultants to verify American-made materials for an 85-unit building. Waiver requests submitted in November remain unapproved, threatening to halt construction entirely.
HUD has acknowledged the challenges but offered few solutions. Secretary Scott Turner stated the agency is 'looking at this … to provide flexibility to certain projects,' but provided no timeline or specifics. Supporters of BABA argue the law itself is not the issue but emphasize the need for streamlined waiver processes and clearer industry guidelines.
As delays persist and costs rise, the BABA law continues to strain affordable housing development, leaving thousands of low-income Americans in limbo.