Over the last few years, the U.S. Environmental Protection Agency (EPA) has consistently tightened its national ambient air quality standards (NAAQS) for particulate matter and ozone and nitrogen dioxide (see related stories posted to the Observer during January 2010 - http://newsletters.agc.org/environment). AGC has closely tracked and weighed in on these rulemaking actions with an eye to what they may mean for future construction, including stricter requirements and/or restrictions on diesel engines and their use.
The Clean Air Act (CAA) requires EPA to set NAAQS that define acceptable levels for six pollutants: ozone, carbon monoxide, nitrogen dioxide, sulfur dioxide, particulate matter (PM) and lead (http://www.epa.gov/air/urbanair/). States are required to monitor for each of these pollutants and submit data that are used to determine whether geographic areas are in "attainment" for each of the standards. If EPA designates an area as in "nonattainment" (i.e., areas where pollutant concentrations exceed the standard), the state where the area is located must develop a state implementation plan (SIP) that demonstrates the steps that will be taken to reduce pollution and achieve compliance with air quality standards. As part of the SIP, states may enact and enforce requirements that affect the business of construction.
As federal air standards have become increasingly more stringent, the number of nonattainment counties has continued to increase. In addition, state rulemaking agencies have found it more and more difficult to secure the emission reductions they need to develop EPA "approvable" SIPs. AGC remains concerned that states will eventually be forced to focus more on placing restrictions or limits on previously unregulated activities - i.e., moving from the traditional focus of stationary sources to mobile sources. The authority for such restrictions, and how they are applied, will certainly be the subject of much future debate.
Click here to view the SIP strategies developed by AGC of America that are appropriate to the construction industry, as well as a list of unacceptable strategies.
Restriction on Equipment Use
As EPA continues to tighten the federal NAAQS, states are challenged to find ways (within their existing legal authority) to further reduce pollution from mobile sources. In geographic areas that do not meet federal ambient air standards, states may attempt to directly impose requirements through their SIPs on the users of diesel engines to reduce emissions from the existing fleet of construction equipment.
The CAA generally reserves for the federal government the authority to set emissions standards for either new or old engines in off-road (also called "nonroad") construction equipment, a concept called federal preemption. Nonetheless, some states have attempted (or currently are attempting) to include provisions in their SIPs that appear to violate this statutory prohibition. Such provisions include: operating restrictions on the use of construction equipment; requirements to retire or replace older diesel equipment; or mandates (via contract specifications or bid preferences) to retrofit old off-road engines.
AGC generally opposes equipment use/operation restrictions, including the application of contract language (bid specifications) to require contractors to retrofit their equipment for a given project because it has the potential to threaten the integrity of the competitive bidding process and unfairly discriminate against contractors on the basis of their equipment. As an alternative to this practice, recently, AGC of America and the Clean Air Task Force (CATF) have agreed on "principles" to require reductions in diesel emissions from federally-funded transportation projects via contract change orders that cover 100 percent of the costs to retrofit equipment. CATF represents leading environmental groups and targets diesel emissions reductions nationwide. To read AGC's press release click here, and to read an AGC's Environmental Observer article with more information click here.
As stated above, state and local governments are prohibited from crafting their own patchwork rules to control emissions from engines and fuels. The one exception would be for states to identically adopt stricter emissions standards first set by California. (Congress wrote a narrow exception specifically for California into the statute. The relevant provision adds that such California standards must meet with federal approval, but if they do, then California can enforce them, and other states may adopt and enforce identical standards.) California has enacted new standards, and tighter NAAQS may force states to adopt California's new mobile source standards. AGC has significant concerns with California's rule on off-road diesel emissions, as it would place an excessive, and in some cases insurmountable, economic burden on the already struggling construction industry. The state's construction industry originally estimated that the cost would reach $13 billion, and its latest estimates are even higher. If other states across the nation adopt (or "opt-in") to California's requirements, the cost to industry will be many times greater. AGC estimates that 32 other states are already monitoring California's situation.
Loss of Federal Highway Funding
States that fail to develop suitable SIPs (or to meet EPA's CAA deadlines) could be subject to numerous federal sanctions, including emissions caps limiting economic development and the loss of federal highway transportation dollars. In addition, EPA's "transportation conformity" provisions can bring federal funding for road and transit projects to a grinding halt. Under the CAA transportation conformity provisions, federal departments and agencies may not approve, permit or provide financial support to most highway and transit projects in areas that have not attained air quality standards, unless such projects conform with the state's SIP. "Conformity" means transportation activities will not cause new air quality violations, worsen existing violations or delay timely attainment of air quality standards in polluted areas. Failure to demonstrate conformity results in a "conformity lapse," which renders the area's transportation program and plans invalid.
Only certain types of projects can advance during a conformity lapse (e.g., safety projects and transportation control measures).
AGC continues to educate EPA and other policymakers on why restrictions on the use and operation of diesel equipment and the loss of highway funds are, in essence, construction bans. Leaving projects incomplete has consequences far beyond the impacts to the project itself, as the owner and users are deprived of the direct benefits of that project. In addition, because construction is a major contributor to employment, gross domestic product (GDP) and manufacturing, the effects reverberate through the larger economy. Finally, construction is vital to restoring our nation's aging infrastructure and delivering important public services.
Any tightening of a federal NAAQS could result in construction bans that would:
- Lead to a massive layoff of construction workers and of workers who supply a multitude of materials, equipment and services to construction.
- Delay the renovation and improvement of public infrastructure, including highway and transit construction projects, bridge construction and repairs, dam repairs and school renovation.
- Impede projects that are vital to improving municipal water supplies and wastewater treatment facilities located throughout the nation.