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Proposed Federal Contractor Greenhouse Gas Reporting Requirement

Seemingly Innocuous Requirement is a Sign of More Contractor Mandates to Come 

On July 25, AGC submitted comments on the Federal Acquisition Regulation (FAR) Council proposed rule that would require federal contractors with annual gross revenues of $7.5 million and above to make an annual representation within the System for Award Management indicating if and where they publicly disclose greenhouse gas emissions and greenhouse gas reduction goals or targets. Although this proposal may appear innocuous on its face, AGC believes this is the first in a number of steps towards mandating new federal contractor greenhouse gas emissions requirements and issuing new policies and regulations on climate change.

AGC’s comment letter notes that the construction industry itself has a limited, direct impact on greenhouse gas emissions and is heavily represented by small businesses, which would be unfairly disadvantaged by any new GHG reporting requirements that could likely result.  AGC found that a majority of the top 100 contractors do not disclose information related to GHGs and that none of the small business contractors queried publically disclose that type of information.  AGC “fears that the federal government will use the limited information generated by the most sophisticated and financially well-off companies to draw up requirements for the entire federal construction contracting industry.”  The association urged the FAR Council to understand the limitations of the data collected if and when considering future GHG emissions policies and regulations.

Additionally, AGC holds “that the rule should limit its inquiry and reporting requirement to only the offeror, not to its immediate owner or highest level owners.”  Construction companies may be held by firms with diverse portfolios that would not be indicative of what is possible for a construction company or the work it performs. 

The proposal rule comes as a result of President Obama’s 2015 Executive Order 13693, Planning for Federal Sustainability in the Next Decade, wherein the seven largest procuring agencies—i.e. Department of Defense, General Services Administration and Department of Veterans Affairs—are to implement procurements that take into consideration contractor GHG emissions.

For more information, contact Jimmy Christianson at christiansonj@agc.org. 

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