National AGC, Northeastern Chapters Oppose Diesel Retrofit Mandate
AGC of America has partnered with nine of its Chapters located in the Northeastern United States to jointly respond to draft model contract language that would require contractors to retrofit or repower their equipment before they could competitively bid on most construction work in that region.
The model “specification” is being developed by a clean diesel policy group, known as the “Northeast Diesel Collaborative.” The draft calls for contractors to reduce particulate emissions from their fleet to a level that is much lower than what was required when the equipment was manufactured and sold to the construction industry. To meet this contractual provision, contractors would need to perform massive equipment overhauls.
AGC submitted initial comments opposing the Collaborative’s plan to rewrite engine emissions standards for equipment that is already in the field. AGC’s letter points out that it is legal to continue to operate this equipment “as is” until the end of its useful life. The Collaborative, however, is urging all public contracting agencies and private developers undertaking large construction projects located in urban areas within CT, MA, ME, NH, NJ, NY, PR, RI, VT to make diesel retrofit a standard pre-bid qualification—and to specify stringent recordkeeping, reporting and non-compliance penalty provisions in their contract documents. The Collaborative’s model language is based on a similar specification recently drafted and widely circulated by an anti-diesel environmental group.
AGC remains concerned that the draft language was developed without sufficient industry input. Initially, the Collaborative offered only 11-days for AGC to provide comment. Recently, however, the Collaborative granted AGC’s request for more time to solicit feedback from its membership, and subsequently postponed its meeting to discuss stakeholder input and to plan its next steps.
Impact on Construction Contractors
AGC believes the draft contract language—as currently written—would render thousands of pieces of older construction equipment worthless unless and until these fleets are re-powered with entirely new engines that may or may not be available, or fitted with emission controls that may or may not be available. This practice could wipe out the net worth of many construction companies, depriving them of their bonding capacity, and simultaneously requiring them to make massive capital investments. The model language also is likely to undermine the competitive bidding process by giving a preference to companies operating new fleets. In addition, AGC fears this initiative would compel many construction contractors in the Northeast to retire equipment long before the end of its useful life, costing workers their jobs and delaying the completion of essential infrastructure improvements. Smaller- and minority-owned businesses are likely to be disproportionately impacted because larger firms are more likely to have a greater annual percentage turnover in their equipment fleets.
The Northeast Diesel Collaborative (click here) is an ad hoc advocacy group (not a rulemaking agency) made up of representatives from federal, state, and local government, private industry, and environmentalists. This Collaborative (along with other similar groups throughout the nation) seeks to reduce emissions from construction equipment that is currently in use. AGC Chapter and member participation in ALL regional Clean Diesel Collaboratives is needed. To find out how to join your region’s group, click here.
Per the Collaboratives’ direction, many state DOTs (departments of transportation) are setting bid preferences and inserting specifications into construction contracts that require contractors to retrofit their equipment to meet certain emissions limits set for a given project (For examples, see - http://www.epa.gov/diesel/construction/contract-lang.htm). While courts have yet to determine whether such requirements are permissible, AGC of America has generally opposed this practice.
For additional information, contact Leah Pilconis, senior environmental advisor to AGC, at email@example.com.
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