AGC, NE chapters oppose diesel retrofit mandate

Mandate would require contractors to retrofit or repower their equipment before bidding on work

News AGC Highway Facts Bulletin July 13, 2007
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The Associated General Contractors of America (AGC) has partnered with nine AGC Chapters located in the Northeast 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.

AGC has submitted eight pages of 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 Conn., Mass., Maine, N.H., N.J., N.Y., R.I. and 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 is based on language 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, AGC was offered only 11 days to provide comment. Yesterday, 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.

AGC believes the draft contract language would render thousands of pieces of older construction equipment worthless unless and until these fleets are repowered 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.

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