Building Better Relationships Every aggregate producer knows that one of the trickiest aspects of the business isn’t necessarily meeting flat and elongated requirements, but rather is meeting the expectations of the surrounding residents and businesses. Each month, as I compile our roundup of news from around the United States and Canada, I’m struck by the fervor of those opposed to living or working near aggregate operations. It’s no longer an issue of random NIMBYs (not in my backyard), but an all-out assault on the structure of the very communities in which we operate. Take, for example, the town of Nassau, New York. Mining in that community has been described as “the white hot, fist-throwing issue in town.” For nearly a decade, the community has struggled with the questions of where and when to allow mining. Almost 10 years ago, a Connecticut producer launched an unsuccessful attempt to open a mine there. Currently, two companies have proposals to expand operations in Nassau. The debate over those plans has sparked quite a controversy that has overflowed into the political arena, with accusations flying over which town board members are either pro- or anti-mining. From an industry perspective, the simple facts of the matter are that Nassau sits atop a valuable greywacke deposit, and reputable companies want to extract a valuable commodity in an area where demand is high. From a community standpoint, the results have been extremely divisive. In this one town, two large groups of citizens have either already opted out, or are currently trying to opt out, of the community. The lesson to be learned from this cautionary tale is the wisdom of presenting our best face to our neighbors and preventing such problems in our own communities. As we wrestle with inherent conflict between residential and resource development, the benefits of best management practices, or BMPs, increases correspondingly. A community-oriented, well-run operation is less likely to provoke neighbor complaints. Effective BMPs vary from simple concepts such as better housekeeping to far more complex topics such as environmental compliance, erosion control, and water quality. Misting truck loads going out the gate might seem like a minor inconvenience to you as an operator, but it makes a very good talking point to share with neighbors who are concerned about the air they breathe and what might be in it. The same goes for evolving beyond environmental compliance and implementing an environmental management system to truly improve your operation’s ability to be a good neighbor. You may think that you’re just doing the right thing — and you are. But beyond the ethics issues, implementation of best management practices is a sound business strategy. Remember what’s happened in Nassau, and you’ll realize that the use of a few more BMPs can keep your operation, and your community, intact. Changing for the Future? Earlier this year, organized labor in the United States had a somewhat subdued anniversary. Seventy years after the passage of the Wagner Act — the statute that guarantees the right of employees to organize and to bargain collectively — and 50 years after the merger of the AFL-CIO, three of the its largest unions split to form Change to Win. Now each group must define its focus and mission as separate entities. At first glance, this might appear to signal the beginning of the end for organized labor in the United States. The statistics support such a premise. According to data presented by Harold P. Coxson, Esq., at the National Stone Sand & Gravel Association Aggregates Industry Workforce Conference in Washington, D.C., in early September, overall union membership has shrunk from 21.6 percent of the U.S. workforce in 1975 to 12.5 percent in 2004. Another conference speaker, noted demographics expert Marilyn Moats Kennedy, says that employees less than age 36 have no desire to join unions. She predicts that the U.S. Postal Workers union, where two-thirds of employees are more than 50 years old, will be the first major union to go. But before you think you see a light at the end of the collective bargaining tunnel, keep this in mind: unions are fighting for their very survival. When faced with the flight or fight options, they are much more likely to choose the second option. Add to that the fact that not one, but two union groups are likely to be focused on organizational activities and the tunnel starts to look might long. Coxson told conference attendees that the construction industry is a likely target for both the Change to Win and the AFL-CIO organizations because it is a captive market — neither the plants nor people are portable. “It’s going to be sort of like the Wild, Wild West, I’m afraid,” he says of the likelihood that the two groups may try to raid each other’s membership. In 2004, 18.6 percent of U.S. aggregates industry employees belonged to unions. Raids of this portion of the workforce are not the only concern. Seeding of companies to attract new union members is also a possibility, particularly in the South and Southwest. Coxson did, however, offer some excellent advice regarding how aggregates managers may proactively improve employee relations and make themselves less-attractive targets. His suggestions include the following:
Other persuasive factors include your ability to create a safe work environment and a competitive wage and benefits program. Some of the steepest declines in union enrollment followed the creation of regulatory agencies and the enactment of hallmark regulatory reforms. Whether your company is currently union, non-union, or a mix of each, implementing some of these suggestions makes good business sense. The underlying message is to build a trusting relationship with a happy, healthy workforce. And that’s a change worth investing in. No Small Achievement Since its inception, Aggregates Manager has promoted the value of being a good corporate citizen. For nearly a decade, we have shared stories about how aggregates companies make a difference in the communities in which they operate. Although hosting a school tour or donating playground sand may not seem like a big deal, it creates strong bonds not only between the community and the company, but the company and its employees. Recently, such a story was recognized by the American Business Media. Luck Stone Corp. was selected as one of five winners in ABM’s 2005 William D. Littleford Awards program. We nominated Luck Stone for the award because we felt that its education program and its distribution of rock kits to every elementary school throughout Virginia merited the award, which was established to recognize great community service programs. Prior to traveling to New York to accept the award on Luck Stone’s behalf, I was excited about ABM’s recognition — both of Luck Stone and of Tina Grady Barbaccia, who wrote the feature articles that garnered the recognition. After meeting the other award recipients, however, I have to say that Luck Stone and Aggregates Manager are in fine company. To put the award in perspective, let me tell you a little about some of the award winners. The grand prize winner was a family-run tour company specializing in African safaris. After seeing the effects of the AIDS pandemic, the company started a non-profit foundation that allows staff, clients, and business partners to “adopt” orphans and place them in reputable boarding schools in Kenya. Opening next January, the newly built Harambee House (taken from the Swahili word meaning “all pull together”) will be used as permanent home for the children when they are home during school holidays. Another winner is the In-Store Marketing Institute, a marketing event that benefits both the National Alliance of Breast Cancer Organizations and the Y-ME National Breast Cancer Organization. Through its efforts, the institute solicits contributions that fund a 24-hour hotline, run support groups and early detection workshops, and provide wigs and prostheses assistance. Through its Excellence Awards program, another winner — eWeek — supports organizations that use technology to benefit the nation’s youth. One of my lunch companions was a woman who runs a youth center in the Bronx. Her young charges had recently designed a Web page about youth obesity and learned about good nutrition habits through the process. The final winner was a little company by the name of Intel Corp. It was recognized for its Science Talent Search program that introduces promising young scientists and inventions while providing individual student scholarship as well as school financial support. If the old axiom about being judged by the company one keeps is true, Luck Stone and the aggregates industry should be standing tall! Building a Strong SAFETEA Net During the last couple of years, a little tune from my childhood keeps echoing in my mind: “I’m just a bill; yes I’m just a bill, and I got as far as Capitol Hill. Well now I’m stuck in committee, and I sit here and wait while a few key congressmen discuss and debate whether they should let me be a law...Oh how I hope and pray that they will, but today I am still just a bill.” While the creators of School House Rock would probably be thrilled to know that their jingle has had more than 30 years of staying power, it’s a shame that a little bill called the Safe, Accountable, Flexible, Efficient Transportation Equity Act — Legacy for Users, or SAFETEA-LU, has had such a long journey toward becoming a law. At press time, the bill was finally on its way to the Oval Office with the promise of a presidential signature. And while transportation reauthorization is certainly good news for the industry, it comes a record-breaking 12 extensions and more than two years too late. Certainly, SAFETEA-LU has its promising notes. With highway funding levels of $193.2 billion during five years, it guarantees the highest level of infrastructure investment in the nation’s history. Other provisions, such as federal funding for aggregate research and environmental streamlining, mean that better roads will be built, and they will be built more quickly. State departments of transportation have also been guaranteed a more equitable distribution of funds as an increasing share — up to 92 percent in 2008 — is returned to the state in which it was collected. On the other hand, the funding levels are nowhere near what the Federal Highway Administration said was necessary to maintain the quality of U.S. roads. That’s left the political rhetoric about improving safety and decreasing travel times ringing a little hollow in my ears. Another major problem with the 1,000 plus-page bill is the number of earmarked projects, including a $450 million bridge that will be named for House Transportation Committee Chairman Don Young (R-Alaska). These projects have an estimated value of $23 billion, money that could have been much more wisely allocated. The earmarks struck a sour chord with not only watchdog groups, but also with the general populace. Finally, political maneuvering played too dominant of a role in this legislation’s development. From the chest-beating in the White House and on Capitol Hill to a last-minute attempt by Sen. Max Baucus (D-Montana) to insert language reopening a runway on a Montana air base, politicians were more interested in advancing their own agendas than in addressing public need. Before the next transportation reauthorization effort begins, it’s time to study some of these issues. Is multi-year federal transportation reauthorization still the best mechanism for funding the nation’s infrastructure? How can transportation dollars be invested where the need and the value is the greatest? What will prevent legislators from loading the bill with pork? Which elected officials will step forward as both strong leaders and advocates for transportation funding? As an industry, it’s our responsibility to formulate possible answers to these questions. So take a couple of weeks and think them through. Then, it will be time to gear up for the next round of transportation reauthorization. Survival of the Fittest When I began covering the aggregates industry in 1991, it was apparent that the role of an aggregates manager was undergoing an evolution. A decade earlier, a plant superintendent merely needed to understand how to maximize plant production and to keep the customers happy. Now, that same plant manager also needs to ensure continuous improvements in safety, to meet tighter product specifications — often with lower quality deposits — and to keep peace in the neighborhood. None of those challenges are simple, but the last one may indeed be the most frustrating. As non-government organizations, or NGOs, gain momentum, they imbue a sense of entitlement in disgruntled neighbors. These groups, often wearing the guise of environmentalists, portray miners as money-grubbing capitalists who have no appreciation for the devastation they wreak upon the bumblebee bat, the spawning salmon, or the sensitive wetlands. The poor hapless souls who built their half-million dollar shacks 1,000 feet away from the “big, evil quarry” are just its latest victims. Of course, the picture these groups portray is completely one-sided. It doesn’t take into account the fact that many endangered bats make their home in underground mines that create a hospitable, protected shelter for them or the fact that sand and gravel operations are not allowed to mine certain parts of rivers and streams during spawning season. It doesn’t take into account the fact that producers are required to mitigate any wetlands when developing reserves or the fact that most states require reclamation plans as part of the permitting process. And, it doesn’t take into account the fact that numerous operations have gained ISO 14001 certification. To build some type of balance between these disparate viewpoints, the World Business Council for Sustainable Development initiated a review of mining-related practices through a project titled, Mining, Minerals, and Sustainable Development. Initiated in 2001, one of the key results of the project was the development of a framework for tracking the contribution of mining and mineral activities as a means of assessing the compatibility of mining and minerals projects and operations with the concept of sustainability. That framework is called The Seven Questions to Sustainability. These questions evaluate such issues as whether engagement processes are in place and working effectively, how people’s well-being will be affected, whether the integrity of the environment is assured during the long term, if the economic viability of the operation is assured, and more. (For a complete list, visit the Web site www.iisd.org.) According to Dr. Dirk Van Zyl, mining engineering department chairman at the University of Nevada’s Mackay School of Earth Sciences and Engineering, a producer’s ability to effectively answer those seven questions may impact his ability to remain in business. Essentially, he says, future producers have to gain the respect of and establish trust with the communities in which they operate. Gaining this “social license” to operate may be the key to future viability. In such a Darwinian situation, it may be wise to plan your company’s next environmental evolution. It’s one way to ensure that your business isn’t the one on the endangered species list. Demanding Better of Our Representatives When it comes to politics, Charles De Gaulle may have said it best when he declared, “I have come to the conclusion that politics are too serious a matter to be left to the politicians.” As the general who led French resistance during World War II, his own experience with politicians may have been what drove him to become the France’s prime minister. After an emersion course in local politics, I’d have to agree with his assessment. A few months ago, the school district that my children attend announced that — due to overestimated revenues and underestimated expenses — its projected $1.6 million end-of-year surplus would instead be a $3.7 million deficit. To compensate, building closings were announced, teachers were laid off, and a levy was placed on the ballot. The community was up in arms, and the inevitable fingerpointing began. Like other parents, I wanted to know what happened, so I started digging for answers. What I discovered was that my district was one of nearly half those in the state which were expected to be in some category of fiscal crisis by the end of the school year. The root problem was the state’s school funding formula, House Bill 920, which — because of its heavy reliance on property taxes — has repeatedly been declared unconstitutional by the Ohio Supreme Court. I also learned that the only way to keep the state from taking control of the district was to ensure passage of the levy. And that was a virtual impossibility if you asked any local politician. What the elected “leaders” didn’t anticipate was the impact of community resolve. Parents started talking — at our schools, in our yards, and by the fields of our kids’ baseball and soccer games. We wanted, and demanded, a real solution to our district’s problems. From those discussions, a parental advocacy group was formed. In the weeks leading up to the levy vote, we held community meetings, lobbied the mayor and the city council to endorse the unpopular levy, distributed tax exemption materials to senior citizens, and organized a fourth-grade political sidewalk chalk campaign that ended up on the front page of the local newspaper. On Election Day, we made history. For the first time in decades, the district passed an additional tax levy on the first attempt. Every precinct in the city voted in favor of the levy, also a first. Of course, passing the levy was just the first step in helping the district. The next, and arguably more important, challenge is to force the state to abandon a bad funding formula and to develop a more equitable alternative. As we work — seemingly endlessly — to pass federal transportation funding, or any other industry issue, keep in mind the lessons from this local tale. As constituents, we hold the true political power in a representative democracy. When we refuse to accept anything less than our goal, politics can be set aside and leadership can occur. Jurisdictional Jurisprudence If at first (and second, and third, and fourth, and fifth) you don’t succeed, try, try again. That seems to be the mantra behind House Resolution 1356, the Clean Water Authority Restoration Act of 2005. Introduced by Rep. James Oberstar (D-Minnesota) and John Dingell (D-Michigan), the legislation represents the latest attempt to expand regulatory authority over excavation activities in wetlands. Unlike the Tulloch rule’s string of judicial defeats, however, this endeavor may find a more receptive audience. At press time, H.R. 1356 had more than 130 co-sponsors. Through the infamous Tulloch litigation, the Corps of Engineers and the U.S. Environmental Protection Agency sought to expand permitting under Section 404 of the Clean Water Act, or CWA, to include all excavation activities by redefining “discharge of dredged or fill material” to include any redeposit of “incidental fallback.” Under the 1993 Tulloch rule, spilled material from excavation and dredging equipment would trigger the need for a federal permit under the CWA. It placed an onerous burden on the industry — and was met with a strong response. During the Clinton Administration, the rule was challenged by industry associations and was struck down five times. Throughout the initial ruling and the appeals process, courts found that the rule exceeded the statutory authority of both the Corps and the EPA. The agencies appealed the ruling all the way to a full panel of the Federal Appeals Court — stopping just short of the U.S. Supreme Court — before abandoning a judicial remedy. Having failed in that branch of government, environmentalists are now working through the legislative branch. The proposed bill, which would add an amendment to the Federal Water Pollution Control Act, replaces the term “navigable waters” in the CWA with “waters of the United States.” Essentially, it incorporates the migrating molecule theory of water quality management. That premise traces the path of a drop of water from head waters through dry ditches, ephemeral waters, culverts, etc., and incorporates those areas — and many more — under the Corps’ jurisdiction. In a press release announcing the bill, Oberstar justified the broad jurisdictional expansion saying, “The legislative history of the CWA clearly and unambiguously states that the statute applies to all the waters of the United States...the bill we are introducing today reaffirms the original intent of the Act.” If the bill is passed, many more wetlands come under the purview of the two agencies. From there, no crystal ball is required to predict the future. If lack of jurisdiction prevented enforcement of the Tulloch rule under prior court decisions and the agencies now have that jurisdiction, they can apply Tulloch. H.R. 1356 circumvents a decade’s worth of jurisprudence and deserves the same forceful rebuttal as the Tulloch rule. Putting an End to Retreaded Lawsuits Any aggregates manager who has recently permitted an operation knows that the process — while never quick or easy — is rapidly becoming a quagmire in every sense of the word. Local community groups use the permitting process as an opportunity to demand outrageous concessions. Zoning boards drag out proceedings longer than is reasonable. Hostile regulatory agencies use regulatory fine print or misapplication to thwart permitting attempts. Recent permitting situations underscore these issues. After a decade-long effort to acquire a permit, a New York-based producer agreed to limit the amount of reserves mined; enclose a crusher; create an enormous buffer zone around an urban operation; pay a homeowner’s association to retain its own experts to monitor quarry noise, blasting, and dust; and establish an annual fund to pay for neighbor mitigation requests. The producer considers this agreement a “win-win” situation because he finally got his permit, and with an estimated cost of $500,000, it may have been a bargain. Other producers have made concessions such as guaranteeing values of neighboring properties, limiting hours of operation, allowing community inspections, and making per-ton donations to the local communities. Frequently, concessions made by one company are viewed as a standard part of subsequent permitting efforts. While individual permit battles can be frustrating and expensive, aggregates managers in Missouri found that by working together they were able to dramatically improve conditions in what had been one of the nation’s most hostile permitting environments. According to Steve Rudloff, executive manager of the Missouri Limestone Producers Association, the situation dramatically improved as the result of persistent efforts by the association’s membership. During the last decade and a half, the state’s aggregates community encountered burdensome challenges that caused it to take the significant (and costly) steps necessary to improve the situation. For example, one local regulatory agency implemented extensive modeling of fugitive emissions to restrict operations and developed statewide operating permits that Rudloff describes as a “nightmare.” Rather than accept the status quo, producers developed innovative approaches to dealing with the situation. The association created a template for completing paperwork for the statewide operating permit, as well as a computer program that allows companies to plug in site-specific information and determine whether the site meets ambient air quality standards. If not, the producer can review alternatives, such as moving equipment farther from the property line or adding filtration to mobile equipment in order to adhere to standards. The group also hired an environmental engineering firm to compare the state’s predicted model emissions to actual emissions — and then submitted the disparate results to state officials. Adhering to the state’s “Show-me” motto, producers developed credible evidence of the industry’s impact on the environment and were rewarded with much improved permitting conditions. While not all aggregates companies have the time or resources to execute MLPA’s creative strategy, they can adhere to the underlying concepts: be persistent, be professional, and build credibility by arguing the technical merits of your position. The Permitting Quagmire Any aggregates manager who has recently permitted an operation knows that the process — while never quick or easy — is rapidly becoming a quagmire in every sense of the word. Local community groups use the permitting process as an opportunity to demand outrageous concessions. Zoning boards drag out proceedings longer than is reasonable. Hostile regulatory agencies use regulatory fine print or misapplication to thwart permitting attempts. Recent permitting situations underscore these issues. After a decade-long effort to acquire a permit, a New York-based producer agreed to limit the amount of reserves mined; enclose a crusher; create an enormous buffer zone around an urban operation; pay a homeowner’s association to retain its own experts to monitor quarry noise, blasting, and dust; and establish an annual fund to pay for neighbor mitigation requests. The producer considers this agreement a “win-win” situation because he finally got his permit, and with an estimated cost of $500,000, it may have been a bargain. Other producers have made concessions such as guaranteeing values of neighboring properties, limiting hours of operation, allowing community inspections, and making per-ton donations to the local communities. Frequently, concessions made by one company are viewed as a standard part of subsequent permitting efforts. While individual permit battles can be frustrating and expensive, aggregates managers in Missouri found that by working together they were able to dramatically improve conditions in what had been one of the nation’s most hostile permitting environments. According to Steve Rudloff, executive manager of the Missouri Limestone Producers Association, the situation dramatically improved as the result of persistent efforts by the association’s membership. During the last decade and a half, the state’s aggregates community encountered burdensome challenges that caused it to take the significant (and costly) steps necessary to improve the situation. For example, one local regulatory agency implemented extensive modeling of fugitive emissions to restrict operations and developed statewide operating permits that Rudloff describes as a “nightmare.” Rather than accept the status quo, producers developed innovative approaches to dealing with the situation. The association created a template for completing paperwork for the statewide operating permit, as well as a computer program that allows companies to plug in site-specific information and determine whether the site meets ambient air quality standards. If not, the producer can review alternatives, such as moving equipment farther from the property line or adding filtration to mobile equipment in order to adhere to standards. The group also hired an environmental engineering firm to compare the state’s predicted model emissions to actual emissions — and then submitted the disparate results to state officials. Adhering to the state’s “Show-me” motto, producers developed credible evidence of the industry’s impact on the environment and were rewarded with much improved permitting conditions. While not all aggregates companies have the time or resources to execute MLPA’s creative strategy, they can adhere to the underlying concepts: be persistent, be professional, and build credibility by arguing the technical merits of your position. A Rush to Measurement While the Bush Administration spends the next few months pushing its agenda on Social Security, Iraq, and, hopefully, transportation funding, it is a rulemaking from the preceding administration that could most strongly impact aggregate producers. Days before his departure from the Mine Safety and Health Administration, former Assistant Secretary of Labor for Mine Safety and Health Davitt McAteer pushed through an ill-conceived, under-researched rule on diesel particulate matter in underground mines. Call it his parting gift. After legal challenges to the 2001 rule, MSHA revisited key issues, including what particulate matter was measured and the efficacy of existing filtration technology. A new final rule, due this spring, satisfactorily addresses some, but not all, of the concerns voiced with the first DPM regulation. MSHA recognized that confounding factors such as rock dust, oil mist from pneumatic drills, and cigarette smoke can impact DPM measurements within an underground mine. To minimize the impact of those factors, the interim permissible exposure limit of 308 micrograms per cubic meter of air measures elemental carbon levels rather than total carbon levels. However, the final PEL — which takes effect in January 2006 — is 160 micrograms of total carbon per cubic meter of air. How do producers meet these exposure goals? MSHA says the simple answer is that operators should use filters on their underground equipment. But, the answer isn’t that simple. Lab tests at the Stillwater Mine in Nye, Montana, showed that diesel particulate filters were effective in reducing DPM, including elemental carbon. However, once testing moved into a simulated case-study phase, researchers found compliance much more difficult to achieve. In its own report regarding the study, the National Institute for Occupational Safety and Health notes, “The efficiencies for the DPF systems achieved in the mining studies did not always agree with the efficiencies reported in the laboratory studies. These studies also demonstrated that considerable effort is needed to select and optimize DPF systems for individual underground mining applications.” In fact, two tests conducted during the case study were halted by researchers when DPF equipment was found to have a dangerous side effect; it produced more than 5 parts per million of nitrogen dioxide, which exceeds MSHA’s own short-term exposure levels for the gas. These are the results of a carefully staged study using government researchers who worked with MSHA, equipment manufacturers, and professional miners under ideal conditions in a short-term testing environment. What happens next year when individual mines are asked to meet stricter standards under real-life operating conditions and on a long-term basis? Providing a clean, safe work environment for underground aggregate operators is a sound goal, and the rulemaking process itself has caused many aggregates managers to improve their ventilation systems and monitor exposure levels. To that end, the impending DPM rulemaking has been a success. However, before MSHA publishes a final rule, it needs to consider carefully both the way in which it quantifies final exposure levels and whether or not its recommended DPF equipment is likely to do more harm to miners than good.
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