For Better or Worse?

Industry leaders say the final CAFE standards will mean a $65 billion-plus loss for highway and transit improvements.

By Tina Grady Barbaccia, News and Digital Editor

The Obama Administration’s July 29 proposal to increase fuel efficiency standards for cars and light trucks to an average 54.5 miles per gallon (mpg) between 2017 and 2025 would result in the loss of more than $65 billion in federal funding for state and local highway, bridge, and transit improvements, according to an analysis by the American Road & Transportation Builders Association (ARTBA). The original Corporate Average Fuel Economy (CAFE) standard, set in 1975, demanded a 40-percent increase in fuel efficiency.

The impact on the nation’s transportation improvement program, ARTBA President Pete Ruane said, would be like eliminating all federal highway funding for nearly two years.

“Like everyone else, we are supportive of efforts to reduce carbon emissions and improve fuel economy,” Ruane said in a written statement. “However, from a public policy perspective, this is a classic case of the left hand not knowing what the right hand is doing. It’s irresponsible to advance such proposals without acknowledging and attempting to mitigate the adverse effect they would have on other areas of federal responsibility like making infrastructure improvements that improve safety, reduce traffic congestion, create jobs, and help grow the economy.”

Per gallon federal gasoline and diesel taxes collected at the pump are deposited into the federal Highway Trust Fund (HTF). By law, these excises are the primary revenue source for financing road, bridge, and transit projects. The less motor fuel used by drivers, the less revenue generated for improvements financed through the HTF.

The analysis, conducted by Dr. William Buechner, a Harvard-trained economist and ARTBA vice president of economics & research, assumes the increase in fuel efficiency standards between now and 2016 will occur as required (in 2010, the Obama Administration put in place an increase from an average 28.3 to 34.1 mpg by 2016). It also assumes the mpg requirement will be phased in at 5 percent per year from 2017 through 2025 as proposed.

The baseline for calculating revenue losses is the U.S. Treasury’s February 2009 projections of HTF revenues. As new cars and light trucks are purchased in the future and old ones retired, average fuel economy will improve, reducing the 2009 forecast of gasoline sales and HTF revenues.

Buechner says the HTF has already taken a revenue hit with the standards put in place in 2010. From fiscal years 2010-2016, he estimates that action will cost the HTF about $9 billion. This means, if the new standards are enacted, the total loss of revenue for transportation improvements through 2025 is projected at $75 billion.

Ruane said the nearly two-year overdue federal highway and transit program reauthorization bill “provides a ripe opportunity for Congress and the President to identify all possible options to generate the revenues necessary to maintain and improve the system.”

In a prepared statement, President Obama said “an agreement such as this would have been considered impossible. This announcement…represents not only a change in policy in Washington, but the harbinger of a change in the way business is done in Washington. As a result of this agreement, we will save 1.8 billion barrels of oil over the lifetime of the vehicles sold in the next five years. And at a time of historic crisis in our auto industry, this rule provides the clear certainty that will allow these companies to plan for a future in which they are building the cars of the 21st century.”

In a July 29 letter from Volvo Car Corp. to Secretary Ray LaHood and EPA Administrator Lisa Jackson, Doug Speck, senior vice president for marketing, sales, and customer service said, “Volvo Car Corp.…commits to working with the EPA and NHTSA, the states, and other stakeholders to help our country address the need to reduce dependence on oil, to save consumers money, and to ensure regulatory predictability and certainty by developing this kind of strong, coordinated National Program [sic].” For a downloadble PDF of the letter, go to http://www.epa.gov/otaq/climate/letters/volvo-commitment-ltr.pdf.

For a commentary analysis on how the standards may be “ambitious, but not out of the range of feasibility,” go to http://www.1.usa.gov/n69isg.

Caterpillar Settles alleged Clear Air Act violations for $2.55 million

Peoria, Ill.-based heavy equipment manufacturer Caterpillar agreed to pay a $2.55 million penalty — $2.04 million to the United States and $510,000 to the state of California — on July 28 as part of a settlement with the U.S. Environmental Protection Agency (EPA) and the U.S. Department of Justice (DOJ) for alleged Clean Air Act violations. For a downloadable PDF of the United States vs. Caterpillar, go to http://www.1.usa.gov/USvsCat.

Cat allegedly shipped more than 590,000 highway and non-road diesel engines without correct emissions controls, according to the EPA. Caterpillar also allegedly failed to comply with emission control reporting and engine-labeling requirements.

The settlement requires Cat to recall the known defective engines, install the correct ATDs — devices that control engine exhaust emissions once the emissions have exited the engine and entered the exhaust system — and reprogram the fuel injector and fuel map settings. The recall will continue until all engines with incorrect catalysts, fuel injectors, or fuel map settings have been addressed or until Dec. 31, 2011, whichever is earlier, according to the EPA.

Caterpillar also will mitigate excess emissions through permanent retirement of banked emission credits, according to the settlement. Within 30 days of entry of the Consent Decree, Caterpillar agrees to retire credits equivalent to the lifetime excess emissions from the 925 engines that did not receive the correct ATD or that were programmed with incorrect fuel injector or fuel map settings.

“The vast majority of these engines have already been addressed in the company’s ongoing recall program,” Bridget M. Young, a media relations representative from Cat’s corporate affairs department, tells Aggregates Manager.

“As the decree indicates, Caterpillar denies any wrongdoing, but does agree that the decree represents a good faith effort between the parties to resolve their differences and avoid potentially lengthy litigation,” Young says. “Caterpillar is committed to following the terms of the decree.”

The EPA complaint points out that about 925 of the 590,282 engines shipped to original equipment manufacturers (OEMs) with separately shipped aftertreatment and/or fuel programming software actually entered use without correct assembly by the final product OEMs, Young notes.

And the Award Goes to AggMan

The American Society of Business Publication Editors (ASBPE) has honored Randall-Reilly Publishing Co., parent company of Aggregates Manager magazine, with three national editorial awards, 12 regional editorial awards, and three design awards in the organization’s Azbee Awards of Excellence.

Aggregates Manger was honored for its two awards — one gold and one silver award — in the Midwest-South region at an awards banquet on July 28 in Chicago. ASBPE presented its national awards during an awards banquet on Aug. 4 during the organization’s national conference in Chicago.

Last year, ASBPE presented Aggregates Manager with two awards, including a silver and a bronze regional award, honoring both editorial and design work. From 2005 to date, ASBPE has awarded Aggregates Manager a combined 14 regional and national awards.

The Azbee Awards of Excellence is a peer-judged contest that honors the top b2b publications in various categories.

“I’ve always believed Aggregates Manager editors, designers, and contributors are among the best in the business, but it’s particularly gratifying to receive consistent recognition of Aggregates Manager’s editorial quality from our peers,” says Therese Dunphy, editor-in-chief of Aggregates Manager, of the magazine consistently being recognized by ASBPE and other organizations.

Adds Joe Donald, publisher of Aggregates Manager: “We are proud and honored to be recognized by ASBPE. We look forward to continuing to work hard to serve our industries.”

AggMan Awards At a Glance

The following is a list of the 2010 Azbee Awards of Excellence won by Aggregates Manager.

Category Awarded Award                                   Editor/Staff Member Named

Organizational Profile Gold, Regional                     Kerry Clines, Brad Kelley

Regular Column, Silver, Regional                            Bill Langer, Therese Dunphy

Contributed

United States and Canada, visit www.AggMan.com for daily updates.

Arizona

A $400 million new cement plant, the first in the state in more than 50 years, plans to ramp up production as soon as the economy improves. The Arizona Republic reports that the Drake Cement plant, near Paulden, acquired three suppliers in the region and branded them Drake Materials. The plant has been in the works since the 1990s and is one of three currently operating in the state. “The market is very difficult,” Brad Belt, senior vice president, told the newspaper. “There is not enough demand for any producer in the state to be running 24 hours a day. In these markets, we run the plant as long as we can until our storage capacity is full, and then shut down and fire up again when it is time to replenish.”

California

In mid-June, the Duarte City Council voted unanimously to appeal a judge’s ruling in favor of neighboring Azusa and a mining plan for Vulcan Material Co.’s Azusa Rock Quarry. According to the San Gabriel Valley Tribune, Duarte City Manager Darrell George said, “The council’s decision to appeal continues Duarte’s belief that the Vulcan EIR is seriously flawed and that destroying the Van Tassel ridge is the wrong thing to do.” A judge ruled in Azusa’s favor on all counts, including a claim that the environmental impact report was flawed. Azusa councilman Keith Hanks told the newspaper that he was disappointed in Duarte’s decision to appeal, but confident that his city would prevail.

Connecticut

Ken Evarts, president of Seashore Construction Co., appealed a cease-and-desist order for his operation, but the appeal was rejected. The New Haven Register reports that the Zoning Board of Appeals unanimously agreed that Evarts should no longer be able to extract and remove material from his property. Evarts’ attorney said that extraction had been taking place since the turn of the century and should be allowed to continue if it predated zoning laws, which went into effect in 1953. The town engineer presented two photos of the land from 1951 and 1971 showing that it was farmland at that time. The Zoning Board of Appeals chairman told the newspaper that it did not have enough evidence to say that the non-conforming use predated zoning laws and rejected Evart’s appeal.

Maine

West Cumberland voters overwhelmingly approved a ban on commercial gravel operations in rural residential neighborhoods. According to the Portland Press Herald, the vote was 862 to 507 in favor of the first citizen-initiated referendum to change an ordinance in the town’s history. Last fall, the town halted a gravel operation on land owned by Elvin and Randy Copp because it did not have the correct permits. A six-month moratorium was then imposed on new gravel pit applications. Rural residential zones cover about 80 percent of the town. The change does not impact existing aggregate operations in the area.

Minnesota

At Aggregates Manager’s press time, a July 1 state government shutdown appeared imminent. In the absence of a state budget agreement, agencies such as the Minnesota Department of Transportation (MnDOT) were preparing contingency plans in case contracts are suspended, pending authorized appropriations. The Saint Paul Legal Ledger Capital Report noted MnDOT’s 2011 construction program includes 258 new and ongoing projects valued at $900 million, with another $398 million worth of improvements over four years to state roads rated as poor. Tom Stockert, area vice president for Knife River Corp., told the local publication, “We typically don’t show profits until well after July 1, closer to Labor Day.” The company currently has a state project to make improvements to Highways 30 and 83 in Blue Earth County as well as a $14.4 million Highway 212 project in Renville and McLeod counties.

New York

Elam Sand and Gravel and a former town board member, Gary Evans, filed a lawsuit in the state Supreme Court to force West Bloomfield to act on the company’s application for a special-use permit. According to the Democrat and Chronicle, the lawsuit was filed on June 7. A day later, the town adopted a nine-month moratorium on new special-use permits in the town’s agricultural zone (which includes the mine site). A lawyer for the operator told the newspaper that the moratorium was adopted specifically to stall its application.

Ohio

Ohio aggregate companies are benefitting from a new state initiative, CSI Ohio, intended as a common-sense initiative to cut the negative impact of red tape on state businesses. Columbus Business First reports that Lieutenant Gov. Mary Taylor is directing the program. With Taylor’s help, Pat Jacomet, executive director of the Ohio Aggregates and Industrial Minerals Association, says his group was able to conclude a decade-long negotiation with the state Environmental Protection Agency (EPA) on a package of general permits designed to streamline the ability of aggregate companies to begin new operations. Under the new system, companies agree to abide by specific requirements and environmental protections outlined in a general permit issued by the EPA. Companies can then work immediately on projects by notifying the EPA that they will operate under the general permit.

Oregon

Following approval of a gravel mining operation by the Lane County Board of Commissioners, opponents plan to fight the mine on the state level. According to The Register-Guard, about 40 landowners and residents have joined Families for a Quarry-Free Neighborhood. In 2007, mining applicants Donald Overholser and Rodney Mathews applied for county approval of an 18-acre quarry. The project was approved by the planning director in 2010 with some conditions to address issues such as road improvements, hours of operation, truck size, speeds, and number of daily hauling trips. The mine applicant appealed the road improvements, and the hearing official affirmed the planning director’s decision, but removed some limitations including truck speed and number of trips. The board of directors upheld that decision, and opponents are now appealing to the state Land Use Board of Appeals.

Pennsylvania

A New Hope couple, Jim and Kathy Lyons, have organized a citizens group — New Hope Residents Association — to urge state officials to deny a permit for the New Hope Crushed Stone and Lime quarry. According to The Intelligencer, the quarry is seeking approval from the state Department of Environmental Protection (DEP) to dig to depths of 170 feet, a 50-foot increase from its current level. The DEP is reviewing its request. In the meantime, the New Hope Council president told the newspaper that the council may consider sending a letter supporting the community group’s resistance. The group also turned to Rep. Bernie O’Neill and Sen. Chuck McIlhinney, both of whom have supported its cause.

Texas

Industrial Asphalt’s KBDJ Conservation Land & Quarry has implemented a dry dust suppression system at its Hays County quarry. According to Hays Free Press, new equipment and technology are reducing dust emissions by up to 35 percent, while reducing water usage by at least 80 percent. “Dry dust suppression helps protect two natural resources of great value to our neighbors — fresh water and clean air — allowing our company to continue providing locally sourced raw materials that are the building blocks for our region,” KBDJ President Jill Shackelford told the media. The quarry is also using enclosed conveyors to minimize airborne dust.

Texas

A new state law, based on HB 571, takes effect on Sept. 1. It requires aggregate operators to register their facilities by Sept. 1, 2012, with inspections beginning Sept. 1, 2015. The law is intended to eliminate the impact of rogue operators and would assess permit fees of about $550, The Houston Chronicle reports. Registration fees — of less than $1,000 — would be assessed to operators. Sites that are not registered will face fines of between $5,000 and $10,000 per year, with fines up to $25,000 if they remain unregistered for a three-year period. “This brought together a lot of people who normally work on the opposite end of the spectrum,” Richard Szecsy, president of the Texas Aggregates and Concrete Association, told the newspaper. “One important thing to note is that the aggregate industry did want this bill. We want these unlicensed operators out.”

Washington

A South Kitsap homeowner filed a complaint about the proposed extension of a gravel mine near his home, claiming excessive dirt and traffic congestion in the area are the major problems, the Kitsap Sun reports. Steve Taylor filed the complaint with the Department of Natural Resources in response to a request from Miles Sand & Gravel for an extension of its permit for an operation on Bethel-Burley Road in Port Orchard. The company mined about 3 acres of the site during the summer of 2009 and has not operated there since. It now seeks to work the site until 2022 or until the reserves are depleted. A spokesperson for the Kitsap County Department of Community Development noted that the area is zoned as a mineral resource overlay site to let residents know there “may be a possibility of mining in that area in the future.”

Province News

A 2,300-acre limestone quarry proposed for a site in Dufferin County will not affect local drinking water, according to a report from the Guelph city staff. According to the Guelph Mercury, the city’s water supply program manager told council, “Based on the staff’s technical review, the proposed quarry operation falls outside of the Speed River Subwatershed and is not considered to be a concern with respect to either the quality or sustainability of Guelph’s water supply.” The city council ordered the review after residents voiced concerns about its impact on the water supply.

Navistar has filed another suit against the U.S. Environmental Protection Agency, signaling the latest round in the ongoing battle between the exhaust gas recirculation-only engine manufacturer and its competitors, all of which are using selective catalytic reduction technology to meet 2010 diesel exhaust emissions regulations. Navistar opted to use in-cylinder EGR technology to meet the current standards in conjunction with banked EPA credits for meeting and beating pre-existing emissions regulations in effect prior to the 2010 regulations.

 Navistar alleges in the suit filed July 5 with the U.S. District Court for the District of Columbia that the truck maker, a contractor it hired and the California Air Resources Board all say nitrogen oxide emissions skyrocket when drivers don’t keep diesel exhaust fluid topped off, rendering EPA’s rule “irrelevant” altogether. Furthermore, Navistar accuses EPA Director Lisa Jackson of not doing her duty to uphold the Clean Air Act and her agency of not doing its part to protect public health.

 Navistar Public Relations Manager Stephen Schrier says the lawsuit is about ensuring a level playing field in the heavy-duty truck market, noting that testing done by Navistar shows that operators can “defeat” SCR systems by adding water or other substances to the system instead of DEF, allowing the trucks to operate indefinitely in violation of 2010 emissions regulations.

 SCR engine manufacturers, however, say the new lawsuit is nothing new. “We think the complaint is frivolous, and that it won’t go anywhere,” says Brandon Borgna, media relations manager for Volvo Trucks. “The market has already decided that SCR-equipped engines are the preferred choice in terms of performance and fuel economy, as well as the environment. And EPA has said they believe the technology is highly effective. We intend to file a motion to intervene.”

 John Walsh, director of media relations for Mack Trucks, echoes Borgna’s sentiments. “Given the history, we’re not surprised by this,” Walsh says. “It sounds like more of the same. The irony is that a year and a half after the regulations went into effect, they still can’t meet the standard without credits, and their trucks are still spewing two-and-a-half times the pollutants allowed. We think their complaint has no merit, and we intend to file a motion to intervene.”

EPA last month updated its guidance for certification of truck engines using SCR to reduce emissions, calling on SCR engine makers to continue developing warning systems that alert drivers when the truck’s DEF tank is nearly empty or filled with a liquid other than DEF. The new guidance, mostly in response to previous claims made by Navistar that SCR technology can be circumvented, also urged OEMs using SCR to research methods that would inhibit tampering with SCR system operation and incorporate further inducements for drivers to comply.

 Navistar previously had sued both EPA and CARB over their acceptance of SCR technology without stronger measures to prevent engine operation without DEF or an operational SCR system. The truck maker last year settled both lawsuits by garnering a commitment for further review.

 Research cited by Navistar was conducted by EnSight, an independent environmental consulting firm, using two long-haul vehicles and one heavy-duty pickup, all of which used SCR. According to Navistar, EnSight’s research showed that when liquid urea was not present, there was little or no effect on the vehicles’ operations.

 However, EPA said in its recent guidance that testing of SCR systems had yielded mostly positive results. While the agency said Navistar’s findings arose from intentional attempts to circumvent the SCR system and that the majority of operations using SCR would be in compliance, it encouraged SCR OEMs to look further into methods to impede tampering.

 EPA’s guidance was published June 7 in the Federal Register; for more information, go to www.gpo.gov/fdsys/pkg/FR-2011-06-07/html/2011-13851.htm.

Cooperative Federalism Act of 2011 introduced

By Tina Grady Barbaccia

Transportation and Infrastructure Committee Chairman John L. Mica (R-Fla.) and the Committee’s Ranking Member Nick Rahall (D-W. Va.) introduced H.R. 2018, the “Clean Water Cooperative Federalism Act of 2011,” in the House. The bill amends the Clean Water Act (CWA), which would allocate the primary responsibilities for water pollution control to the states.

The bill restricts the Environmental Protection Agency’s (EPA) ability to second-guess or delay a state’s permitting and water quality certification decisions under the CWA once the EPA has already approved a state’s program, according to a written press statement from Mica’s office.

Water Resources and Environment Subcommittee Chairman Bob Gibbs (R-Ohio) and U.S. Rep. Shelly Moore Capito (R-W.Va.) are the original co-sponsors of the proposed legislation.

“Under the Obama Administration, EPA continues to strangle economic growth in this country with its overreaching and arbitrary regulatory regime,” Mica says in the press statement. “This bill will help ensure a common sense regulatory regime that does not unnecessarily harm our nation’s farmers, miners, and other businesses critical to our economy. We must restore and preserve the federal-state partnership that is the foundation of the Clean Water Act, but which is being progressively undermined by EPA.”

The “long arm” superimposed a water-permitting regime that Rahall, the bill’s co-sponsor, says, “amounts to a confused hodgepodge of unwritten requirements and unexplainable goals.

“This legislation aims to instill greater certainty and fairness in the system. It intends to help prevent the EPA from steamrolling state permitting programs, ensuring that the states are truly partners with the federal government in protecting water quality throughout the nation,” Rahall added.

Gibbs, Water Resources and Environment Subcommittee chairman, notes that as the U.S. economy struggles to get back on track, “the EPA continues its assault on what could prove to be the most costly, burdensome, and expansive set of job-destroying regulations ever crafted.”

However, Gibbs says that by “preserving the state’s role in this partnership, we can begin to reign in EPA’s runaway regulations to save countless jobs and protect our economy from the tens of billions of dollars their backdoor energy policies would cost.”

Holcim (Canada) commemorates Earth Week

Toronto-based Holcim (Canada) Inc. celebrated the 41st anniversary of Earth Week at its sites across Canada with what the company says was “a lot of passion and enthusiasm.”

“This year, employees were provided various opportunities to volunteer and get more involved in Holcim Canada’s Corporate Social Responsibility activities and contribute to making a difference in the communities where they live and work,” Holcim (Canada) said of the celebration.

For more information, see the social media release about the Earth Week activities, and for additional photos, go to http://www.tinyurl.com/6xmq9cf.

Lafarge Canada donates material for WWII Memorial

Lafarge Canada is donating Canadian granite for a monument commemorating the Canadian airmen and airwomen who served alongside Great Britain during the World Wars, specifically the Royal Canadian Air Force (RCAF).

The monument is being constructed at the National Memorial Arboretum in Alrewas, England, the United Kingdom’s 150-acre sanctuary and “center of remembrance” of those who have served. 

Lafarge was approached for help finding granite for the monument in February 2011 by Captain Jean Houde, deputy flight commander of the Canadian Forces’ 426 Squadron. “It is an honor and a pleasure to have been asked to participate in this small way to the construction of a memorial to Canadian airmen and airwomen,” says Vice President of Aggregates for Lafarge Canada Bruce Semkowski in a written press statement. “On behalf of Lafarge Canada and all of its employees, we thank Captain Houde for this opportunity.”

Inspiration for the Canadian memorial came when British Royal Air Force Flight Lieutenant Alfie Hall visited the National Memorial Arboretum in May 2010 and noticed the absence of a memorial dedicated to the various Canadian air forces that have served in the UK. Lt. Halls’ own 609 (West Riding) Squadron had 21 Canadian pilots serving alongside his own countrymen during WWII. As a result, Lt. Hall decided to spearhead a fundraising campaign for a monument.

The memorial consists of a circular ring comprised of 13 equal pieces of granite representing each of the 10 Canadian provinces and three territories, according to Lafarge Canada. Within the circle is an upright monolith inscribed with a history of the various Canadian air forces set atop a maple leaf, Canada’s national emblem, also in granite. The monument’s design is based on the modern Canadian Forces roundel, which is painted on all CF aircraft.

Dedication of the Canadian memorial at England’s National Memorial Arboretum is slated for July 8, 2011.

AggBeat to Go

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Road Rally

Hundreds of hard-hat workers from across the United States, representing all parts of the aggregate and road construction industries, rallied on the National Mall on May 25 in support of a multi-year surface transportation bill. Congressional and industry speakers told the cheering crowd the bill is needed to create tens of thousands of new, good-paying American jobs in road construction. The rally was sponsored by 10 associations, including the National Stone, Sand and Gravel Association. The event was held in conjunction with the Transportation Construction Coalition (TCC) Fly-In.

It’s in the news and top-of-mind in many regulatory agencies, so assess your risks related to hexavalent chromium.

by John McGahren, Mark Savit, and Ora Sheinson

Hexavalent chromium (hex chrom) is in the news and on the front line for regulatory agencies and plaintiff lawyers. The Occupational Safety and Health Administration (OSHA) regulated hex chrom (or hex chrome as it is also sometimes called) in 2006 and is enforcing its new rules with citations being issued around the country for items such as testing and monitoring failures and hazard communication failures. Even for cement, which OSHA exempted from the hex chrom exposure regulation, the Deputy Assistant Secretary for OSHA stated:

“OSHA has stepped up its inspections of workplaces where portland cement is manufactured and where portland cement is used on construction sites. The goal of our enforcement emphasis is to ensure that employers train their workers about hex chrome hazards. We also want to be sure that manufacturers include on their material safety data sheets for portland cement the presence of any trace contaminants of hex chrome and their associated hazards, such as allergic contact dermatitis.”

Unions and other groups continue to lobby for stricter workplace regulations. At the same time, while the Environmental Protection Agency (EPA) does not currently have a drinking water standard specific to hexavalent chromium, on Jan. 11, 2011, the EPA issued guidelines requiring public utilities to monitor and sample drinking water for hex chrom. Drinking water standards for hex chrom are under consideration in California and may soon be considered by the EPA. Perhaps most telling, ligation regarding hex chrom exposures from cement plants has been on the rise in California, and cement companies in other parts of the country have been addressing an increase in community concerns regarding potential exposures.

Hex chrom is present in the environment both from naturally occurring sources and as the byproduct of numerous industry activities — including trace amounts that are naturally occurring in portland cement. Also referred to as chromium 6, or Cr(VI), hex chrom exposure is most commonly linked to a rare dermal allergic reaction after repeated exposures. In September 2010, the EPA (through IRIS, its program for evaluating potential risks to human health from chemicals in the environment) proposed new numbers for potential cancer risks from hex chrom. However, the potential cancer risks discussed by the EPA relate to significantly higher hex chrom exposures than the trace amounts found in portland cement, that OSHA found do not require additional worker protections.

Yet, unions have mounted a significant campaign to remove this exclusion. Following a 2007 settlement with a number of unions, OSHA agreed to evaluate exposures to hexavalent chromium during construction site assessments. On June 15, 2010, also as the result of a union lawsuit, OSHA issued a directive that required worker notification for all hex chrom exposures, even those below the permissible exposure limit (PEL). This directive imposes new requirements for workplaces currently exempt from the hex chrom PEL. In addition, OSHA reportedly is reviewing the hex chrom limit and considering lowering the standard from 3.5 µg/m3 to 0.02 µg/m3.

While the EPA does not currently specifically regulate hexavalent chromium in the water, California has proposed a public health goal (not a regulatory limit) of 0.02 parts per billion (ppb) for hex chrom in drinking water. The EPA drinking water standards currently impose a limit of 100 ppb of total chromium, with no requirement to specifically test for specific types of chromium. In December 2010, the Environmental Working Group released a report indicating that 31 out of 35 U.S. cities tested had hexavalent chromium in the water in amounts that greatly exceeded the proposed California public health goal. None of the cities were in violation of the current EPA drinking water requirements. After the report came out, the EPA issued its guidance regarding testing drinking water, and EPA Administrator Lisa Jackson met with a group of Senators who raised the issue of evaluating potential drinking water standards.

Litigation and community concern regarding potential exposures to hexavalent chromium from cement plant operations has been building up over the last several years. In 2008, for example, California’s South Coast Air Quality Management District sued a cement company in Riverside, demanding cleanup costs for alleged soil and groundwater contamination from hex chrom. The company settled with the state for $1 million; however, personal injury and property damage class action lawsuits followed rapidly and are still pending in state court.

Also in 2008, a cement plant in Davenport, Calif., faced community challenges and Erin Brockovich’s attentions over allegations that cement dust containing hexavalent chromium was contaminating the town. After an investigation, in January 2009, the Santa Cruz County Health Agency alleged that a cement plant was the source of the hex chrom in the community. In that same report, however, the county concluded that the levels of hex chrom in the air and dust were all below California’s strict exposure standards. In 2010, the EPA stepped in to monitor for hexavalent chromium at Stevens Creek Elementary School in Cupertino, Calif., alleged to have come from a nearby cement plant. The EPA discontinued monitoring the school after finding no elevated levels of hex chrom.

Potential new regulation of hex chrom in drinking water, enforcement actions, or community concerns can lead to new lawsuits, including water utilities seeking to cover compliance costs and resourceful plaintiffs’ lawyers seeking to capitalize on local press. To minimize risks of future litigation and government enforcement, concerned companies should stay in touch with local, state, and regional water quality departments and seek early warnings regarding elevated levels of hex chrom in the drinking water in and around the area where their business is located. Communication with community groups and leaders is critical in amassing support for safe jobs, permit renewals, or expansions — as well as in discouraging plaintiff lawyer recruitment efforts for unwarranted cases. Due diligence and information gathering regarding other potential sources of hex chrom may also be warranted. Retaining science and engineering experts to provide assistance can bring critical knowledge to the problems well before they arise, and these professionals can help plan responses to community concerns or press inquiries.

Industry has long been targeted as emission sources for potentially toxic materials like mercury, fly ash, silica, and lead, and hex chrom is simply one of the most recent to receive press attention. Despite the many studies finding that cement industry operations are not causing harm in the water, air, or soil surrounding communities, industries like cement will remain a target and need to be vigilant and responsive to community or agency concerns. Companies should apply the lessons learned from structuring and implementing communication, coordination of scientific efforts, and government relations to address these risks on an integrated basis together with successful legal defense strategies. By combining unique health, safety, and environmental expertise with independent scientific experts and advice from nationally recognized litigators, operators can prevent and minimize risks associated with these challenges. AM

John McGahren and Mark Savit are partners with Patton Boggs LLP. McGahren can be reached at 973-848-5610 or jmcgahren@pattonboggs.com. Savit can be reached at 303-894-6117 or msavit@pattonboggs.com. Ora Sheinson is an associate with the practice. He can be reached at 973-848-5615 or osheinson@pattonboggs.com.

Luck Stone initiative with EPA, others means cleaner, greener power at four plants.

By Tina Grady Barbaccia

Funding from the U.S. Environmental Protection Agency (EPA) to Virginia Clean Cities and James Madison University will help launch the first construction repowering project in Virginia to reduce harmful diesel pollution at four Luck Stone plants operating in Richmond, Charlottesville, Leesburg, and Burkeville.

(Pictured right to left) Charlie Luck, president and CEO of Luck Stone Corp., and Shawn Garvin, regional administrator of the U.S. Environmental Protection Agency (EPA), pause at Luck Stone’s shop in Goochland, Va., following the EPA grant check presentation.

EPA’s $710,000 Diesel Emissions Reduction Act grant, combined with $1.1 million from Richmond, Va.-based Luck Stone, will enable the company to repower or replace 11 off-road construction vehicles with new, more efficient diesel engines and generators.

“Putting clean diesel engines to use will bring cleaner, healthier air for the workers and neighborhoods surrounding these plants,” said EPA mid-Atlantic Regional Administrator Shawn M. Garvin. “EPA is pleased to support Virginia Clean Cities’ newest initiative to improve air quality and public health for Virginia’s citizens.”

The company is “honored to be participating in the inaugural construction repower project for Virginia along with the EPA, James Madison University, Virginia’s Department of Environmental Quality, and Virginia Clean Cities,” said Doug Palmore, Luck Stone’s vice president of environmental design and development. “This partnership lines up perfectly with our environmental ethic and practices which focus on creating a net positive outcome for the environment and communities we serve.”

The Luck Stone project is the first construction equipment repowering project in Virginia to be funded by EPA. The new engines will result in a 50-percent reduction in nitrogen oxides and 65-percent reduction in particulate matter for each piece of equipment. Annually, the project will eliminate 30.85 tons of nitrogen oxide, 2 tons of particulate matter, 11.93 tons of carbon monoxide, and 2.74 tons of hydrocarbons from being emitted at the four plants. In addition, the project will create about 20 jobs.

Pictured (left to right) are Doug Palmore of Luck Stone Corp., Brett Alkins of Caterpillar, Ken Newbold of James Madison University, John Pullen of Luck Stone Corp., Shawn Garvin of the U.S. Environmental Protection Agency (EPA), David Tyeryar, U.S. deputy secretary of transportation, Charlie Luck of Luck Stone Corp., Yogesh Doshi of the Department of Environmental Quality, Jerome Brooks of the Department of Environmental Quality, and Chelsea Jenkins of Virginia Clean Cities, accepting the EPA’S $710,000 Diesel Emissions Reduction Act grant that will allow Luck Stone to repower or replace 11 off-road construction vehicles with new, more efficient diesel engines and generators.

“The heavy trucks and equipment that are being repowered or replaced are not only striking in their size and capability, but are critical to Luck Stone’s ability to provide quality crushed stone,” said Virginia Clean Cities Executive Director Chelsea Jenkins. “Virginia Clean Cities and James Madison University are energized to participate in such a significant project that will aide in curbing the impact such equipment has on the environment and, ultimately, Virginia’s economy and the health of its citizens.”

For more information

EPA’s National Clean Diesel Campaign Web site:

http://www.epa.gov/diesel

EPA’s regional diesel Web site:

http://www.epa.gov/reg3artd/diesel/index.htm

Luck Stone Corp. corporate Web site:

http://www.luckstone.com

Virginia Clean Cities:

http://www.hrccc.org

MSHA develops new mine screening standards

The Mine Safety and Health Administration (MSHA) has begun developing new screening criteria for the pattern of violations (POV) enforcement program, which gives the agency additional enforcement tools to use at mines with a history of violating safety standards.

The agency says this is a critical first step in reforming the current POV enforcement program. MSHA announced plans to draft new regulations governing the program in the spring and the new criteria following calls by Congress and the Department of Labor’s Office of Inspector General to fix serious flaws in the current system. The agency has already been moving forward with the second phase in major reforms to its POV process, which includes tougher provisions for mines with chronic and persistent violations of significant health and safety regulations.

MSHA’s decision to develop the mine screening criteria coincides with the release of an independent analysis prepared by the Labor Department’s Office of Inspector General which noted: “In 32 years, MSHA has never successfully exercised its Pattern of Violation authority.”

“We agree with the final recommendations in the OIG report and welcome that input, which we believe will help us improve the process already underway at MSHA,” said Joseph A. Main, assistant secretary of labor for mine safety and health, in a prepared statement. “Our efforts are focused on ensuring that future potential POV and POV determinations are an effective part of MSHA’s enforcement strategy and advance Congress’ intent — that mine operators find and fix the root causes of violations before they become a hazard to miners.”

Main says that since the passage of the Mine Act more than 30 years ago, “not one mining operation has ever been placed on a pattern of violations. We have known for some time that the current system is broken and needs to be fixed. This new screening process improves upon the old one, which cast too broad a net and did not distinguish mines with the highest levels of elevated enforcement. This new system will let MSHA focus its attention on those mines that are putting miners at greatest risk.”

Main says that MSHA’s changes to the POV program cannot fix shortcomings that require legislation or changes to the existing regulations, but that “this is a stop-gap measure until reform can occur.

“We are aggressively pursuing both regulatory and legislative reforms, but in the meantime, this new policy improves our ability to identify problem mines,” Main continues. “Our goal with each of these reform efforts is to identify mines with a pattern of dangerous conditions and encourage them to improve their safety records. If a mine fails to do so, it will be placed into POV status.”

Section 104(e) of the federal Mine Safety and Health Act of 1977 (Mine Act) provides that mine operators with a pattern of significant and substantial (S&S) violations be subject to closure orders for areas of the mine affected by those violations until the mine receives a clean inspection. Under current regulations, MSHA uses a screening process to determine whether a mine has a potential pattern of violations. A mine operator found to have a potential pattern of violations is given a period of time to reduce violations before MSHA uses its authority under 104(e) to issue closure orders.

According to the legislative history of the Mine Act, POV provisions are intended for use “at mines with a record of repeated [significant and substantial] violations and where the other enforcement provisions of the statute have not been effective in bringing the mine into compliance with federal health and safety standards.” The preamble to the existing final rule states that “MSHA expects to reserve the use of the 104(e) sanctions for mines where the operator has not responded to an escalating series of enforcement actions by the Agency.”

“MSHA’s changes to the screening process are designed to meet these statutory and regulatory objectives,” said Main. “The new screening criteria will draw more attention to the so-called ‘bad actors’ than did the old criteria. They will focus on mines that exhibit chronic failures to maintain safe working conditions, have repeated significant and substantial violations, and have not responded to other enforcement tools.”

The new screening process is designed to identify mines that have been subject to closure orders, including closure orders for serious issues such as failing to correct violations after MSHA cites them, unwarrantable failures to comply with health or safety standards, failure to provide miners with required training, and imminent dangers in the mine. The criteria will better identify mines where these tools have been used, but have not been sufficient to improve compliance. The criteria also will consider whether a mine has high numbers of S&S violations involving elevated negligence, as well as a mine’s injury severity rate, targeting operations with an above-average injury severity measure. All of these factors are either new to the screening criteria or given greater emphasis than before.

The quantitative criteria use the most recent available 12 months of health and safety data to screen for mines. The screening criteria address two categories of violators. In the first category, a mine must exhibit high numbers of S&S violations (at least 50); have S&S violations either issued at an elevated rate (eight per 100 inspection hours) or at elevated levels (25 percent or more) of negligence; have a high rate of elevated enforcement actions (.5 per 100 inspection hours); and have an elevated record of severe injuries (above the industry rate).

The second category targets mines that do not meet the above criteria, but still have high numbers of S&S violations and elevated enforcement actions — at least 100 S&S citations/orders and at least 40 elevated citations/orders.

In addition, as required under current regulations, the screening requires mines in both categories to have either repeated S&S violations of the same standard (at least five) or repeated S&S violations caused by an unwarrantable failure to comply with the law (at least two).

For more information on MSHA’s Pattern of Violations guidance, go to www.aggman.com and click on Digital Edition.

Excluding redundancy costs, profit in the first quarter of 2009 was $0.39 per share. First-quarter sales and revenues of $8.238 billion were down from $9.225 billion in the first quarter of 2009.

“Economic conditions are definitely improving, particularly in the world’s developing economies,” said Chairman and CEO Jim Owens in the earnings statement. “Industry activity and orders are significantly higher than last year and are at record levels in some areas. As a result, we are hard at work ramping up production to meet increasing demand from customers,”

Owens said that despite the recession in 2009, Cat continued to invest in our facilities throughout the world, and those investments will position us for success as global growth continues.

“We are also seeing strong order activity related to mining and energy, and that should be very positive for our U.S. exports as the year unfolds,” Owens added.

First-quarter profit was $233 million compared with a loss of $112 million in the first quarter of 2009. The improvement in profit was a result of lower manufacturing costs, the absence of redundancy costs and favorable price realization. The improvements were partially offset by the impact of lower sales volume and higher taxes, including the $90 million charge related to the recently signed U.S. health care legislation.

“We are very encouraged by our performance in the first quarter. We focused on cost management and deployment of the Caterpillar Production System — factory efficiency improved, margins improved and our machinery business returned to profitability,” Owens said. “In addition, cash flow was positive, and we strengthened our balance sheet with continued improvement in our debt-to-capital ratio. As a result, we are well positioned to invest for growth where needed.”

Caterpillar is increasing its outlook for 2010 by raising the sales and revenues range and profit expectations.

For sales and revenues, the revised range is $38 billion to $42 billion. The revised 2010 profit outlook is a range of $2.50 to $3.25 per share.

“The main driver behind our improved outlook is robust growth in Asia/Pacific and Latin America and continued improvement in mining and energy globally,” Owens said. “We are increasing production schedules and expect sales to improve as we move through 2010. We remain highly focused on execution — the deployment of the Caterpillar Production System using 6 Sigma, tight cost management, efficiently ramping up production and preparing for Environmental Protection Agency (EPA) Tier 4 emission requirements. We expect to continue to add employees around the world to support growth and in the  United States to support growing exports. We are confident in the ability of the entire Caterpillar team — our suppliers, employees and dealers — to work together to meet growing customer demand.”

Click here for a downloadable PDF of the Caterpillar first-quarter 2010 earnings statement.

This two day course, at the Palm Desert location, provides technicians the essential knowledge they must have in order to install and service the CARB and EPA verified MK System. Both theoretical and practical learning is involved, including a practice filter installation on a Mack freightliner truck.

“We are very excited about this new program, and believe it will truly benefit everyone involved,” Phil Surma, managing director notes.

A Huss senior technician will be instructing the course twice a week, to a group of six to eight service technicians from different dealers across the country that sell and distribute Huss products.

“The goal is to make sure that our dealers’ technicians are knowledgeable about our products, and that they are equipped to provide expert service to their customers,” Tom Williams, senior Huss technician and instructor, says.