AGC Petitions California to Reconsider CARB Rule

The Associated General Contractors of America and its two California chapters formally petitioned the state of California to reconsider or repeal a new rule that would force construction companies across the state to retrofit, retire, or replace almost all of their heavy construction equipment.

In a petition filed with the California Air Resources Board, the association demonstrated that the "In-Use Off-Road Diesel-Fueled Fleets Regulation" would impose an excessive burden on the state's struggling construction industry. Since July 2007, when this board adopted the rule, California's construction industry has fallen $22 billion short of the state's economic forecast and lost approximately 120,000 jobs.

"The last thing we want to do is force even more staggering losses and layoffs in the construction industry," said Stephen Sandherr, the CEO of AGC of America. "This is the wrong time to put people out of work and put a new drag on economic growth."

In its petition, the association explained that both "the economic costs and the environmental benefits of the rule are much different than expected" at the time the state adopted the rule. Well before the economic slowdown, state officials acknowledged that the cost was already at "the economic limit of what industry could bear."

The association also noted that Cal/OSHA has found that retrofitting existing construction equipment to meet the new standards may actually violate construction safety standards. As a result, builders will now have to spend much more than the state expected to come into compliance. Unable to retrofit, contractors will have to replace a much higher percentage of their diesel-powered construction equipment.

The association added the rule is no longer necessary because the economic decline has led to a significant reduction in the construction industry's consumption of diesel fuel. Indeed, at current levels, the construction industry is below the state’s emissions targets.

"Unless changed, this rule will needlessly force builders to throw away billions of dollars worth of equipment," said Jim Ryan, the executive vice president of the association's San Diego chapter.

Also pending is California's request for federal approval of the rule. If the U.S. Environmental Protection Agency grants that request, other states will be free to adopt the same rule.

To view a copy of the petition, please go to