Home » 2013 Issues » January 30, 2013 » ENV-50-11-00003-A Conforming the Requirement for Best Available Retrofit Technology to Recent Statutory Changes and Court Decisions
ENV-50-11-00003-A Conforming the Requirement for Best Available Retrofit Technology to Recent Statutory Changes and Court Decisions
1/30/13 N.Y. St. Reg. ENV-50-11-00003-A
NEW YORK STATE REGISTER
VOLUME XXXV, ISSUE 5
January 30, 2013
RULE MAKING ACTIVITIES
DEPARTMENT OF ENVIRONMENTAL CONSERVATION
NOTICE OF ADOPTION
I.D No. ENV-50-11-00003-A
Filing No. 37
Filing Date. Jan. 10, 2013
Effective Date. s , 30 d
Conforming the Requirement for Best Available Retrofit Technology to Recent Statutory Changes and Court Decisions
PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:
Conforming the requirement for best available retrofit technology to recent statutory changes and court decisions.
Purpose:
To make Part 248 consistent with the amendments to New York ECL section 19-0323 and recent court decisions.
Text or summary was published
in the December 14, 2011 issue of the Register, I.D. No. ENV-50-11-00003-P.
Final rule as compared with last published rule:
No changes.
Revised rule making(s) were previously published in the State Register on
September 5, 2012.
Text of rule and any required statements and analyses may be obtained from:
James Bologna, P.E., NYSDEC, Division of Air Resources, 625 Broadway, Albany, NY 12233-3255, (518) 402-8292, email: airregs@gw.dec.state.ny.us
Additional matter required by statute:
Pursuant to Article 8 of the State Environmental Quality Review Act, a Short Environmental Assessment Form, a Negative Declaration and a Coastal Assessment Form have been prepared and are on file.
Assessment of Public Comment
6 NYCRR Part 248, Use of Ultra Low Sulfur Diesel Fuel and Best Available Retrofit Technology for Heavy Duty Vehicles
Comments received from September 5, 2012 through 5:00 P.M., October 5, 2012
It should be noted that the Department received intelligible comments from Commentor 3 on October 23, 2012 which is after the comment deadline. Commentor 3 initially submitted comments prior to the close of the comment period that were garbled by the electronic transmission. However, since the Department determined that a good faith effort was made by Commentor 3 to submit the comments in a timely manner, we have decided to accept and respond to those comments as part of this record.
Applicability
1. Comment: I am looking for any information I can find on the Diesel Emissions Reduction Act. Any info would be appreciated. (Commentor 1)
Response to Comment 1: Heavy Duty Vehicles (HDVs) operated by or operating “on behalf of” state agencies and public authorities are subject to the use of Ultra Low Sulfur Diesel Fuel (ULSD) and Best Available Retrofit Technology (BART) requirements. Paragraph 248-1.1(b)(14) defines subject vehicles, and specifically excludes certain HDVs from applicability. Section 248-2.1 includes exemptions from applicability for certain heavy duty vehicles. Additional information regarding DERA and the Part 248 requirements, including applicability, can be found on the Department’s website (www.dec.ny.gov). Also, questions relating to specific requirements of the regulation can be directed to the NYSDEC Division of Air Resources, Bureau of Mobile Sources and Technology Development at (518) 402-8292.
2. Comment: NYMaterials reiterates that the proposed regulations as currently drafted do not clearly define the scope of applicability and are unnecessarily broad. (Commentor 3)
Response to Comment 2: The Diesel Emission Reduction Act of 2006 (DERA) states that those HDVs operated by or operating “on behalf of” state agencies and public authorities are subject to the use of Ultra Low Sulfur Diesel Fuel (ULSD) and Best Available Retrofit Technology (BART) requirements. Pursuant to two court decisions, the proposed revisions to this regulation remove the applicability of Part 248 to subcontractors and limit applicability to prime contractors’ vehicles. See Matter of N.Y. Constr. Material Ass’n v. DEC, 83 A.D.2d 1323, 1328 (3d Dep’t 2011) (Matter of N.Y. Construction Materials) and Riccelli Enterprises, Inc. v. Grannis, 30 Misc. 3d 573, 579 (Sup. Ct. Onondaga Co. 2010) (Riccelli). Paragraph 248-1.1(b)(14), pursuant to DERA, defines subject vehicles, and specifically excludes certain HDVs from applicability. This provision is not being changed in this rulemaking. Section 248-2.1 also continues to include additional exemptions from applicability for certain heavy duty vehicles and is also not being changed in this rulemaking. Prime contractor applicability remains as originally adopted in Part 248. See, also previous “Assessment of Public Comments 6NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”.
Costs/Economics
3. Comment: The proposed regulations as currently drafted drastically underestimate the potentially severe direct and indirect effects on the State’s economy. (Commentor 3)
4. Comment: The Regulatory Flexibility Analysis for Small Businesses and Local Governments notes that affected small businesses will incur substantial costs to comply with the regulatory requirements, and businesses may elect to reduce the number of their employees to cover the costs of purchasing/installing BART devices on their affected HDVs or place higher bids on state contracts. Affected local governments may also elect to reduce the number of their employees to cover the costs of the BART devices. Affected small businesses may also choose not to bid on state agency/public authority projects and local governments may choose not to enter or renew contracts with state agencies/public authorities. NYMaterials believes Part 248 imposes an unfunded mandate on both the public and private sectors. Likewise, we have noted before that it is unconscionable for DEC to suggest regulations that result in significant and costly mandates for a technology that decreases fuel economy and increases the production of greenhouse gases. Moreover, the Department continues to fail to realize (or even attempt to quantify) the true impact that this regulation will have on the regulated community. (Commentor 3)
Response to Comments 3 and 4: The Department identified the anticipated costs of the program to the best of our ability in the Regulatory Impact Statement (RIS) and other supporting documents, and understands that there may be significant economic impact to some businesses, including those related to the trucking industry, state agencies and public authorities when complying with the retrofit requirements. However, under DERA, the Legislature directed the Department to develop and promulgate regulations to implement the BART requirements. Two court decisions, Riccelli and Matter of N.Y. Construction Materials, have narrowed the scope of applicability and these revisions are being proposed in order to comply with these court decisions. Specifically, the Department is removing subcontractors from applicability. Even if these regulations were not in place, the provisions of DERA, enacted in 2006, require the retrofit of vehicles owned and operated by state agencies and authorities, as well as prime contractors to state agencies and authorities, by a date certain. See, also previous “Assessment of Public Comments 6 NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”.
5. Comment: The re-drafted Part 248 regulations again go beyond the intent of the Legislature and recent court decisions, while promising job losses and higher construction costs. The proposed Part 248 regulations are completely counter to the Governor’s “business friendly” New York initiative and invite further litigation. (Commentor 3)
Response to Comment 5: The Department is aware that there will be additional costs associated with this program. The Department’s evaluation of costs is included in the RIS and other supporting documents. We are obligated under DERA to develop and implement the regulatory program for the BART requirements. The Department believes that the proposed regulation conforms to DERA and the recent court decisions regarding prime and subcontractors. See Riccelli and N.Y. Construction Materials. Even if these regulations were not in place, the provisions of DERA, enacted in 2006, require the retrofit of vehicles owned and operated by state agencies and authorities, as well as to their prime contractors, by a date certain. See, also previous “Assessment of Public Comments 6 NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”.
6. Comment: There must be some form of justification for those of us who complied with the DEC rulings; perhaps in a form of reimbursement, grant money or tax credit, for trucking companies that tossed away a great deal of money. In this economy none of us has money to just spend foolishly. I certainly understand fully, what the DEC was trying to accomplish and I did my best to do as told, but it certainly backfired for my company. How can I recoup my money? (Commentor 2)
Response to Comment 6: The Department is not aware of any current source of funding for those DERA related retrofits. The court decisions directed the Department to remove subcontractors from the Part 248 regulation. However, as a result of the timing of the decisions and the Part 248 rulemaking process, subcontractors may have incurred retrofit costs. (See also Response to Comment 11). The Department is aware of state legislation in the form of Bill A137 which would amend the tax law to allow a tax credit for those taxpayer businesses that retrofitted their heavy duty vehicles to comply with DERA. The amount of the credit would be 50 percent of the cost to the taxpayer for retrofitting their HDVs for taxable years beginning on or after January 1, 2009.
Definitions
7. Comment: The proposed revisions continue to be ambiguous, creating additional regulatory uncertainty. As an example, the determination of what is considered a “regular and frequent basis” is up to each regulated entity. (Commentor 3)
Response to Comment 7: As noted in the previous “Assessment of Public Comments 6 NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”, according to the American Heritage College Dictionary, Third Edition (2000), “regular” means customary, usual or normal. Ballentines’s Law Dictionary (2010) defines “regular” as conforming to an established rule, principle or custom…consistent…following a fixed procedure or schedule…acting or happening at uniform intervals. Black’s Law Dictionary, Sixth Edition (1990) defines “regular” as … steady or uniform in course, practice or occurrence. American Heritage defines “frequent” as occurring or appearing quite often or at close intervals. Webster’s New World College Dictionary, Fourth Edition (2005), defines “frequent” as occurring often, happening repeatedly at brief intervals. Each agency and authority must determine what is regular and frequent for its own business model and is in the best position to make that determination.
Legal Authority
8. Comment: Two important DERA lawsuits prompted the Part 248 revisions, but the regulations fail to satisfy the court orders or the Legislative intent of the statute. Specifically, the re-drafted regulations require prime contractors to comply with BART requirements without describing the “direct agency relationship” with the contracting agency described by the court. The Legislature clearly did not intend for DERA to establish two classes of private sector vehicles - prime contractors and all others. The regulations should be revised to clearly define that only state vehicles, and not prime or subcontractor vehicles, are subject to the BART requirements, as determined by the court. (Commentor 3)
Response to Comment 8: The removal of subcontractors from applicability was not a part of the revised rulemaking. However, the Department continues to believe that the New York State Legislature clearly intended that DERA and any subsequent implementing regulations include both state and prime contractor owned and operated vehicles. Revisions to Part 248 concerning applicability conform to the intent of the legislature as determined by two courts, N.Y. Construction Materials Association and Riccelli. Both N.Y. Construction Materials and Riccelli specifically mention prime contractors with reference to applicability. (“Accordingly, we conclude that the Legislature did not intend to impose DERA’s requirements on vehicles other than those used by prime contractors under direct contract with state agencies.” ‘Matter of N.Y. Construction Materials Association’). The court in Riccelli went so far as to provide the exact regulatory language for use in revising Part 248 concerning prime contractors in its decision including “all heavy duty vehicles used to perform entity work by a prime contractor. Those vehicles include, but not limited to, heavy duty vehicles owned, operated or leased by a prime contractor…”. Further, the court stated “ [p]rime contractor means any person or entity that contracts directly with the regulated entity to perform regulated entity work (“prime contract” and who is responsible for the completion of the contract with the regulated entity. This definition shall not include subcontractors”. See previous “Assessment of Public Comments 6 NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”.
Miscellaneous
9. Comment: NYMaterials continues to object to the proposed revisions to Part 248 as currently drafted. (Commentor 3)
Response to Comment 9: The Department acknowledges that NYMaterials objects to the proposed regulatory revisions.
Record Keeping/Reporting
10. Comment: Each regulated entity is responsible for determining the schedule for which they are to receive each prime contractor’s vehicle inventory and annual report. Therefore every regulated entity could have different reporting deadlines and different determinations of what vehicles may be exempt considered from Part 248. (Commentor 3)
Response to Comment 10: The record keeping provisions were not a part of the revised rulemaking. However, the record keeping requirements noted in Section 248-7 of the proposed regulation are necessary to ensure compliance, and will assist the regulated entity and prime contractors in meeting the reporting requirements listed in Section 248-6 of the proposed regulation. In order for the Department to report on the use of ULSD, it must receive information from the agencies and prime contractors, and determine compliance. DEC has no way to determine who is a prime contractor to each agency and therefore has no way to determine compliance with the reporting requirement and therefore compliance with DERA. Requiring agencies to keep track of their contractors reporting is a reasonable way to ensure compliance. This requirement is not a new requirement; it was included in the initial rulemaking adopted in 2009. See previous “Assessment of Public Comments 6 NYCRR Part 248, Comments received from December 14, 2011 through 5:00 P.M., January 26, 2012”.
Timing
11. Comment: I was one of the trucking companies (A.T.&A Trucking Corp.) that followed the rules pertaining to the BART emissions regulations in 2010. We were given a date of November 1, 2010 to comply or no longer work on state projects. I submitted all of the necessary paperwork and I spent a large amount of money on retrofit kits for my vehicles. It was long, laborious process, a very expensive process and I later found out I was one of the very few trucking companies in the area to follow through and “do as I was told” to comply with regulations. The ground work that it took to even locate a reputable company to purchase retrofit kits was ridiculous. Shortly after purchasing all of these expensive kits, close to $50,000, rulings were in the news that things had changed and subcontractors may not need to retrofit trucks. I was aware of the outcome to the Richard Riccelli case making it clear subcontractors were not to be included with the retrofits, although, it seemed that eventually the rule would still go through, so I never said anything and hoped that my money was not a 100 percent waste. Recently, I received the Friday Final Publication and read that the DEC has revised rulemaking and that subcontractors do not need to comply with the regulations only main contractors. I am a subcontractor trucking company. Well, isn’t this just great after I was one of the few to follow directions and spend so much money for no reason at all. Previously, the DEC had me jumping through hoops to comply or not be able to work on the Thruway Jobs I was working on. (Commentor 2)
Response to Comment 11: In 2006 the Legislature passed and the Governor signed DERA. DERA contained specific deadline for compliance with BART. The Department’s subsequent rulemaking, Part 248, which became effective on July 30, 2009, was required to include those same deadlines. The BART compliance deadline for all covered vehicles as required under DERA/Part 248 was December 31, 2010. Subcontractors along with prime contractors were included for applicability purposes.
The New York Construction Materials Association (NYCMA) filed a lawsuit against the Department in November 2009. The court decision in that case, rendered in April 2010, favored the Department. In May 2010, NYCMA filed an appeal to that decision. In October 2010, Riccelli filed a complaint against the Department.
In December 2010, the Department issued an enforcement discretion letter indicating that the DEC would not enforce the Part 248 requirements until ten days after the Notice of Entry was served following the court decision on the NYCMA appeal. Also in December 2010, a court decision on the Riccelli case was issued indicating that subcontractors were not covered under DERA/Part 248. In early 2011, the Legislature approved an extension of the December 31, 2010 BART compliance deadline to December 31, 2012 by amending DERA. In April 2011, the court decision of the NYCMA appeal was issued also removing subcontractors from applicability under DERA/Part 248. Shortly thereafter, the Department began a rulemaking to revise the Part 248 regulation to conform to the court decisions (including the removal of “subcontractor” from Part 248 requirements) and the legislative amendments. A stakeholders meeting was held in July 2011 with members of the regulated community to discuss the proposed rulemaking. A Notice of Proposed Rulemaking was issued in December 2011, a public comment period was opened and public hearings were held. In early 2012, the Legislature again approved an extension of the December 31, 2012 BART compliance deadline to December 31, 2013 by amending DERA. As a result, the Department issued a subsequent Notice of Revised Rulemaking to include the December 31, 2013 BART extension date.
Waivers
12. Comment: In addition, due to poor legislative revisions, the regulations now propose a “useful life waiver” that ends on the day jurisdiction begins. The waiver is now moot, because neither the agency nor the regulated community benefit. (Commentor 3)
Response to Comment 12: The waiver deadline was not a part of the revised rulemaking. The waiver deadline is in DERA and therefore the Department may not change that deadline in regulation.
List of Commentors
1. Mark Miller, SUNY College of Environmental Science and Forestry
2. Annemarie Tripi, A.T.&A Trucking Corp.
3. David S. Hamling, President and Chief Executive Officer, New York Construction Materials Association
