EPA proposes SoCal warehouse laws to apply nationwide – up to $670 Million in fees per year estimated

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SAN BERNARDINO COUNTY –   The Environmental Protection Agency (EPA) proposed Thursday, to approve a rule by the South Coast Air Quality Management District (SCAQMD) that they say protects communities from air pollution generated by warehouse operations, including freight vehicle trips to and from warehouses.

SCAQMD previously estimated the rule could impose up to $670 million in mitigation fees per year.

Warehouse rule to become federally enforced

In 2021, SCAQMD adopted a rule that requires large warehouses to offset pollution from the truck traffic they attract. 

The EPA says the Warehouse Indirect Source Rule (ISR) serves to reduce harmful air pollutants, including nitrogen oxides and particulate matter, from warehouse operations. 

“The rule also addresses related mobile sources of pollution, such as trucks that deliver goods to and from the facilities, yard trucks, and transport refrigeration units,” said the EPA news release.

The agency said that if finalized as proposed, ISR will become federally enforceable.

Fees for failure to comply

ISR imposes a compliance obligation based on the number of truck visits to a warehouse per year.  

Warehouse operators can comply through a points system – the Warehouse Actions and Investments to Reduce Emissions (WAIRE) Program. 

RELATED: New report says labor hoarding likely reason for Inland Empire logistics employment slowdown

Operators choose from a list of options to obtain points that include purchasing a zero-emission Class 8 truck and receiving visits from a zero-emission Class 8 truck.

Failure to accumulate the required points may result in mitigation fees which are set at $1,000 per point.

Pending lawsuit

Although SCAQMD announced plans to start enforcing ISR in September, two trade associations are challenging the legality of the rule in a federal lawsuit.

The California Trucking Association (CTA) alleges that federal law overrides ISR.

According to CTA, Congress’ intent in allowing states to include ISRs in their State Implementation Plan was to provide for programs that prevent new or modified warehouses from attracting mobile sources of air pollution.

They say that ISR applies to existing and non-modified warehouses.

In addition, CTA said that ISR is a de facto purchase mandate – ISR grants incentives such that purchasing zero emissions (ZE) or near-zero emissions (NZE) vehicles is the only real option to comply with the rule.

Airlines for America (A4A) agreed and added that the rule unlawfully forces its members to utilize trucks that meet District standards rather than federal standards.

To view the proposed rule and submit a formal comment visit https://www.federalregister.gov/documents/2023/10/12/2023-22518/air-plan-approval-california-south-coast-air-quality-management-distric

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