Comment Log Display

Everyone wants cleaner air and healthier cities. Trucking companies
are no exception. We live and work in California and we want our
state to be a healthy, prosperous place.

The plan that CARB is proposing is not going to make California
more healthy or more prosperous. It will do just the opposite.
CARBs proposals are not supported by the state’s own economic
analysis data. Even economists whose opinions were solicited by the
state in support of the initiative think CARB is putting a "rosy
face on a plan that might wreak havoc in the state."

Harvard University's Robert Stavins:
"I have come to the inescapable conclusion that the economic
analysis is terribly deficient in critical ways and should not be
used by the state government or the public for the purpose of
assessing the likely costs of CARB's plans."

CARB should go back and re-study the economic underpinnings of
their analysis. Their economic justifications are badly flawed.

The California State Legislative Analyst's Office declared "the
plan's evaluation of the costs and savings of some recommended
measures is inconsistent and incomplete." 

This plan will saddle every business and resident of this state
with higher costs and make us, as a whole, that much more
uncompetitive with other states and regions. CARB has consistently
promulgated severe regulations without
considering other viable options, and without calculating the
actual costs to the state.

A retrofit of our 12-vehicle fleet will cost our small company,
with annual gross revenues of around a million dollars, nearly
$250,000. We have only ever purchased CARB-approved vehicles, but
suddenly those investments will be obsolete without a large capital
outlay on our part. Meanwhile, there is no way to
make up for the cost of this expense in this economy. 

Businesses are seeking out cheaper freight, cheaper production,
cheaper labor just to survive this trying time. How can we afford
to retrofit? I ask you in all sincerity, how? 

We are still paying off fuel bills from when diesel soared to more
than $5 a gallon in California this summer. Where are we going to
get $250,000 in the middle of an economic downturn that has been
compared to the great depression? There’s been a 40% drop in the
volume of freight in California. Lumber is not moving because
houses are not being built. People have no money for home
renovation because the value of their homes has dropped so
precipitously. General merchandise freight has slowed because
consumers are worried about overspending. 

When I tell you we are struggling just to keep going, I’m not
saying that for dramatic emphasis. I’m saying that as a business
owner laboring to keep the doors open the past year. We have
borrowed, renegotiated loans, tried to patch old equipment to keep
it running a while longer, because there is nothing extra
in our budget. 

Our employees have not had a raise in years. We have office and
capital equipment that needs upgrading. We have been dealing with
health care cost increases to the tune of 15 to 20% per year for
more than a decade. Sales and use taxes have gone up locally and
statewide. Almost every expense has gone up because of energy price
increases. These fluctuations are huge challenge for any business
but especially for a small business with less than 20 employees. 

Now the state wants to put another huge burden on our shoulders. 

Since deregulation in the early 1990s, the number of transport
companies in the state has drastically diminished. Instead,
transportation hubs to serve the California market sprung up in Las
Vegas, Phoenix, Reno and Eugene, Oregon.
The cost of doing business in those states is much cheaper. Just
by moving a company across state lines, you could have a huge
competitive advantage. And that is what has happened. Out of state
and transnational trucks come into California, move freight around,
and leave. Those trucks leave pollution in our
state but do not shoulder the costs of it. 

Instead, an ever-shrinking number of struggling California freight
companies are faced with paying the bill.

If California wants to decrease pollution related to
transportation of goods, it should consider levying a tax on every
item imported at a port or hauled around by out of state trucks. It
should also consider re-regulating trucking rates so that
compensation is once again in line with real world costs and
California companies have a level playing field. The deregulation
of our industry has hurt our state badly. We have seen small and
mid size companies, which drive so much of our economic growth,
driven out of business completely. The trend is
toward ever larger companies, 99% of which are not based in
California at all and simply come in and out without having to bear
any of the costs of doing business here. We have seen this for
ourselves. We are the one of the only remaining small private
freight companies left in our country. 

But asking trucking companies to pay $20,000 per truck to retrofit
vehicles that met all California requirements only a few years ago
is an extraordinary action that will have repercussions for
everyone in this state, not least of all the 16 people we employee
in Mendocino County.

California trucking companies are not making it in the current
business environment. The new CARB action will be the final blow. 

There is no logic in the rulemaking and legal process as it now
stands. That is why ag vehicles are exempted from air quality rules
even in the biggest agricultural valley in the state. That is why
California fuel costs more than fuel anywhere else in the nation.
Agency’s calculate the costs to justify their rulemaking. One cost
is calculated but another is ignored, leading to legislative and
regulatory equations which are completely out of whack.

Freight will continue to need to be moved in California since
there is no other way to get items from Point A to Point B except
via large trucks. But those trucks wont be California trucks - and
they wont be paying California taxes or abiding
by CARB rulings. This rulemaking will put many people out of
business. It will also drive up the cost of every good and service
in the state of California at a time when people can least afford
it.



Gary Hartmann
President, KVS INC 
Ukiah, CA