No. 03-358
In the Supreme Court of the United States
UNITED STATES DEPARTMENT OF TRANSPORTATION,
ET AL., PETITIONERS
v.
PUBLIC CITIZEN, ET AL.
ON WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
JOINT APPENDIX
VOLUME II
THEODORE B. OLSON
Solicitor General
Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217
Counsel of Record
for Petitioners
STEPHEN P. BERZON
Counsel of Record
JONATHAN WEISSGLASS
ADAM B. WOLF
ALTSHULER, BERZON,
NUSSBAUM, RUBIN & DEMAIN
177 Post Street, Suite 300
San Francisco, CA 94108
(415) 421-7151
Attorneys for Respondents
Public Citizen, Inter-
national Brotherhood of
Teamsters, California
Labor Federation,
and Environmental Law
Foundation
(Additional Counsel Listed on Inside Cover)
PETITION FOR WRIT OF CERTIORARI FILED: SEPT. 8, 2003
CERTIORARI GRANTED: DEC. 15, 2003
GAIL RUDERMAN FEUER
ADRIANNA QUINTERO SOMAINI
NATURAL RESOURCES
DEFENSE COUNCIL
71 Stevenson Street, Suite 1825
San Francisco, CA 94105
(415) 777-0200
Attorneys for Respondents
Natural ResourceS Defense
Council and Planning and
Conservation League
DAVID C. VLADECK
PUBLIC CITIZEN
1600 20th Street, N.W.
Washington, D.C. 20009
(202) 588-1000
Attorneys for Respondent
Public Citizen
DAVID ROSENFELD
WEINBERG, ROGER &
ROSENFELD
1800 Grand Avenue, Suite 1400
Oakland, CA 94612
(510) 839-6600
Attorneys for Respondent
Brotherhood of Teamsters,
Auto and Truck Drivers,
Local 70
PATRICK J. SZYMANSKI
General Counsel
INTERNATIONAL
BROTHERHOOD
OF TEAMSTERS
25 Louisiana Ave., N.W.
Washington, D.C. 20001
(202) 624-6945
Attorney for Respondent
International Brotherhood
of Teamsters
PATRICK J. COUGHLIN
ALBERT H. MEYERHOFF
STANLEY S. MALLISON
MILBERG WEISS BERSHAD
HYNES & LERACH LLP
100 Pine Street, Suite 2600
San Francisco, CA 94111
(415) 288-4545
WILLIAM S. LERACH
MILBERG WEISS BERSHAD
HYNES & LERACH LLP
401 B Street, Suite 1700
San Diego, CA 92101
(619) 231-1058
Attorneys for Respondents
International Brotherhood
of Teamsters, Brotherhood
of Teamsters, Auto and
Truck Drivers, Local 70,
California Labor Federa-
tion, California Trucking
Association, and Environ-
mental Law Foundation
BILL LOCKYER State of California [SEAL OMITTED]
Attorney General DEPARTMENT OF JUSTICE
DEPT OF TRANSPORTATION
01 Oct - 2 AM 9:09
1300 I STREET SUITE 125
P.O. BOX 944255
SACRAMENTO, CA 92244
Public: (916) 324-5475
Telephone: (916) 324-5475
Facsimile: (916) 327-2319
E-Mail: Susan.Durbin@doj.ca.gov
October 1, 2001
Honorable Julie Anna Cirillo, Deputy Administrator
Federal Motor Carrier Safety Administration
c/o Docket Clerk
U.S. DOT Dockets
Room PL-401
400 Seventh Street, S.W.
Washington, D.C. 20590-0001
RE: Docket Nos. FMCSA 98-3297[-279], 3298[-254], and 3299[-259] Request
to File Late-filed Comments
TRANSMITTED BY FACSIMILE - HARD COPY TO FOLLOW
Dear Deputy Administrator Cirillo:
California Attorney General Bill Lockyer, acting in his independent capacity
to protect the natural resources of the State of California, asks to file
these comments on the regulations proposed by the Federal Motor Carrier
Safety Administration (FMCSA) that would allow facilitate, and regulate
the entry and operation of Mexican carriers in the United States. The undersigned,
on September 26, 2001, at 10:40 a.m. Pacific Daylight Time, spoke with Ms.
Valerie Height of the FMCSA, who advised me that your agency is continuing
to accept late-filed comments, although she cautioned me that the agency
might not be able to consider fully comments filed at this point.
Attorney General Lockyer respectfully submit these comments pursuant to
his independent authority to protect the public interest under the California
Constitution, common law, and statutes. Along with other California agencies,
the Attorney General has the power to protect the natural resources of the
State from pollution, impairment, or destruction. (See Cal. Const., art.,
V, § 13, Cal. Gov. Code, §§ 12511, 12600-12; D'Amico v. Board
of Medical Examiners (1974) 11 Cal 3d, 14-15.) These comments are made on
behalf of the Attorney General and not on behalf of any other California
agency or office.
We emphasize at the outset that Attorney General Lockyer does not make these
comments in any attempt to prevent Mexican trucks from operating in California
when FMCSA has fully complied with statutes and regulation applicable to
these regulations. We do not seek to exclude trucks owned by Mexican carriers,
but we do seek to have the full environmental and fiscal effects of the
proposed regulations analyzed, disclosed, and where possible, mitigated
pursuant to the National Environment Policy Act, the Clean Air Act, and
the Unfunded Mandates Act before the regulations are issued in final form
and become effective.
Our office has reviewed the proposed regulations and Regulatory Analysis.
We believe that the proposal, contrary to FMCSA's analysis, is a major federal
action with the potential significantly to affect the environment, and that,
as such, it must be the subject of full environmental analysis pursuant
to the National Environment Policy Act (NEPA), 42 U.S.C. 4321, et seq. Based
upon our own, very preliminary analysis, we believe that the FMCSA must
prepare a full environmental impact statement (EIS) on the proposals before
they can be published in final form. Further, we believe that the FMCSA
must prepare a full environmental impact statement (EIS) on the proposals
before they can be published in final form. Further, we believe that the
FMCSA must prepare and publish a conformity determination, as required by
the federal Clean Air Act, 42 U.S.C. § 7506 for the actions that would
be permitted and facilitated by the proposed regulations before those regulations
may be finally adopted. Finally, we do not believe that the existing Regulatory
Analysis supports the finding by FMCSA that the proposed regulations do
not violate the Unfunded Mandate Act, and that additional documentation
and support for that finding is required before the proposed regulations
may be issued in final form. Each of these statutes is discussed more fully
below.
National Environmental Policy Act
Allowing Mexican carriers to enter and operate in the United States beyond
the existing commercial zone is a change to the status quo that will increase
significantly the emission of air pollutants from Mexican trucks in this
country, and in California where such trucks are driven in California. The
pollutants whose emission will increase include both criteria pollutants
such as oxides of nitrogen, and toxic pollutants. Oxides of nitrogen are
designated as a criteria pollutant by the Clean Air Act and regulations
issue pursuant to it. 42 U.S.C. §7409(a) and (c); 40 C.F.R. §
50.11. The California Air Resources Board has designated particulate exhaust
from diesel engines as a toxic air contaminant1, and diesel engine exhaust
is listed as a chemical known to the State of California to cause cancer,
pursuant to the Safe Drinking Water and Toxic Enforcement Act of 1986 (commonly
known as Proposition 65).2 The proposed regulations, by allowing the operation
of hundreds, perhaps thousands, of trucks in California each day that do
not currently operate here, trucks that are not subject to the full panoply
of emission control requirements to which California trucks are subject,
will allow concomitant increases in pollutant emissions from those trucks.
NEPA's requirements are simple, clear, and apply here. NEPA was passed to
ensure that "environmental concerns be integrated into the very process
of agency decisionmaking." Andrus v. Sierra Club, 442 U.S. 347, 351;
42 U.S.C. 4321. It requires that an Environmental Impact Statement (EIS)
be prepared for all "major Federal actions significantly affecting
the quality of the quality of the human environment." 42 U.S.C. §
4332(2)(C). If an agency is not sure whether the action requires preparation
of an EIS, it must first prepare an Environmental Assessment (EA) to determine
whether the action will have a significant effect on the environment. 40
C.F.R. § 1501.4; Salmon River Concerned Citizens v. Robertson, 32 F.3d
1346, 1356 (9th Cir. 1994). If the EA establishes that the agency's action
may have a significant effect upon the . . . environment, then the agency
must prepare an EIS on the action. Foundation for North American Wild Sheep
v. United States Dep't of Agriculture, 681 F.2d 1172, 1178 (9th Cir. 1982).
If it is clear from the EA that the action will not have such a significant
effect, the agency issues a Finding of No Significant Impact (FONSI), see
Blue Mountains, 161 F.3d at 1212 (quoting Save the Yaak Comm. v. Block,
840 F.2d 714, 717 (9th Cir. 1988). The record here does not show that FMCSA
performed an EA, or issued a FONSI.
We believe that it should have. The increased air pollution that will result
from allowing Mexican carriers to operate outside the existing commercial
zone is a major federal action with more than significant potential to harm
the human environment. The Notice of Proposed Rule Making states that "the
proposed action does not require any environmental assessment" and
the Regulatory Analysis states explicitly that it does not discuss environmental
issues. We therefore do not know the basis upon which FMCSA has made its
finding that the proposed regulations do not constitute a major federal
action significantly affecting the environment. Because our own analysis
leads us to conclude that the proposed regulations will significantly harm
the environment, we believe that FMCSA must prepare a full EIS in order
to comply with NEPA. At the very least, the agency must prepare an EA. If
the EA leads FMCSA to again conclude that the proposed regulations have
no significant potential to harm the environment, the agency must issue
a FONSI setting out the reasons, backed up by documentation and analysis,
to support that conclusion. To this point, FMCSA has done neither, placing
it in violation of NEPA.
In making an evaluation of the potential effects on the environment of the
proposed regulations, FMCSA must consider not only the effects in the immediate
future, but those that are reasonably foreseeable over the medium and longer
term. "Crystal-ball" analysis of uncertain future consequences
is not required by NEPA, but a projection of environmental effects from
the federal action that can be predicted with reasonable certainly is required.
40 CFR § 1508.17. This is particularly true for air pollution, where
planning horizons for State Implementation Plans (SIP) stretch one to two
decades into the future. 42 U.S.C. § 7511. It is in this context that
FMCSA must determine whether the proposed regulations are a major federal
action significantly affecting the environment.
The regulations isued by the Council on Environmental Quality (CEQ) to interpret
NEPA provide that whether an action can be considered "significant"
depends on many factors, including "the degree to which the proposed
action affects public health and safety" and "[w]hether the action
threatens a violation of Federal, State, or local law or requirements imposed
for the protection of the environment." 40 CFR 1508.27, (2) and (10).
Here, the increased diesel engine emissions that will be caused by authorizing
Mexican trucks to operate freely outside the commercial zone will result
in increased human exposures to diesel exhaust as a whole, and increased
human exposure to known carcinogens, such as benzene, that are constituent
chemicals in diesel exhaust. These emissions will cause an increase in the
risk of cancer and other human health damage. The CEO regulations also provide
that the significance of an action should be judged in context. 40 C.F.R.
§ 1508.27(a). In California, the increase in diesel exhaust emissions
will worsen exposure in areas where there is already very considerable exposure
to diesel exhaust, such as the South Coast Air Basin.3 As an indication
of how severe the diesel exposure problem currently is, last year the south
Coast Air Quality Management District (SCAQMD), the agency that is responsible
to reducing air pollution in the greater Los Angeles metropolitan areas,
adopted rules that will require public agencies from school districts to
sanitation agencies in that air basin to spend cumulatively millions of
dollars to buy low-polluting buses and trucks as they replace or augment
their fleets, in an attempt to reduce diesel emissions, emissions of the
very type that the Mexican trucks will increase. The increase in diesel
emissions in such heavily polluted air basins as the South Coast Basin and
the San Joaquin basin that a significant influx of additional trucks will
cause must be considered significant, and requires full environmental analysis.
Further, the Mexican trucks will also emit increased oxides of nitrogen,
one of the precursors of photochemical ozone pollution (what is commonly
referred to as smog). This impact will be significant in the South Coast
Basin, one of only two areas of the country with an "extreme"
ozone problem.4 Any increase in emissions of oxides of nitrogen in that
air basin may make it virtually impossible for California and the SCAQMD
to amend the SIP and craft regulations that will allow the basin to meet
federal air quality standards. Such an impact is significant, and on its
own requires a full environmental analysis.
As a threshold matter, we do not believe that FMCSA has provided a sufficient
basis in fact to support its estimates, whether high, medium, or low, of
the number of carriers currently operating in the commercial zone, or operating
without appropriate regulatory documentation, during the moratorium, and
has assumed that the universe of Mexican carriers wishing to operate in
the United States will not greatly increase when the moratorium ends. With
respect, we do not believe that this assumption has been adequately supported.
When the moratorium is lifted, a new, legal market for transport will open
to Mexican carriers, and we believe that more documentation of the numbers
of carriers that may apply for OP-1 or OP-2 status must be provide before
FMCSA may rely on its extremely low estimate of the numbers of carriers
that will take advantage of the proposed regulations to enter the U.S. Such
documentation should include economic analyses of the transport market in
Mexico, and analysis of the possible entry into the Mexican market of foreign
companies, including the possibility of American trucking companies establishing
Mexican firms or affiliates.
We are aware that, in many respects, the emission standards for new Mexican
trucks are the same as California standards. However, this is misleading;
there are many differences that will cause the Mexican commercial carrier
fleet, which includes far more older than new trucks, to emit greater amounts
of particulate and nitrogen oxide emissions than California trucks. We have
had a preliminary examination of the differences made, and summarize the
most significant ones below. The technical report from which these facts
are drawn will be submitted under separate cover:
1. Mexican trucks were not subject to emissions control regulations prior
to 1993, while federal5 and California trucks were subject to such regulations
as of 1987. Thus, while current emissions standards for California and Mexican
trucks may be the same (at least, on paper), there were no regulations to
ensure, and no assurance is possible, that Mexican trucks manufactured before
the advent of emissions regulations in Mexico are controlled to the same
level that 1987-93 federal and California trucks are.
2. The overall emission from any given fleet depend to a large degree on
the ages of the vehicles that comprise the fleet. Here, not only were Mexican
trucks not subject to emissions standards prior to 1993, but the Mexican
fleet is, as a whole, of a far greater average age than the federal or California
fleet. That is, there is a much higher percentage of vehicles in the Mexican
fleet that are older than ten years than there is in the federal or California
fleet, a higher percentage that is older than 20 years, and so on, including
a higher percentage of trucks that are forty-five years old6 than can be
found in the federal or California fleet. The greater age of the Mexican
fleet makes it higher-emitting as a whole.
3. Specifically, the Mexican fleet emits more nitrogen oxides than the California
fleet, and will continue to do so into the future. For the year 2010, the
Mexican fleet will emit between 10% and 68% more nitrogen oxides than the
California fleet, depending on the age distribution of the Mexican fleet
at that time. The situation is even worse for emissions of particulates
(the chief cancer risk): in 2010, the Mexican fleet can be expected to emit
between 17% and 80% more than the California fleet, again depending on the
age distribution of the Mexican fleet. These figures alone constitute a
potential for significant environment impacts, and require preparation of
an EIS on the proposed regulations.
4. As background, and as the FMCSA must be aware, heavy-duty truck engines
are often, perhaps usually, rebuilt during the life of the vehicle. Recently,
the U.S. EPA and the California Air Resources Board (CARB) entered into
a consent decree with major manufacturers of heavy-duty diesel engines.
This consent decree requires that, when heavy-duty engines are rebuilt in
the U.S. (including California), they must be rebuilt using low-nitrogen
oxide kits supplied by the settling manufacturers. These kits will lower
nitrogen oxide emissions from the levels emitted when the trucks were new.
However, Mexican trucks are not subject to the consent decree. Presumably,
these trucks will be rebuilt with standard techniques, and not using the
low-nitrogen oxide kits. Certainly, there is no regulatory requirement that
they be rebuilt with low-nitrogen oxide rebuild kits, and FMCSA has no basis
to assume that they will be. Accordingly, as truck engines are rebuilt,
nitrogen oxide emissions from Mexican trucks will be greater than the corresponding
emissions from California trucks of the same model year, and that difference
will continue throughout the life of the rebuild. The current expectation
is that the rebuilt trucks will emit about 36% less than the pre-rebuild
trucks, meaning that Mexican trucks will emit about 36% more than corresponding
California trucks from the date of rebuild for the life of the rebuild.7
Again considering how long Mexican trucks tend to be driven, this will constitute
a continuing, and significant, increase in emissions over time, and will
harm the environment in which the trucks are driven. In the South Coast
Basin, such an increase in nitrogen oxides emissions over currently projected
emissions (i.e., those now expected from the operation the truck fleet as
it is currently configured in the area) will endanger the attainment of
federal and state air quality standards for many years into the future.
This constitutes another significant impact that requires an EIR.
5. California has in place a diesel inspection and maintenance program,
to ensure that diesel engines in trucks and buses have their emissions control
systems periodically inspected, and properly maintained. This program applies
only to California diesels, and has been shown to reduce particulate emissions
by about 30% on a fleetwide basis, and up to 50% in the case of vehicles
that fail roadside tests. Because the program does not apply to Mexican
trucks, those trucks will emit, and continue over time to emit, proportionately
more than the California trucks that are subject to the program.
6. Emission from the trucks and buses are directly related to the fuel they
burn. Federal and California regulations are now moving to limitations on
sulfur in diesel fuel, limiting the sulfur content to 15 parts per million.
There is no guarantee that Mexico will adopt and enforce a corresponding
limitation on sulfur in diesel fuel available in Mexico. Since excess sulfur
can permanently damage and corrupt emission control systems, the difference
between California/federal fuel and Mexican fuel presents a serious potential
for increased emissions from Mexico trucks.
This list illustrates the variety, and gives an indication of the number
and magnitude, of the ways in which Mexican emission standards are not identical
with California or federal emissions standards. It is clear that the Mexican
truck fleet will emit significantly more nitrogen oxides and particulate
matter than the California or federal truck fleets.8 Before the proposed
regulations allow these trucks to release this added pollution in California,
FMCSA must comply with NEPA and prepare environmental documentation. We
believe that a full EIS is required, and that the regulations cannot legally
be finalized until this is done.
In addition to the air pollutant emission questions, we also believe that
circumstances with respect to transportation of hazardous materials have
changed since the time the regulations were proposed. As many news stories
have reported, there may now be a terrorist threat from the deliberate misuse
of hazardous materials, and terrorists may have sought licenses to transport
such materials in order to release or otherwise do harm with them. We understand
that your agency is now charged with making a thorough investigation of
the potential for terrorist use of hazardous materials in transport. We
respectfully suggest that this investigation ought to include an examination
of the potential for transport of hazardous materials from Mexico, in Mexican
carriers' trucks, and that the potential for harm to the environment from
any release of such materials ought to be examined in the EIR that we believe
is legally require for these proposed regulations.
The Clear Air Act
The Clear Air Act, 42 U.S.C. 7401, et seq., at 42 U.S.C. section 7506, forbids
any federal agency from taking any action that is not conformity with the
State Implementation Plans (SIP) that is the overall plan for meeting and
maintaining federal air quality standards. This requirement proscribes all
federal agencies from permitting or requiring any action that would cause
pollutant emissions in excess of those emissions that have been projected
and provided for by the States and local governments in the relevant SIP.
This is known as "conformity" with the SIP, and all federal agencies
are under the affirmative duty to evaluate their actions for such conformity.
The FMCSA presents no conformity determination in its proposed rule making,
and it does not appear that any was performed. The Clear Air Act makes a
consistency determination the affirmative responsibility of federal agency.
Environmental Defense Fund v. EPA, 167 F.3d 641, 643 (D.C. Cir. 1999).9
Without repeating the list of reasons why the Mexican fleet will emit significant
greater amounts of nitrogen oxides than the federal or California fleets,
as set forth above, the numbers set out in this letter show that emissions
increases to be expected from Mexican trucks are sufficiently large as to
be inconsistent with the current emissions inventory and emissions "budget"
reflected in the California SIP. This requires a conformity determination
by FMCSA, and that determination must be done prior to final agency action,
i.e., prior to the issuance of final regulations. We are concerned both
with the potential adverse health effects of the increased emissions and
with fairness. The ozone problem in California's South Coast Air Basin is
truly extreme, and sources that contribute only perhaps one-tenth of one
percent of the total pollution inventory are often considered significant.
Sources that are not controlled at all in less polluted areas are tightly
regulated in the South Coast Basin.10 The additional emissions put out by
Mexican carriers' trucks will require equivalent decreases in emissions
from some other source or sources, putting additional burdens on already
heavily regulated California industries. Before the regulations are issued
that would require such sacrifices from California, FMCSA must perform and
certify a full conformity analysis.
Unfunded Mandates Act
The Notice of Proposed Rule Making states that there will be less than $100
million in costs to tribes, states, localities, and the private sector from
the carrying out of the proposed regulations, and that therefore the regulations
do not fall under the requirements of the Unfunded Mandates Act Reform Act
of 1995. 2 U.S.C. § 1532, et seq. With all due respect, we do not believe
that FMCSA has provided sufficient documentation to support this conclusion.
It is clear from the proposed regulations that FMCSA will rely upon border
or roadside inspections to determine whether Mexican carriers are actully
complying with the safety programs whose documentation FMCSA reviews. However,
the Government Accounting Office and the Department of Transportation's
own Inspector General have made clear in recent reports that federal inspection
of Mexican trucks is woefully underfunded, and that the greatest part of
the burden of inspection falls on the States.11 We believe that FMCSA must
develop and disclose a reasonable estimate, supported by appropriate documentation,
of the number, length, and cost of inspections, both at the border and at
the roadside, that States will be required to perform in order for the federal
regulations to provide the assurance of compliance that FMCSA projects and
relies upon in calculating the benefits and burdens of the proposed regulations.
FMCSA must assure, pursuant to 2 U.S.C. § 1535, subdivision (a), that
the alternative regulatory approach that is least burdensome alternative
to the States has been chosen. The Inspector General's report cited above
shows that California now performs the most inspections of Mexican trucks
crossing the border, and we anticipate that it is on California that the
greatest burden of inspection will fall under the proposed regulations.
FMCSA is obligated under the Unfunded Mandates Act to properly calculate
and disclose the extent of this burden, and to ensure that it has used the
least burdensome regulatory approach. We do not believe that FMCSA has complied
with these requirements.
Conclusion
Grave and serious questions about public health, environmental harm, potential
for terrorism, and financial impacts on already stretched State budgets
are presented by the proposed regulations, and have not been adequately
analyzed or answered by FMCSA. We believed that the regulations cannot be
lawfully adopted in final form until the statutes discussed above have been
fully complied with. Attorney General Lockyer thanks the FMCSA for the opportunity
to file these comments, and we hope that FMCSA will fully consider them
and carry out the actions we have requested herein, including preparation
of an EIR, preparation of a conformity determination, and revision of the
Unfunded Mandates analysis.
Please feel free to contact my office with any questions.
Sincerely,
/s/ SUSAN L. DURBIN
SUSAN L. DURBIN
Deputy Attorney General
For BILL LOCKYER
Attorney General
1 Cal. Code of Regs., tit. 17, sec. 93000.
2 Cal. Code of Regs., tit. 22, sec. 126000.
3 See Los Angeles Times, January 13, 2000 (Metro Section), and Orange County
Register, February 5, 2001.
4 The other extreme ozone area is Houston, Texas.
5 This letter uses the term "federal" to refer to trucks and buses
that were certified to federal standards issued by the U.S. Environmental
Protection Agency, and "California" to refer to trucks and buses
certified to California's emissions standards by the California Air Resources
Board.
6 As seen in the Mexican trucks now being operated in Imperial and San Diego
Counties in California, within the existing commercial zone.
7 Development and Use of Heavy-Duty Nox Defeat Device Emission Effects for
MOBILE5 and MOBILE6", M6HDE Report, US EPA, October 1999.
8 While any individual carrier's truck may not emit a significant amount
by themselves, the CEQ regulations at 40 C.F.R. sec. 1508.27(b)(7) require
that actions be evaluated cumulatively with other actions to determine their
significance. Thus, FMCSA is required to look at the cumulative emissions
that would be caused by all the Mexican carriers' trucks that would increase
their operations in California under the proposed regulations in determining
whether the action is "significant."
9 Although the EDF case dealt with transportation projects, consistency
is a requirement imposed on all federal agencies and activities.
10 In the South Coast Air Quality Management District, controls have been
enacted on consumer products such a spray deodorants, bakeries, and pleasure
boats, all sources whose control was not anticipated even a few years before.
Daniel Selmi, Impacts of Air Quality Regulation on Economic Development,
13 Fall Nat. Resources & Env't 382 (1998).
11 DOT Office of Inspector General, Interim Report on Status of Implementing
the North American Free Trade Agreement's Cross-Border Trucking Provisions.
IG Report No. MH- 2001-059 (May 8, 2001); General Accounting Office, Commercial
Trucking, Safety and Infrastructure Issues Under the North American Free
Trade Agreement, GAO No. RCED-96-61 (February, 1996)
United States General Accounting Office
GAO Report to Congressional Requesters
December 2001 NORTH AMERICAN
FREE TRADE
AGREEMENT
Coordinated
Operational Plan
Needed to Ensure
Mexican Trucks'
Compliance With U.S.
Standard
GAO
Accountability*Integrity*Reliability
GAO-02-238
* * * * *
BACKGROUND
Since NAFTA's implementation, trade between the United States and Mexico
has more than doubled, growing from $100 billion in 1994 to $248 billion
in 2001.12 Enhanced trade has increased the number of northbound truck crossing
from 2.7 million in fiscal year 2001. According to DOT, about 80, 000 trucks
crossed the border in fiscal year 2000, 63,000 of which were estimated to
be of Mexican origin. Trucks from Mexico enter the United States at border
crossing points in four U.S. states (see fig. 1), but most of the crossings
occurred at five ports entry in fiscal 2001: Laredo, El Paso, Hidalgo/Pharr
in Texas, and Calexico and Otay Mesa in California.
Figure 1: Commercial Ports of Entry Along the U.S.-Mexico Border
Note: Numbers in parenthesis indicate the number of ports of entry for those
with more than one.
Source: GSA and DOT.
Commercial truck traffic at Texas and California ports of entry, which handle
approximately 91 percent of truck crossings from Mexico, has grown just
over 60 percent since NAFTA went into effect. Table 1 lists the principal
commercial ports of entry and the number of truck crossings that occurred
at each port in fiscal year 2001.
Table 1: Truck Crossings From Mexico into the United States, Fiscal Year
2001
Location
Truck Crossing
Percentage of total crossing
Texas
Laredo
1,419,165
33%
El Paso
656,257
15
Hidalgo/Pharr
367,991
9
Brownsville
255,231
6
All Others
223,159
5
Total Texas
2,921,803
68
California
Otay Mesa
700,453
16
Calexico
259,174
6
All others
63,970
1
Total California
1,023,597
23
Arizona
Nogales
251,474
6
All others
90,424
2
Total Arizona
341,898
8
New Mexico
34,851
1
Total
4,322,149
100%
Source: U.S. Customs Service.
Under NAFTA, barriers have gradually been reduced for trade in goods and
services among Canada, Mexico, and the United States. Among other things,
NAFTA allows Mexican commercial vehicles greater access to U.S. highways
to facilitate trade between the two countries. Under NAFTA's original timeline,
Mexico and the United States agreed to permit commercial trucks to operate
within both countries' border states no later than December 18, 1995, and
beyond the border states by January 1, 2000.13
However, due to U.S. concerns about the safety of Mexican trucks and the
adequacy of Mexico's truck safety regulatory system, the United States postponed
implementation of NAFTA's cross-border trucking provisions and only permitted
Mexican trucks to continue to operate in designated commercial zones within
Arizona, California, New Mexico, and Texas.14
DOT's Office of Inspector General and GAO have reported that out-of-service
rates for Mexican trucks operating in the commercial zones exceeded those
of U.S. trucks in the nation as a whole. The Inspector General has also
reported that the percentage of Mexican trucks placed out-of-service in
the commercial zones declined from 44 percent in fiscal year 1997 to 36
percent in fiscal year 2000.
In 1998, Mexico challenged the United States' delay in implementing NAFTA's
schedule for cross-border trucking. In February 2001, a NAFTA arbitration
panel ruled that the United States' blanket refusal to review and consider
Mexican motor carrier applications for operating authority to provide cross-border
trucking services beyond the commercial zones violated its NAFTA obligations.
The panel indicated that under NAFTA, the United States is permitted to
establish its own safety standards and ensure that Mexican trucking firms
and drivers comply with U.S. safety and operating regulations. However,
the panel also noted that due to differing regulatory regimes in each country,
the United States need not treat Mexican carriers or drivers exactly the
same as those from the United States or Canada, provided that such different
treatment is imposed in good faith with respect to a legitimate safety concern
and conforms with relevant NAFTA provisions.
In February 2001, the administration announced that it would comply with
its NAFTA obligations and allow Mexican commercial carriers to operate beyond
the commercial zones by January 2002. In May 2001, DOT issued three proposed
rules that would revise existing regulations and application forms and establish
a two-tiered application process for Mexican carriers seeking authority
to operate within and beyond the commercial zones.15 Under the proposed
rules, a carrier's authority would be conditioned on satisfactory completion
of a safety audit within 18 months of receiving conditional operating authority.16
* * * * *
The small scale and size of Mexican trucking operations could also limit
travel beyond the commercial zones. Mexico's truck fleet is relatively small
compared with that of the United States, and Mexican trucking association
representatives said that their members' fleets have fewer trucks than their
U.S. counterparts. For example, there are nearly 600,000 trucking companies
with approximately 6.3 million tractors and trailers in the United States,
according to DOT. Mexico, in contrast, in 200010 had approximately 83,000
federally registered commercial cargo carriers with approximately 277,000
tractors and trailers (trucks may also be registered by Mexican states if
they do not drive on federal highways).11 Further, the overall age of the
Mexican commercial vehicle fleet may also limit the number of Mexican carriers
able to operate beyond the commercial zones. According to Mexican registration
data, in 2000 only 20 percent of the commercial cargo trucks registered
for use on Mexican federal highways were manufactured after 1994. Mexican
industry officials told us that trucks manufactured in Mexico prior to this
date were not built to U.S. safety and emissions standards. Mexican carriers
can apply to have older vehicles certified to be in compliance with U.S.
safety standards. However, Mexican industry officials told us that these
vehicles might have difficulties meeting U.S. emissions standards.
Uncertainty about DOT's final rules for obtaining operating authority has
reduced the number of Mexican carriers that will initially apply for authority
to operate beyond the commercial zones, according to Mexican government
and private sector representatives. According to these officials, this uncertainty
makes it difficult to plan for the future since union contracts allowing
traveling beyond the commercial zones and distribution ties must be established
in advance.
Emissions Inspection of Commercial Trucks
Vary by State
Under the 1990 Clean Air Act, EPA is required to establish minimum national
standards for air pollution and individual states are assigned primary responsibility
to ensure compliance with the standards through state implementation plans.
Such plans can include truck emissions inspections. Since 1994, EPA's primary
role in regulating commercial truck emissions has been to certify compliance
of commercial truck engines at the factories where they are manufactured.
EPA relies on the commercial truck engine manufacturers to certify that
their products meet air emissions standards and conducts spot checks at
engine factories.
Some U.S. states have implemented emissions testing requirements for heavy-duty
diesel trucks as part of their efforts to meet EPA air quality standards
for non-attainment areas.12 State testing programs differ significantly,
with some states requiring yearly checks of trucks and others operating
both annual and more frequent roadside inspection programs. California,
which has a large number of areas that do not meet federal air quality standards,
including the state's two southern border counties, conducts emissions tests
at the border. Since 1999, California has assigned two inspectors each to
the ports of entry at Calexico and Otay Mesa to monitor the emissions of
U.S. and Mexican heavy-duty vehicles. According to California state officials,
in 2000, the failure rate for U.S. trucks was approximately 8 percent, while
the failure rate for Mexican trucks was 12 percent.
Arizona also operates an emissions testing program for commercial trucks,
but testing is conducted on a yearly basis for trucks registered in the
state's two non-attainment areas, Phoenix and Tucson-neither of which are
located at the border. Neither Texas nor New Mexico performs emissions inspections
at the border.
12 NAFTA was agreed to by Canada, Mexico, and the United States in 1992
and implemented in 1994.
13 Canada and the United States have permitted each other's truck complete
access to all highways since 1982.
14 Commercial zones are designated areas where Mexican commercial vehicles
are allowed to (1) transfer their cargo to U.S. carriers or (2) unload their
cargo for later pick-up by U.S. carriers. Commercial zones generally encompass
areas extending between 3 and 20 miles north of U.S. border cities.
15 Among other things, the rules would require carriers to
(1) describe their operations, (2) self-certify that they understand and
will comply with U.S. safety standards, and (3) describe their recordkeeping
procedures relating to drivers and accidents.
16 These safety audits are expected to focus on reviewing a carrier's records
and not individual truck inspections.
10 Secretariat of Communication and Transportation, Estadistica Basica del
Autoransporte Federal. (Mexico City, Mexico: 2000).
11 An additional 23,000 vehicles of all types are operated by private trucking
companies. Private trucking companies own and operate their own fleet.
12 EPA defines a non-attainment area as a geographical region that exceeds
scientifically accepted levels for certain air pollutants.
[FMCSA-98-3297-2]
[FMCSA-98-3298-1]
[FMCSA-98-3299-1]
NORTH AMERICAN FREE TRADE AGREEMENT
ARBITRAL PANEL ESTABLISHED PURSUANT TO CHAPTER TWENTY
IN THE MATTER OF
CROSS-BORDER TRUCKING SERVICES
(Secretariat File No. USA-MEX-98-2008-01)
Final Report of the Panel
February 6, 2001
Panel Members:
J. Martin Hunter (Chair)
Luis Miguel Diaz
David A. Gantz
C. Michael Hathaway
Alejandro Ogarrio
* * * * *
B. The United States' Contentions
153. According to the United States:
[t]he Mexican safety regime lacks core components, such as comprehensive
truck equipment standards and fully functioning roadside inspection or on-site
review systems. In light of these important differences in circum-stances,
and given the experience to-date with the safety compliance record of Mexican
trucks operating in the U.S. border zone, the United States decision to
delay processing Mexican carriers' applications for operating authority
until further progress is made on cooperative safety efforts is both prudent
and consistent with U.S. obligations under the NAFTA.142
154. Thus, the United States is not obligated to grant Mexican trucking
firms operating authority when there are not yet adequate regulatory measures
in place in Mexico to ensure U.S. highway safety.143 The United States asserts
"that NAFTA contains no such requirement. To the contrary, under NAFTA's
national treatment and most-favored-nation obligations, a NAFTA Party may
treat service providers differently in order to address a legitimate regulatory
objective."144
155. According to the United States, Mexican carrier safety cannot be assured
on a case by case basis: "A carrier-by-carrier approach, however, cannot
effectively ensure safety compliance by Mexican motor carriers operating
in the United States. Rather, as the United States has explained, highway
safety can only be assured through a comprehensive, integrated safety regime.
It is for this reason that the United States is working with Mexican officials
to develop comparable motor carrier safety systems."145 Nor can the
United States, as a practical matter, inspect every truck as it crosses
the border.146
156. The United States notes the deficiencies of the Mexican oversight system:
The Government of Mexico cannot identify its carriers and drivers so that
unsafe conduct can be properly assigned and reviewed. While we understand
that the Government of Mexico is engaged in an extensive effort to register
all of its motor carriers and place them in a database that would facilitate
the assignment of safety data, that database does not contain any safety
data. Therefore, Mexico cannot track the safety fitness of its carriers
and drivers. . . . Without such carrier safety performance history, the
United States cannot conduct a meaningful safety fitness review of Mexican
carriers at the application stage.147
157. The United States also contends that it would be futile to try to perform
inspections of Mexican carriers in Mexico because "Mexican carriers
are not required to keep the types of records that are typically reviewed
in these inspections." Even if an effort were made, it "could
not be corroborated until the Government of Mexico develops and implements
information systems to collect and make available that information."148
Nor has there been any U.S. verification experience in Mexico: "The
United States has never performed a compliance review or any other type
of carrier or truck inspection in Mexico or issued any 'qualification or
approval' to a Mexican carrier based on a visit to a carrier's offices."149
158. The United States also disagrees with Mexico's reliance on Article
105. According to the United States," the intent of Article 105 is
simply to clarify that each NAFTA Party is responsible for ensuring that
its state and provincial governments are in compliance with NAFTA obligations."
Moreover, "Nothing in Article 105 suggests that measures entailing
cooperation between NAFTA Parties are somehow forbidden or excluded."150
159. The United States (and Canadian) truck safety programs are the key
to providing like circumstances in which trucks operate: they "provide
a high degree of assurance that U.S. and Canadian trucks operating on U.S.
highways each day meet minimum safety standards." The principal elements
of the U.S. truck safety program include:
a comprehensive system of rigorous vehicle and operator safety standards;
enforcement through road side inspections and onsite compliance reviews;
strict record-keeping rules; electronic databases that promptly provide
inspectors in the field with safety-related data on drivers and motor carriers;
and a substantial commitment of enforcement resources and personnel.151
160. According to the United States," Adequate assurances of safety
also require that Mexico, as Canada has done, adopt safety controls within
its own borders. The United States has been engaged in extensive cooperative
efforts with Mexico to assist in the development of the Mexican safety system.
Although Mexico has made substantial progress, work remains undone."
Under these factual circumstances, "NAFTA's national treatment and
most-favored-nation obligations do not, as Mexico argues, require the United
States to treat Mexican trucking firms in the same manner as U.S. and Canadian
firms."152
161. In particular, NAFTA does not obligate:
the United States to license the operation of Mexican trucking firms in
circumstances in which: (1) serious concerns persist regarding their overall
safety record; (2) Mexico is still developing first-line regulatory and
enforcement measures needed to address trucking safety standards; and (3)
essential bilateral cooperative arrangements are not fully in place.153
162. Moreover, the United States contends that under Rule 33 of the Chapter
Twenty Rules of Procedure, the burden of proving violations of Article 1202
and 1203, is on Mexico, "including the burden of proving relevant regulatory
circumstances and demonstrating that those circumstances are 'like'."154
163. The United States suggests that:
to prove that a particular measure adopted or maintained by another NAFTA
Party is inconsistent with Articles 1202 and 1203, the complaining Party
must demonstrate each of the material elements of those [a]rticles. Those
include showing: 1) the existence of one or more measures adopted or maintained
by a Party; 2) that the measure(s) relate to crossborder trade in services;
3) the treatment accorded by the measure(s); 4) the extent to which that
treatment may favor domestic, or certain foreign, service providers over
the providers of the complaining Party; 5) the relevant "circumstances"
under which that treatment is accorded; and 6) whether those circumstances
are "like".155
164. Mexico is faulted for failing to address all of these elements: Most
importantly, it has failed to describe the "circumstances" under
which the United States is treating Mexican Firms for safety purposes. Moreover,
Mexico has also neglected to demonstrate that those circumstances are "like"
the circumstances that pertain to the regulation of U.S. and Canadian trucking
companies.156
165. The inclusion of the qualifying "like circumstances" language
"permits NAFTA Parties to accord differential, and even less favorable,
treatment where appropriate to meet legitimate regulatory objectives."157
The United States quotes with approval from Mexico's opening submission,
"even if Mexican carriers were somehow not exactly 'like' U.S. and
Canadian carriers, it was within the power of the United States to impose
requirements that would make them 'like.'"158 However, the United States
differs with Mexico on the fundamental issue of whether "Mexican carriers
are 'like' U.S. and Canadian carriers for purposes of applying NAFTA's national
treatment and MFN provisions."159
166. The United States reviews the use of the term "like circumstances"
in U.S. bilateral investment treaties, arguing that NAFTA language is derived
fromthem, even though the BIT language is "in like situations."160
Here and in the FTA, national treatment does not mean that a particular
measure must in every case accord exactly the same treatment to U.S. and
Canadian Service providers. Under paragraph three of FTA Article 1402, covered
service providers from the two countries may be treated differently to the
extent necessary for prudential, fiduciary, health and safety, or consumer
protection reasons, as long as the treatment is equivalent in effect to
that accorded to domestic service providers and the party adopting the measure
provides advance notice to the other in conformity with Article 1803.161
167. According to the United States, NAFTA negotiating history confirms
this earlier approach to the "in like circumstances" language,
adopting "in like circumstances" on the understanding that it
had similar meaning to "like services and services providers,"
as preferred originally by Canada and Mexico.162
168. Further support for the U.S. position is found in the U.S. Statement
of Administration Action, which provides in pertinent part that "Foreign
service providers can be treated differently if circumstances warrant. For
example, a state may impose special requirements on Canadian and Mexican
service providers if necessary to protect consumers to the same degree as
they are protected in respect of local firms."163 Similarly, the Canadian
Statement of Implementation provides that " a Party may impose different
legal requirements on other NAFTA service providers to ensure that domestic
consumers are protected to the same degree as they are in respect of domestic
firms."164 Thus, "the 'like circumstances' language of Articles
1202 and 1203 makes clear that the United States may make and apply legitimate
regulatory distinctions for purposes of ensuring the safety of U.S. roadways."165
169. The United States also contends that "The regulatory environment
in which U.S., Canadian, and Mexican trucking firms operate is a critical
'circumstance' relevant to U.S. treatment of those firms because it helps
to establish industry safety practices in the three countries. As elaborated
in the Statement of Facts [of the U.S. submission], Mexican carriers in
fact operate within a less stringent regulatory regime than that in place
in either Canada or the United States."166 The problem areas include
driver hours of service: "U.S. and Canadian safety rules strictly limit
drivers' hours of service. Mexican truck drivers are only governed by the
more general rules of Mexican labor laws, with no safety regulation directly
applicable to the time a drivermay spend behind the wheel."167
170. Also, "U.S. and Canadian safety regulations require drivers to
keep logbooks, the only practicable way to enforce hours of service regulations.
Other than for hazardous materials, Mexico has no logbook requirements."168
Moreover, "U.S. and Canadian safety regulations include exhaustive
equipment regulations address to truck safety. Mexico, however, lacks specific
regulations gov-erning the condition and maintenance of CMV safety equipment."169
Other problematic aspects of Mexico's motor carrier regulatory system relate
to inspections by the motor carrier itself and government safety inspections.170
171. The United States observes that "[a]nother circumstance relevant
to the treatment of U.S., Canadian, and Mexican trucking firms is the ability
of U.S. transportation safety authorities to enforce U.S. safety regulations
with respect to those carriers."171 While the "maintenance of
government databases of accident and safety records, with respect to both
firms and drivers, is an important element of safety regulation in the United
States (and Canada) . . . the United States has no access to similar data
for Mexican firms ordrivers."172 Moreover, "U.S. highway safety
regulators rely in part on their ability to conduct on-site audits and inspections
of U.S. firms and, where appropriate, to impose civil or criminal penalties."
However, "U.S. regulators have no right to conduct inspections or audits
in Mexico, only limited and recent experience with Mexico on joint inspections
(by contrast with a long track record with Canada), and limited ability
to impose and collect civil or criminal penalties with respect to Mexican
firms that might ignore U.S. safety regulations."173
172. A further major U.S. concern regarding "treatment of U.S., Canadian,
and Mexican carriers is available evidence regarding the comparative safety
records of firms operating in the United States. . . . Mexican trucks operating
in the United States have a significantly higher incidence of being placed
out of service for safety problems uncovered in random inspections. In particular,
the available data show that the out-of-service rate for Mexican carriers
is over 50 percent higher than the rate for U.S. carriers."174
173. In contrast to Mexico's system, the United States notes that "Canada's
truck safety rules and regulations are highly compatible with those of the
United States."175 Thus, "when Canadian-based commercial trucks
cross into the United States, federal and state transportation authorities
can have a high level of confidence that those trucks comply with U.S. standards
and requirements at least to the same degree as U.S.-based trucks. That
confidence level is bolstered by a fully functioning, computerized bilateral
data exchange program."176 Under these circumstances, "when Mexican
trucks cross into the United States, there is no assurance that, based on
the regulatory regime in place in Mexico, those trucks already meet U.S.
highway safety standards."177
174. Given all of these considerations, the "United States has . .
. concluded that the 'circumstances' relevant to the treatment of Mexican-based
trucking firms for safety purposes are not 'like' those applicable to the
treatment of Canadian and U.S. carriers."178 Accordingly, "the
United States may apply more favorable treatment to U.S. and Canadian trucking
firms than to their Mexican counterparts without running afoul of Chapter
Twelve's national treatment or most-favored-nation rules."179
175. The United States further notes that Mexico has presented no data on
truck safety enforcement in Mexico, and states that although "Mexico
does allege that 'it was within the power of the United States to impose
requirements' that make Mexican carriers 'like' U.S. and Canadian carriers,"
Mexico has failed to explain "what those requirements might be nor
how such requirements would be practicable or effective."180 According
to the United States, "this absence of contrary evidence reinforces
that the United States, in delaying the processing of Mexican applications
until truck safety can be ensured, is acting reasonably, appropriately,
and consistently with its NAFTA obligations."181
176. With regard to the question of whether high out-of-service rates for
Mexican drayage trucks in the border zone are relevant to long-haul experience,
the United States contends that "In terms of safety, the service provided
by drayage trucks is no different from that provided by long-haul trucks-they
haul goods on the same roads, through the same cities and towns through
which long-haul trucks operate."182 In any event, Mexico has not demonstrated
that their long-haul trucks are safer. Issuance by the United States of
long-haul authority to Mexican trucks "would not, standing alone, prevent
a defective drayage truck from operating in the United States beyond the
border commercial zone."183
177. The United States explains certain carriers are permitted to "transit"
U.S. territory from Mexico to Canada because the Congress has not granted
the U.S. Department of Transportation ("DOT" or "Department")
the authority to require such transit carriers to seek operating authority.
Therefore, transit operations are unaffected by the moratorium on the issuance
of operating authority to Mexican motor carriers for operations outside
the commercial zone. All firms operating in the United States, however,
regardless of whether they are subject to such registration requirements,
are subject to DOT's safety jurisdiction.184
U.S.-owned, Mexican-domiciled carriers and "grandfathered" carriers
are unaffected by the statutory moratorium and thus are also permitted to
transport goods from Mexico to the United States beyond the border zone.185
178. However, the United States does not believe that the exemption of these
groups from the moratorium "demonstrates that the United States does
not have authentic safety concerns about Mexican carriers."186 "The
number of carriers entitled to these exemptions represents only a small
fraction-about two percent-of Mexican firms engaged in cross-border operations.
Specifically, 8,400 Mexican firms have authority to operate in the commercial
zones, while a total of only 168 Mexican carriers are entitled to the above
discussed exemptions."187
179. Mexican motor carriers operating in the border commercial zones are
required to obtain special certificates of registration. These carriers
are fully subject to all U.S. safety regulations. They must also have trip
insurance, must carry evidence of the insurance in their trucks, and must
have U.S. registered agents.188 The United States denies that the use of
trip insurance instead of continuous insurance reflects any lack of concern
over differences in the safety of U.S. and Mexican carriers operating in
the commercial zones. Rather, "[a]n insurer's potential liability arising
from trip insurance is just the same as that arising from continuous insurance,
and in both cases the insurer has the same incentives to reduce its potential
liability."189
180. The United States also explains its alleged lack of concern with trailers:
"In practice, however, the safety of Mexican trailer components has
not been a major issue, because eighty to ninety percent of the trailers
used in crossborder trade are in fact U.S.-owned."190
181. With regard to national treatment and most-favored-nation obligations,
according to the United States, the relevant issue is whether the U.S. actions
are consistent with its Chapter Twelve national treatment and MFN obligations
in light of the different circumstances applicable to U.S. and Canadian
trucking firms, on the one hand, and Mexican trucking firms on the other
. . . it is acting reasonably and appropriately by delaying the processing
of Mexican firms' applications for operating authority while U.S. and Mexican
transportation officials work cooperatively to establish adequate safety
enforcement tools to ensure that the grant of additional operating authority
to Mexican firms does not undermine highway safety. Applying NAFTA's national
treatment and MFN obligations to this set of facts turns on a close analysis
of highway safety issues, not abstract arguments regarding "conditionality".191
182. According to the United States, Mexico has failed to meet its burden
of proof regarding denial of investment benefits, "because Mexico had
not shown that any Mexican national meets the definition of 'investor' in
Chapter Eleven."192 In this respect, the United States disagrees with
Mexican reliance on WTO doctrines under which a complaining Party does not
have to show trade impact. Moreover, the United States believes under WTO
principles "complaining parties bear the burden of proving an alleged
violation by a WTO Member of its WTO obligations."193
183. The United States, which emphasizes that it has not raised Chapter
Nine as a defense,194 also expresses its disagreement with Mexico's relating
of the "in like circumstances" language to Chapter Nine. A NAFTA
Party, according to the United States, does not need any NAFTA provision
to serve as a "vehicle for" (which, presumably, Mexico means "to
authorize") any particular governmental regulation. In applying governmental
regulations, NAFTA only comes into play when a particular NAFTA obligation
is relevant to the regulation at issue. Chapter Nine imposes certain obligations
(such as MFN and national treatment obligations) with respect to standards-related
measures, but Chapter Nine is not "the vehicle for application"
of standards.
184. According to the United States, if Mexico's argument is predicated
on the theory that only NAFTA Chapter Nine could "permit" differential
treatment between domestic and foreign service providers, the argument is
both circular and inconsistent with the plain text of the agreement.
185. Also, the United States contends that the Parties could not, as Mexico
suggests, have intended Chapter Nine to serve as the exclusive "vehicle"
for applying standards-related measures because the scope of Chapter Nine
is limited to goods and only two services sectors: telecommunications and
land transportation services. Chapter Nine does not apply to measures affecting
any other services nor to measures affecting investment. Mexico's interpretation
would lead to the untenable result that the Parties neglected to provide
any "vehicle" for the application of standards-related measures
applicable to most services covered by NAFTA and to all investments covered
by NAFTA.195
186. The United States contends that its position is confirmed by Article
2101, one of the general exceptions, which provides:
that 'nothing in . . . Chapter Twelve (Cross-Border Trade in Services) .
. . shall be construed to prevent the adoption or enforcement by any Party
of measures necessary to secure compliance with laws or regulations that
are not inconsistent with the provisions of this Agreement, including those
relating to health and safety and consumer protection.'196
187. Similarly, in the Preamble to NAFTA, the Parties explicitly state their
resolve under NAFTA to "preserve their flexibility to safeguard the
public welfare."197 "These provisions illustrate that NAFTA Parties
contemplated that their regulatory authorities would retain their ability
to make regulatory distinctions with regard to cross-border services trade
necessary to protect human health and safety in their territories."198
188. The United States also contests Mexico's assertion that a government
may not "condition[] . . . market access of its goods and services
on the exporting country's adoption of the rules and laws of the importing
country."199 The United States disclaims the applicability of the unadopted
GATT Panel report in Tuna,200 and argues that the controlling case is the
Appellate Body Report in United States - Import Prohibition of Certain Shrimp
and Shrimp Products. It appears to the United States, however, that conditioning
access to a Member's domestic market on whether exporting Members comply
with, or adopt, a policy or policies unilaterally prescribed by the importing
Member may, to some degree, be a common aspect of measures falling within
the scope of one or another of the exceptions (a) to (j) of Article XX of
GATT 1994.201
189. The United States concludes, "Mexico has no support for its proposition
that some general principle of international law prohibits the United States
from taking account of the exporting Party's regulatory regime."202
190. The United States also asserts that Mexico has made no case for nullification
or impairment under NAFTA Annex 2004, noting some similarity to the Korean
Procurement case in the WTO.203 According to the United States, Mexico has
the burden of showing nullification or impairment and has made no such argument.
Also, the United States declares that under NAFTA, a nullification or impairment
claim may not be made if it would be subject to an Article 2101 exception.
As the United States has shown, differential treatment for Mexican carriers
is warranted by safety concerns, and is thus consistent with the U.S. obligations
under the national treatment and MFN provisions of Chapter Twelve. For the
very same reasons, (and in the event that the Panel had needed to examine
this issue in response to a nullification or impairment claim), the U.S.
measure would fall squarely within the scope of Article 2101(2).204
191. The United States asserts that the "subjective" motivation
for the alleged U.S. violations-as argued by Mexico-should not be the basis
for the Panel's analysis. WTO Appellate Body decisions support the position
of the United States that the pertinent issue here is whether safety concerns
warrant the differential treatment provided to Mexican carriers, and not-as
Mexico claims-the subjective motivations of U.S. decision-makers in December
1995.205
192. The United States cites to Japan - Alcoholic Beverages,206 where the
Appellate Body determined that "This is not an issue of intent"
and determined "an examination in any case of whether dissimilar taxation
has been applied so as to afford protection requires a comprehensive and
objective analysis of the structure and application of the measure in question
on domestic as compared to imported products."207
193. Also, in Chile - Alcoholic Beverages,208 the Appellate Body noted that
The subjective intentions inhabiting the minds of individual legislators
or regulators do not bear upon the inquiry, if only because they are not
accessible to treaty interpreters. It does not follow, however, that the
statutory purposes or objectives-that is, the purpose or objectives of a
Member's legislature and government as a whole-to the extent that they are
given objective expression in the statute itself, are not pertinent.209
194. Consequently, the Panel in this case should "likewise examine
U.S. compliance with national treatment obligations based on a fact-specific
analysis of the U.S. measure and all of the relevant circumstances, and
not-as the Appellate Body wrote-on the 'subjective intentions inhabiting
the minds of individual . . . regulators.'"210
* * * * *
VII. FINDINGS, DETERMINATIONS AND RECOMMENDATIONS
A. Findings and Determinations
295. On the basis of the analysis set out above, the Panel unanimously determines
that the U.S. blanket refusal to review and consider for approval any Mexican-owned
carrier applications for authority to provide cross-border trucking services
was and remains a breach of the U.S. obligations under Annex I (reservations
for existing measures and liberalization commitments), Article 1202 (national
treatment for cross-border services), and Article 1203 (most-favored-nation
treatment for cross-border services) of NAFTA. An exception to these obligations
is not authorized by the "in like circumstances" language in Articles
1202 and 1203, or by the exceptions set out in Chapter Nine or under Article
2102.
296. The Panel unanimously determines that the inadequacies of the Mexican
regulatory system provide an insufficient legal basis for the United States
to maintain a moratorium on the consideration of applications for U.S. operating
authority from Mexican-owned and/or domiciled trucking service providers
297. The Panel further unanimously determines that the United States was
and remains in breach of its obligations under Annex I (reservations for
existing measures and liberalization commitments), Article 1102 (national
treatment), and Article 1103 (most-favored-nation treatment) to permit Mexican
nationals to invest in enterprises in the United States that provide transportation
of international cargo within the United States.
298 It is important to note what the Panel is not determining. It is not
making a determination that the Parties to NAFTA may not set the level of
protection that they consider appropriate in pursuit of legitimate regulatory
objectives. It is not disagreeing that the safety of trucking services is
a legitimate regulatory objective. Nor is the Panel imposing a limitation
on the application of safety standards properly established and applied
pursuant to the applicable obligations of the Parties under NAFTA. Furthermore,
since the issue before the Panel concerns the so-called "blanket"
ban, the Panel expresses neither approval nor disapproval of past determinations
by appropriate regulatory authorities relating to the safety of any individual
truck operators, drivers or vehicles, as to which the Panel did not receive
any submission or evidence.
B. Recommendation
299. The Panel recommends that the United States take appropriate steps
to bring its practices with respect to cross-border trucking services and
investment into compliance with its obligations under the applicable provisions
of NAFTA.
300. The Panel notes that compliance by the United States with its NAFTA
obligations would not necessarily require providing favorable consideration
to all or to any specific number of applications from Mexican-owned trucking
firms, when it is evident that a particular applicant or applicants may
be unable to comply with U.S. trucking regulations when operating in the
United States. Nor does it require that all Mexican-domiciled firms currently
providing trucking services in the United States be allowed to continue
to do, if and when they fail to comply with U.S. safety regulations. The
United States may not be required to treat applications from Mexican trucking
firms in exactly the same manner as applications from U.S. or Canadian firms,
as long as they are reviewed on a case by case basis. U.S. authorities are
responsible for the safe operation of trucks within U.S. territory, whether
ownership is U.S., Canadian or Mexican.
301. Similarly, it may not be unreasonable for a NAFTA Party to conclude
that to ensure compliance with its own local standards by service providers
from another NAFTA country, it may be necessary to implement different procedures
with respect to such service providers. Thus, to the extent that the inspection
and licensing requirements for Mexican trucks and drivers wishing to operate
in the United States may not be "like" those in place in the United
States, different methods of ensuring compliance with the U.S. regulatory
regime may be justifiable. However, if in order to satisfy its own legitimate
safety concerns the United States decides, exceptionally, to impose requirements
on Mexican carriers that differ from those on U.S. or Canadian carriers,
then any such decision must (a) be made in good faith with respect to a
legitimate safety concern and (b) implement differing requirements that
fully conform with all relevant NAFTA provisions.
302. These consideration are inapplicable with regard to the U.S. refusal
to permit Mexican nationals to invest in enterprises in the United States
that provide transportation of international cargo within the United States,
since both Mexico and the United States have agreed that such investment
does not raise issues of safety.
* * * * *
142 USPHS at 2-3.
143 USCS at 2.
144 USCS at 2.
145 USPHS at 3.
146 USPHS at 4.
147 USPHS at 5.
148 USPHS at 6.
149 USPHS at 7. Although the United States asserts that it has never been
able to perform compliance reviews in Mexico, Mexico disputes this fact.
In its initial submission, Mexico observed that in 1997, USDOT officials,
accompanied by Mexican officials, did indeed make visits to several Mexican
motor carriers. According to Mexico, these U.S. officials were satisfied
with the conditions they found during these inspections. MIS at 44-45.
150 USSS at 19-20.
151 USCS at 2.
152 USCS at 2-3.
153 USCS at 35.
154 USCS at 42.
155 USCS at 39.
156 USCS at 39.
157 USCS at 39.
158 MRS at 13.
159 USSS at 6.
160 USSS at 6-7.
161 USSS at 9-10, citation omitted.
162 USSS at 11-12.
163 USCS at 40-41, emphasis supplied by U.S.
164 USCS at 41.
165 USCS at 42.
166 USCS at 43.
167 USCS at 43.
168 USCS at 44.
169 USCS at 44.
170 USCS at 44.
171 USCS at 45.
172 USCS at 45.
173 USCS at 45.
174 USCS at 45-46.
175 USCS at 47.
176 USCS at 47-48.
177 USCS at 48.
178 USCS at 49.
179 USCS at 49.
180 USSS at 3-4.
181 USSS at 4.
182 USPHS at 7.
183 USPHS at 8.
184 USSS at 20-21.
185 USSS at 21-22, citations omitted.
186 USSS at 22.
187 USSS at 22.
188 USSS at 24.
189 USSS at 24-25.
190 USSS at 25-26.
191 USSS at 17.
192 USSS at 26.
193 USSS at 26-27, quotation and citation omitted.
194 Comments of the United States on the Initial Report of the Panel, December
19, 2000, at 2.
195 USSS at 14-16, citations omitted.
196 NAFTA Article 2101(2).
197 USCS at 40.
198 USCS at 40.
199 USPHS at 17, quoting Mexico.
200 United States - Prohibition of Imports of Tuna and Tuna Products from
Canada (Report of the Panel adopted on Feb. 22, 1982, L/5198-29S/91 [hereinafter
Tuna].
201 USPHS at 17-18.
202 USPHS at 18.
203 USPHS at 10-11.
204 USPHS at 13.
205 USPHS at 14-17.
206 Japan - Taxes on Alcoholic Beverages, Panel Report adopted Oct. 4, 1996,
WT/DS8/AB/R.
207 Id. at 28-29, as cited in USPHS at 16.
208 Chile- Taxes on Alcoholic Beverages, Panel Report adopted Dec. 13, 1999,
WT/DS87/AB/R.
209 Id. at para. 62, as cited in USPHS at 16, emphasis in original.
210 USPHS at 17.
FRIENDS OF THE EARTH**NATURAL RESOURCES DEFENSE
COUNCIL**SIERRA CLUB**CENTER FOR INTERNATIONAL ENVIRONMENTAL LAW
VIA FACSIMILE AND FEDERAL EXPRESS
Comment Clerk
U.S. Dept. of Transportation
Docket Management Facility, Room PL-401
400 Seventh Street, SW
Washington, DC 20590-0001
Re: Comments on Dockets:
1. Proposed Rules for the Revision of Regulations and Applications for Mexican-Domiciled
Motor Carriers To Operate in U.S. Municipalities and Commercial Zones on
the U.S.-Mexico Border, Fed. Reg. Vol. 66, No. 86 (May 3, 2001). FMCSA-98-3297
2. Proposed Rules for the Application by Certain Mexican Motor Carriers
To Operate Beyond U.S. Municipalities and Commercial Zones on the U.S.-Mexico
Border, Fed. Reg. Vol. 66, No. 86 (May 3, 2001) FMSC-98-3298
3. Proposed Rules for a Safety Monitoring and Compliance Initiative for
Mexican Motor Carriers Operating in the United State, Fed. Reg. Vol. 66,
No. 86 (May 3, 2001) FMCSA-98-3299
Dear Comment Clerk:
These comments are submitted on behalf of Friends of the Earth, Natural
Resources Defense Council, Center for International Environmental Law, and
Sierra Club for inclusion in the dockets of each of the proposed rules and
draft guidance referenced above.
Friends of the Earth ("FoE") is an environmental advocacy organization
established in 1969 with U.S. offices in Washington, DC, Seattle, WA and
Burlington, VT. Friends of the Earth has more than 20,000 members nation-wide,
and is dedicated to protecting the planet from environmental degradation;
preserving biological, cultural, and ethnic diversity; and empowering citizens
to have an influential voice in decisions affecting the quality of their
environment-and their lives. A major program of FoE is to advocate for appropriate
consideration of environmental consequences stemming from free trade agreements.
The Natural Resources Defense Council ("NRDC") is a national nonprofit
environmental organization with more than 500,000 members. Since 1970, our
lawyers, scientists, and other environmental specialists have been working
to protect the world's natural resources and to improve the quality of the
human environment. NRDC has offices in New York City; Washington, D.C.;
Los Angeles; and San Francisco.
The Sierra Club is a national environmental advocacy group, founded in 1892,
with more than 700,000 members.
The Center for International Environmental Law ("CIEL") is a public
interest environmental law organization founded in 1989 to bring the energy
and experience of the public interest environmental law movement to the
critical task of strengthening and developing international and comparative
international environmental law, policy, and management throughout the world.
Through its offices in Washington, D.C. and Geneva, CIEL's Trade Program
works to ensure that the governance of trade and investment rules integrates
environmental protection and promotes sustainable development.
In these rules, the U.S. Department of Transportation's ("DOT")
Federal Motor Carrier Safety Administration ("FMCSA") authorizes
Mexican-owned trucks to operate on U.S. highways throughout the United States,
including within and beyond communities on or near the U.S.-Mexico border.
DOT's proposed action raises serious environmental issues that require appropriate
consideration and mitigation where possible.
BACKGROUND AND SUMMARY
The comments of FoE, NRDC, Sierra Club, and CIEL concentrate on two concerns:
1) DOT must comply with the National Environmental Policy Act prior to finalizing
these proposed rules, and 2) DOT must consider the disproportionate impact
these rules will have on the health and safety of children pursuant to Executive
Order 13045.
Beginning with the start of its implementation in 1994, The North American
Free Trade Agreement ("NAFTA"), has liberalized trade among its
signatories the United States, Mexico, and Canada. Among the many legal
and policy changes NAFTA required of its signatories to take were new rules
governing the shipment of goods and materials by truck. Specifically, NAFTA
required that by 1995, Mexican trucks be permitted to drive throughout the
U.S.-Mexico border states. NAFTA countries agreed to virtually completely
open borders by requiring that trucks from any NAFTA country could drive
anywhere in all NAFTA countries.
Limits on the operation of motor carries from Canada were lifted by a Presidential
Memorandum from September 20, 1982. However, despite NAFTA's requirements,
the Memorandum continued the moratorium for Mexican trucks, citing concerns
over the safety of Mexican trucks. The U.S. only permitted them to travel
in designated U.S. communities located with 20 miles of the U.S.-Mexico
border. These designated communities are used by trucking companies to transfer
freight among U.S. and Mexican trucks.
The procedures and regulations of the U.S. and Mexico which apply to motor
carriers vary widely. The DOT grants motor carrier authority to operate
through an application procedure, and regulates and enforces compliance
with laws pertaining to safety and environmental issues through roadside
inspections and compliance reviews at a truck company's place of business.
Mexico's regulations are different than those in the U.S. as they relate
to driver hours of service, driver logbooks, driver qualifications, transport
and handling of hazardous substances, and equipment.
After several years of negotiations between Mexico and the U.S. to lift
the U.S. moratorium were unsuccessful, on September 22, 1998, Mexico requested
the formation of an arbitral panel to resolve the dispute pursuant to NAFTA
Article 2008(1). On February 6, 2001, the arbitral panel issued its ruling
In the Matter of Cross-Border Trucking Services (Secretariat File No. USA-Mex-98-2008-1).
The arbitral panel ruled that the U.S. must allow Mexican commercial trucks
to carry and deliver cargo throughout the U.S. or else pay trade sanctions
for refusal to comply.
This increased truck traffic will result in significant impacts to the environment
and raises serious safety issues, including, but not limited to, impacts
to air quality, emissions of gasses that cause climate change, transport,
handling, and release of hazardous materials. For instance, less stringent
air emission standards apply to Mexican trucks, including diesel fuel standards
that allow a higher sulfur content. It is estimated that Mexican trucks
produce higher levels of Nitrogen Oxides ("NOx"), volatile organic
compounds ("VOC"), carbon monoxide ("CO"), particulate
matter less than 10 microns ("PM-10")1, and carbon dioxide (CO2).2
In addition, major differences exist between US and Mexico regulations pertaining
to the transport and handling of hazardous substances. Mexico's regulations,
for example, do not provide detailed construction, inspection, and operating
requirements for commercial motor carriers, such as the regulations in the
U.S.
DOT MUST PREPARE AN ENVIRONMENTAL ASSESSMENT AND SHOULD PREPARE AN ENVIRONMENTAL
IMPACT STATEMENT PRIOR TO FINALIZING PROPOSED FEDERAL RULES IMPLEMENTING
THE NAFTA PANEL'S DECISION
DOT's actions will be arbitrary and capricious if it promulgates these proposed
regulations without first complying with NEPA, Counsel on Environmental
Quality ("CEQ") regulations, and DOT's own procedures.
Enacted in 1970, NEPA requires all federal agencies to identify the harmful
effects of projects they undertake, fund, or approve and to consider adoption
of alternatives and mitigating measures that will avoid or reduce such impacts.
To these ends, Section 102(2)(C) of the Act declares:
The Congress authorizes and directs that, to the fullest extent possible
. . . (2) all agencies of the Federal Government shall-. . . (C) include
in every recommendation or report on proposals for legislation and other
major Federal actions significantly affecting the quality of the human environment,
a detailed statement by the responsible official on-(i) the environmental
impact of the proposed action . . . ." 42 U.S.C. § 4332(2)(C).
This mandate is intended to "inject environmental considerations into
the federal agency's decision making process" and "to inform the
public that the agency considered environmental concerns in its decision
making process." Weinberger v. Catholic Action of Hawaii/Peace Education
Project, 454 U.S. 139, 143 (1981). Because of its importance, the EIS provision
only gives way in the face of a "clear and unavoidable conflict in
statutory authority." See Flint Ridge Development Co. v. Scenic Rivers
Ass'n of Oklahoma, 426 U.S. 776, 788 (1976).
To implement the EIS requirement and other provisions of NEPA, the CEQ issued
regulations in 1978 that are binding on all federal agencies. 40 C.F.R.
Parts 1500-1508. Those rules established certain basic requirements governing
preparation and public review of an EIS, and they required each agency to
publish its own rules to supplement those of the CEQ. 40 C.F.R. § 1505.1.
Environmental Impact Statements ("EIS") are required for any "major
federal action significantly affecting the quality of the human environment."3
Accordingly, if the DOT decides to grant Mexican trucking companies motor
carrier authority under existing regulations or under new regulations, it
must determine whether such action constitutes "a major federal action
significantly affecting the quality of the human en-vironment." If
the determination is affirmative, the agency will be required to prepare
an EIS.
Currently, there is nothing in record supporting DOT's proposed decision
not to comply with NEPA. If DOT is not certain that an EIS must be prepared,
then it must first prepare an EA.4 Such an assessment is to provide sufficient
evidence and analysis for determining whether an EIS is needed, or a finding
that the proposed federal action does not have significant environmental
impact, and therefore no EIS is needed.5 In preparing an environmental assessment,
the agency must consult with other environmental agencies, applicants, and
the public, "to the extent practicable."6
DOT's decision to not comply with NEPA is inconsistent with its own rules,
CEQ regulations, and the statute itself. The Department of Transportation
implemented its NEPA/CEQ requirements pursuant to an order ("DOT Order")7
that sets out procedures for all constituent agencies within DOT, and delegates
responsibility for full compliance to each constituent agency. The DOT Order
applies to all rulemaking and regulatory actions, including notices of proposed
rules.
Under the DOT Order, an EIS shall be prepared for "any proposed major
federal action significantly affecting the environment."8 The DOT also
identifies a non-exhaustive list of categorical exclusions which do not
require either an EIS or an EA. In addition, the DOT Order requires each
constituent agency to provide further guidance and instructions to comply
with NEPA (the "implementing instructions").
The implementing instructions may be either (i) detailed instructions or
regulations issued by a constituent agency which provides guidance on applying
environmental considerations to its programs;9 or (ii) adoption of the DOT
Order itself as its implementing instructions, plus the issuance of supplementary
guidance which "at a minimum applies the environmental process to the
administration's programs." The supplementary guidance must include,
among other things:
- a list of actions which normally require preparation of an EIS,
- a list of actions which are not normally major Federal actions significantly
affecting the environment and as such do not require an EA or EIS (i.e.,
categorical exclusions), and
- identification of the decision-making process.10
Moreover, notwithstanding the foregoing, the implementing instructions must
provide for the preparation of an EA or EIS for actions that would otherwise
be categorical exclusions, if those actions are likely to involve a significant
impact on the environment or create substantial controversy.
The FMCSA, as a constituent agency within DOT, has not complied with these
requirements in issuing its Proposed Rules. Rather, the Proposed Rules only
say . . . . (something that indicates briefly how limited they are, then
go into specifics of what they fail to do). It has failed to issue detailed
instructions or regulations to provide guidance on its environmental process;
nor has it adopted supplementary guidance to the DOT Order. It has failed
to identify a decision-making process, a list of categorical exclusions,
or a list of actions which normally require an EA or EIS. And, the FMCSA
has failed to otherwise analyze these rules pursuant to NEPA. The FMCSA
is therefore not in compliance with the DOT Order.
DOT may not base its decision that compliance with NEPA is not required
for these regulations on the argument that the "impacts to the human
environment" are a result of a decision to lift the moratorium on Mexico-owned
trucks. The CEQ regulations define a "major federal action" under
NEPA as, among other things, "systematic and connected agency decisions
allocating agency resources to implement a specific statutory directive
or executive directive." 40 C.F.R. § 1508.18(b)(3). CEQ also defines
a "major federal action" as "new and continuing activities,
including projects and programs entirely or partly financed, assisted, conducted,
regulated, or approved by federal agencies; new or revised agency rules,
regulations, plans, policies, or procedures; and legislative proposals."
40 C.F.R. § 1508.18(a).
Accordingly, there is no doubt that these rules trigger the need for NEPA
compliance.11
DOT MUST COMPLY WITH EXECUTIVE ORDER 13045 BECAUSE THE INCREASED POLLUTION
AND SAFETY CONCERNS PRESENTED BY THESE RULES CAUSE A DISPROPOTIONATE RISK
TO CHILDREN
DOT has determined that it need not prepare identify and assess the health
and safety risks that these proposed rules could have on children. In each
of the Federal Register notices at issue, DOT asserts that these proposed
rules are "not economically significant" and do "not concern
an environmental risk to health or safety that may disproportionately affect
children." Sufficient evidence exists to compel DOT to reverse this
determination, and complete the required analysis under Executive Order
13045.
The purpose of Executive Order 13045 is to assess and consider how federal
actions and decision may disproportionately impact children. It requires
that each federal agency "(a) shall make it a high priority to identify
and assess environmental health risks and safety risks that may disproportionately
affect children; and (b) shall ensure that its policies, programs, activities,
and standards address disproportionate risks to children that result from
environmental health risks and safety risks."12 The Executive order
requires that for each regulatory action subject to it, agencies must conduct
"an evaluation of the environmental health or safety effects of the
planned regulation on children" and include "an explanation of
why the planned regulation is preferable to other potentially effective
and reasonably feasible alternatives considered by the agency."13 These
findings are to be submitted to the Office of Management and Budget's Office
of Information and Regulatory Affairs for review.
Air pollution, especially particulate matter, affect children more seriously
than others in the population. Several U.S. Environmental Protection Agency
("EPA") studies confirm this fact.14 For instance, EPA finds that
air pollution, such as ozone, particulate matter, carbon monoxide, nitrogen
dioxide, and sulfur dioxide, "are particularly unhealthy for children."
EPA finds that these pollutants cause a disproportionate risk to children
because "children breathe more rapidly and inhale more pollutants per
pound of body weight than adults, and their airways are more narrow than
those of adults and their respiratory systems are still developing."15
Therefore, an assessment of the risks these proposed rules present to children
is required.
DOT has failed to address the disproportionate impacts the environmental
health and safety risks resulting from these proposed rules. DOT's conclusory
statement that these proposed rules do "not concern and environmental
risk to health or safety that may disproportionately affect children"
is not supported by the facts now in the record. Accordingly, DOT must prepare
the analysis required by Executive Order 13045 prior to finalizing these
rules.
CONCLUSION
DOT must comply with NEPA before finalizing these proposed rules that would
allow Mexican-owned trucks to drive throughout the United States resulting
in increased air pollution and other environmental hazards. The requirements
for agency compliance with NEPA are outlined by the CEQ Regulations. The
DOT Order outlines general NEPA procedures and then requires its constituent
agencies to issue detailed instructions or supplementary guidance reporting
environmental considerations. The FMCSA has not issued either detailed instructions
or regulations on its environmental processes or supplemented the DOT Order,
nor has it evaluated these rules under NEPA. Therefore, the FMCSA is not
in compliance with either the DOT Order, the CEQ Regulations or NEPA.
In addition, the increased air pollution and other environmental risks resulting
from these proposed rules presents health and safety risks that would disproportionately
affect children. Therefore, compliance with Executive Order 13045 is required.
By failing to consider the environmental and health effects of these rules,
both DOT and FMCSA violate NEPA and the Executive Order 13045. These rules
constitute agency action and must comply fully with the requirements of
the law. Therefore, DOT should prepare the necessary analysis prior to issuing
final rules.
Respectfully submitted,
Brian Dunkiel
SHEMS & DUNKIEL, PLLC
87 College Street
Burlington, VT 05401
(802) 860-1003
Attorney for Friends of the
Earth
Milberg Weiss Bershad Hynes & Lerach LLP
100 Pine Street, 26th Floor, San Francisco, CA 94111
(415) 288-4545 Fax: (415) 288-4534
April 17, 2002
U.S. Department of Transportation
Dockets Management Facility
Room PL-401
400 Seventh Street, S.W.
Washington, D.C. 20590
Re: 1. Docket No. FMCSA-98-3298; Application by Certain Mexico-Domiciled
Motor Carriers To Operate Beyond United States Municipalities and Commercial
Zones on the United States-Mexico Border, Interim Final Rule; Request for
Comments, 67 Fed. Reg. 12702 (2002)
2. Docket No. FMCSA-98-3299; Safety Monitoring System and Compliance Initiative
for Mexico-Domiciled Motor Carriers Operating in the United States, Interim
Final Rule, Request for Comments, 67 Fed. Reg. 12758 (2002)
On behalf of the International Brotherhood of Teamsters, the California
Federation of Labor, Public Citizen and Natural Resources Defense Council,
we submit the following comments on the above-listed actions of the Federal
Motor Carrier Safety Administration (FMCSA). Not only will these federal
actions significantly increase the overall commerce by truck between Mexico
and the U.S., thereby greatly increasing emissions of air pollutants beyond
those amounts that would otherwise be emitted, but they will also allow
entry to thousands of Mexico-domiciled trucks, nearly all of which emit
higher amounts of air pollutants than the U.S. trucks that they will displace.
These increased emissions will delay timely attainment of the national primary
air quality standard (NAAQS) for photochemical oxidants (ozone) in several
areas in California and Texas that are currently non-attainment for that
standard, and they may delay the attainment of the national primary ambient
air quality standard (NAAQS) for particulates (PM10) in several areas in
California that are currently nonattainment for that standard. The increased
emissions from the influx of Mexico-domiciled trucks allowed by the above-listed
actions will also increase the frequency or severity of existing violations
of the NAAQS for ozone and particulates. Further, the increased emissions
from the Mexico-domiciled trucks will cause or contribute to new violations
of the recently issued NAAQS for ozone and fine particulates.
FMCSA has prepared an Environmental Assessment (EA) that purportedly addressed
the adverse environmental impacts of above-listed actions, and it has made
a finding of no significant impact (FONSI) based upon that assessment. However,
the EA is woefully inadequate and by no means supports the associated FONSI.
We are enclosing for your review a technical report (hereinafter the "Sierra
Research Report")'1, prepared by Sierra Research, a highly-regarded
consulting firm that specializes in air pollution assessments on behalf
of public and private clients. The authors of this report are recognized
experts in the field of air pollution research, particularly from mobile
sources. The resumes of the principal authors, James Lyons, Philip Heirigs,
and Lori Williams, are enclosed for your consideration.
The Sierra Research Report demonstrates that the above-listed actions constitute
a major federal action significantly affecting the quality of the human
environment. As such, it is an action for which FMCSA must prepare a full-fledged
Environmental Impact Statement ("EIS").
Moreover, aside from failing to prepare an EIS, FMCSA has not prepared a
conformity analysis pursuant to section 176 of the Clean Air Act, 42 U.S.C.
§ 7506, so as to determine the extent to which the influx of Mexico-domiciled
trucks will increase emissions in nonattainment areas, the emissions reduction
from other sources that will be needed to offset the increased emissions
from Mexico-domiciled trucks, and the steps necessary to achieve the offsets.
Since the above-listed actions do not conform to the Texas and California
implementation plans ("SIPS"), the FMCSA may not engage in or
support those actions in any way. The FMCSA also cannot approve any actions
by private entities (i.e., the owners and operators of the Mexico-domiciled
trucks) that result in the increased emissions described above.
I. The FMCSA's Environmental Assessment Is Grossly Inadequate and Should
Be Replaced With a Full-Fledged EIS Prior to Proceeding with the Above-Listed
Actions.
Under the National Environmental Policy Act ("NEPA"), 42 U.S.C.
§§ 4321, et seq., when a federal agency proposed to undertake
a "major federal action significantly affecting the quality of the
human environment," it must prepare an EIS detailing its environmental
impact, any unavoidable adverse environmental effects, alternatives to the
action, local short-term uses versus long-term productivity, and the commitment
of any irreversible and irretrievable resources. In 1978, the Council on
Environmental Quality ("CEQ") promulgated regulations that federal
agencies are required to follow in implementing NEPA. 40 C.F.R. §§
1500 et seq. In determining whether to prepare in EIS, the agency must ordinarily
prepare an environmental assessment (EA). 40 C.F.R. § 1501.4(b). If
the EA leads the agency to conclude that an EIS is not necessary, it must
prepare a finding of no significant impact (FONSI). 40 C.F.R. § 1501.4(e).
The FMCSA has prepared an EA and a FONSI for the actions that it proposed
on May 3, 2001.2 We assume that the agency intends the EA and FONSI to cover
the interim final rules listed above. In any event, the EA and FONSI are
legally defective in numerous respects.
For example, the CEQ regulations define the term "effects" to
include "[d]irect effects which are caused by the action and occur
at the same time and place" and "indirect effects, which are caused
by the action and are later in time or farther removed in distance, but
are still reasonably foreseeable." 40 C.F.R. § 1508.8(b). In particular,
"indirect effects" may include growth inducing effects . . . and
related effects on air and water and other natural systems, including ecosystems."
40 C.F.R. § 1508.8(b). As the agency's EA apparently recognizes, the
adverse air quality impacts of the increase in the number of Mexico-domiciled
trucks that will come into existing ozone and particulate nonattainment
areas and areas that are potentially nonattainment for ozone and fine particulates
are clearly indirect effects of the above-listed actions. Yet the EA dismisses
these effects, completely disregarding the technical evidence demonstrating
that the increased emissions will be substantial.
The EA is also defective in terms of defining the areas that will be impacted.
The CEQ regulations define the terms "significantly" to require
considerations of both "context" and "intensity." In
considering the "context" of the action, the agency must analyze
"several contexts" including both "society as a whole"
and the "affected region." 40 C.F.R. § 1508.27(a).
Incredibly, the EA prepared by the FMCSA examined only the overall percentage
increases in emissions nationwide and entirely failed to assess the air
quality impact of increased emissions and increased ambient pollutant levels
in those areas where the impacts of the no action and proposed action scenarios
are likely to be greatest. This approach directly conflicts with the agency's
obligation to consider the "affected region." The Sierra Research
Report demonstrates that many specific regions and geographic areas will
be hard hit as a result of the interim final rules.
In considering the "context" of the action, the CEQ regulations
provide that "[b]oth short and long-term effects are relevant."
40 C.F.R. § 1508.27(a). Yet as shown in the Sierra Research Report,
the EA prepared by FMCSA considered only the exceedingly short-term impacts
of the actions on air quality in the year 2002, at least half of which will
be over by the time that the trucks begin to move across the country. The
use of such a short time frame is preposterous in the context of regulatory
decisions that will have such a long life span.
In considering the "intensity" or "severity" of the
impact, the agency must examine "the degree to which the proposed action
affects public health or safety," "[u]nique characteristics of
the geographic area," "[t]he degree to which the effects on the
quality of the human environment are likely to be highly controversial,"
"[t]he degree to which the possible effects on the human environment
are highly uncertain or involve unique or unknown risks," and, importantly,
"[w]hether the action threatens a violation of Federal, State, or local
law or requirements imposed for the protection of the environment."
40 C.F.R. § 1508.27(b). Yet the consideration of these and other critical
factors in the EA prepared for FMCSA was grossly inadequate.
More particularly, Sierra Research found that the EA contained the following
specific flaws:
( Failing to account for emissions differences between Mexico-domiciled
and U.S.-domiciled trucks that exist now and that will become even more
significant in the future;
( Improperly assessing the air quality impact of the no action and proposed
action scenarios by comparing the associated increase in emissions to total
nationwide emissions from trucks;
( Failing to assess the air quality impact of increased emissions and increased
ambient pollutant levels in those areas where the impacts of the no action
and proposed action scenarios are likely to be greatest, which include many
areas that current do not comply with existing federal air quality requirements
and are likely to be out of compliance with future federal requirements;
( Failing to assess the localized air quality impacts of increased numbers
of safety inspections;
( Failing to consider increases in emissions of toxic air contaminants resulting
from the no action or proposed action alternatives, particularly within
the context of the increase in local emissions due to increased numbers
of safety inspections; and
( Failing to assess the air quality impacts of the no action and proposed
action alternatives over more than a single year or beyond 2002.
The Sierra Research Report found that both the "no action" and
"proposed action" alternatives examined in the EA would foreseeably
result in adverse air quality impacts in two ways. First, both alternatives
would "allow the direct substitution of higher-emitting Mexico-domiciled-domiciled
trucks for lower-emitting U.S.-domiciled trucks for freight carrying in
the United States." Second, both alternatives would "have the
potential to increase overall U.S. truck traffic." Sierra Research
concluded that the actions would "present a particularly significant
issue in those areas of the southwestern U.S. that currently violate and
are likely to continue to violate health-based federal National Ambient
Air Quality Standards (NAAQS) applicable to ozone and fine PM."
Clearly, much more work is necessary before the above listed actions may
legally go into effect. The key assumptions underlying the EA are completely
flawed. Contrary to the EA, existing research concludes and knowledgeable
experts state that the federal actions being proposed through these regulations
will indeed significantly increase U.S. truck traffic beyond historical
levels. See, e.g., Comment Letter of Mark J. Spalding dated April 17, 2002.
The same is true with respect to the potential displacement of U.S. domiciled-trucks
by Mexico-domiciled trucks: existing research concludes and reputable sources
state that a significant displacement is likely to occur. See Id.; "North
America Trade and Transportation Corridors: Environmental Impacts and Mitigation
Strategies, "prepared for the North American Commission for Environmental
Cooperation by ICF Consulting (February 21, 2001) (copy enclosed).
The Sierra Research Report and simple common sense suggest that an action
that will have the effect of allowing thousands of heavily polluting Mexico-domiciled
trucks to travel through some of the most seriously polluted cities in the
United States-cities that are struggling to bring air quality up to healthy
levels-will significantly affect the quality of the human environment. The
FMCSA must therefore prepare a full-fledged EIS detailing the adverse environmental
effects on the most affected regions of the country.
II. The Above-Listed Actions Do Not Conform to the Approved SIPs for California
and Texas and Therefore Cannot Be Implemented.
Section 176 of the Clean Air Act provides that "[n]o department, agency,
or instrumentality of the Federal Government shall engage in, support in
any way or provide financial assistance for, license or permit, or approve,
any activity which does not conform to" a State Implementation Plan
(SIP) promulgated pursuant to section 110 of the Clean Air Act. 42 U.S.C.
§ 7506(c)(1). The statute further defines "conformity to an implementation
plan" to mean conformity to the plan's purpose of eliminating or reducing
the severity and number of violations of the national ambient air quality
standards. 42 U.S.C. § 7506(c)(1)(A). It is also defined to mean that
"such activities will not-(i) cause or contribute to any new violation
of any standard in any area; (ii) increase the frequency or severity of
any existing violation of any standard in any area; or (iii) delay timely
attainment of any standard or any required interim emission reductions or
other milestones in any area." 42 U.S.C. § 7506(c)(1)(B).
EPA's implementing regulations require federal agencies to make a determination
that an action conforms to the relevant SIPs based upon a written conformity
analysis before taking the action if the action will cause direct or indirect
emissions that exceed de minimis levels. 40 C.F.R. § 51.850(b), 51.(b),
51.854. The de minimis level of VOC and Nox emissions vary, depending upon
the extent of nonattainment. For serious areas the de minimis level is 50
tons per year (tpy). For severe areas (including Houston, Northwest Los
Angeles County, Ventura County, and San Diego) it is 25 tpy, and for extreme
areas (Los Angeles), it is 10 tpy. 40 C.F.R. § 51.853(b).
The Sierra Research Report graphically demonstrates the difference in emissions
rates between U.S. trucks and Mexico-domiciled trucks and shows how those
differences grow dramatically from 2010 to 2020 to the point at which Mexico-domiciled
truck emissions will be almost 4.5 times U.S. truck emissions for both oxides
of nitrogen (an ozone precursor) and particulate matter. The emissions will
far exceed the de minimis thresholds set out in the EPA regulations. For
example, Sierra Research has calculated that if we make the reasonable assumption
that 50 percent of the U.S. trucks currently traveling through Houston are
replaced by Mexico-domiciled trucks, the increase in Nox emissions by the
critical attainment year of 2007 will be 84 tons per day, more than three
times the de minimis level for annual Nox emissions in a serious nonattainment
area.
These staggeringly high increases in Nox and particulate emissions must
be accounted for the in the emissions budgets for Houston, Dallas/Ft Worth,
San Diego, Los Angeles, San Francisco and intervening nonattainment areas,
and federally enforceable offsetting emissions reductions must be located
and implemented before the FMCSA and NHTSA actions may be allowed to go
forward. At the very least, the agencies must prepare their own conformity
analysis that assesses the impact over the years of their actions on the
nonattainment areas through which the Mexico-domiciled trucks will travel.
III. Conclusion
The easily foreseeable result of implementing the above-described regulations
is a large influx of trucks from Mexico that do not conform to the emissions
standards with which U.S. trucks must by law comply. Just as foreseeable
is a large increase in emissions of NOx, particulate matter, and other toxic
air pollutants. Before FMCA may lawfully allow the above-listed regulations
to go into effect, the agencies must prepare an EIS detailing the adverse
environmental impacts of these increases in emissions. Furthermore, the
FMCSA cannot lawfully allow the regulations to go into effect until it has
prepared an adequate conformity analysis under section 176 of the Clean
Air Act and ensured that the actions will not cause or contribute to any
new violation of any standard in any area, increase the frequency or severity
of any existing violation of any standard in any area, or delay timely attainment
of any standard or any required interim emission reductions or other milestones
in any area.
We urgently request that FMCSA not allow the above-listed actions to go
into effect until the agency has complied with its legal obligations under
the National Environmental Policy Act and the Clean Air Act.
Respectfully Submitted,
/s/ STANLEY S. MALLISON
STANLEY S. MALLISON
1 The release of smaller particulate matter is also released on average
at a higher rate by Mexican trucks.
2 North American Trade and Transportation Corridors: Environmental Impacts
and Mitigation Strategies, North American Commission for Environmental Cooperation
(February 21, 2001) at 9.
3 40 C.F.R. §1502.3.
4 40 C.F.R. §1501.3(b).
5 40 C.F.R. §§ 1508.9(a)(1), 1501.4(b)-(c).
6 40 C.F.R. § 1501.4(b).
7 Department of Transportation Order 5610.1C, as amended (July 30, 1985).
8 See also 40 C.F.R. § 1502.3.
9 DOT Order at pg 19, Subparagraph 20 (a)(1).
10 Id. at pg. 20, Subparagraph 20 (b).
11 DOT may not finalize these regulations prior to complying with NEPA.
According to CEQ regulations, "no action concerning the proposal shall
be taken which would: 1) Have an adverse environmental impact; or 2) Limit
the choice of reasonable alternatives. 40 C.F.R. § 1506.1.
12 Executive Order 13045, Fed. Reg. Vol. 62, No. 78, (April 23, 1997).
13 Id.
14 www.epa.gov/children/air.htm
15 Id.
1 The full title of the Sierra Research Report is "Critical Review
of "Safety Oversight for Mexico-Domiciled Commercial Motor Carriers,
Final Programmatic Environmental Assessment," Prepared by John A. Volpe
Transportation Systems Center, January 2002" (Report No. SR02-04-01).
2 John A. Volpe Transportation Systems Center, Safety Oversight for Mexico-Domiciled
Commercial Motor Carriers, Final Programmatic Environmental Assessment (January
2000).
REPORT NO. SR02-04-01
CRITICAL REVIEW OF
"SAFETY OVERSIGHT FOR
MEXICO-DOMICILED COMMERCIAL
MOTOR CARRIERS, FINAL
PROGRAMMATIC ENVIRONMENTAL ASSESSMENT," PREPARED BY JOHN A VOLPE TRANSPORTATION
SYSTEMS CENTER, JANUARY 2002
April 16, 2002
prepared by:
Sierra Research, Inc.
1801 J Street
Sacramento, CA 95814
(916) 444-6666
Critical Review of
"Safety Oversight for Mexico-Domiciled Commercial Motor Carriers, Final
Programmatic Environmental Assessment," Prepared by John A Volpe Transportation
Systems Center, January 2002
Table of Contents
Executive Summary
[1]
Background
[4]
Freight Transport and Truck Emissions
Relevant Air Quality Issues in the United States
[4]
Implications
[4]
Critical Review of FMCSA EA
[13]
Summary of FMCSA EA
[13]
Flawed Air Quality Analysis Methodolgy
[13]
Inappropriate Analysis Period
[15]
Differences in Emission Rates of Mexican-
and U.S.-Domiciled Class8b Trucks
[16]
Failure to Consider Toxic Air Contaminant
Impacts
[21]
Failure to Properly Assess the Impacts of Air
Quality in Specific Areas and to Perform
Transportation Conformity Analyses
[22]
Appendix A - Estimating the Impacts of Mexican Truck Travel on Emissions
from Heavy-Duty Diesel Vehicles in Houston and San Diego
EXECUTIVE SUMMARY
The Federal Motor Carrier Safety Administration (FMCSA) is proposing several
actions that may dramatically increase the number of Mexican-domiciled heavy-duty
Diesel vehicles operating in the United States and that would lift current
restrictions that limit operation of such vehicles to the immediate border.
Under the National Environmental Policy Act ("NEPA"; 42 U.S.C.
4371 et seq., enacted in 1969), responsible federal officials must prepare,
prior to undertaking "major Federal actions significantly affecting
the quality of the human environment," a "detailed statement"
(referred to as an Environmental Impact Statement, or EIS) addressing the
following aspects of the proposed action: its environmental impact, any
unavoidable adverse environmental effects, alternatives to the action, local
short-term uses versus long-term productivity, and the commitment of any
irreversible and irretrievable resources.
The threshold question in the NEPA process is whether the action is one
that "significantly" affects the environment. In 1978, the Council
on Environmental Quality (CEQ) adopted formal regulations (40 CFR 1500-1508)
governing the NEPA process. The regulations contain a brief description
of the process agencies must follow in determining the threshold question
of significance. The key definitions are those for "effects" and
"significantly." The definition of "effects" (40 CFR
1508.8) requires an examination of direct effects, and also indirect effects
that are "reasonably foreseeable" as well as "cumulative."
In addition to ecological impacts, the examination must consider "aesthetic,
historic, cultural, economic, social and health impacts." The term
"significantly" is defined (40 CFR 1508.27) in terms of two main
general parameters, "context" and "intensity," with
the latter broken down into ten distinct categories. If the answer to the
threshold question of significance is in the affirmative, then an EIS must
be prepared; if not, then a Finding of No Significant Impact (FONSI) is
permitted.
The CEQ regulations (40 CFR 1501.3, 1501.4 and 1508.9) specify that, unless
the project falls into a predetermined category under the lead agency's
internal NEPA procedures, the preliminary question of significance is to
be addressed through the preparation of an "Environmental Assessment",
or EA. The EA is a "concise public document" that must (1) "briefly
provide sufficient evidence and analysis" for determining whether an
EIS or a FONSI must be prepared, (2) aid the agency in complying with NEPA
when no EIS is prepared, and (3) facilitate preparation of an EIR when one
is necessary. The EA must also include "brief discussions" of
the need for the proposed action, alternatives, environmental impacts of
the proposal and
In this case, the FMCSA has made a FONSI based on an EA.* This report presents
a detailed critical review of that EA, demonstrating that the EA is both
inadequate in terms of scope as well as fatally flawed in terms of the methodology
used to assess the significance of the air quality impacts associated with
the proposed actions. Because of the inadequacy of the EA, we conclude that
the FONSI is incorrect with respect to air quality impacts and that, based
on NEPA, a complete EIS must be prepared for the proposed action.
The specific flaws in the FMCSA EA include the following:
Failing to assess the air quality impacts of the no action and proposed
action alternatives over more than a single year or beyond 2002;
Improperly assessing the air quality impacts of the no action and proposed
action scenarios by comparing the associated increase in emissions to total
nationwide emissions from trucks;
Failing to account for emissions differences between Mexican-domiciled and
U.S.-domiciled trucks that exist now and that will become even more significant
in the future;
Failing to assess the air quality impacts of increased emissions and increased
ambient pollutant levels in those areas where the impacts of the no action
and proposed action scenarios are likely to be greatest, which include many
areas that currently do not comply with existing federal air quality requirements
and are likely to be out of compliance with future federal requirements;
Failing to consider increases in emissions of toxic air contaminants resulting
from the no action or proposed action alternatives, particularly within
the context of the increase in local emissions due to increased numbers
of safety inspections; and
Failing to assess the localized air quality impacts of increased numbers
of safety inspections.
The overall impact of both the no action and proposed action alternatives
will be to allow the substitution of higher-emitting Mexican-domiciled trucks
for lower- emitting U.S.-domiciled trucks for freight-carrying in the United
States. In addition, the alternatives have the potential to increase overall
U.S. truck traffic. Based on the available data, this will present a particularly
significant issue in those areas of the southwestern U.S. that currently
violate and are likely to continue to violate current and future health-based
federal National Ambient Air Quality Standards (NAAQS) applicable to ozone
and fine PM.
Both the no action and proposed action alternatives are in direct conflict
with federal law that requires compliance with the NAAQS by specific dates.
Heavy- duty Diesel vehicles are widely recognized as contributing to high
ambient levels of ozone and fine particulate matter and for that reason
have been required to meet increasingly stringent and costly emission standards
established by the U.S. EPA. Allowing higher-emitting Mexican-domiciled
trucks that do not have to comply with the same emission standards as comparable
U.S.-domiciled trucks will not only undercut the U.S. EPA standards but
also promote the use of Mexican-domiciled trucks for hauling freight in
the U.S.
In addition to the NEPA process, the U.S. EPA has promulgated conformity
regulations (§51 and §93 of Title 40 Code of Federal Regulations)
to assure that actions taken by the federal government are consistent with
air quality goals in that they do not cause or contribute to any violation
of a NAAQS in any area, or delay attainment with a NAAQS in any area. The
FMSCA has not performed any conformity analyses for the current project
despite the fact that the no action and proposed action alternatives are
very likely to lead to emission increases that exceed the threshold levels
above which a conformity analysis would be required in many existing nonattainment
areas.
BACKGROUND
Freight Transport and Truck Emissions
Most freight carried by trucks in the United States is transported by heavy-duty
Diesel vehicles. In turn, most of the freight carried by heavy-duty Diesel
vehicles is transported by trucks with gross vehicle weight ratings of more
than 60,000 pounds,* which are referred to as Class 8b trucks in most air
quality arenas. The pollutants emitted by these vehicles that are of greatest
concern from an air quality perspective are oxides of nitrogen (NOx) and
particulate matter (PM). Emissions of volatile organic compounds (VOC) from
heavy-duty Diesel vehicles are also of some concern although emission levels
are generally much lower than applicable emission standards.
It is expected that both the no action and proposed action scenarios considered
by FMCSA will result in an immediate increase in the use of Mexican-domiciled
Class 8b trucks in the United States outside of the existing border areas
as indicated in the EA. In addition, the use of Mexican-domiciled trucks
in the United States outside of border areas is expected to increase in
the future.** It is also expected that the no action and proposed action
scenarios will result in Mexican-domiciled vehicles being used to carry
freight that is currently being carried by U.S.-domiciled trucks and that
it is possible that they may actually increase total truck traffic in the
U.S. by reducing the costs associated with shipping freight by truck.***
If the emission levels of Mexican-domiciled trucks were equal to those of
U.S.-domiciled vehicles in the past, present, and future, the only potential
air quality impact associated with the no action and proposed action scenarios
would be an increase in total truck traffic in the U.S. However, in general,
emission levels of Mexican-domiciled trucks have not been, are not now,
and will not be the same as those of U.S.-domiciled trucks for at least
two reasons. First, as discussed in more detail later, the emission standards
that have applied and will apply to Mexican-domiciled trucks are, in general,
higher than those for comparable U.S.- domiciled trucks. Based on the best
current information, it appears that there will be a large difference in
NOx, PM, and VOC emission levels between new U.S. trucks and new Mexican
trucks beginning in 2007 when stringent new U.S. emission standards and
a U.S. nationwide requirement for production of ultra-low sulfur Diesel
fuel begin to be phased in. Secondly, Mexican-domiciled trucks tend, on
average, to be older than those domiciled in the U.S. This, coupled with
the fact that older trucks have higher emissions than newer vehicles, again
leads to a situation where even if all other things were equal, Mexican-domiciled
trucks would have higher emissions than comparable U.S.-domiciled trucks.
Based on the above, there are two air quality issues of concern with respect
to the proposed action:
1. Higher emissions in the United States resulting from the operation of
Mexican-domiciled trucks as replacements for U.S.-domiciled trucks, and
2. Higher emissions in the United States resulting from an increase in freight
demand due to the lower costs associated with freight shipping with Mexican-domiciled
trucks.
Although not properly addressed in the FMCSA EA, these issues are of concern
both now as well as into the foreseeable future.
Relevant Air Quality Issues In the United States
In the United States, the federal government has established National Ambient
Air Quality Standards (NAAQS) for a number of pollutants in order to protect
public health. The NAAQS set exposure limits that are generally cast in
terms of limits on the maximum concentration of pollutants that the public
can be exposed to during some period of time. Compliance with the NAAQS
is determined for relatively small geographical areas (rather than the United
States as a whole) based on air quality monitoring data. Areas in which
pollutant concentrations exceed those allowed are described as being in
"nonattainment" with respect to the NAAQS.
With respect to the matter at hand-the EA for the proposed FMCSA action-potential
adverse impacts on the ability of areas to achieve and maintain compliance
with NAAQS for ambient ozone and fine particulate matter (PM)* represent
significant air quality issues. Ozone is formed by a complex series of reactions
between HC and NOx in the presence of sunlight. It is a strong irritant
to the lungs and eyes and at high concentrations causes shortness of breath
and also aggravates asthma, emphysema, and other conditions. Fine PM can
penetrate deep into the lungs where it becomes deposited, which causes and
aggravates respiratory problems, decreases in lung function, and premature
death. It should also be noted that there are two types of fine PM: (1)
particles that are directly emitted from sources such as the exhaust of
Diesel engines, and (2) so-called "secondary" particles that form
in the atmosphere due to gas to particle conversion. NOx can be an important
chemical species with respect to secondary particle formation.
It should also be noted that, although delayed by litigation, it appears
that new NAAQS for both ozone and fine PM (in this case PM2.5) will be enforced
by the U.S. EPA. These new NAAQS are considered to be more stringent than
the existing NAAQS for ozone and fine PM (PM10). There are different degrees
of "nonattainment" with the NAAQS that have been established.
For the current one-hour ozone NAAQS, in order of increasing nonattainment,
these are marginal, moderate, serious, severe, and extreme. For the current
one-hour PM10 NAAQS, the categories are moderate and serious.
States in which nonattainment areas are located are required pursuant to
federal law to develop plans that specify the actions that will be taken
to reduce pollutant levels to the degree required to comply with the NAAQS
prior to deadlines specified by federal law. Once compliance with the NAAQS
is achieved, additional plans are required under federal law that specify
the actions that will be taken to control emissions so that compliance with
the NAAQS will be maintained in the future. Failure to come into compliance
with NAAQS by the required deadlines and to maintain compliance can lead
to the imposition of economic sanctions by the federal government and, in
some cases, intervention by the federal government that involves the development
and enforcement of a plan to bring the area into compliance.
In addition to the legal requirements regarding the attainment of the NAAQS
in given areas, there are legal requirements that compel federal government
agencies to assess the impact of their actions on emissions levels in areas
where there are currently or have been violations of the NAAQS. These requirements
are referred to as "conformity" and the applicable provisions
with respect to the no action and proposed action scenarios are found in
§51 and 93 of Title 40, Code of Federal Regulations. As set forth in
those sections, a conformity analysis may be required if the emission increases
associated with an action equal or exceed the values shown in Table 1.
Currently, there are a number of areas of the country that are in nonattainment
for either or both the ozone and PM10 NAAQS. These areas are shown in Figures
1 and 2 for ozone and PM10, respectfully. All areas of the U.S. are required
to come into attainment with the current ozone standard by 2010 and no later
than 2007 (considering possible extensions) for PM10.
As shown in Figure 1, many urban areas in the Southwestern U.S.-including
the San Diego, Los Angeles, and Central Valley areas of California, Phoenix,
Arizona; and Houston, Dallas, and El Paso, Texas-are currently in nonattainment
with the existing ozone NAAQS. Similarly, Figure 2 shows that many of these
areas and others are also in nonattainment with the current PM10 NAAQS.
Similar figures showing likely nonattainment areas for the new federal ozone
and PM2.5 NAAQS are shown in Figures 3 and 4, respectively. As shown in
Figures 3 and 4, these and more areas are projected to be in nonattainment
with the new ozone and PM2.5 NAAQS when the U.S. EPA make formal determinations.
Compliance deadlines with the new standards have not yet been set, although
they are sure to extend beyond the deadlines for the current NAAQS.
Figure 5 depicts the expected U.S. freight corridors for U.S./Mexico truck
traffic resulting from NAFTA as projected by the U.S. Federal Highway Administration
for 2020. As seen by comparing this figure with the nonattainment area maps
in Figures 1-4, major freight routes, where the amount of freight carried
by Mexican-domiciled trucks may increase substantially, pass directly through
many of the areas that are and will be in nonattainment of the ozone and
fine PM NAAQS. Similar data for 1996 also show the same major freight routes
for U.S./Mexico truck traffic.*
In addition to the NAAQS, the U.S. EPA also states in the preamble to the
2007 standards that it believes that Diesel exhaust "is likely to be
carcinogenic in humans by inhalation" and notes that reductions in
fine PM emissions along with emissions of the Toxic Air Contaminants (TACs)
benzene, 1,3-butadiene, formaldehyde, and acetaldehyde resulting from the
2007 standards will reduce public exposure to this hazard.
As Mexican-domiciled trucks will not be subject to the same standards as
U.S.-domiciled trucks, absent changes in Mexican requirements, they will
present a great toxics risk.
Finally, it should be noted that the state of California has established
its own ambient air quality standards, which are in general more stringent
than the federal NAAQS. The California Air Resources Board (CARB) is charged
with reducing emissions sufficiently to attain both the federal and state
standards. This is a difficult challenge as evidenced by CARB's recent release
of a comprehensive Clean Air Plan* that indicates that the agency will be
required to adopt increasingly costly emission reduction measures in order
to achieve its goals. Increase in emissions associated with the operating
of Mexican-domiciled trucks in California will hinder the state's ability
to achieve those goals and require the adoption of even more costly measures
than would otherwise be necessary.
Implications
As outline above, many areas in the Southwestern and Southern United States
currently violate and are likely to continue to violate health-based federal
NAAQS applicable to ozone and fine PM. Federal law requires those areas
to develop plans for reducing emissions to lower ambient concentrations
of these pollutants and to come into compliance with the NAAQS by specific
dates. Heavy-duty Diesel vehicles are widely recognized as contributing
to high ambient levels of ozone and fine particulate matter and for that
reason have been required to meet increasingly stringent emission standards
established by the U.S. EPA. In addition, in light of this fact, the U.S.
EPA recently adopted dramatically more stringent emission standards for
Diesel vehicles and specifications for Diesel fuel to enable compliance
with those standards, specifically to aid area such as these in their quest
to comply with the NAAQS.*
Now, in almost diametric opinion to the above, the federal government is
proposing an action that may result in the operation of large numbers of
higher-emitting Mexican-domiciled Diesel trucks operating in nonattainment
areas. This clearly undercuts the recent U.S. EPA rulemaking and will make
compliance with the NAAQS more difficult than it would otherwise be (or
perhaps impossible) for those areas. Further, the FMCSA EA upon which the
FONSI with respect to air quality is based either ignores or improperly
addresses these issues.
CRITICAL REVIEW OF FMCSA EA
Summary of FMCSA EA
The air quality related portion of the FMCSA EA is found on pages 3-9 through
3-12 of Section 3 entitled "Affected Environment" and on pages
4-14 through 4-24 of Section 4 entitled "Environmental Consequences,"
with additional details presented in Appendix C.
In Section 3, the EA recognizes the NAAQS and the air quality planning process
for nonattainment areas (including the related transportation planning requirements),
and notes that some of the counties directly on the Mexican border and in
the location of the busiest border crossings are in nonattainment with either
the current ozone or PM NAAQS or both.
The EA also notes correctly both that mobile sources make a significant
contribution to total emissions of VOC, NOx, and PM emissions and that heavy-duty
Diesel vehicles are of concern from an air quality perspective primarily
because they emit substantial amounts of NOx and PM.
In Section 4, the potential impacts of the proposed action on air quality
are addressed. The basic methodology employed in the EA compares emissions
from Mexican-domiciled vehicles operating in the U.S. in 2002 under each
scenario to total U.S. emissions from all on-road vehicles in the U.S. and
then to total emissions from all sources in the U.S. based on data developed
by the U.S. EPA for 1999. Emissions of Mexican-domiciled vehicles were assumed
to be equal to those of U.S.-domiciled vehicles. The numbers of Mexican-domiciled
vehicles assumed to be operating in the U.S. under each scenario during
2002 were estimated by FMCSA. These estimates indicate that on the order
of 30,000 Mexican-domiciled trucks will begin to operate inside the U.S.
beyond the current border areas in 2002 alone.
Emissions associated with proposed safety inspections of Mexican-domiciled
vehicles are estimated separately for 2002 using the U.S. EPA MOBILE5b and
PART5 emission factor models and are also compared to total U.S. emissions
in 1999. Again, estimates of the numbers of vehicles tested and the characteristics
of those inspections were developed by FMCSA and are not documented in the
EA. In addition, emissions from Mexican trucks were apparently assumed to
be the same as comparable U.S. trucks although it appears that the older
age of Mexican-domiciled vehicles was taken into account to some degree
in this limited section of the EA air quality impacts analysis.
Flawed Air Quality Analysis Methodology
The air quality analysis methodology used in the EA is fatally flawed due
to a number of serious methodological deficiencies and the use of a number
of erroneous assumptions. As a result, the methodology used in the EA is
completely inappropriate for assessing the air quality impacts of the no
action and proposed action scenarios. Because the air quality analysis is
fatally flawed, the FONSI with respect to air quality is inappropriate because
it is not supported.
The fundamental flaws with the air quality analysis contained in the EA
include the following:
1. Failure to consider impacts in the proper geographical regions;
2. Failure to consider impacts over the proper time horizon;
3. Failure to account for differences in emissions between Mexican- and
U.S.-domiciled trucks;
4. Failure to consider impacts of emissions of toxic air contaminants (TACs);
and
5. Failure to properly assess the impacts on air quality.
The nature and import of these flaws are outlined below and should be addressed
through an EIS. In addition, an assessment of the potential emission impacts
of the no action and proposed action alternatives indicates that those impacts
generally exceed the thresholds beyond which transportation conformity analysis
requirements are triggered for affected nonattainment and maintenance areas.
Inappropriate Analysis Areas
The FMCSA EA evaluates the emission impacts of the no action and proposed
action scenarios in light of annual nationwide emissions from on-road trucks.
This approach is invalid and the results are meaningless with respect to
the assessment of the significance of air quality impacts.
Air quality issues, including ozone and fine PM concentrations, are usually
evaluated for relatively small geographical areas. For example, attainment
and nonattainment designations with respect to the various NAAQS may be
areas that represent only a portion of a single county. The reason for this
is that local air quality particularly is determined primarily by local
emissions and local meteorological conditions.
As shown previously in Figure 5 and the maps in Figures 1-4, the impacts
of the no action and proposed action alternatives are likely to occur along
major trucking corridors that pass through areas that are not in attainment
with the current and future ozone and fine PM NAAQS. It is in these areas
where the assessment of impacts needs to be performed. Obviously, even if
an increase in emissions that represents only a small fraction of nationwide
emissions occurs in an localized area with pre-existing air quality problems
-such as San Diego, El Paso, Houston, or Dallas-that increase could either
prevent or substantially delay attainment with the NAAQS.
The magnitude of the potential impacts of Mexican-domiciled trucks must
be investigated in each of the major urban areas in the Southwest that are
currently in nonattainment with ozone and PM NAAQS as well as those likely
to be in nonattainment with the new ozone and fine PM standards and those
where maintenance plans are in effect. In addition, analyses may need to
be performed for other nonattainment areas that are much further from the
border, including Baton Rouge, St. Louis, and potentially the major urban
areas of the eastern seaboard. Again, it should also be noted that the purpose
of U.S. EPA conformity requirements that apply in localized areas is to
ensure that federal actions such as this do not result in the exceedance
of delayed compliance with applicable NAAQS.
Inappropriate Analysis Period
The EA analyzes the impact of the no action and proposed action alternatives
for only a single year-2002. No explanation is provided for why this is
appropriate or how an analysis performed for only a single year is satisfactory
to assess the impacts of the alternatives that will extend into the future
and will change over time. As noted previously, the areas that may be adversely
affected by the alternatives must come into compliance with current federal
air quality standards late in this decade and with future standards probably
sometime during the next decade. Therefore, the analysis should be carried
out over a much longer period, in our opinion through at least 2020.
As shown above, Mexican-domiciled trucks will have higher emissions than
U.S.-domiciled trucks, with the differences in emissions increasing over
time. This fact must be taken into account in the EA. Further, it is clear
from Section 3 of the EA that Mexican imports and northbound border crossings
of trucks from Mexico are increasing over time. Further, the FHWA data shown
in Figure 5 incorporate an estimated 3.4% annual increase in freight traffic
into and out of Mexico from the U.S. in developing the estimates for 2020.
This means that even without a shift in freight from U.S.- to Mexican-domiciled
trucks, there will be greater numbers of the latter operating in the U.S.
in the future.
It is also likely that there will be a shift in freight from U.S.- to Mexican-domiciled
trucks that will further in
crease their operation in the U.S. over time. There are several reasons
for this, including the following:
1. New Mexican trucks will likely be less expensive to purchase and operate
than comparable new U.S. trucks because they will not be required to certify
to the same stringent emission standards (which require the use of expensive
aftertreatment devices) and will not suffer the associated fuel economy
penalties; and
2. The ability of U.S. trucks designed to comply with the 2007 U.S. EPA
standards and to operate on ultra-low sulfur Diesel fuel will likely be
limited (because of the required after treatment devices) if that fuel is
not available in Mexico, as engine manufacturers probably will not honor
warranties for vehicles that have been misfueled with higher sulfur Diesel
fuels.
Therefore, any assessment of the actual operation of Mexican-domiciled trucks
operating in the U.S. needs to consider both the short- and long-term impacts
since there are likely to be significant changes in the amount of freight
traffic handled by Mexican trucks operating in the U.S. over time. Again,
the existing EA completely ignores this significant issue.
Differences In Emission Rates of Mexican- and U.S.-Domiciled Class8b Trucks
The EA assumes that the amount of emissions that results from the per-mile
operation of Mexican- and U.S.-domiciled trucks is the same. This assumption
is incorrect for two reasons. First, for a given model year, the U.S. truck
will have been required, in general, to meet more stringent emissions standards.
Second, based on available data, the average Mexican truck is older than
the average U.S. truck and, again in general, will have higher emissions
regardless of its state of repair because older trucks are certified to
less stringent emission standards.
Dealing first with the issue of different emission rates and standards,
Table 2 shows how, on the basis of emissions, Mexican-domiciled trucks translate
to U.S.-domiciled trucks as a function of model year. The development of
this table and the sources of information are described in detail in Appendix
A, along with all required assumptions.
The data in Table 2 were then used in combination with the latest versions
of the U.S. EPA (MOBILE6 and PART5) and California Air Resources Board (EMFAC
2001) emission models.* assuming that the vehicles operated in the Houston
or San Diego areas, respectively, to generate gram per mile travel ed emission
rates for the average Mexican-
Table 2
Emissions Equivalency Between Mexican- and U.S.-Domiciled Heavy-Duty Diesel
Vehicles as a Function of Model Year
Mexican Truck
Model Year(s)
Equivalent U.S. Truck Model
Year(s) for Emissions
1966-1969
1966
1970-1972
1968
1973-1974
1971
1975-196
1973
1977-1978
1975
1979-1980
1977
1981-1982
1979
1983
1980
1984-1985
1981
1986
1982
1987-1988
1983
1989-1990
1986
1991
1988
1992
1989
1993-2003
1993-2003
2004+
2003
and U.S.-domiciled class8b heavy-duty Diesel trucks. Rates were calculated
for 2000, 2002, 2007, 2010, 2015, and 2020. As shown in Tables 3 and 4,
the composite emission rates for U.S.-domiciled trucks are lower in all
years using both models.
The data presented in Tables 3 and 4 do not consider differences in the
average age of Mexican- domiciled trucks versus U.S.-domiciled trucks. Data
regarding the differences in the ages of the two fleets were developed for
use in estimating emissions of Mexican trucks from a "Mexicanized"
version of the U.S. EPA MOBILE5 model prepared by Radian International under
contract to the Western Governor's Association.*
Those data were used in combination with the data and models used to develop
the information presented in Tables 3 and 4 to estimate the combined impact
of different emission standards and older average ages on the relative per-mile
emissions of Mexican-
Table 3
Comparison of Per-Mile Emission Rates of Mexican- and U.S.-Domiciled Class8b
Heavy-Duty Diesel Vehicles Accounting for Different Emission Standards Using
MOBILE6/PART5
Year
Emission Rates (grams per mile of operation)
NOx
PM2.5
PM10
VOC
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
2000
25.70
25.45
0.66
0.56
0.73
0.62
1.29
1.05
2002
22.96
21.65
0.54
0.47
0.59
0.51
1.07
0.90
2007
16.69
13.00
0.34
0.31
0.38
0.34
0.72
0.60
2010
14.95
9.39
0.29
0.19
0.31
0.21
0.67
0.49
2015
13.46
4.45
0.23
0.08
0.25
0.09
0.61
0.37
2020
12.80
2.18
0.21
0.05
0.23
0.05
0.60
0.33
Table 4
Comparison of Per-Mile Emission Rates of Mexican- and U.S.-Domiciled
Class8b Heavy-Duty Diesel Vehicles
Accounting for Different Emission Standards Using EMFAC2001 for San Diego
Year
Emission Rates (grams per mile of operation)
NOx
PM2.5
PM10
VOC
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
2000
21.53
19.13
0.58
0.45
0.63
0.48
1.34
0.96
2002
19.91
18.06
0.49
0.38
0.53
0.41
1.17
0.87
2007
16.60
12.83
0.29
0.23
0.32
0.26
0.81
0.63
2010
15.05
9.31
0.22
0.15
0.24
0.16
0.66
0.48
2015
13.89
5.23
0.18
0.08
0.19
0.09
0.56
0.32
2020
13.48
3.32
0.17
0.04
0.18
0.05
0.55
0.25
and U.S.-domiciled class8b trucks. The results are shown in Tables 5 and
6. As shown, the difference in average emission rates between the two fleets
of vehicles becomes larger when both the effect of differences in emission
rates and standards as well as the average age of the fleet are taken into
account.
Additional details regarding the development of data presented in Tables
3-6 can be found in Appendix A.
Table 5
Comparison of Per-Mile Emission Rates of Mexican- and U.S.-Domiciled Class8b
Heavy-Duty Diesel Vehicles Accounting for Both Different Emission Standards
and Differences in Average Vehicle Age Using MOBILE6/PART5
Year
Emission Rates (grams per mile of operation)
NOx
PM2.5
PM10
VOC
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
Mexican
U.S.
2000
31.54
25.45
1.49
0.56
1.63
0.62
3.33
1.05
2002
29.23
21.64
1.35
0.47
1.48
0.51
2.67
0.90
2007
24.62
13.00
0.82
0.31
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