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Kentucky Resources Council, PO Box 1070, Frankfort, KY 40602 Phone [502] 875-2428

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PO Box 1070, Frankfort, KY 40602  Phone 502.875.2428, Fax 502.875.2845

KRC Testifies In Opposition to Senate Bill 39  Posted: February 9, 2006
Testimony of Tom FitzGerald, Director,
Kentucky Resources Council before the
Senate Agriculture and Natural Resources Committee
on Senate Bill 39

Chairman Jensen, members of the Committee, I appreciate this opportunity to testify in support of Louisville’s ability to establish necessary and appropriate regulations to provide for healthful air, and against SB 39.

While the precise impact of the bill is subject to some legal debate, the bill’s clear intent is to prevent continued implementation of the STAR air toxics program adopted by the Metro Louisville Air Pollution Control District and endorsed by the Metro Council. I ask you to consider three points as you deliberate on this bill:

First, there is no legal right to use the public’s air for waste disposal. Hazardous air pollution represents an existing cost being shifted to and paid for by the public’s health, rather than being properly controlled at its source and incorporated into the product as a cost of doing business.

Second, Louisville’s decision to adopt an toxics program in order to protect public health should be respected.

KRS Chapter 77 has provided all 120 counties the authority to step forward to address local air pollution problems. Only 1 of the 120 counties has ever felt the need to do so. Louisville has had a local air pollution agency for 61 years and has throughout that time had the power to adopt regulations above the minimum state and federal rules, and it has used that authority sparingly and only after great deliberation. Metro Louisville’s government did not act carelessly or on a whim here – they acted prudently, in a metered manner, sampling the air, verifying the data, seeking peer review from experts on the quality and meaning of the data, and moving forward after exhaustive public comment to enact a program that fills the gap left by the state and federal programs. That decision deserves to be respected. Louisville should be allowed to maintain the tools it needs to achieve and maintain healthy air.

The suggestion that a level playing field is needed because increased environmental protection measures will drive away business is a myth. Decades of economic research dispel the hypothesis that rigorous environmental management hurts economic growth and development.

The complaint from industry that the STAR program should include other sources of air toxics is curious, both because the STAR program does call for development of measures to reduce toxics from minor, area and mobile sources, and because those same companies were conspicuously absent during the failed effort to retain a vehicle testing program that had resulted in demonstrated reductions of those mobile source air toxics.

Third, the program must not be eliminated on the basis of the assertion that it will cause Ford or other industries to leave Louisville.

KRC appreciates the contributions that Ford and those companies that supply it make to the local economy in Metro Louisville. In both direct employment and employment of companies supplying parts, they have been and remain an integral part of our local and regional economy – a fact recognized and certainly understood by the elected and appointed officials of Metro government in their deliberations on the STAR program.

And KRC appreciates the fears and the anguish that the Ford workforce has already felt and will continue to feel concerning both the short- and long-term future of the two plants. The current situation has been brought on by forces beyond the workers’ control - by Ford’s significant overcapacity, by competition from newer, smaller companies that do not have the same fixed and legacy social costs (particularly in relation to health care), and by Ford’s loss of market share.

But STAR didn’t cause Ford North America’s problems, and killing STAR won’t cure them.

KRC applauded the decision by Ford in 2000, after 3 years of dialogue, to adopt the CERES Principles – a voluntary commitment to continual environmental improvement developed by the Coalition for Environmentally Responsible Economies embraced by many major companies. When it announced that commitment, Ford’s then-Board Chairman and now CEO, William Clay Ford, Jr., said "by endorsing these principles, we are pledging to go beyond the requirements of the law to preserve and protect the environment." Ford’s website also acknowledges that “[w]ith respect to health and environmental concerns, regulatory compliance represents a minimum.”

Given Ford’s vocal support for going beyond the minimum, KRC was disappointed to hear that Ford was pressuring the UAW Locals to support SB 39, and was lobbying for this bill.

I question the claim that compliance with STAR will cause the loss of the Louisville plants, or even significantly impact the company’s decision. The STAR program has been designed with safety valves to avoid those results. But I don’t doubt that, despite what I’m sure are sincere sentiments by the Ford CEO, there are those who would use the current retrenchment and atmosphere of uncertainty as an opportunity to avoid any costs that can be imposed on others instead of being paid by those responsible.

Any manufacturer will typically resist internalizing health and safety costs where it has historically been able to avoid including those costs in the product, and will often predict economic ruin if required to incorporate those costs - as Ford did in 1966 regarding federal safety requirements for laminated windshields, collapsible steering assemblies, enhanced door locks, and lap and shoulder safety belts, and again in 1971 regarding shoulder harnesses and headrests.

Yet worker safety and environmental controls are, according to the economic research, far more often the scapegoats rather than drivers for industrial retrenchment decisions, with only a small number of plant shutdowns or relocations in the manufacturing sector attributable in whole or in part to environmental protection measures.

The community has indicated its willingness to work with Ford and other smokestack industries in every way to create incentives to allow for expansion of the plants, and we are certain that the community would assist in helping with environmental compliance as part of that effort. Tax and other incentives exist to aid in job retention, pollution control improvements and plant modernization.

But those incentives don’t include continued daily exposure of the metro population to unhealthy levels of air toxics – that is a concession no company has a right to demand of a local government, and a concession that this Committee has the power, but not the right, to demand from Louisville’s citizens.

Thank you Mr. Chairman, and members of the Committee.


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