California is squeezing the life out of small, independent trucking companies.
Gov. Gavin Newsom just signed three bills into law that further tighten the state’s grip on the industry’s throat. As always, large companies will be better able to absorb the fees, regulatory costs and compliance burdens than small companies, which could be forced out of business.
Senate Bill 210 creates a new emissions inspection program for trucks. The law requires the California Air Resources Board (CARB) to establish a Heavy Duty Vehicle Inspection and Maintenance Program for trucks and other heavy vehicles. CARB will also create licensing standards for the inspection and repair shops, as well as a new compliance certificate that drivers will be required to keep with the vehicle. New fees will be deposited into the new Truck Emissions Check Fund.
California air regulators have already mandated that the trucking industry convert to cleaner engines. The 2008 Statewide Truck and Bus Rule required all heavy-duty trucks to have new or retrofitted engines as a condition of operating on California roads. This enormous compliance expense earned the industry only the slightest nod from Sacramento lawmakers. “SB 210 acknowledges the investments made by the trucking industry to upgrade truck fleets,” a Senate analysis of the bill noted, before claiming that the bill “leverages this investment to create improved time and cost efficient compliance measures.”
Trucking companies may have to buy new equipment yet again under Senate Bill 44, just signed by the governor, which directs CARB to update its 2016 “mobile source strategy” to include “a comprehensive strategy for the deployment of medium-duty and heavy-duty vehicles.” A Senate analysis of the bill says CARB will be making new regulations to “support commercialization” of medium- and heavy-duty vehicles that reduce emissions of greenhouse gases. Perhaps the plan is for regulators to persuade manufacturers to produce electric trucks by mandating California trucking companies to buy them.
Independent truckers and small trucking firms may be facing their greatest threat from the governor’s signature on Assembly Bill 5, which will end the practice of truckers working as independent contractors. Firms will have to hire drivers as employees instead, becoming responsible for payroll taxes, workers’ compensation and unemployment insurance, paid sick days and family leave.
Owner-operators, truck drivers who own and maintain their own vehicles, will no longer be able to enter into contractual arrangements with carriers. That could put them out of business in California.
And don’t forget the 20-cent-per-gallon increase in the tax on diesel fuel, part of 2017’s Senate Bill 1, with another increase this year. Between February 2016 and July, average retail diesel fuel prices rose 75 percent in California, compared to 58 percent nationally.
In July, Modesto-area Timmerman Starlite Trucking, Inc., closed its doors for the last time, laying off 28 drivers. Owner Colby Bell cited flat revenues and a 40 percent increase in costs over the last 10 years.
The cost of trucking is built into the price of everything that is transported in California, the state with the highest poverty rate in the nation when the cost of living is taken into account. Nearly 1 in 5 Californians struggle to pay for basic necessities.
Independent trucking was once a road to prosperity. But like so many roads in California, the government has left it in ruins.
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