June 01–The way Tommy C. Fitzgerald sees it, competitors backed an environmental regulation to kill his business and a federal agency isn’t moving quickly to help despite President Donald J. Trump’s vow to ease rules, putting the potential for 250 jobs in Wayne County at risk.
The issue in the fight is a large truck called a glider, produced by combining a new cab and chassis with an older, rebuilt engine — as well as a transmission and usually a rear axle — from wrecked or worn-out trucks.
Starting in a one-bay garage in Pall Mall, Tenn., nearly 30 years ago, Fitzgerald and partners built their glider-making business into a $700 million enterprise, the largest in the nation.
Fitzgerald Glider Kits says it has been assembling more than 3,000 vehicles annually in recent years, providing 700 jobs in northern Tennessee and Southern Kentucky and supporting thousands more at suppliers.
The company announced in March that it would make dump-truck beds at the former Belden Wire & Cable plant in Monticello, which closed because the company moved much of its production to Mexico.
But now Fitzgerald, a 53-year-old Kentucky native, says those jobs and many others are in jeopardy because of a rule to reduce pollution from trucks.
The problem for gliders is that the U.S. Environmental Protection Agency defined them as new trucks, meaning a glider with a 2017 cab and a 2005 engine would be classified as a 2017 model. That makes the vehicle subject to pollution limits for new trucks, but with an engine lacking new emission controls.
Fitzgerald told the government his company would have to slash production by 90 percent by the end of 2018 under the rule.
If that happens “most of these people will be sent home,” Fitzgerald said of his employees.
That rule affects the plan to open a factory in Monticello, even though it would produce a different product, because money from Fitzgerald’s glider business underpins the company’s other ventures, said Jon Toomey, a lobbyist for the company.
The investment to buy and equip the vacant Monticello factory is about $5 million, Toomey said.
Gov. Matt Bevin’s office said in March that the factory would provide 250 jobs, which was cause for celebration in Monticello and Wayne County.
“This is a possible game changer for the Wayne County economy,” Republican state Rep. Ken Upchurch, who lives in the county, said at the time.
But Fitzgerald told the Herald-Leader he would have to cancel the project if the emissions rule stays in place.
“The large investment required to rehab the building and buy the equipment would come from the glider business. Without it we cannot move forward with the dump bed project,” Fitzgerald said.
The rule already has hurt Fitzgerald because it limited large glider makers to producing 300 trucks this year using pre-2010 engines — far less than it has been used to producing, Toomey said.
The company is in its second round of layoffs and expects more, Toomey said.
Fitzgerald and other glider-makers petitioned EPA last July to repeal the emissions rule, saying that leaving it in place would devastate their industry.
The companies argue that gliders don’t fit the definition of new vehicles because the most significant parts are not new, and that as a result the EPA shouldn’t apply the rule to them.
The glider market is a fraction of the new-truck market, but the vehicles provide an important option for smaller trucking firms and owner-operators who can’t afford all-new trucks, Fitzgerald said.
Fitzgerald said gliders cost about 25 percent less than trucks from original equipment manufacturers. Those completely new trucks reportedly can cost $150,000 or more.
Fitzgerald said gliders provide other economic and environmental benefits as well because they get better gas mileage than all-new trucks in many cases; extend the life of damaged vehicles; cost less to maintain and repair; and re-use thousands of pounds of steel in each vehicle, avoiding the need to cast new steel.
Fitzgerald has portrayed the emissions rule on gliders as an example of the Washington, D.C. swamp, with well-heeled companies using influence to get the government to give them an edge.
“Instead of celebrating our rural American economic miracle, glider haters in the new-truck industry conspired with the Obama EPA to try to put us out of business . . .,” he said in an April commentary in The Daily Caller, a conservative news site.
The New York Times reported that Fitzgerald has used the system himself to push back, giving $225,000 in contributions from related entities to Republican U.S. Rep. Diane Black, who introduced legislation to keep the emissions rule from applying to gliders.
The glider industry found a friend in EPA Administrator Scott Pruitt, who has moved to undo Obama-era environmental regulations.
In November, Pruitt started the process of repealing the rule on gliders, saying his agency did not have legal authority for it.
“The previous administration attempted to bend the rule of law and expand the reach of the federal government in a way that threatened to put an entire industry of specialized truck manufacturers out of business,” Pruitt said at the time.
If things had gone as the glider industry wanted, the rule would have been gone by now.
However, a different branch of government, the Office of Management and Budget, rejected the repeal because EPA did not do an analysis of the regulatory impact, Toomey said.
That has delayed the repeal.
“There is no doubt that Volvo, a foreign truck manufacturer, whose largest shareholder is Chinese, has lobbied for the limits and ban of gliders and is now lobbying against the repeal,” Fitzgerald told the Herald-Leader.
The glider industry is continuing to push for the repeal, lining up support from officials concerned about job losses if it doesn’t go through.
Two dozen members of Congress, including Republican Rep. Hal Rogers, whose district includes Wayne County, sent a letter to OMB Director Mick Mulvaney on May 24 asking him to waive the regulatory analysis and let the repeal become effective right away.
There is a good deal of opposition to exempting the glider industry from the emission limits, however.
That arises from the other side of the story — the argument that glider makers shouldn’t be allowed to benefit from a loophole at the expense of businesses that make, sell and use cleaner-running trucks, and which keeps higher-polluting trucks on the road.
Opponents of the repeal argue that the glider market traditionally was limited to salvaging usable engines from wrecked trucks.
However, glider production shot up after the first phase of the emissions rule went into effect on new trucks. It did not apply to gliders at the time.
Production went from a few hundred trucks a year to about 10,000 in 2015, according to comments submitted to EPA.
That happened because “some companies exploited the opportunity to offer glider vehicles with older ‘pre-emissions’ engines to customers seeking to avoid modern emissions control systems,” Susan Alt, an executive with Volvo, said in a letter to the EPA, which also pointed out that Volvo employs thousands in the U.S.
Opponents of the repeal say many gliders don’t have the latest safety equipment, and have argued that the lack of a single emissions standard on gliders could lead to a hodge-podge of state rules.
A range of business and health interests have lined up against the repeal, including the National Association of Manufacturers; new-truck makers; the American Trucking Associations; United Parcel Service; the American Lung Association; an association of state clean-air regulators; and attorneys general from 12 states.
“Simply put, gliders are a pollution menace that, unless properly regulated, threaten to undermine the entire national program to reduce harmful emissions from heavy duty vehicles and engines,” the attorneys general told the EPA.
The Office of Management and Budget did not respond to a question on whether it is considering letting the repeal go through without a regulatory analysis.
But Wayne County Judge-Executive Mike Anderson said that after talking this week with a Fitzgerald representative, he is optimistic the company’s plan for a new facility in his county will come to fruition.
“Those jobs are very, very important to Wayne County and Monticello,” Anderson said.
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