Rock Products - The Leading Voice of the Aggregate Industries.

The Past is Prologue


 

Mark SavitIt’s A Little Like The First Day Of Baseball Season When Every Team Is Undefeated And Hope Springs Eternal.

By Mark Savit

 The holidays are over. It looks like deals will be done so that we won’t have another government shutdown this year. Congress appears poised to compromise on a budget that might actually bring us some good news on the infrastructure-funding front. Construction appears to be coming back. In all, it looks like we might actually be poised to start the slow climb out of what had been a fairly depressing past few years.

It’s a little like the first day of baseball season when every team is undefeated and hope springs eternal. The problem with the opening day euphoria is that, for at least half the fans, it lasts precisely one day. Half the teams lose their first game. Reality just sets in a bit later for the half that didn’t.

Unfortunately, my job is to remind folks of reality and there appears to be a fair amount of reality on its way, at least from my perspective.

Tragic Accidents
There is no denying that the year ended with a spate of fatalities that left everyone in our industry (as well as the rest of the mining industry) in a bit of shock. What we all thought was going to be another record low year turned out not to be.

This is tragic on a number of levels and that overarching tragedy needs no elaboration here. Why this sudden increase in fatalities occurred is being examined by a whole host of industry professionals, but it will, no doubt, form a central theme in upcoming MSHA enforcement.

In the past, every tragic accident has been followed by a call for more stringent laws, and more stringent and aggressive enforcement. There is no reason to think that, just because the fatalities at the end of the year didn’t all come from a single event, they won’t trigger the same reaction from MSHA.

In fact, MSHA’s announcement regarding the end-of-the-year fatality numbers make it clear that they intend to implement increased enforcement efforts in response to the troubling numbers. One has to wonder, however, if doing more of the same will really elicit a different result.

But aside from continued enforcement efforts, there are a number of developments that bear watching. On the legal front, the challenge to MSHA’s Pattern of Violations rule is moving forward. By the time this article is published, the case will already have been argued before the U.S. Court of Appeals. While it is impossible to predict when the Court of Appeals will rule in the case, their pattern so far has been to rule fairly quickly. Should the rule be struck down, we would simply go back to the prior POV rule.

If that happens, MSHA could still change the screening criteria that it uses. If it is upheld, it allows MSHA so much discretion, that there’s no telling what the agency may do in terms of adopting new POV criteria. No matter what happens, it promises to be a very interesting year on the POV front.

New Regulations
MSHA has also said that it intends to issue some new regulations. For the last several years, it has said that it intends to change the penalty assessment rules to “simplify” the process, especially as it involves designating citations as “S&S” or “non-S&S.”

What is clear from what MSHA has said about this issue is that it wants more discretion in making the decision as to whether a citation should be “S&S” or not. Once again, it is too early to speculate what form this new rule might take.

Should the current POV rule be upheld and should MSHA give itself more discretion than it already has in determining which citations are “S&S,” the combined result could give MSHA the power to impose severe sanctions on any mine at any time, dependent only on the whim of the individual inspectors involved.

OSHA Rears its Head
While we normally discuss MSHA in the column, it seems clear that by far the most significant impact on the aggregate industry as a whole will come not from any MSHA rulemaking but from OSHA’s two current regulatory initiatives.

As everyone in the industry knows by now, OSHA is proposing radical reductions in silica exposure limits which, if implemented, will have extraordinarily significant impacts on the downstream side of every aggregates operation.

Unless it has been extended after publication, the comment period on the rule will be closed by now. There’s no way to predict when (or, for that matter, if) a final rule will be released but if it looks anything like the proposed rule, everyone’s world will change.

The other proposed OSHA rule is a bit of a sleeper. It would require large employers (more than 250 employees) to report all injury and illness data to OSHA on line in a way that would be immediately accessible to the public. The agency’s rationale for this is that, once the data is publicly accessible, people will be able to bring public pressure on those companies with higher than average injury rates. In short, it would serve as a sort of public shaming program for industries with “bad” records.

Public hearings on this proposed rule have just been held and comments are due very shortly. This philosophy is the same as that employed in the 16th and 17th centuries when it was thought that shaming offenders by putting them in the stocks in the public square would discourage them from committing additional crimes. Penologists long ago concluded that this approach does not work, but apparently, OSHA has yet to receive that news.

Out of Context
But, you may fairly ask, why I think the rule (if adopted) would have a significant effect on the aggregates industry. My prediction is that, if adopted, data taken out of context from reports submitted by the OSHA side of a large aggregates or construction materials producer could become the centerpiece of opposition to every zoning request in the future.

Opponents of the industry have tried every environmental argument under the sun but they have become less and less successful as we prove them wrong over and over again. This will only provide more fodder and fresh approach for opponents of the industry (and quite possibly by labor unions) and we need to be ready for it if and when it comes.

We end where we began – with hope. But the upturn in demand is not without challenges. We just need to be prepared for the increased cost of the opportunity that is hopefully on its way.


Mark Savit is a shareholder in the Denver office of Jackson Lewis P.C.  Savit counsels clients in government investigations, and on regulatory matters, to help limit civil liabilities, prevent criminal prosecutions, and promote sound health, safety and environmental policies. He has expertise in health and safety law, industrial disaster response and environmental law, and related litigation and legislative services. He can be reached at