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Another alternative used by some state and municipal governments to promote diesel retrofits has been the adoption of contracting requirements for equipment used on public works projects. With Massachusetts’ Big Dig project and Connecticut’s Q-Bridge project as visible examples, more and more government entities are considering such contract provisions. In New York, retrofit requirements were included in the The Ohio General Assembly passed a bill in the fall of 2006, which was subsequently signed by the Governor, creating a statewide Diesel Emissions Reduction Program. 26 World Trade Center recovery and rebuilding project and are now required in all New York City construction projects as a result of New York City’s Local Law 77. This commitment was expanded to the state level in August 2006 when the Governor signed into law legislation which requires the use of ULSD and best available retrofit technology in all state-owned heavy duty diesel vehicles or heavy duty diesel vehicles under contract with the state (with exceptions for agricultural equipment, emergency vehicles and other select cases).

While such measures have received strong support from environmental groups, they pose challenges for the construction community since they give a competitive advantage to firms that have already retrofitted their equipment and larger firms, which can better afford capital equipment investments. One way to ameliorate this potential competitive disadvantage is to provide a contract allowance that partially or fully offsets the cost of the emissions reduction investment as part of the final contract. Examples of these allowances have been found in Georgia and Texas, with other localities just beginning to adopt such measures. The Associated General Contractors of America (AGC) has been particularly interested in the impact of such provisions on their members. More information impact of contract requirements on the construction industry is available at the AGC website at: www.agc.com.