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Summer 2007 OCMA News |
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Summer 2007 OCMA News |
Summer 2007 OCMA NEWS President George J. Deckebach called the business meeting to order at 12:15 P.M. II. SPEAKERS
The Honorable Ross McGregor, (R-72nd District Clark County & Springfield), was the luncheon speaker. Rep. McGregor is the only state representative who is directly associated with manufacturing. He serves as Business Project Manager for the family-owned Pentaflex, Inc., a heavy metal stamping business serving the truck manufacturing industry. As a businessman dealing with “bottom line” issues every day, Rep. McGregor has a very insightful understanding of how taxes, regulations, and government policy can affect Ohio’s businesses. The key points of his presentation are summarized below. 1. His first taste of electoral politics occurred in 2002 when he ran for Clark County Commissioner and narrowly lost to a 20-year incumbent. In 2005, when Rep. Merle Kearns gave up her seat in the Ohio General Assembly to become Director of the Ohio Department of Aging, he threw his “hat in the ring” to replace Rep. Kearns. Ohio Speaker of the House Jon Husted selected him and his experience in state government began. 2. Fortunate to have Ohio Congressman David Hobson as a mentor, when Rep. McGregor came to the state legislature he took Rep. Hobson’s sage advice which was, “keep your mouth shut; listen, don’t talk”. He quickly learned that the legislative process had very little in common with the classes in government he had studied in college. As an appointed legislator, he had to run for election in November 2006. The 72nd district is considered a “swing” or competitive district and the 2006 election was one of the most expensive in the state. At the end of the day, he was re-elected by a considerable margin in a tough race. 3. Having won a tough race in a very difficult election year for
Republicans, Rep. McGregor was rewarded with good committee assignments
on Finance
and Appropriations, Insurance, Healthcare Access and Affordability.
He was also selected to Chair the Joint Committee on Agency Rule
Review
(JCARR). The primary function of JCARR is to review proposed new,
amended, and rescinded rules to ensure the rules do not exceed
the scope of the
rule-making agency’s statutory authority and that the rules
do not conflict with the intent of the legislature. 5. Having completed the biennial budget for the State of Ohio, the next big issue will be electricity deregulation and how to prepare for the end of the rate stabilization plans at the end of 2008. He is promoting a more proactive stance on the issue. Ohio needs to find a solution that enhances industry’s ability to compete. It is important to stem the loss of manufacturing jobs in Ohio. An important ingredient in that antidote is reasonably priced, reliable, and consistent electricity. To that end, the individual chairs of the House & Senate Utility Committees have asked Governor Strickland to take a leadership role in this debate. 6. He is very concerned about the increasing cost of healthcare. Serving on the House Healthcare Access & Affordability Committee he is bombarded with cries for more government involvement in healthcare. The Massachusetts legislature recently enacted a type of universal care in their state. He is concerned that Ohio may turn in that direction. Importantly, he states placing more taxes on business in Ohio to provide care to those without insurance is not the answer. 7. Lastly, Rep. McGregor has introduced H.B. 285 that would waive fines and penalties for first-time paperwork violations. The bill calls for directing the company’s attention to their error and helping them fix it with no fines or penalties. The NFIB is supporting this legislation.
Kathy Trent, Director Government Affairs, Waste Management, Inc. provided a report on the solid waste industry, industrial recycling, and the activities of the Ohio EPA’s Division of Solid & Infectious Waste Management (DSWIM) that may affect Ohio metal casters in the near future. Key points of her presentation are provided below: 1. Ohio is blessed with plentiful disposal capacity. Presently, the capacity is anticipated to last thirty years at current rates of usage. One of the critical factors of this capacity is the highly successful recycling activity of industry. Recent studies show that the industrial sector is recycling on average approximately 65% of its waste. That is “pretty darn good”. 2. The Ohio EPA DSWIM is in solid financial condition so additional fees should not be forthcoming. The DSWIM presently receives its funding from the $3.50 /ton solid waste fee collected at the landfills and $1.60/ton collected at construction demolition debris (C&D) landfills. The DSWIM receives more than $45 million per year from these charges. 3. Ohio EPA has a new Director, Chris Korleski, formerly from Honda of America Mfg., Inc. and a new Chief of the DSWIM, Pam Allen, a longtime employee of the department. Ms. Trent expects a more effective division under her leadership. 4. Ohio EPA DSWIM has been engaged in a major rule re-writing task for the past two years. The Agency’s two-year effort was targeted to reorganize and develop a “common sense approach for the regulation of industrial waste”. Under this standard, industrial waste with similar waste characteristics should be disposed of in similar disposal facilities, something that was not the case under the old rules. However, the draft rules were written by OEPA staff with little if any input from affected industries. As a result, more than 1400 comments were received during the comment period and the draft rules have been rescinded. 5. The new management at DSWIM is focused on completing the proposed Construction Demolition Debris rules based upon the requirements outlined in H.B. 397. The department has held numerous “focus group” meetings to solicit feedback and suggestions. Revised draft of the C & D rules is expected in approximately six months. The revised rules will include: siting, ground water monitoring, operational plans, permitting, contingency plans, closure and post-closure and financial assurance standards. 6. In November 2006, Ohio EPA released Draft Rules on Beneficial Reuse to replace rescinded Ohio EPA Policy 400.007. Although these draft rules received numerous comments, the Agency has put further progress on hold until the C & D rule revisions are complete. The draft rules did create new testing and analytical standards for wastes to be “beneficially reused.” Beneficial reuse is defined as “disposal of an industrial byproduct in a pre-approved use, and requires a permit. 7. Unlike Ohio EPA Policy 400.007, the draft beneficial reuse rules do not include use as an alternative daily cover for landfills. The draft rules do identify prohibited uses and establishes testing protocols and concentrations allowed for beneficial reuse. 8. The draft rule does include several pre-approved allowable uses as long as the material meets standards. These include: confined geotechnical fill; unconfined geotechnical fill and soil blends. 9. DSWIM proposed Industrial Waste Draft Rules in August 2006. These rules received significant comments asking for revisions. The draft rules included recommendations for twelve (12) different landfill types based upon waste characterization. The rule revisions are on hold until C & D rules are completed. Ms. Trent’s PowerPoint presentation is available from the OCMA office. If you are interested in a copy, please call or e-mail.
Kristin Zimmerman, PhD, General Motors Public Policy Center, and Jim Schifo, PE, Keramida Environmental, Inc. provided their perspective on the global warming issue with their presentation entitled, “Strategic Business Response to Energy Security and the Global Climate Issue”. Dr. Zimmerman is currently working in GM’s Public Policy Center as manager of Environmental and Energy Policy, where she is focusing on developing and implementing GM’s global energy/carbon management strategy, policy and practices. She is also in charge of GM’s greenhouse gas reporting policy and practices for all global operations. Mr. Schifo, a former long-time GM Powertrain casting & environmental expert, has written several articles concerning carbon production in foundry operations. The key points of their presentation are presented below: General Motors Report on Energy Security and the Global Climate Issue – April 2007 Executive Summary At GM we recognize that we live in an era of highly volatile energy supplies and costs, potential constraints on carbon emissions, and concerns with both the availability and reliability of energy that can significantly affect our facilities, products, and customers. Addressing these realities presents a challenging assignment, but also an extraordinary opportunity. GM believes the key to success is energy diversity – that is, being able to offer vehicles that can be powered with many different and more sustainable sources of energy. Developing alternative sources of energy and propulsion can mitigate many of the issues surrounding energy availability and the global climate issue, including global demand; business and profitability risks; and greenhouse gas emissions. 1. GM is developing an Advanced Propulsion Technology Strategy to address the energy security and global climate issues. The strategy is to diversify the fuels used to propel GM vehicles moving over time from petroleum to bio-fuels to electricity and on to hydrogen fuel cells. 2. Basic facts about the greenhouse effect and global warming. There is a natural greenhouse effect. Greenhouse gases (GHGs) absorb infrared radiation from earth and warm the planet near the surface. Without the natural greenhouse effect the earth would be much colder: an average of –2 degrees F versus the current average of 57 degrees F. Water vapor is the most important GHG, but there are other GHGs of natural and/or manmade origin such as carbon dioxide (CO2), methane, nitrous oxide, ozone chloro- and hydro-fluorocarbons (CFCs) and HFCs. 3. Carbon dioxide is not a pollutant. It is the objective of every Engineer to convert all the carbon in fuel to CO2. Carbon that is not converted comes out as pollutants: carbon monoxide (CO), VOCs, particulate matter (soot) and the combustion is inefficient. Plants breathe CO2 (it is their source of carbon) and exhale oxygen. People and animals breathe in oxygen and exhale CO2. Without CO2, life could not exist. 4. Manmade sources account for about 4% of annual global carbon dioxide emissions. In 2000 manmade U.S. CO2 emissions approximated 1.6 gigatons of carbon and of this total light duty vehicles contributed 18% of the total. Of the 1.6 gigatons of carbon, U.S. metal casting facilities are responsible for approximately 0.03 gigatons (30 million tons) including calculations to include direct and indirect consequences such as energy consumption. Ohio foundries are responsible for approximately 3.5 million tons of CO2. 5. CO2 Contributions of US Foundries by Metal: - Iron – 52% 6. CO2 emissions in tons per ton of castings shipped presents an interesting picture: - Gray Iron – 2.0 tons 7. More than one-half (50.5%) of US Foundry production is concentrated in four states with Ohio at 14% of total U.S. casting production tons. Future CO2 emission inventories will likely result in future regulatory initiatives in these states. Other emissions of interest from foundry operations include methane and CO2 from sand molding lines and VOC emissions. 8. There is increasing awareness by the general public about the global warming issue. Major publications such as Time & National Geographic have released special issues warning of the catastrophic consequences of continued global warming. 9. January 2007 announcement of US Climate Action Partnership (CAP), calling for cap-and-trade system to combat climate change (ten companies from energy, manufacturing, and financial services sectors and four environmental organizations. GM is a member signing on to a goal of 60-80% reduction by 2050. 10. What are the observed changes in the climate that have prompted this concern? The warming rate since the mid-70s has been 2-3 times the century average. Warm extremes have increased and cold extremes have decreased. It is very likely that average NH temperatures during the 20th century were warmer than any 50-year period in the last 500 years and likely that this was the warmest period in the last 1000 years. Eight of ten warmest years in instruments record (since the 1890s) occurred between 1995 and 2004. 2005 was the warmest ever even over 1998, a strong El Nino year (although this is still in contention). 11. In early 2007, five climate change bills had been introduced by major “players” in the 110th Congress. There have been hearings in numerous House and Senate Committees. Speaker Pelosi authorized the formation of the Select Committee on Energy Independence and Global Warming. The five major bills are: - McCain-Lieberman (S. 280) and Olver-Gilchrest (H.R. 620) 12. Comparing the potential impact of the various bills it is important to note that if the economy hums along to 2050 without legislation the number of millions of metric tons of CO2 Equivalent is projected to be approximately 12,000. Under the Bingaman draft, which has not been introduced, the number would be between 8,000 and 10,000 depending upon the implementation of a “safety value”. The McCain-Lieberman legislation would result in a reduction to approximately 5,000 and the Sanders-Boxer proposal, by far the most restrictive, would reduce that number to 2,000, a reduction of more than 80% from “business as usual”. 13. Potential legislative outcomes in the near-term include the passage of a Renewable Energy Portfolio Standard (RPS) that would require utilities to have a certain percentage of their energy produced from renewable sources such as wind or solar power. Legislation could also be enacted that would require a certain percentage of vehicles produced to be able to operate on renewable fuel; a Renewable Fuel Standard (RFS). Mandatory Green House Gas (GHG) reporting at the facility level is also on the horizon along with new Energy Efficiency Standards and possible NSR reform. 14. In the mid-term, 2010-2017, sectoral CO2 mandates are likely with and without trading. Long-term, after 2020, expect an economy-wide Cap and Trade Program. The PowerPoint presentation of Dr. Zimmerman and Jim Schifo is available from the OCMA office. Please just call or e-mail your request. II. OLD BUSINESS A. Approval of Past Minutes A motion was made, seconded, and unanimously approved to accept the minutes from the meeting held on January 16, 2007, at the Columbus Convention Center. B. Membership and Finance OCMA Vice President-elect Jim Flanagan, Babcock & Wilcox Company, presented the membership report. There were no new members and no member losses. OCMA membership stands at 85 members. OCMA Treasurer John Burke presented the financial report. The Board of Trustees adopted the OCMA budget for 2007-2008. FY 2006-2007 was a very good year financially with the golf outing and two workshops contributing to a substantial surplus for the fiscal year. The over-all surplus stood at approximately $50,000 at the end of FY 2006-2007. The Treasurer’s report was adopted.
C. Environmental Update OCMA Vice President for Environmental Affairs Ryan Burke, OSCO Industries, Inc., presented the environmental report. The PowerPoint environmental report is available from the OCMA office, just call or e-mail. Key issues are outlined below: Generally Available Control Technology • USEPA is preparing to propose a GACT standard before the
court ordered deadline of December 2007. GACT will apply to area
sources; those
with a potential to emit less than 10 tons/yr for a single HAP
or less than 25 tons/yr for any combination of HAPs. • USEPA is proposing all furnaces (including Electric Induction Furnaces (EIFs) meet a limit of 0.8 lbs/ton or equivalent metallic HAP limit. The Agency is also considering production cutoffs of 10,000 tons per year below which no controls would be needed by those facilities. Facilities of this size would still be required to have scrap management plans and visual observation for fugitive emissions. • USEPA claims only 30-40 foundries with EIFs would not meet the 0.8 emission factor. USEPA claims the proposed rule would reduce metallic HAPs by approximately 34 tons along with a significant reduction in PM. The Agency estimates that annual compliance costs would be approximately $11 million which represents only 1% of revenues so cost of compliance should not be too burdensome. Finally, USEPA claims that no small businesses will be affected. • The AFS GACT Working Group is preparing additional research concerning the validity of the 0.8 lb/ton emission factor. It is planning to prepare case studies to demonstrate that USEPA cost estimates are incorrect. It will ask USEPA to consider higher cutoffs for those facilities with EIFs. Finally, the group will show that the USEPA is incorrect to deny a small business impact. The AFS Washington Office is already in contact with the Small Business Administration advocate. Miscellaneous • MACT facilities semi-annual compliance report is due July
31st.
Beneficial Reuse Update John Kurtz, Kurtz Bros., Inc. provided the report. • The rules have been on hold for several months now so that Solid and Infectious Waste could concentrate on the Construction and Demolition Debris Rules. However, after internal discussion last week at OEPA they think that they may start revising the rules again. The agency will first respond to comments. Then the proposed rules will almost definitely go out for public comment again before anything is finalized. EMTEC Report Nick Cannell, EMTEC, provided the report. Highlights are outlined below:
• He has updated the OCMA website following a problem with the ISP. If anyone notices a problem with the website please notify Nick at (216) 408-7706 or Russ at the OCMA office IV. NEW BUSINESS A. OCMA Secretary John Kurtz, Kurtz Bros., Inc., presented the following recommendations of the Nominating Committee to the body. A motion was made to accept the recommendations. The motion was seconded and the nominees were elected unanimously. * President Jeff Otterstedt, Clow Water Systems Board of Trustees - Terms to expire in 2010 * Dan Salak, Foseco Metallurgical, Inc. The Board of Trustees filled the vacancy created by Jim Flanagan’s acceptance of the Vice Presidency with Angela Dine Molaskey, St. Marys Foundry, Inc. It also filled the vacancy created by Doug Rowe’s retirement with Dave Yonto, The Quality Castings Company. These terms will expire in 2008 and 2009, respectively.
B. OCMA President George
J. Deckebach, Miami-Cast, Inc., presented the 2007 President's
Awards. The awards are based upon the recipient's contributions
to the OCMA and to the Ohio metal casting industry. The Company Award
was
presented to OCMA Past President John Vaught, Tri-Cast, Ltd. The
Vendor Award was presented to Jerry Clancey and Greg Tordoff representing
Fairmount Minerals,
Ltd.
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