Washington Truckers, Farmers Seek Exemption Compliance
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Washington Trucking Associations and Washington Farm Bureau have given the state Department of Ecology a 60-day deadline to answer how it will comply with a new carbon price added to most fuel that should be exempt when used to grow and transport agriculture.
“It is estimated that the agricultural sector alone will be illegally overcharged $74 million due to this exemption not being recognized,” noted a statement issued recently by Washington Farm Bureau and Washington Trucking Associations. “Despite the law’s explicit exemption for agriculture, farm and ranch operations throughout the state continue to be subjected to the carbon price.”
This year, the Department of Ecology began implementing a cap-and-invest program that applies a carbon price to the purchase of certain fuels, but allows exemptions on fuels purchased for agricultural purposes such as transportation on highways and growing, raising and producing.
The farm bureau, the state’s largest general agriculture organization, is a grassroots advocacy group representing Washington’s ranch and farm families.
BIG NEWS: WFB and WTA filed a Petition for Review with the Department of Ecology to address agriculture's illegal subjection to a carbon price on fuel purchases. #agriculture #dowhatsrighthttps://t.co/pl1pgLekgS — Washington Farm Bureau (@WAFarmBureau) June 23, 2023
The petition, sent in mid-June, states that the rules outlined in the language of the Climate Commitment Act that delegated authority to the Department of Ecology for the fuel exemptions is “woefully deficient in establishing an adequate process to exempt agricultural related fuel” from carbon add-on charges.
Both organizations issued a “Petition for Review” to Department of Ecology requesting rulemaking “to ensure that motor vehicle fuel used exclusively for agricultural purposes and fuels used for transporting agriculture products on public highways are exempt from coverage under the Climate Commitment Act. The petition reminded the state agency about its obligation by the Legislature to ensure the agriculture’s exemption is protected."
The petition states that the rules outlined “are woefully deficient in establishing an adequate process to exempt agricultural related fuel from Climate Commitment Act-related charges.”
Call
WTA President Sheri Call told Transport Topics that the main problem is the Department of Ecology has failed to implement the exemptions. She believes the state’s trucking industry is being hit with a much greater financial impact than the $74 million annual figure tied only to the Washington agriculture industry.
“For the trucking industry, we’re having a hard time nailing it down because of the nature of the industry. Some carriers are niche carriers. They do ag for half a year, or they may do it for a day and then move on and do something else like building supplies,” Call said. “So it really takes a complete audit of your mileage and your fuel usage and the commodity that you’re hauling [to track exemptions].”
Not only are trucking companies not being exempt when hauling agricultural goods, but their fuel prices rose in anticipation of the new carbon fuel add-on.
“Some members who have relationships with fuel suppliers reported getting letters about prices being raised by 50 cents and 55 cents [per gallon] to prepare for the cost of cap,” Call said. “Prices went up right away.”
Lemmons
Dale Lemmons, president of Kelso-based Signature Transport Inc., voiced strong opinions about the Department of Ecology shirking its responsibility. His company, with 90 people, specializes in hauling wood residuals from sawmills and live poultry. Agriculture accounts for 15% of his business.
“At this point, they have left it to us to design a system to track and exempt the fuel used in ag transport. We have spent countless hours designing that system and will now implement it. However, we don’t know if that system will meet [the Department of Ecology’s] requirements for proof that the fuel was used for ag.
“We will only know that after someone gets audited and if our system doesn’t meet their requirements. We will get penalized by the very folks who should be designing the system in the first place,” Lemmons said.
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Although his company spent a few hundred dollars to develop its fuel-exemption system, it will have to pay from $6,000 to $8,000 per year for the billing employee to track and submit information to the state.
Fairly simple to administer and without driver involvement, the system was designed by Signature Transport’s fuel distributor.
“We are fortunate to be large enough to work with one vendor who will carve out those gallons used for ag,” Lemmon said. “Many smaller companies fuel up wherever they can get the cheapest price that day and don’t have the volume to make it worthwhile for the seller to track and exempt those gallons, putting the smallest companies, who can least afford it, in great jeopardy.”
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