Government Regs Threaten to Bury Local Contractor

Before another politician makes a statement claiming that regulations don’t do any economic harm, he needs to talk to Buddy Byrd.

Byrd got his first contractors license in 1984 when he was 24 years old. He built Byrd Underground up to 65 employees by 2006, at the peak of Southern Nevada’s building boom.

The company, which he describes as “a full-A civil contractor” that performs grading, paving, concrete, digs trenches and installs utilities such as electrical, water and sewer, fell to sixteen employees recently although he has added two new people since.

But if certain new regulations are allowed to take effect in 2014, he is concerned that Byrd Underground, after surviving the collapse of the local construction market, may become a casualty of federal government overregulation.

In 2014 new EPA guidelines take effect that tighten emissions standards on certain diesel engines – those not for highway use – to what is called a Tier 4 standard. In some cases, these emissions would have to be reduced by 90% from their current standard to comply with Tier 4.

Byrd, whose current vehicles and equipment comply with the Tier 3 standard, says he can “not afford to replace every single piece of equipment I have or bring it up to the new Tier 4 regulations.”

He estimates it would cost him over $7.5 million to upgrade or replace his fleet to comply with Tier 4. With gross revenues of $2-3 million per year and net profits “down to nothing” it may be impossible for Byrd’s family business to continue if this regulation is implemented.

It’s not as though Byrd’s equipment is ancient. Much of his 50 pieces of heavy equipment and 15 trucks were purchased new in and around 2006. That is virtually brand-new in the area of construction equipment, but obsolete in terms of the pending regulations.

In the end the new regulation may be self-defeating. The best option available, according to Byrd, may be “to sell all of my equipment and let it go overseas.”

Other countries, such as Mexico and China, don’t have nearly as strict emissions standards as the United States. So companies in those nations would readily buy the perfectly-good but non-compliant equipment American firms would have to dump. The equipment would still be emitting the same particles, only on foreign projects instead of American ones.

The NFIB featured Byrd as part of its Small Business for Sensible Regulations campaign, which highlights the impact of federal regulations on small businesses. NFIB’s Nevada State Director, Randi Thompson says, “Currently there are over 4,000 federal regulations that are in the pipeline.” She adds, “What we’ve seen in the last six years is a 60% increase in regulations that actually have an economic impact.”

“It costs businesses that have 20 employees on average about $2,400 a year per employee to comply with federal regulations,” according to Thompson. The purpose of the NFIB campaign is to focus attention on the plight of the small business owners who must deal with these regulations.

While the emissions standards may have the most damaging effect on Byrd’s business they are far from the only federal regulations hampering it. Byrd identified the health care reform legislation (the Patient Protection and Affordable Care Act, or ObamaCare) as one that will pile additional costs on his business. In addition, one of Byrd Underground’s projects has been on hold, with the company’s equipment sitting idle, because of federal lead paint regulations.

As Thompson says, “They only way they’re going to pull back on these reg’s is if people like Buddy Byrd stand up and say, ‘You know what this is going to cost me?’” Buddy Byrd is standing up, but are they listening?