22 WESTERN PALLET
The Role of Government Affairs in Supporting the Industry
“It’s great to get together to network, but one of the primary reasons we join associations is to protect ourselves from the Bogeyman (boogeyman),” stated Mike Hachtman. He has been the Chairman of the NWPCA Government Affairs Committee for several years, and since 2017, has served on the Board of Directors of the NWPCA. He is also President of WPA-member Relogistics Services.
“There are groups of people who have plans that would directly impact our business,” he continued. “Many of those involve government. That’s why politics in our nation’s capital, as well as state capitals, is so important to everyone here whether you are making lumber, pallets, or nailing machines.
“Whatever they do can have a direct effect on every one of us. The good news is that we are a powerful organization. Due to strategic relationships developed by NWPCA, he said, “things just don’t happen anymore without us knowing about it.” Because of relationship building, NWPCA now is very likely to get a call if something is on the legislative radar that could be an issue. But pallet industry support is still critical. “ We can’t afford to have paid staff in every state, so we need you to be our eyes and ears on the ground. Let us know if something crazy is going on in your home state. The more people we get involved, the more powerful we become as an industry.”
Some of the initiatives that could be potentially damaging to the pallet industry include work by the Carey Institute to ban international shipment of wood packaging, as well as efforts by Change the Pallet, a corrugated pallet group.
“We as an industry have no problem competing with materials,” Hachtman said. “Let the market decide. The wood pallet is the most widely used around the world. What we have a problem with is artificial government interference in the marketplace--people outside that marketplace are trying to influence (lawmakers as to) what is right and what is wrong.”
In regards to the ISPM 15 exemption between the United States and Canada, Hachtman reported assurances that there will be no action through at least to 2020, allowing the free movement of wood packaging back and forth between Canada and the U.S. One interesting issue, however, is that USDA has proposed to end inter-state quarantine for invasive species.
As such, the industry wants to make sure there are no unintended consequences of eliminating those quarantines which would give Canadians pause for caution about continuing the exemption. “NWPCA has submitted comments to USDA and will continue to look at that to make sure there are no unintended consequences,” he said.
Further to the theme of complex policy issues, he surprised some attendees by suggesting they were at least indirectly in the energy business, and that cheap natural gas was causing problems for fiber residuals.
“We are indirectly in the energy business,” he said. “Guess what, fracking has been a wonderful development for the economy of our country over the last few years. It has also allowed us to get $2.25 diesel, which is great. It has brought down prices around the globe. But when you pull liquids out of the ground, what do you get? You get natural gas, and it is incredibly cheap. There are companies out there who might have used wood pellets or wood fiber in their boiler. It’s cheaper to just burn natural gas, now. Those biomass plants can’t compete with natural gas generated electricity. It is just cheap, which is both a good thing and a bad thing for our industry.
“As an industry we have to understand how these external things can affect us.”
NWPCA is also working to eliminate potential restriction on the use of recycled fiber in pellets that has been pushed by EPA. “We do not need government saying that our residuals are unusable,” Hachtman said. “So we have submitted comments to EPA that there is nothing wrong with wood pallets being used for wood pellets.” In fact, he noted, because the material is so dry, the BTU content is much higher.
Hachtman also touched on more general business concerns, including tax, immigration, health care, labor, and OSHA.
Of note, NWPCA formed its PalletPac in 2018. (A Pac is a political action committee.) “It is designed solely to support the wooden pallet and container industry,” Hachtman said. “It’s one more arrow in our quiver that allows us to find friend in Washington DC and keep friends in Washington DC. We need friends on both sides of the aisle, senate and congress.”
To find out more about PalletPac and how you can support it, visit https://www.palletcentral.com/page/PalletPAC.