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Settlement comes after trucking operator Complete Logistics falsely certified emissions compliance to obtain state funds
OAKLAND – California Attorney General Rob Bonta and the California Air Resources Board (CARB) today announced a $2.38 million settlement against Complete Logistics Company, LLC (CLC), resolving allegations that the trucking operator falsely claimed compliance with California emissions regulations in order to obtain $2.2 million in state grants to purchase newer, cleaner trucks. The Goods Movement Emission Reduction Program, funded under Proposition 1B, uses incentive grants to entice trucking companies to reduce emissions below the threshold required under law. Trucking operators must affirm they meet state emissions standards before acquiring funding for the purchase of additional clean trucks. CLC allegedly made false certifications of emission compliance and then took remedial steps to become compliant once the impropriety was discovered by the owner.
"Californians unfortunately still breathe the worst air in the nation, and heavy trucks contribute to that air pollution. Proposition 1B provides a vital program that helps to fight this pollution by incentivizing private trucking fleets to secure newer, cleaner trucks that benefit community health,” said Attorney General Bonta. “In order for the program to work, companies need to play by the rules. Any company that bilks the state out of taxpayer dollars will swiftly be brought to justice. We’re heartened to see that Complete Logistics cleaned up their act."
"CARB utilizes its audit and investigation tools to ferret out companies receiving incentive funds based on falsely-reported compliance with CARB regulations. As this case illustrates, the consequences of such cheating are serious,” said CARB Executive Officer Richard W. Corey. "It's vital that other companies take note of the high settlement amount and remember that they risk their reputation and their business if they falsify information to obtain precious incentive funding."
CARB incentivizes trucking companies to comply with state emissions standards with grants provided by Proposition 1B, a 2006 statewide bond that directed approximately $1 billion to help reduce air pollution associated with freight travel in California. Through an audit, CARB concluded that CLC was out of compliance when the company falsely certified its fleet met such state emissions standards and improperly accepted $2.2 million in Proposition 1B funds. The company did use the grant funds to purchase new, clean trucks.
The alleged misrepresentation occurred while CLC’s owner left the company due to health issues. When the owner returned to CLC in 2017, he took remedial measures upon learning of the misrepresentations to CARB that included terminating responsible employees. CARB reports that CLC became compliant in 2019 and is now a model trucking operator with respect to emissions compliance.
Under the terms of the settlement, CLC will pay $2.38 million to the state of California, of which CARB will receive 90% and the California Department of Justice will receive 10%. CARB previously secured a $650,000 settlement against CLC to resolve alleged violations of fleet emissions regulations. Today’s settlement resolves CARB’s breach of contract and fraud claims against CLC.
A copy of the settlement is available here.