The South Coast Air Quality Management District (SCAQMD) won the challenge to its Indirect Sourcing Rule (ISR) brought forward by the California Trucking Association (CTA) and Airlines for America.

For those not familiar with the ISR, it was approved in 2021 and requires warehouses 100,000 sqft or greater in Southern California to either pay a fine based on the number of truck trips into their facility or earn points by utilizing green technologies. It is estimated 1,400 of the 2,000 applicable warehouses are not compliant and have not paid the penalty fees.

The CTA and Airlines for America sued SCAQMD based on violations of federal law. Unfortunately, the District Court did not agree. The CTA and Airlines for America are weighing their options for appeal.

In the meantime, this rule opens the door to a patchwork of regulations across states, regions, counties and municipalities.

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