Construction Materials Association of California Finds That Looming Sand and Gravel Shortages Threaten California's Future.

Business Editors

SACRAMENTO, Calif.--(BUSINESS WIRE)--Sept. 11, 2001

Aggregates Industry Major Contributor to California's Economy,

But Shortages Pose Risk to Infrastructure

Policymakers and planners have failed to consider whether local supplies of construction aggregates will be available to meet the state's urgent need of upgrading, maintaining, and building new infrastructure. This planning lapse is one of the conclusions of a new study released today by the Construction Materials Association of California.

Finding that California's construction industry provides over $108 billion, or 10% of the state's $1.2 trillion gross product, "The Aggregates Industry: Its Importance to California's Economy and Infrastructure" presents economic data documenting the contribution that the aggregates industry, in its pivotal role as supplier of raw materials for construction, makes to the California economy. Applied Development Economics, a leading Sacramento- and Berkeley-based consulting firm specializing in industry analysis, wrote the study in association with e concepts of Burlingame.

Known as "aggregates," sand and gravel and crushed stone are the basic raw materials used in construction, road building, and ready mixed concrete. All of California's public and private infrastructure -- its roads, highways, homes, buildings, schools, and industrial and commercial facilities -- depend upon readily available aggregates for construction.

Maintaining access to locally available aggregates is especially critical, as investment in California's crumbling infrastructure has been identified as one of the state's most pressing concerns. Overcoming deficiencies in the maintenance and development of transportation systems, school facilities, and affordable housing will depend upon local, low-cost, and large sources of aggregates. According to Jim King, President of Applied Development Economics, "The New Economy firms that are the engines of economic growth in California cannot compete in the global marketplace if the state's basic infrastructure is not world class."

Throughout California, many local sources of permitted aggregate supplies are rapidly running out. Without local, low-cost, and accessible quality aggregates, California communities will be unable to sustain an attractive quality of life or economy. According to the report, local and county jurisdictions will need to give greater consideration to aggregates in their land use planning and policies, and provide for the development of these resources at the local level.

Other Key Findings:

-- The aggregates industry contributes $5.1 billion to the state's gross
product, including nearly $1 billion in federal and state taxes.

-- Aggregate companies employ nearly 35,000 workers and provide over $1.5
billion in wages.

-- Aggregate companies boost the economies of all 58 California counties.

-- While construction increased by over $9.5 billion between 1995-99,
California's failure to invest in essential infrastructure is causing critical
deficiencies in roads, schools, bridges, power plants, airports, and water and
sewage systems.

-- A deteriorating infrastructure threatens California's quality of life,
public safety, and competitiveness in the global economy.

A copy of the study is available from the Construction Materials Association of California, 1029 "J" St., Sacramento, CA 95814, or call 916/554-1000.