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Regulatory and Legislative Update - April 2024

April 19, 2024 | By
Regulatory and Legislative Update - April 2024
TEANA

Regulatory and legislative news for April 2024 includes the FMCSA renewing consideration of knowledge/proficiency exams for carriers and brokers, the FMCSA inviting comments on its plan for a new online registration platform and Hawaii seeking exemption on student transportation options. The FMCSA is also set to revise a younger driver pilot program.

Contents

Regulation and Enforcement

Courts

Advocacy and Comment

 

Regulation and Enforcement

FMCSA renews consideration of knowledge/proficiency exams for carriers, brokers

Unfulfilled congressional mandates dating back 12 to 25 years have resurfaced as matters of interest within the Federal Motor Carrier Safety Administration as the agency once again is considering mechanisms to ensure the knowledge and proficiency of carriers, brokers, and freight forwarders. The recent focus on fraud and crime in freight transportation apparently is one factor in the renewed interest.

Last month, FMCSA decided to grant a petition for rulemaking submitted by the Transportation Intermediaries Association to implement and enforce provisions of the 2012 law known as MAP-21 that specify that brokers and freight forwarders have at least one officer who has at least three years of relevant experience or who provides FMCSA with satisfactory evidence of the individual’s knowledge of related rules, regulations, and industry practices. The agency has not taken any further action yet since notifying TIA on March 13 of its decision to act positively on its petition.

A similar requirement concerning motor carriers has been on the books since the last century. Section 210(b) of the Motor Carrier Safety Improvement Act of 1999 – the law that created FMCSA – ordered the agency to establish minimum requirements to ensure applicant carriers are knowledgeable about applicable federal motor carrier safety standards. The law ordered FMCSA to establish a proficiency exam for applicant motor carriers as well as other requirements to ensure such applicants understand applicable safety and commercial regulations before being granted operating authority.

The Department of Transportation’s periodic report on significant rulemakings currently targets July of this year for a supplemental advance notice of proposed rulemaking (SANPRM) to consider methods for ensuring new motor carrier applicants are knowledgeable about safety requirements and to consider a proficiency exam, among other steps. FMCSA notes that the SANPRM would respond to issues raised in a petition from Advocates for Highway and Auto Safety. That petition for reconsideration of a December 2008 rule to improve the new entrant safety audit was filed in January 2009. FMCSA has included essentially the same language that is in the latest DOT significant rulemaking report in such reports dating back to 2009.

Although the 1999 law clearly stated that FMCSA “shall establish a proficiency examination,” the agency over the course of the last 25 years has repeatedly characterized the law as saying that it was required “to consider establishing a proficiency examination.” In an interim final rule issued in 2002, FMCSA decided to implement the law initially by providing educational and technical assistance materials to prospective new entrants and to require that they certify that they are knowledgeable about and will comply with the regulations.

Following the provisions enacted in MAP-21, FMCSA held several listening sessions in 2014 to gather feedback on how the agency might assess carrier, broker, and freight forwarder knowledge of regulations and industry practices as part of the registration process. Since then, little has transpired – at least in the public view. The DOT significant rulemakings report has continued to list the topic, although only in the reports published in September 2023 and February 2024 did FMCSA indicate any specific next step or timeline.

FMCSA invites comments on its plan for a new online registration platform

In various meetings and presentations recently, FMCSA has discussed plans to modernize its registration system (_see the January 2024 Regulatory Update_), and it now has formally announced its intent to do so. In a Federal Register notice, the agency said it will replace its Unified Registration System with a new online registration system called the “FMCSA Registration System,” or FRS, and is requesting comments on its plans within 60 days.

Although the URS in place today is used to register new entities, the FRS also will allow virtually all existing entities that must register or update registration to do so in an online environment. The system would cover, for example, MCS-150 updates, BOC-3 process agent designations, applications for additional authority, voluntary suspensions and reinstatements of operating authority for carriers, brokers, and freight forwarders, and so on. The FRS will replace forms that must be filed today with a series of questions using smart logic, FMCSA said.

In its Federal Register notice, FMCSA offered no timeframe for implementation. Although the notice does not use the word “fraud,” the agency has been touting thwarting fraud as a benefit in its discussion with stakeholders. The system will streamline registration processes and ensure that the agency can more efficiently track motor carriers, freight forwarders, and brokers, FMCSA said. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-08439.

FMCSA to revise younger driver pilot program following new law

FMCSA has moved to implement a provision in the final DOT appropriations act approved last month that mandates changes to the Safe Driver Apprenticeship Pilot Program. The program, which was authorized by Congress in 2021, is intended to determine whether commercial motor vehicle drivers aged 18 to 20 can operate safely in interstate commerce.

The provision adopted in the final fiscal year 2024 appropriations act bars FMCSA from requiring inward facing cameras or from requiring motor carriers to register an apprenticeship program with the Department of Labor as a condition for participation in the pilot program. FMCSA filed in the Federal Register an emergency request seeking Office of Management and Budget approval for changes to the application and monthly reports to implement the congressional mandate. However, the agency said plans to continue to ask carriers whether they use inward facing cameras and whether they have a registered apprenticeship program approval number.

Although up to 3,000 drivers are authorized for the program at any given time, a mere 36 drivers working for 34 carriers had been approved through the fourth quarter of last year. FMCSA had received 112 motor carrier applications, of which 38 had been disapproved as not meeting the safety performance criteria. Another 38 carriers had been approved except for not meeting the registered apprenticeship requirement. Those carriers now presumably will be approved by virtue of the provision in the appropriations act.

For the Federal Register notice, visit https://www.federalregister.gov/d/2024-07172. The appropriations act is available at https://www.congress.gov/bill/118th-congress/house-bill/4366. For more information on the pilot program, visit https://www.fmcsa.dot.gov/sdap.

EPA finalizes rule to sharply reduce greenhouse gas emissions in trucks

The Environmental Protection Agency announced its final rule requiring reductions in greenhouse gas emissions in new medium- and heavy-duty trucks. The regulations kick in as early as model year (MY) 2027 for smaller classes of vehicles and require reductions in GHGs by MY 2032 of 25% to 60% in vehicles brought to market, depending on vehicle type and application.

For over-the-road vehicles, the rules begin in MY 2028 for Class 8 daycab tractors and in MY 2030 for Class 8 sleeper cab tractors. The GHG reductions required by MY 2032 compared to existing rules are 40% for day cabs and 25% for sleepers.

EPA does not require any specific technological path for achieving GHG reductions but presumes a combination of technologies, such as battery electric trucks, hydrogen fuel cell, hydrogen combustion, hybrids, and plug-in hybrids. Reduced GHG emissions in diesel trucks also would count toward the mandates, although the scope of GHG reductions that EPA is requiring presumably could not be achieved without more fundamental changes in technology for many of the vehicles produced in 2032.

Not surprisingly, the EPA has drawn widespread criticism from the trucking industry. The objections go beyond the cost and performance of zero-emissions vehicles and include a criticism that EPA has no authority to mandate the charging and fueling infrastructure needed to support them. Although Congress theoretically has the authority to disapprove the rule, that cannot happen this year as Republicans do not have the votes to override an inevitable veto. Because the rule is being finalized so long before the election, an incoming administration would not be able to withdraw the rule. Nor would the rule be eligible for disapproval under the Congressional Review Act by the new Congress. The only realistic options for overturning the rule appear to be court action or an entirely new rulemaking in the event of a change in administration next year.

FMCSA rejects Florida’s exemption application on CDL skills testing

FMCSA denied an application sought by the Florida Department of Highway Safety and Motor Vehicles (FLHSMV) for an exemption from the regulation that requires the three-part commercial driver’s license (CDL) skills test to be administered and successfully completed in the following order: pre-trip inspection, basic vehicle control skills, and on-road skills. FLHSMV wanted to allow testers, at their discretion, to continue testing applicants who fail the pre-trip inspection or basic vehicle controls segments of the CDL skills test and allow applicant to return later to retake the failed segment(s) only.

FMCSA said the sequence of the skills test ensures that an applicant has demonstrated sufficient knowledge and skills to safely attempt the next step in the testing process. The agency further noted that current regulations already provide some flexibility. FMCSA also argued that with federal entry-level driver training requirements in place, licensing agencies should see fewer applicants who fail portions of the CDL skills test. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-08335.

Carrier seeks exemption for metal coil securement method

FMCSA is requesting comments by May 15 on an application from K & L Trucking for an exemption that would allow it to transport metal coils using a single two-ply nylon-Kevlar tie down strap to secure its metal coils for transport to a metal coil carrier affixed to the bed of its trucks/trailers as an alternative to the requirements in current regulations. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-07892.

Hawaii seeks exemption on student transportation options

FMCSA is requesting comments by May 15 on an application from the Hawaii Department of Transportation to allow Class A or B commercial driver’s license holders with passenger endorsements to operate a school bus without holding a school bus endorsement and to allow the use of motorcoaches and vans to transport students to/from a central location to school daily. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-07901.

Reminder: CSVA schedules International Roadcheck for May 14-16

The Commercial Vehicle Safety Alliance has scheduled its annual International Roadcheck intensive roadside inspection focus for May 14-16. Each year, CVSA announces a special emphasis for the event. This year, Roadcheck will focus on tractor protection systems and alcohol and controlled substance possession. Tractor protection systems include the tractor protection valve, trailer supply valve and the anti-bleed back valve, all of which might be overlooked during routine inspections, CVSA said.

 

Courts

Judge dismisses renewed lawsuit to block AB 5 enforcement

U.S. District Judge Roger Benitez has rejected another challenge by the California Trucking Association and the Owner-Operator Independent Drivers Association, among others, to California’s AB 5 law, which essentially outlaws the leased owner-operator model in trucking due to strict ABC test. The parties are appealing the judge’s ruling to the U.S. Court of Appeals for the Ninth Circuit.

CTA and OOIDA had advanced various arguments that they had not needed to develop in January 2020 when Judge Benitez granted a preliminary injunction on the grounds that enforcement of AB 5 on motor carriers was preempted by the Federal Aviation Administration Authorization Act (FAAAA). A federal appeals court overturned that injunction, and the U.S. Supreme Court cleared California to enforce AB 5 on trucking in June 2022.

 

Advocacy and Comment

Allowing for the downtime surrounding the Fall election

The FMCSA discussed its administrative agenda at The Mid-America Trucking Show (MATS). The only pending item to be addressed this year is the implementation of a new, more complex initial carrier application. While the Agency is to be commended for trying to institute anti-fraud provisions in its proposal, there are many unresolved issues that need to be carefully addressed. A new application procedure does not address the need for data verification and policing of existing non-compliant carriers, brokers, and forwarders. Nor does it evidence any intent to collect data, to determine carrier safety and compliance, or to use collected data to vet, police, and prosecute fraud.

In this regard, other pending issues suggest that while better vetting of new carrier and broker applications is a good idea, to promulgate a new application at this time should be postponed.

1. As noted above, TIA has filed a petition for rulemaking, calling into question the Agency’s obligation to vet new brokers under an anti-fraud statute passed by Congress twelve years ago. Therein, applicants for broker authority must provide satisfactory evidence of their ability to comply with “related rules, regulations, and industry practices.” This rulemaking would require FMCSA to vet and test brokers which is beyond its existing practices and the proposed new application.

2. Based on a law placed in effect when the Agency was chartered 25 years ago, the Agency has up for consideration a law requiring the establishment of a proficiency exam for motor carrier applicants to ensure carriers’ knowledge about safety regulations.

Taken together, these two petitions, if granted, would require pre-issuance testing of carriers, brokers, and forwarders. The pendency of these two rulemakings suggest that a massive change in the application process now is untimely.

Yet there is some basis for consensus. The Agency should be encouraged to clean up its database and institute fraud identification analysis of both currently authorized carriers and brokers, as well as new applicants. The unresolved issues of a new safety fitness determination and the Agency’s ultimate mandate to police and enforce rules of commerce and prevent fraudulent conduct by brokers and carriers should be resolved first.

During the pre-election doldrum, we hope there will be new ideas and initiatives to solve both the safety fitness determination issue and the anti-fraud vetting problem. Readers are urged to support a “safety compliance and common sense” approach which was discussed at MATS and will be endorsed by a growing list of diverse stakeholders. The proposal is that the Agency’s previously approved desktop audit be revised and built in to the new applicant process as a prerequisite for issuing authority.

During the 25 day pendency of grant, brokers would be vetted for fraud and non-safety compliance, and carriers would be subject to testing for both fraud and safety. The result would be the after-approval issuance of licenses. This alternative would produce several important benefits. New applicant motor carriers and existing motor carriers over time would be subject to desktop audits and receive a safety fitness determination of “Examined and found fit for use” offering the shipping public the “red light green light” it deserves.

Secondly, the 25 day time period before issuance would afford the Agency time to do the necessary background checks and testing of broker compliance with 49 CFR 371 to ensure that brokers and forwarders bear the burden of compliance and recordkeeping to facilitate the use of show cause orders and civil and criminal penalties through enforcement. Hopefully the Agency will decide against a piecemeal approach to gain the benefits of this proposed answer to both the safety and fraud issues, while continuing to ensure its data is “transparent and accountable.”

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Modern day hot shot trucking provides the speed and exclusivity you need to meet the most demanding and time-sensitive shipping requirements. We use every resource, avenue, and channel available to ship your freight by ground or air. Designed specifically to address supply and distribution problems that arise without warning, hotshot trucking tactics involve coordinating a network of carriers in a variety of locations. By calling on the vehicles closest to your supply or distribution points, hotshot brokers can fill any sudden gaps in your supply network almost as soon as they happen. This minimizes the disruption to your business and allows you to quickly return to ordinary operations, weathering the storm without skipping a beat.

Automotive

The automotive supply chain already has significant challenges. Don’t let malfunctioning equipment stop the production line. Step on the gas with HotShotTrucking.com’s suite of services that will get you back in the fast lane. With HotShotTrucking.com, companies are devising shipping strategies to swiftly deliver critical parts and equipment — whether it's ground expedite service with sprinter vans, box trucks and 53-foot tractor trailers or air freight and air cargo.

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One shipping delay can snowball and cause delays throughout your entire project. You need an experienced 3PL provider who understands the construction industry and has the logistical reach to deliver your freight on time, anywhere. That 3PL partner is HotShotTrucking.com. Whether in the air or on the ground via truck and trailer, we can connect companies to expedited freight services for the prompt delivery of parts and equipment throughout North America.

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From cranes to chemicals to excavators to conveyor belts, HotShotTrucking.com has the experience and industry know-how required for shipping sensitive, oversized, and hazardous equipment. Third-party hot shot trucking and logistics providers such as HotShotTrucking.com specialize in devising and implementing innovative shipping solutions, ensuring mines can swiftly return to operation. We’ll pick up your shipment, deliver it to the airport and receive it at the other end – providing hand-carried service as necessary or required.

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Every moment a manufacturing facility or factory sits idle costs a company money because of the high costs involved. With many manufacturers building to only just-in-time production rates, any disruption threatens parts and vehicle inventories. This is where the speed and expertise of freight services from HotShotTrucking.com can make a difference throughout the entire manufacturing supply chain. We do all the logistical legwork to find the optimal solution for your job, whether it's an exclusive air charter or expedited ground shipping.

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From servers to cell towers, information, voice, and data must flow to keep businesses, production, and the public online and connected. When equipment goes dark, depend on HotShotTrucking.com to get your systems flashing green again. This is where the speed and experience of trucking and freight services from HotShotTrucking.com can help. Our hot shot truck network excels at the prompt delivery of parts and equipment throughout North America.

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