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Regulatory and Legislative Update

Henry E. Seaton, Esq.Seaton & Husk, L.P.

www.transportationlaw.net

AHAA Fall 2015November 10‐12, 2015

42


PART 1: RULEMAKING

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Issues To Be Addressed(1) ELDs (Electronic Logging Devices)

(2) Prohibition of Coercion

(3) Speed Limiters

(4) Drug and Alcohol Clearinghouse

(5) New Driver Reg Neg

(6) URS (Unified Registration System)

(7) Safety Fitness Determination

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(1) ELD (Electronic Logging Devices)

• Final rule may be issued this month.• Design and performance standards will be included.• ELD requirement when implemented, will apply to all carriers

currently required to complete RODs• Supporting documents which must be maintained will be revised.• Will address harassment concerns of OOIDA.

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(2) Prohibition of Coercion• Final rule at OMB may be issued this month.

• Aimed at brokers and shippers who require or permit legal violations.

• Fines of up to $11,000 per occurrence.

• Drivers may be whistleblowers.

• Brokers will be required to certify familiarity with safety regulations under new Unified Registration System (URS).

• This is what being a “stakeholder” will look like in the future.

46


(3) Speed Limiters

• ATA supports NHTSA proposal.

• Notice of Proposed Rulemaking stage at OMB.

• Outcome is fairly certain, but effective date is not.

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(4) Drug and Alcohol Clearinghouse

• Would track all CDL holders with

positive drug screen.

• Privacy and false positives are

issues.

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(5) New Driver Reg Neg• Negotiated rulemaking.• Members were stacked with few trucking representatives.

• ATA and NASTC were only advocates for reason.

• Studies could not prove additional classroom and school driving time was better than non‐school training, including carrier finishing programs. 49


(6) URS (Unified Registration System)

• Final rule in 2013 said it would be effective on October 23, 2015.• Agency not ready and has moved most dates back yet another

year.• New applications must be filed electronically starting in

December 2015.• Goal is to merge all applications into MCSA‐1.• Ultimately major penalties for not filing electronic biennial

update on time.• Carriers must have PIN.• Agency using resident agents as basis for service carriers.

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(7) Safety Fitness Determination• Intended to be culmination of SMS process started in 2003.• Touted as being submitted to OMB this summer.• Agency may be moving goalpost, creating new class of “high risk

carriers.”• Expect quicker and more thorough audits aimed at imminent

hazards with more conditional safety ratings and fines.• Agency says safety fitness ratings will not be based on percentile

rankings but upon static scores.• Role of BASICs in SMS data is uncertain.

51


OMB Presentation – August 10, 2015

• Made on behalf of 6 trade associations including AHAA.

• Intent of presentation was to ensure that SMS methodology, data adequacy and sufficiency issues and affect on carriers could not be circumvented in rule.

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Three issues were presented:• SMS /CSA methodology is not a “given” –

– Thorough review under Administrative Procedure Act is required.

– Cost benefit analysis in effect on small carriers is required.

– Data quality issues have been raised.

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• Data sufficiency and accuracy problems:

– SMS generates sufficient data to measure only 100,000 of 536,000 carriers the agency must evaluate.

– GAO Study says data lacks statistical accuracy to measure 90% of carriers (20 inspection rule minimum).

– Data generated in each BASIC is insufficient and inaccurate.

• Crash data 80% preventability error

• HOS over 50% violations are form and manner

• Unsafe Driving enforcement disparities by state

• Vehicle Maintenance – non out‐of‐service issues are greatest point accumulators

• Other BASICs – too few “acute” violations to be accurate measure (less than 3% rule)

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• SMS methodology fails cost benefit analysis:

– 60% of audits result in Satisfactory or Non‐Ratable ratings.

– Since SMS has been implemented, trend lines for crashes and fatalities are up, not down.

– Administrative cost to small carriers exceeds benefit.

– Agency must consider alternatives.

– BIT / Biennial desktop audit is more accurate and efficient.

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Commentary• FMCSA was on phone and silent.

• SBA rep who set up the meeting said the presentation was “impressive.”

• OMB has not released the rule for publication – a very good sign.

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57

PART 2: LEGISLATION


• Short term highway funding ends November 20, 2015.

• Long term Highway Bill –

– No fuel tax supported.

– Funding will be left to budget process and face no new tax cuts.

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CSA Study Provisions• Agency required to pay for consultant review, must address IG and

GAO Studies, must address data accuracy and sufficiency concerns.

• Ultimately would require rulemaking.

• Would require SMS percentile rankings to be removed pending certification.

• Is not broad affirmation of “fit to operate” is “fit to use” standard, but removes SMS as issue in vicarious liability suits until study is complete.

59


Major Legislative Issue Remaining is “Interim Hiring

Standard”• Pet project of TIA.

• As proposed:

– Would create separate hiring standard for shippers and brokers

– Would be equal to licensed, authorized and insured

– Shippers and brokers checking on carriers’ safety fitness rating every 35 days would have immunity from negligent selection suits

• From the outset, TIA and ATA supported separate Bills.60


• We opposed the interim hiring standard because it:

– Established an independent credentialing requiring unhinging “fit to operate” from “fit to use.”

– Placed new duties on customers.

– Applied only to negligent selection.

– Trumped preemption and existing law which is used as defense today.

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• The “hiring standard” got worse.

– It was modified to apply for only 26 months.

– It currently protects shippers and brokers only when using Satisfactory carriers.

– Thus, it disenfranchises 95% of the carriers who have Unrated or Conditional ratings.

– Senate Bill does not contain parallel provisions.

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A Call to Action: It is Time to Kill the Interim

Hiring Standard• As will be discussed, it is not needed to protect shippers and brokers.

• No good deed goes unpunished ‐ as currently written a majority of the

carriers would be disenfranchised.

• TIA / OOIDA propose an amendment which may be brought up in

Committee to include Unrated as well as Satisfactory carriers as subject to

immunity.

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• Amendment would make “Conditional” the new

“Unsatisfactory.”

• With enhanced investigative techniques, anyone can

become “Conditional” with no judicial appeal.

• Small carrier coalition is addressing the issue this week.

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The Denham Amendment• In House Bill would federally preempt state laws involving rest and

meal breaks as well as alternative wage and hour calculations.

• Important to stop encrosion of pay by the hour, time and a half for overtime suits and alternative to owner‐operator percentage pay.

• An issue which requires support from irregular route carriers – to be discussed tomorrow as major regulatory reform issue.

• Amendment was approved but hotly disputed.

• Needed to reverse 9th Circuit decision on California meal break.

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Other Legislative Issues• Both Bills would establish a pilot study for drivers younger than 21 to drive in a limited number of states.

• Senate Bill would mandate a program to recognize motor carriers and drivers with excellent safety records.

• Both Bills would authorize hair testing for substance control as an alternative to urine testing. 66


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