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Archive of the Regulation Category
May 27, 2008
Ready for roadcheck?
“It is clear there have been dramatic safety improvements over the last 20 years and, in large part, this success has been the direct result of an increase in roadside inspections and enforcement.” –Stephen F. Campbell, executive director, Commercial Vehicle Safety Alliance Every year, the Commercial Vehicle Safety Alliance (CVSA) helps sponsor a 72-hour roadside safety “blitz” by federal, state, provincial and local inspectors at over 1,000 locations across the U.S. and Canada to conduct comprehensive North American Standard Level I Inspections. This year’s event kicks off June 3, so you now have fair warning to make sure your trucks are up to snuff as they hit the highway. This year also marks the 20th anniversary of these annual roadcheck safety events, so it’s worth noting the vast improvement that’s occurred in terms of truck equipment safety over that time span. Stephen Campbell, CVSA’s executive director, noted that when Roadcheck was launched in 1988, there were 4,885 fatal crashes involving large trucks, resulting in 5,679 fatalities in the U.S. That equated to 4.12 crashes per 100 million miles, along with 94.4 people injured and 215.2 people killed per 100 million miles. Fast forward to 2006, he said, and those metrics show dramatic improvements: 2.24 crashes per 100 million miles (an 84% improvement), 47.4 injuries per 100 million miles (a 99% improvement) and 134.4 fatalities per 100 million miles (a 60% improvement). “While we certainly have a long way to go and we can never be satisfied until we have zero deaths, it is clear there have been dramatic safety improvements over the last 20 years and, in large part, this success has been the direct result of an increase in roadside inspections and enforcement through the Motor Carrier Safety Assistance Program (MCSAP),” Campbell said in a recent press statement. It’s also worthy to note that the federal government is providing a lot more funding for the MCSAP effort, to the tune of $197 million last year, compared to $50 million in 1988. Annually, there are more than 3.5 million roadside inspections conducted across North America, said Campbell. “Roadcheck gets to the core of what CVSA stands for: uniformity and reciprocity of commercial vehicle inspections and enforcement activities,” he stressed. “It is through programs such as this that we are able to demonstrate to the public that we are getting results.” Still, there are areas that need improvement – and not just in terms of equipment safety. Last year, 7,708 inspectors at 1,449 locations across North America performed 62,370 truck and bus inspections and one of the metrics they found increasing revolved around hours of service (HOS) violations by truck drivers. For the second straight year, the number of drivers placed out of service increased from 5.6% in 2006 to 6.2% in 2007 – the highest Roadcheck driver out of service rate since 1999, said Campbell – with 65.9% tagged for hours of service (HOS) violations. This compares with 57.1$ in 2006. However, is this all due to willful logbook violation or are some drivers still confused about the complicated new rules put in place since 2004? CVSA’s figures shoe that only 11.4% of those drivers placed out of service falsified records of their duty status, down from 12.4% in 2006. That indicates to me that there’s still a lot of confusion out there about HOS rules that needs to be cleared up myself. Still, remember that 93.8% of all drivers last year passed roadcheck inspections, with 78.5% of all commercial vehicles passing as well. Those are some pretty good numbers. Let’s hope we keep seeing such positive results after this year’s round as well.
March 6, 2008
California port plan
The port of Long Beach in California is pushing ahead with an aggressive truck replacement plan that got the green light last month – a plan that seeks to replace a large chunk of the 16,800 diesel-powered tractors serving the port with models equipped with 2007-compliant engines or fueled with liquefied natural gas (LNG). The port’s Clean Trucks Program – which got the go-ahead Feb. 19 this year – is designed to slash truck-related air pollution by 80% within five years. “This truck program is a major step forward for cleaner air,” said Richard Steinke, executive director for the port of Long Beach. “Getting these old, dirty trucks off the road will deliver major air quality improvements for the entire region.” It’s sister facility, the port of Los Angeles, is also forging ahead with a similar plan, he noted. Starting on October 1 this year, the port is going to ban pre-1989 trucks from operating on its premises. By January 1, 2010, all 1989 through 1993 model trucks will be banned from the port’s terminals, along with non-retrofitted 1994 through 2003 model trucks. The final step comes on January 1, 2012, when any trucks that do not meet the 2007 federal emission standards will be banned from port of Long Beach terminals. The Port plans to start granting five-year concessions to licensed motor carriers (LMCs) for a one-time application fee of $250 and $100 per truck each year if those operators meet several key requirements, including using trucks that meet the port’s “clean truck” standards, use drivers that meet security requirements including enrollment in the federal Transportation Worker Identification Credential (TWIC) program, and tag their vehicles with radio-frequency identification devices so the port of long beach can monitor engine compliance with air quality standards. However, the port stressed that truck owners are going to be offered a variety of financial incentives to upgrade their vehicles. The first is a lease-to-own program, whereby an applicant can exchange an older truck for a pre-approved new truck under a 7-year lease agreement for a monthly lease payment between $500 and $700, with the port augmenting the lease payments with monthly stipends of $800 to $1,400, along with prepaid maintenance. At the end of the lease term, the port noted it would provide a 50% ($7,000 - $15,000) subsidy towards the purchase of the truck for the lessee. For truck owners seeking to buy an new, pre-approved cleaner truck model, the port plans to offer grants of $60,000 to $75,000 for a clean diesel truck, with $90,000 to $120,000 for LNG or other alternative fueled truck, with prepaid maintenance also provided via another upfront grant. Trucker owners that wish to retrofit their vehicles to lower pollution levels can also receive financial help, via one-time grants of as much as $20,000 towards the purchase of retrofit equipment for model year 1994 – 2003 trucks in 2008 and 2009. Money to provide for all of these grants and subsidies is expected to come largely from a new “Clean Trucks Fee” of $35 levied on every loaded twenty-foot equivalent container unit (TEU) that arrives by ocean carrier starting this October, along with funds from California’s newly passed Proposition 1B transportation bond. The fee – which should generate about $1.6 billion, the port estimates – does not apply to containerized cargo moving through the port by train, it noted. So, is this program the bellwether of future efforts by ports, cities, and states to reduce air pollution? Will it ultimately be affordable for truckers larger and small, even with the generous subsidies being offered? That remains to be seen. One thing is for certain – the clock is now ticking on this program, meaning truckers at the port must deal with it now or risk big disruptions in their business at year’s end.
February 1, 2008
Will it work?
So New York City is gearing up to be one of the first U.S. cities (I think – if anyone knows different, please correct me!) to try out “congestion pricing.” It’s not a done deal yet – the plan is in limbo for now and must be approved by March 31 or disappear, probably for good – but I’m betting it will eventually get the green light. Here’s why: based on the proposed $8 charge for entering Manhattan south of 86th Street every day during peak traffic hours (6 a.m. to 6 p.m. Monday-Friday), annual revenue should roughly add up to $400 million in the first year and up to $900 million by 2030, according to rough figures compiled by public policy group Transport Alternatives. The group notes that most delivery vehicles will be charged a flat $8 per day, regardless of how often they enter and exit this “congestion zone” in lower Manhattan, but it points out NYC has not yet defined the term “trucks.” So far, the definition does NOT include delivery vans and other two-axle vehicles with a maximum gross weight under 7,000 lbs — meaning trucks with a GVW of over 7,000 lbs. and more than two axles will get charged more than $8 a day. What fun. I am sure truckers are getting pretty steamed about the whole idea by now, but they’re not alone: many local politicians, representing NYC boroughs that lack adequate access to bus routes and the subway, are none too happy with it, either. They see this as a burdensome tax on low-income workers that must commute downtown every day. However, New York City Mayor Michael Bloomberg takes issue with that view. For one, he thinks reduced traffic congestion will significantly lower the amount of time trucks spend stuck in traffic, so the productivity increase will make up for (and in many cases, exceed) the congestion charge. A $1 fee added to taxi fares is also being considered, to provde an “offset subsidy” for commuters with jobs below a certain income level. Mayor Bloomberg anticipates that this congestion pricing plan – dubbed “PlaNYC” – should foment a 6.5% reduction in the number of vehicles entering Manhattan south of 86th Street overall, with an 11% traffic reduction during peak hours – resulting in a 20% to 40% reduction in time loss to traffic delays. So, here’s the big question: how will the congestion fees be collected? Is NYC going to ring its streets with tollbooths? Well, no – at least that’s the hope. The plan calls for using a combination of EZ Pass technology, combined with a camera system that’ll scan license plate numbers, so cars and trucks don’t have to slow down. The congestion fee then either gets assessed to a driver’s EZ Pass account, or can be paid electronically, by mail, or at designated retailers — based on that snashopt of your license plate, just like with red light cameras. (Probably not a comparison many like.) Sounds crazy on the outside, I know, but London implemented a similar system a few years ago with few ill effects (so the news wires tell me) and at a higher cost — $13 instead of $8. A 2006 Partnership for NYC study forecast traffic reductiosn similar to what London experienced by using congestion pricing. According to that study’s estimates, traffic would drop in downtown Brooklyn (by 29%), Williamsburg/Greenpoint (by 24%), Long Island City (by 7%), Harlem (by 14%), the South Bronx (by 5%) and Flushing (by 3%). Why NYC is doing this is no surprise. According to Environmental Defense, a national non-profit organization, even though only 5% of commuters drive into Manhattan’s central business district (CBD) to work, the city suffers from some of the worst traffic congestion rates in the country, costing workers and businesses billions a year in lost time and heavily contributing to poor air quality. Andy Darrell, regional director for Environmental Defense, said the congestion fees should guarantee that nearly half a billion dollars in annual revenue will be invested in mass transit expansion – helping cut a $30 billion backlog in capital investment needs. It’s interesting to note that this is also an environmental group calling for the creation of a transit “lockbox” that guarantees revenue from these fees only goes to new transit expansion (wish some of these “green” folks would call for a similar lockbox for highway funding!) But for now, we wait: the clock is ticking to see if all the vested interests in NYC can be wooed by the mayor to sign off on this plan. If it works, we may start to see similar efforts take root in other major metropolitan efforts. Yet ‘if’ is a big word, despite it’s small size – we’ll have to see how it all plays out.
January 28, 2008
Hours in place
So it seems the Federal Motor Carrier Safety Administration’s risky of move of not changing its new hours of service (HOS) formula may be paying off, for the U.S. Court of Appeals for the District of Columbia Circuit late last week denied motions filed by the Teamsters and Public Citizen to toss them out. You may remember that a lawsuit filed by Public Citizen and the Teamster put the FMCSA’s new HOS rules – 11 hours of driver time within a 14-hour duty period, after which truckers must go off duty for at least 10 hours, with a 34-hour restart provision – in limbo last year. The court found the feds hadn’t properly documented the safety aspects of the new rules, so FMCSA went back and pulled together reams of new safety data they said showed the revised HOS rules worked. The feds submitted that data to the court late last year, and now it seems the court agrees with the FMCSA on this. “Government and industry safety data clearly indicate that the current rules are working in terms of driver health, truck safety, and overall highway safety,” said Bill Graves, president and CEO for the American Trucking Association, which has supported the new rules. “[They’ve] been in force for four years and safety has improved over this time period.” FMCSA noted that, in 2006, the fatality rate per 100 million vehicle miles traveled was 1.94 - the lowest rate ever recorded. Similarly, since 2003, the percentage of large trucks involved in fatigue-related fatal crashes in the 11th hour of driving has remained below the average of the years 1991-2002. In 2005 alone, the agency noted, there was only one large truck involved in a fatigue-related fatal crash in the 11th hour of driving while in 2004 there were none. In addition, between 2003, when the 11-hour driving limit and the 34-hour restart were adopted, and 2006, the percent of fatigue-related large truck crashes relative to all fatal large truck crashes has remained consistent, FMCSA said – adding that estimates show that only 7% of large truck crashes are fatigue related. “The data makes clear that these rules continue to protect drivers, make our roads safer and keep our economy moving,” said FMCSA Administrator John Hill, last year, when the agency submitted its new findings to the court. However, the court’s ruling doesn’t mean HOS is home free by any means. The 11-hour drive time and 34-hour restart provision – the most controversial parts of the rule, both of which the court specifically put in limbo last summer – only get to stay in place while FMCSA collects additional safety data, secures comments from interested parties, and subjects its scientific analyses to peer review as it seeks to turn this from an interim final rule into a done deal. Also, the opposition – and the Teamsters in particular – don’t plan to give up without a fight. “We will continue to fight this dangerous rule, though the court refused to intervene this time,” said Jimmy Hoffa, the Teamster’s general president, in a statement. “This was a procedural ruling that does nothing to support the Bush administration’s justification for letting tired truck drivers spend even more time behind the wheel.” But at least at this point, current HOS regulations are going to stay in place – crossing a significant legal hurdle that could ultimately lead to them becoming a permanent part of the trucking landscape.
January 17, 2008
Seat belt conundrum
“Did you know that ‘if’ is the middle word in ‘life’?” –Walter Kurtz, Apocalypse Now Everyone knows that wearing a seat belt in a motor vehicles vastly improves your chances of surviving a vehicle crash. That’s a given. So it would seem a no-brainer to equip all U.S. school buses with seat belts. And yet … school bus crashes remain the rarest of incidents on the roadways today. In fact, the greatest dangers to children, according to years of data gathered from the Fatal Analysis Reporting System (FARS), are the areas around school buses, as well as the routes to and from school. The National Highway Traffic Safety Administration (NHTSA) argues that school buses are an incredibly safe form of transportation – probably one of the safest on the road today – making the addition of seat belts to buses a negligible benefit. That’s one of the reasons why Christopher Murphy, chairman of the Governors Highway Safety Association (GHSA), is but one of several prominent voices opposing the Department of Transportation’s recent Notice of Proposed Rulemaking to mandate seat belts on school buses. The reason? Money. “According to the proposed rule, school districts that decide to add seat belts could apply for existing federal highway safety grant funds to cover the cost of the additional safety equipment,” he said. “While this use of grant funds is not new, the additional focus on the issue may cause states to be pressured to spend federal highway safety money for this purpose to the detriment of many competing highway safety needs.” In a recent press statement, he used Maryland as an example. That state receives approximately $3.3 million each year for its basic behavioral highway safety program. But if the seat belt rule went into effect, Maryland could spend that full amount on adding seat belts to school buses yet still not equip them all – and wouldn’t be able to fund other highway safety efforts. “We want to ensure that federal highway safety funds are spent in areas that will have the most lifesaving benefit,” Murphy said. “ Largely these are directed to critical occupant protection, drunk driving and speeding programs. As these funds are limited, they could be quickly devoured if a state is pressured to use its federal funding for seat belts on school buses.” To solve this issue, the GHSA wants more money – federal funds specifically set aside to cover the cost of adding seat belts to school buses. But in these tight times – especially with the economy for all intents and purposes in a recession – that seems unlikely at this stage. More germane to the discussion is this: Are seat belts needed on school buses? The statistics show school bus crashes are rare, but that doesn’t mean they don’t happen. It all comes back to the word ‘if’ in my view – if the bus doesn’t crash, then you don’t seat belts. However, several years ago, such a crash DID occur in Arlington County, VA (where I grew up) between a school bus and garbage truck, injuring 15 children and leaving one of them dead. Would a seat belt have saved the child? Probably – the driver of the school bus walked away from the crash, as she was belted in. But how do you make sure the kids belt themselves in – and don’t undo the belts mid-trip, for instance? There’s always the human factor, but by and large, since we are now belting our kids into a variety of seats in our personal vehicles since the day they are born, I would think by now seat belts are reflexive behavior, at least for most children. I personally think it’s worth the money to put seat belts on school buses. It’s just not worth the risk, however small, not to have them in case a crash occurs. But with funds so tight, it could indeed create a financial headache for the states to handle. Yet I think it’s a headache the state’s can and should manage. Keeping vehicle occupants as safe as possible is something you just can’t skimp on.
January 16, 2008
Bye, bye fines
The death-knell has sounded for Virginia’s controversial abusive driver fines, so for all the readers that thought these were a bad idea, your wish is coming true. Virginia’s Governor, Tim Kaine (D), said in his annual “State of the Commonwealth” address that “the abusive-driver fee idea has flunked with voters, and we should acknowledge it an move on.” Many Virginia Republicans praised Kaine’s position on the fees, which pretty much means they are headed for the trash bin. The abusive-driver fines in question were civil penalties drawn up to fine drivers going 20 mph over the speed limit $1,050, plus $61 in court costs, in ADDITION to existing fines that typically total $200. Also, a first-time drunken driver faced a $2,250 civil penalty – plus fines and court costs that typically run about $500 or more – under the abusive-fee regime, while driving without a license came with a mandatory $900 civil penalty in addition to the ordinary $100 for a fine and court costs. Many reasons are being trotted out for the failure of these fines, probably the biggest being that they only applied to in-state residents. That stuck in everyone’s craw, because if you didn’t pay them in three installments over 26 months, you’d lose your license: not so for someone from Ohio or any of the other 49 states in the Union. And apparently so many people HADN’T paid them that Virginia planned to revoke 300,000 licenses over the next two years, according to a story in the Virginia Business Magazine. Non-payment of fines also meant that the state didn’t get much of the $65 million in revenues it expected: monies lawmakers were hoping to use for road repairs. Never mind, of course, that you would never encounter these fines if you did three simple things: DON’T DRIVE DRUNK, DON’T SPEED, DON’T DRIVE WITHOUT YOUR LICENSE. Gee, wow: guess we can’t manage to do anything that simple in my state. And the numbers prove it, too: over 1,000 people died in traffic accidents in Virginia last year: a number we haven’t seen in my state since 1990. Several readers wrote in to tell me that fines like this don’t improve highway safety: indeed, they told me, punitive highway safety measures don’t work in the U.S. overall. Just look at the numbers – 43,300 people died on our highways in 2006, according to the latest figures from the U.S. Department of Transportation, with another 2.56 million sustaining injuries from highway crashes. The DOT estimates that highway crashes cost this country of ours $230.6 billion a year, roughly $820 annually for every man, woman, and child in the U.S. Those numbers fluctuate up and down a few hundred, but by and large, that’s been the death toll for many years And we seem to so blithely accept this!! I mean, drunk drivers killed 17,941 people in 2006 ALONE! And most drunk drivers are repeat offenders, folks that get caught again and again behind the wheel rocked out of their minds … yet manage to keep their license and the keys to their vehicles. Sure, Public Citizen is after the trucking industry, trying to find a way to reduce the 5,018 people killed in car-truck collisions … too bad no one wants to take the same approach to drunk drivers, who kill more than three times as many innocent people. So, OK, abusive-driver fines are on the way out and we probably won’t see them again. But here we are left facing a yearly pile of bodies on our highways with no one – politicians and John Q. Public as well – willing to seriously address it. We’re driving more and more miles, at faster and faster speeds, and we don’t seem to care that a lot of people are getting killed in the process. I thought the abusive-drive fine regime would work. Obviously, it didn’t. You tell me what the answer is. I for one think killing 43,000 people a year due to chronic bad driving is a horrible statistic we shouldn’t be willing to accept.
December 27, 2007
FedEx vs. The IRS
“Taxation has made more liars out of the American people than golf has.” –Will Rogers Like almost every large company in the U.S. tries to do nowadays, FedEx attempted to hide some very bad news in a regulatory filing with the Securities & Exchange Commission last week – and failed miserably. Buried deep in its regulatory filing – and unearthed faster than gold from a Pharaoh’s tomb – FedEx noted in very dry, terse language that the Internal Revenue Service slapped it with $319 million in fines and penalties for the 2002 tax year ALONE, as the tax man believes FedEx treats its independent contractors like full time employees and so must pay taxes on them as such. At issue are the 15,000 independent contractors the company’s FedEx Ground division uses as drivers – a business model FedEx used for years as a way to keep costs down. Yet that very same model also put FedEx in hot water with state governments and labor groups such as the International Brotherhood of Teamsters, which is engaged in a long-term campaign to unionize FedEx drivers like what’s been done at FedEx’s biggest rival, United Parcel Service. At issue, said Bear Stearns analyst Edward Wolfe in a recent research note, is that FedEx exercises too much control over its ground drivers for them to be classified as contractors. As a result, FedEx’s use of contractors is the focus of lawsuits in 36 U.S. states, brought by some current and former FedEx Ground drivers, alleging the level of control the company exercised over their work qualified them as employees — and that they deserve the benefits that go with that status. Massachusetts’ Attorney General, for example, just cited FedEx Ground for intentionally misclassifying 13 pickup and delivery drivers as independent contractors rather than employees and fined FedEx $190,000 in penalties — alos ordering the comapny to fix their employment status and pay those 13 drivers restitution. Recently, the California Supreme Court refused to review a California Court of Appeal ruling that found single route FedEx Ground drivers in that state to be misclassified. So, in September this year, the company unilaterally terminated contracts for 1,000 contract drivers in California – paying between $25 million and $37 million in one-time severance costs associated, according to Teamster estimates. Analyst Jason Seidl with Credit Suisse wrote in a research note to clients that should the FedEx be forced to offer the same deal nationwide, it could cost the company between $250 million and $430 million. The big problem for FedEx is that the IRS isn’t done with its audits yet, for the federal taxman is now reviewing the company’s books for tax years 2004 through 2006. Credit Suisse’s Siedl added in his research note that the company “could potentially owe nearly $1.5 billion in taxes and expenses when all audits are completed.” Now, obviously, FedEx is fighting all this – but there will probably come a time when it may choose to settle, rather than carry on what’s shaping up to be an expensive and protracted battle. A title bout against the IRS isn’t what most companies want, and frankly, FedEx should be able to afford to write the agency a big fat settlement check, if you ask me. Look, the company posted net income in just its SECOND fiscal quarter this year of $479 million on revenues of $9.45 BILLION. Not too shabby for one quarter in a year when freight ton-miles are down 2.2%, fuel costs are skyrocketing, and the U.S. economy seems headed for a recession. And though concerned about the overall economic outlook, Frederick Smith, FedEx’s chairman, president and CEO, put forth some confident words in his company’s second quarter report. “High fuel prices and weak U.S. economic growth year over year have impacted our business,” he said. “We continue to benefit from solid international growth, which helps mitigate softness in U.S. industrial production. While we see challenging near-term economic trends, we remain confident about long-term prospects in all our business segments.” Me, I am betting that FedEx is going to completely reshape – if not eliminate – it’s independent contractor business model, settle with the IRS, let everyone get on a soap box and crow about the company’s failures, then get on with business. My only question is why it didn’t do something sooner about its contractors, instead of being forced to make changes under the hammer blows of the taxman and the courts. Would’ve saved them a lot of grief.
December 20, 2007
The waiting game
“He stopped to capture a wagon train. And what was a wagon train compared to the tremendous issues we had at stake?” –General Robert E. Lee The above quote comes from comments the famous general made about his cavalry commander, Jeb Stuart, before the battle of Gettysburg – the moment most historians recognize as the “high water mark” of the Confederacy during the Civil War. Stuart had gone off on a dashing raid behind Union lines, forgetting that his cavalry served as Lee’s eyes and ears. Deprived of badly needed intelligence, Lee found himself forced to fight at Gettysburg, sacrificing the high ground and much of the battle’s initiative to the Union forces under General George Meade. Though Stuart rejoined Lee as the first day of that deadly battle drew to a close (with his captured wagons in tow) the die, as they say, had been cast – and Stuart’s oversight, compounded with other mistakes, would cost the Confederacy dearly. I’m reminded of this as the debate over hours of service (HOS) regulations heats up yet again, battling on well worn turf over how many hours per day a trucker can drive. From my perspective, at least, that seems almost incidental to the real problem: how many hours per day a trucker must wait. The long lines spent awaiting the chance to load or unload, followed by the time spent physically loading or unloading the trailers themselves. Frankly, that wait time is what blows HOS all to hell. Sure, under the current rules, a driver gets three hours per day (out of a 14 hour on-duty schedule) that can be used for loading and unloading purposes. Problem is, three hours doesn’t even come close to covering how much time drivers actually spend on those tasks. A 1999 dry van driver survey found truckload drivers on average typically waited 2.3 hours JUST to load their trailers: Loading itself consumed another 1.1 hours of their time. On the back end, again, waiting to unload took up the most time – 2.4 hours on average – with unloading taking 1.2 hours. I know this survey is almost 10 years old, but it’s the only one I know of that looked this issue square in the face. The Owner-Operator Independent Drivers Association (OOIDA) contends that shippers and receivers make drivers wait anywhere from two hours to two DAYS to load and unload their trailers – time that drivers don’t get compensated for. Many drivers I’ve talked to say that’s the main reason why so much logbook fudging goes on – they need to put miles on the road to earn something back to cover all that unpaid time. A March 2003 report by ICF Consulting for the Federal Highway Administration (FHWA) addressed this issue in pretty damning terms. The report – saddled with the unwieldy title of “Evaluation of U.S. Commercial Motor Carrier Industry Challenges and Opportunities” – had this to say about waiting time and its impact on trucking operations: “While a portion of driver wait time may be attributable to carriers building buffers into their schedules to ensure on-time pickup and delivery, the biggest contributing factor is that shippers and receivers do not directly bear the cost of keeping driver and equipment waiting,” it said. “Shippers are typically charged by the mile and do not incur any immediate costs for making drivers wait: Drivers and carriers bear the costs of waiting in lost wages and revenue. Carriers may recoup some of these costs by charging higher rates. [But] the fact that private carriers delivering to owned facilities rarely have to wait tells us that the cost of long wait times in for-hire carriage are not being internalized in the rate structure. That is, when a single entity bears both the cost and benefit of waiting, it rarely chooses to make its drivers wait. If shippers had to bear the cost of waiting, they would behave differently.” The report also touched on an even thornier issue: lumpers. “While loading and unloading is often done by the truck driver or by the shipper/receiver, independent employees sometimes perform these activities. One carrier noted the related problem of being forced to use these individuals – known as ‘lumpers’ – at a high cost, or else waiting one to two days to load or unload. This problem is reportedly most serious in the refrigerated foods business.” “If drivers were compensated for all of the work they do, drivers’ time would become valuable and shippers would be forced to streamline their operations to minimize loading and unloading time,” contended OOIDA member Walter Krupski in testimony before the U.S. Congress this week. “A new approach is needed if Congress and the agency truly wish to make significant improvements in driver fatigue.” Some receivers, Krupski noted, even require drivers to perform warehouse work such as restacking pallets. Not only is such work unpaid, it also essentially steals the time that drivers have under the HOS rules to do the work they are actually paid for: driving the truck. It’s OOIDA’s belief that if drivers were compensated for both their driving and non-driving on-duty work, they would have every incentive to record all of their on-duty time, and problems with the accuracy of logbooks would disappear. I really think there’s a lot of truth to this – and that if waiting time abuses aren’t addressed, then HOS reforms aren’t going to amount to a hill of beans. They’ll end up being as worthless as Stuart’s wagon train.
December 13, 2007
Hours, safety, and sense
“Never give in: Never, never, never, never, in nothing great or small, large or petty. Never give in except to convictions of honor and good sense.” –Winston Churchill So the Federal Motor Carrier Safety Administration (FMCSA) is going to stick with the 11-hour driving time limit and 34-hour restart provisions that got thrown out by the U.S. District Court of Appeals for the District of Columbia Circuit back on July 24. Not much of a surprise there, for the agency long thought these two parts of the revised hours of service (HOS) legislation it put in place back in 2004 worked well for truckers. And it’s prepared to go to the mat for them, too. “The people who have litigated in the past against these rules will most likely do so again,” John Hill, FMCSA’s chief administrator, said in a phone conference with reporters this week. “We are prepared to go to court to defend these rules.” And to court they shall be going, I guarantee you, for the rhetoric is already thick and heavy in the air over this. “FMCSA is continuing to allow large trucks to roll like time bombs on our highways,” said Joan Claybrook, president of Public Citizen, in a press release responding to the agency’s decision. “With its action today, the administration has shown that it is willing to risk carnage on the highways to boost the bottom line for big corporations. We urge the agency to draft a rule based on science instead of industry politics – a rule that will protect truck drivers and those of us who share the road with them. To do otherwise is the height of insanity.” “It’s clear the Bush administration has more loyalty to its corporate supporters than to the men and women who actually drive on our roads,” said James Hoffa, the Teamsters’ general president, in a similar statement. “The Federal Motor Carrier Safety Administration in particular is showing that it is held captive by the trucking industry.” OK, so we all know these rules are incredibly divisive … but are they truly unsafe? At the end of the day, do they make more sense than the old rules? I asked a couple of longtime industry veterans this question and here are some of their thoughts. “In regard to highway safety, while I don’t believe the rules will do anything to make the industry less safe, more needs to be done by both trucking management and their customers to encourage practices that will ensure drivers are better rested,” said David Sparkman, a veteran journalist and public relations expert that’s covered trucking for decades. “That should be a factor for consideration at a time when more exacting demand-driven supply chains are rapidly reshaping drivers’ daily reality.” So I looked at some of the safety statistics compiled by the Feds used to support their contention that the 11-hour drive time limit and 34-restart provisions don’t lead to unsafe driving conditions. For starters, truck-involved fatalities decreased 4.7% last year – from 5,240 in 2005 to 4,995 in 2006, the largest percentage drop in truck-involved fatalities since 1992 – and the number of truck-involved-crash injuries decreased by almost 2,000 in 2005 and dropped another 8,000 in 2006. Over the last seven years, the fatality rate per 100 million miles dropped 13% – so at a time when trucks are logging more and more miles on the rate, fewer people are being killed. Bob Inderbitzen, another industry veteran and long-time safety expert, added that there are a lot more positives than negatives in these revised rules – positives that many are ignoring. “The best change is that you can no longer abuse drivers and put them off the clock even though they are still responsible for the vehicle – waiting in line, waiting to unload, etc.,” he told me. “We are also closer now to a 24-hour clock which matches the circadian rhythm of human beings [14 on and 10 off] and I also like the 34-hour restart since it allows a ‘weekend effect’ of two full rest/sleep periods that also … allows you to bring a driver home after a restart.” Inderbitzen also believes that safety rates are improving precisely because of the HOS change. “You have to communicate with drivers, run some training sessions, provide logbook examples, and generally pay more attention to them than you might have been doing,” he explained. “Even an owner-operator had to study the changes, to see what effect they had on his/her business and adjust accordingly. All these things help to refocus on safety and take people out of their routines and comfort zones. Call it a wake up call, if you will; but I believe awareness is heightened when you are adjusting to change.” He added that the benefits of this “wake up call” are being felt especially with new drivers. “If you select well, a new driver is usually safe for the first 18 months to two years while getting used to the new company, new routes, new products, new supervisors, and much more. Then, as things get more routine, accidents would start to happen,” Inderbitzen said. “It is no accident – pun intended – that HAZMAT retraining is required every three years. It keeps drivers on their toes.” Here’s what really gets me about the war of words and legal challenges over HOS today: the so-called safety advocates got 90% of what they wanted when the feds revised the regulations. Under the old rules, a driver looked at a 15-hour workday that could be indefinitely extended by logging breaks. Now, they work a 14-hour day – one hour shorter than before – and the clock CANNOT be stopped. Drivers used to face five hours of non-driving on-duty time – now they only face three. They used to get just eight hours off; now they get 10, a full two hours more. But by just adding one extra hour of drive time, going from 10 to 11, the so-called safety groups are willing to throw the whole smash out and go back to the old rules – rules created way back in 1933, when they didn’t even conduct sleep studies, much less envision global supply chains. Many drivers aren’t happy with the revised rules because they feel they can’t take a break: that with the clock running, they need to drive or risk losing pay if they stop for a rest break. FMCSA’s John Hill is aware of this – I asked him about it and he said the agency would address it once they get some sort of finality to the basic HOS rules. “We must have a final framework in place before we start looking at breaks,” he told me. “So our focus right now is getting a final rule done.” Still, to my mind at least, the HOS rules the industry is working under right now seem to be working – they provide good building blocks from which improvements to the driver’s working life can be made. “I know there has been a lot of rhetoric around one size not fitting all, but I think there is enough flexibility to satisfy most: You’ll never get them all,” said Inderbitzen. “And I agree – [fatality and injury] rates are going down. I don’t think you can argue with success.”
December 10, 2007
SOS on HOS
“Oh, I knew there’d be hell to pay/but that crossed my mind a little too late.” — Dierks Bentley So we may finally get a glimpse of what changes – if any – the Federal Motor Carrier Safety Administration (FMCSA) is going to make to the hours-of-service (HOS) regulations that govern the working days and nights of U.S. truckers. There’s a going to be a hearing this week – Dec. 12 – before the Surface Transportation and Merchant Marine Infrastructure, Safety, and Security Subcommittee that’ll be focused almost exclusively on the contents of HOS rules FMCSA submitted Nov. 27 to the Office of Management and Budget (OMB). The contents of those rules weren’t revealed to the public, so this week’s hearing is probably going to be the industry’s first look at them. The Owner-Operator Independent Drivers Association (OOIDA) is one group planning to attend this hearing in force to see what the lay of the new HOS land will look like – with senior member Walter Krupski from New Jersey, a long time trucker from New Jersey, testifying before the assembled Congressional members. All of this devolves from the legal decision handed down this past summer by the District Court of Appeals for the District of Columbia Circuit, which declared two key provisions of the current HOS rules adopted in 2004 –an increase in driving time from 10 to 11 hours and the 34-hour restart provision – null and void. Yet a close reading of the court’s decision indicates (at least to this thick-headed reporter) that these two elements got tossed because the FMCSA didn’t provide enough data, or maybe the right kind of data, to explain their reasoning behind green-lighting those two provisions. In other word’s, FMCSA got charged with the equivalent of a technicality. So that leaves me to believe that what we might see this week when the curtain is pulled back on FMCSA’s revised HOS rules are … the exact same rules, but with different and more detailed paperwork supporting them. No change to the 11-hour drive time limit; no change to the 34-hour restart. If that’s so, I would fully expect the same parties that sued the first time around – Public Citizen at the fore – to sue the FMCSA again, if the D.C. Appeals Court doesn’t throw out the agency’s argument right from the get go, that is. At the end of the day, we’re all going to be right back where we started – trying to establish a single set of rules that govern the working hours of millions of truck drivers, people whose sleep patterns are all over the map, working in an industry that must serve the 24/7 needs of our economy and society at large. To call this a Gordian knot is an understatement, for you can’t solve this problem al la Alexander the Great (cutting it down the middle with a sword – that’s a sharp dude). Vic Suski, a senior engineer at the American Trucking Associations – one of the largest lobbying groups in trucking – and I shared a few emails on the topic, and his frustrations with the regulations speak for a lot of drivers and carriers, I think. “Look, some of us are ‘night people’ and some are day people,” he told me. “Let drivers drive when they know they are at their best: don’t cram them into one-size-fits-all regulations.” It’s a good point, but the obvious problem is not all drivers will conduct themselves professionally – making sure they get enough rest, not pushing it while fatigued – and so increasing the risks of an accident. The blunt truth is that people cheat in the business world – just look at the sleight-of-hand of Enron for starters – and without regulations in place, legitimate law-abiding companies and their employees lose out. But at the same time there’s got to be some way we can come up with a set of rules that give drivers the flexibility to take naps and get sufficient rest without impacting their ability to make a good living. It’s a tall order, for sure. We’ll see if we can tackle it over the next few months.
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