NEW REGULATIONS THAT TAKE EFFECT IMMEDIATELY
The FMCSA has published the following regulations in the October 1, 2013 edition of the Federal Register implementing various provisions of MAP-21. The FMCSA is taking the position that the regulations are mandated by Congress, so the agency is not exercising any discretion by promulgating the regulations. In effect, the FMCSA is merely bringing its regulations in line with what Congress already dictated when MAP-21 was first passed. As such, these new regulations will take effect immediately when published – there will be no notice or comment rulemaking procedure. The public will have 60 days from the date of publication of the rules to submit requests for reconsideration. Among these new regulatory pronouncements are the following:
1) Financial Security of Brokers and Freight Forwarders. The FMCSA is revising its rules regarding financial security to increase the amount required to be maintained by property brokers to $75,000 and to make the requirement applicable to freight forwarders, as well.
2) Revised Timeframe for New Entrant Safety Audits. The Federal Motor Carrier Safety Regulations (FMCSRs) are being revised to clarify that new entrant safety audits must be completed within 12 months of a property carrier beginning operations, and within 120 days of a passenger carrier beginning operations. Previously, the rules had allowed 18 months for all carriers.
3) Increased Penalties. Current penalties for violation reporting, record-keeping and most registration requirements are $500 and violations of the passenger carrier authority requirements are $2,000. The rules increase the penalties to: (1) $1,000 for violating reporting and record-keeping requirements; (2) $10,000 for violating non-passenger carrier registration requirements; and (3) $25,000 for violating passenger carrier registration requirements. The penalty for transporting hazardous waste without proper authority is increased from a maximum of $20,000 to a minimum of $20,000 and a maximum of $40,000. Violations of rules relating to the transportation of hazardous materials will now result in fines of up to $75,000 or, if involving death, serious illness, severe injury, or substantial destruction of property, of up to $175,000. Penalties for failing to respond to a subpoena are increased to between $1,000 and $10,000 (from the current levels of $100 to $5,000). General penalties for evading regulations currently require that the violation be knowing and willful. That requirement is being removed and penalties are increasing to $2,000 to $5,000 for a first violation, and $2,500 to $7,000 for subsequent violations. The regulations will add a penalty of $25,000 for violating an out-of-service order. A carrier’s “ability to pay” will no longer be taken into account in determining the penalty for violating the FMCSRs.
4) Fleet-wide Out-of-Service Orders. Prior to MAP-21, if a vehicle was used to provide service without or beyond the scope of its registration, that vehicle could be placed out of service. MAP-21 revised the law to say that the carrier (not just the vehicle in question) could be put out of service. The FMCSRs are being revised to reflect this change.
5) Reporting of Foreign Driver Offenses. The FMCSRs are being revised to require states to report certain convictions by “foreign drivers” to the Federal Convictions and Withdrawal Database. The rules are also being revised to clarify that such individuals can be disqualified from operating a CMV (Commercial Motor Vehicle).
6) Revocation of Foreign Motor Carrier Authority. MAP-21 explicitly states that the FMCSA has authority to suspend, amend or revoke the authority of foreign carriers on the same grounds as applicable to domestic carriers, and the regulations are being revised to reflect that authority.
7) Carrier Responsibility for Disqualified Drivers. Prior to MAP-21, a motor carrier was only prohibited from using a driver it “knew” to be disqualified or otherwise lacking authority to operate a CMV. MAP-21, and the new regulations, will prohibit use of a driver if the carrier “knows or should reasonably know” that the driver is not qualified.
8) Hazardous Driver Disqualifications. The FMCSA will revise the definition of “imminent hazard” – if a driver’s operation of a vehicle is found to create an imminent hazard, the driver is subject to emergency disqualification.
NEW INSURANCE FILING RULES FOR PRIVATE HAULERS
A new federal regulation will require an estimated 80,000 private haulers of hazardous materials and agricultural products to provide the government proof of insurance for the first time. It will increase efficiency by streamlining the registration process and enable FMCSA to maintain more accurate information.
Although the FMCSA requires all truckers to carry a minimum of $75,000 in liability insurance – and a minimum $5 million for most hazmat haulers – some carriers have not been required to file that information with the government. These carriers were already required by statute and regulations to obtain insurance, but this new rule now requires the filing of evidence of such insurance with FMCSA. The requirement will go into effect in October of 2015, and is part of the FMCSA’s Unified Registration System rule, announced last month, which is intended to streamline the registration process for fleets by condensing 16 forms into one single Web-based form.
This regulation will affect an estimated 30% to 40% of exempt carriers who do not have insurance. The new provision will add “teeth” to make sure the carriers are in full compliance. Previously-exempted private carriers generally have been engaged in a primary business other than transportation. Likewise, exempt agricultural carriers include those that haul livestock and agricultural or horticultural commodities, which can range from timber to unprocessed goods.
FMCSA said the new provision assumes that carriers will be able to establish accounts with insurers before registering, and will then be able to contact their insurers and provide the required information after receiving their inactive USDOT Numbers. The FMCSA said that the new UCR system will allow the agency to better track small motor carriers who have sometimes operated under their radar.