Prepared by the
Members of the
The
WMCA is a non-profit trade association representing the interests of truck
owners within the state of
Overview: These are critical times for the trucking industry. Fuel costs have escalated and insurance costs remain extremely high. Truck drivers hauling hazardous materials are now required to be fingerprinted. We are probably one of the most regulated industries in the country, facing all of the general business regulations as well as trucking-specific requirements from the Federal Motor Carrier Safety Administration, the Environmental Protection Agency, and the Department of Agriculture. Finally we will have to cope with a whole new round of environmental regulations on fuel in 2006 and on diesel engines in 2007.
Government
policies are important factors in the business decisions made by trucking company
officials and we appreciate the chance to provide our perspective.
The WMCA makes the
following recommendations on specific matters currently before Congress. Background information on these issues is
provided in the following pages.
·
During highway reauthorization:
-
Oppose increases in excise taxes/fees on the
trucking industry;
-
Oppose indexing the federal motor fuel tax;
-
Continue the fight to get
a more equitable federal highway aid distribution for
-
Make additional investments for truck parking spaces;
-
Oppose efforts to toll the existing Interstate Highway System;
-
Eliminate the current Single State
Registration System (SSRS);
-
Support amendments
relative to the movement of household goods;
-
Support additional
truck driver training funds;
-
Oppose language in
H.R. 3 relative to fuel surcharges.
·
Support changes to the law that would amend the Sherman Act to make
oil-producing and exporting cartels illegal.
·
Support efforts to reduce the number of boutique fuels produced.
·
Utilize financial incentives for the purchase of the 2007 Engines.
·
Provide financial incentives for trucking companies to buy anti-idling
equipment and help to standardize the idling regulations in the various states.
·
Encourage the FMCSA to modify their proposed rulemaking on supporting
documents relative to the hours of service.
·
Reassess the feasibility and benefits for the finger printing and
background checks for hazardous materials drivers. Also help to insure that
there will be employer notification and phased enforcement of this program.
·
Support raising the bond required for
transportation brokers.
The association also wishes to emphasize a number of
general perspectives that should be considered as regulatory and tax issues are
addressed:
·
The trucking industry is very competitive and has
very low profit margins;
·
This country needs to reduce its dependence on
foreign oil by permitting more domestic exploration;
·
The trucking industry takes highway safety very seriously and has an
excellent safety record.
The trucking industry provides efficient and safe
transportation service to customers throughout the country. In 2004, truck tonnage grew 5.7% compared to
the previous year. Last year, intercity and local trucks transported 9.1
billion tons of freight, representing 68.9% of total domestic tonnage
shipped. Businesses chose trucks for 87
cents out of every dollar they spend on shipping.
There are 524,000 for hire and private carriers in the
In
The most important issue to members of the WMCA is a healthy economy. If new homes are not being built, if
consumers are not purchasing goods and services, if agricultural products are
not grown, there is little freight for the trucking industry to haul.
According to ATA’s Advanced
Adjusted Truck Tonnage Index, freight for January of 2005 increased 3.4% over
December of 2004. Furthermore, truck tonnage in 2004 grew 5.7% compared with
2003.
It should be kept in mind,
however, that costs (particularly the cost of insurance and the price of fuel)
remain high. These increased costs are difficult to absorb because profit
margins in the trucking industry are very thin.
As an example, according to the ATA, even though net profit margin rose improved
in 2003 compared to 2002, it still only increased to 2.4%.
HIGHWAY
REAUTHORIZATION BILL
The
current reauthorization bill expires on
Congress took an important step in the TEA-21 Act,
by increasing
Some
of the industry’s initiatives during reauthorization would close the
maintenance loophole on interchanged intermodal equipment and funding for
increased truck parking facilities. Additional fights in reauthorization
include pushing back on onerous new hazardous materials transportation
regulations; a requirement forcing each truck to have an electronic decal
showing proof of heavy vehicle use tax payment; and expensive new medical
standards.
Other
specific issues in the HR 3 include the following:
A. TOLLS – WMCA members were disappointed that the House rejected an amendment by
Congressman Kennedy that would have curtailed the imposition of tolls by states
on existing lanes of the Interstate Highway System. Tolling existing Interstates has never
happened before, and there is virtually no available research demonstrating the
safety, congestion, environmental and economic effects that could be
substantial.
WMCA members have experienced first-hand the impact
on trucking when tolls are raised, often without public hearing, by officials
that are not accountable to the voters.
As this issue is debated, please keep in mind that:
· Tolls on existing Interstates will result in considerable diversion of traffic to other roads. Traffic diversion reduces safety because of additional miles traveled and greater accident exposure. Interstates are the safest roads, and alternate routes can have accident rates four times higher or more.
· This diversion will also lead to traffic on local roads that were not designed to handle heavy traffic, thereby leading to additional maintenance costs.
· The quality of life of those people who live along routes parallel to the toll roads will be degraded.
Tolls are an extremely inefficient,
unproductive and unsafe method of taxing highway users. Please
oppose efforts to toll the existing lanes of the
B. SSRS
- For-hire carriers are subject to the requirements
of the Single State Registration System, which involves the payment of annual
per-vehicle fees in most states – but only on the part of for-hire carriers.
SSRS is administratively burdensome and many members of the WMCA would like to
see it repealed. For many years, ATA has been working to replace SSRS with a
single unified motor carrier registration system at the federal level. ATA believes it to be in the interests of the
industry to (1) replace the revenues the states now obtain through SSRS and (2)
achieve a federal preemption against states replacing such revenue in any way
other than strictly limited per-carrier fees levied on all carriers, not just
for-hire. The House version of the
federal highway reauthorization (H.R. 3) contains a repeal of SSRS, but does
not include the ATA-supported language providing for revenue replacement and
state preemption.
The high price of diesel fuel continues to
frustrate our members. The national price of diesel fuel was $2.32 cents per
gallon for the week of April 11th. Last year, the price was $1.68,
meaning that the price of diesel has jumped 64 cents per gallon in one
year.
Fuel constitutes the second largest expense for
most trucking companies, behind labor costs. If a truck consumes 20,000 gallons
of fuel per year, this would mean that it would cost over $12,000 more to
operate that same truck in 2005 as it did in 2004. The problem of high diesel
fuel prices is even more difficult in
WMCA members also worry about the impact that
higher fuel prices will have on the economy in general. As an example, the
latest version of the ATA’s freight volume index showed that February loads
declined 2.4%.
The WMCA appreciated Senator Kohl’s legislative
efforts last session to have the OPEC oil cartel face antitrust lawsuits in
BOUTIQUE
FUELS
WMCA members are convinced that the different
boutiques fuels that are produced in this country are at least part of the
reason for high fuel prices. Efforts
should be made to standardize some of the fuels and reduce the number currently
being produced.
In addition the industry will be adversely impacted
by state boutique diesel fuel mandates. ATA
is working with Representative Blunt (R-MO) to advance legislation that would
limit the proliferation of boutique fuels.
To date,
FUEL SURCHARGES
During the
last few years, trucking companies have responded to drastic increases in the
price of fuel by implementing fuel surcharges. A very competitive market
restricts the success of truckers, particularly the small fleets or
owner-operators, in passing these increased costs on to shippers. Even when a contract contains a fuel
surcharge, the trucking company is rarely made whole because of the reluctance
of shippers to pay them or because of a delay when the surcharge becomes
effective. At a minimum, there is always a delay in paying the surcharge,
causing cash-flow problems for the trucker.
Despite
the frustrations with high diesel prices, the WMCA does not support the fuel
surcharge provisions contained in the Highway Reauthorization Bill. That
language would require a trucking company to pay an owner operator for a fuel
surcharge, even if the trucking company doesn’t collect a fuel surcharge from
the shipper. We also oppose the
provision of the bill that would provide owner-operators with a private right
of action against carriers to enforce the mandatory pass-through provisions of
the bill. Some WMCA members are also opposed philosophically to the government
mandating price adjustments in contracts that are negotiated between two
parties.
EPA’s DIESEL RULES
EPA rules require the production and retailing of
low-sulfur diesel fuel beginning in 2006 and sets out an aggressive schedule
for reducing emissions of nitrogen oxides and particulate matter beginning in
2007 and 2010.
The stricter engine
standards that will become effective in 2007 will further reduce fuel economy
and greatly increase the cost of purchasing new equipment. This will be a
huge hit on transportation costs:
WMCA members want to ensure a smooth transition
under EPA’s Rule and would like Congress to develop financial incentives
(favorable tax treatment) for purchasing of the new equipment.
Apparently, EPA
is also exploring the possibility of pursuing regulatory measures to retrofit
all diesel engines with emission control devices. WMCA members are
opposed to retrofit mandates, but support funding options for voluntary
retrofit programs.
IDLING REDUCTION
Long-duration truck
idling consumes approximately 960 million gallons of diesel fuel
annually. The average truck consumes .80 gallons of diesel fuel per hour
when idling (not to mention that studies have shown maintenance on trucks
increases on average $1.13 per day as a result of reduced oil change and
overhaul intervals). All trucking fleets
improve their bottom-line by reducing idling. WMCA members support
federal legislation that would afford fleets tax credits of up to $7,000 per
truck, if they are equipped with idle reduction devices. In
The industry continues to
face a multitude of state and local restrictions on idling. The ATA’s research organization, the American
Transportation Research Institute (ATRI), has completed a pocket guide for
drivers that shows anti-idling restrictions on a state-by-state basis.
Placing this guide in the hands of drivers has helped them avoid costly
anti-idling citations and associated court costs, but it continues to be a
frustration dealing with the various requirements.
HOURS
OF SERVICE - ELECTRIC ON-BOARD RECORDERS (EOBR)
The Federal Motor Carrier Safety
Administration’s current Hours of Service regulations have been challenged in
the courts. The agency issued an
Advanced Notice of Proposed Rulemaking (ANPRM) for EOBR devices in September
2004. The ANPRM requested input on a
wide variety of technical and operational issues.
There are a number of policy questions
that must be satisfactorily addressed prior to the ATA and the industry taking
a position on this issue. These key issues include: tangible evidence that EOBR’s result in
greater fleet safety performance; data captured beyond hours of service information
is protected from law enforcement action and excluded from civil litigation
proceedings; driver privacy is reasonably proscribed; a reasonable performance
standard is developed; and implementation occurs uniformly from a timing
standpoint.
HOURS
OF SERVICE – SUPPORTING DOCUMENTS
The Wisconsin Motor
Carriers Association filed comments on the Federal Motor Carrier Safety
Administration’s (FMCSA) notice of proposed rulemaking (published in the Federal
Register of
"Upon review of your proposal, we find it to be an unnecessary expansion of what is already required to document compliance with current HOS regulations. Your definition of ‘supporting documents’ appears to be overly broad and vague and far beyond what should be reasonably required to document the validity of a driver’s HOS record of duty status.
“The proposal appears not to give any consideration to the time and cost involved for motor carriers for the retention and maintenance of such records. In an industry already burdened with recordkeeping responsibilities to insure compliance with substantial regulation, we would think the agency would approach the issue of “supporting documents” to reduce rather than add to paperwork requirements.”
BACKGROUND CHECKS
FOR HAZARDOUS MATERIALS DRIVERS
Congress passed the USA
Patriot Act in October of 2001, in response to the terrorist attacks of
Our members question whether this
costly procedure will have the desired effect of insuring that hazardous
material vehicles are not used for terrorism activities.
Employer notification is a key aspect
of this rule that must be included.
If TSA runs a background check and a driver is found to be a
security threat due to a past conviction, an employer should be notified
immediately.
BONDS FOR BROKERS
The Owner-Operators Independent Drivers Association
(OOIDA) has petitioned the U.S. DOT to raise the bond required for
transportation brokers from $10,000 to at least $300,000. OOIDA argues that the
$10,000 is simply inadequate and that truckers are not able to effectively
track the credit worthiness of every broker with whom they deal.
When the $10,000 requirement was set in 1977, there
were 70 registered brokers compared to some 15,000 today. The ATA is on record
supporting an increase to $250,000 while WMCA members agree that the bond
should definitely be increased to a minimum of $100,000.
In a 2003 survey, WMCA members indicated that the
two most critical issues to them were “Controlling Insurance Costs” and “Tort
Reform & Lawsuit Abuse”. Over 80%
indicated that controlling insurance costs was very important to them while 74%
ranked tort reform as very important.
An ATA Insurance Task
Force found that in the long term, legal (tort)
reform is the most important goal to deal with rising insurance premiums,
especially at the state level. While
insurance claims against the trucking industry have fallen over the years, the
cost per accident has continued to climb, mostly as the result of large jury
awards.
Because of the acute shortage of truck drivers, the
WMCA supports the effort to provide additional assistance to the truck driver
training programs through the
Additional federal aid
for truck driver training would be helpful to the technical college system and
to the trucking industry in general. It
should be remembered that truck-driving jobs are good paying jobs and good
employment opportunities for minorities and others that may be unemployed or
underemployed.
Highway safety
continues to be a top priority of the
The ATA has recognized the WMCA with the Excellence In Safety Award. This national award is presented annually
to the state trucking association with the best safety programs.
Our commitment to highway safety is also
illustrated by the industry sponsored Wisconsin Road Team that visited with
over 14,000 drivers education students in over 175 schools throughout the state
last year, discussing how to safely share the road with a truck.
The trucking industry is proud of an excellent safety record. Consider, for instance:
·
According to the Federal Motor Carrier Safety
Administration, the 2004 large truck fatal crash rate was 2.23 per 100 million
miles, down from 2.31 in 2003. Overall, there has been an 18% decline in truck
fatalities from 1996 to 2003.
·
Truckers in