trucking laws

Last month, House of Representatives lawmakers approved an amendment made to at least double minimum insurance requirements for commercial motor vehicles.

The highway funding bill would increase minimum liability insurance from $750,000 to $2 million, and was introduced by Illinois Rep. Jesus “Chuy” Garcia to amend the INVEST Act transportation bill. The House Transportation and Infrastructure Committee passed the amendment by a 37 to 27 vote.

Although the bill has been widely criticized by trucking industry professionals saying owner-operators and smaller carriers could face major challenges due to costs, Garcia defended his beliefs on Twitter.

“Minimum insurance requirements for motor carriers were established in 1980 and have never been adjusted for inflation,” he said. “It’s inadequate and saddles families with crippling medical care costs resulting from catastrophic crashes. My amendment with Rep. (Adriano) Espaillat, Rep. (Steve) Cohen, and Rep. Hank Johnson modestly increases the minimum insurance requirements and requires that it keep up with inflation. This isn’t about trial lawyers or an attack on truckers. It’s about supporting families who have lost loved ones.”

The bill is also currently opposed by the American Trucking Associations and the Owner-Operator Independent Drivers Association.

“ATA does not support an arbitrary increase to minimum insurance limits,” said ATA vice president of communications, Sean McNally. “To be an effective tool for improving safety, there must be an open, fair, and data-driven process to inform and guide what insurance limits should be, not just inserting a number that trial lawyers pull from thin air.”

The industry has seen insurance premiums steadily rising for motor carriers over the last few years, which has also aligned with increasing amounts of “nuclear verdicts” against trucking firms. But although fleets have been paying higher costs for insurance, premiums have stayed rooted in safety standards.

Still, amendment opposers are convinced higher prices will prove detrimental to smaller businesses throughout the industry.

“Raising the insurance minimum will do nothing to improve highway safety and would be nothing short of disastrous for many small motor carriers that are struggling to stay in business,” said OOIDA director of public relations, Norita Taylor.

On the other hand, the bill’s supporters, including some trucking safety groups, have praised the passing of the amendment, deeming it a victory for the families of crash victims.

“#SaferTrucking Update: Rep. Chuy Garcia’s Amendment 062 says the #InfrastructureBill passed by a vote of 37 (Ayes) – 27 Nays!” tweeted the Institute for Safer Trucking. “This amendment will help families who have survived truck crashes and help make the trucking industry safer.”

In the American Transportation Research Institute’s recent study of nuclear verdicts, results from analysis of 600 jury verdicts from between the years of 2006 and 2019 and from surveys by defense attorneys, plaintiff attorneys, insurance carriers, and industry experts showed concerning trends.

“One respondent specified that ‘low-risk’ motor carriers are experiencing 8% to 10% increases in insurance costs, while new ventures and average-to-marginal carriers are experiencing a 35% to 40% annual increase–a trend that has occurred for three consecutive years,” said that institute in its study. “Based on ATRI’s operational cost data, small fleets and owner-operators pay out-of-pocket considerably more on a per-unit basis than large fleets.”

FMCSA said that although it had received a large number of comments in response to the ANPRM, the commentary “did not provide responsive information necessary to allow the agency to proceed to a notice of proposed rule-making.”

The agency continued: “In particular, commenters did not provide sufficient costs or benefit data, and the agency was unable to otherwise obtain sufficient data on industry practice with respect to the level of liability limits in excess of the agency’s minimum financial responsibility requirements, the costs of such premiums and the frequency of [them], and the amount by which bodily injury and property damage claims exceed policy liability limits.”

FMCSA said based on this information, it could not determine “potential increases in insurance premiums associated with increased financial responsibility limits, or the impact of an increase in minimum financial responsibility requirements on insurance company capital requirements.”

Before the amendment goes into effect, the INVEST Act will still need to pass in both the House and the Senate.

Democrats in the House have released guidelines regarding the $3 trillion pandemic relief package.  In the Senate, there have been several appropriations bills senators have said may be considered this month. Congress will consider the 12 appropriations bills by the end of September. If funding measures are not enacted by the end of the fiscal year, or a continuing funding resolution plan is not approved, aspects of the federal apparatus will be shut down.

In the fiscal year of 2021, the White House has requested $21.6 billion in discretionary spending for the Department of Transportation, which would be a decrease of 13 percent from the previous year’s level. Mandatory contract authority and obligation limitations would receive $66.2 billion, which would be an increase of 8 percent. The Federal Motor Carrier Safety Administration would receive an increase of almost 4 percent.

According to Transportation Secretary Elaine Chao, this request would also bring $1 billion in infrastructure and freight grants.

“These programs provide federal assistance for critical projects that will spur progress in both rural and urban communities across all modes of surface transportation infrastructure: highways, transit, rail, and ports,” she said.

Still, industry groups are concerned that they are not receiving enough to recover.

Transit has asked for an additional $23.8 billion. It has only had a nod of $15.57 billion within the House bill, which also included $15 billion for highways from the general fund.

The motorcoach industry, which includes passenger buses, private transit, and charter buses, asked for $15 billion to help survive the time of the pandemic. The House bill gave $750 million in grants for intercity bus providers instead.

According to Peter Pantuso, American Bus Association President and CEO, this allocation is “a great start, but it’s not enough to save jobs and an industry that provides essential and diverse services to every walk of life in America.”

For the American Association of State Highway And Transportation, officials asked for $50 billion for direct emergency assistance to state transportation departments, a request which had support from 137 House members from both parties. The House instead gave state departments of transportation $15 billion. Executive director of AASHTO, Jim Tymon, said this is good news, although it isn’t what they asked for.

According to Tymon, many states have seen gas tax revenues drop significantly during the stay-at-home order implemented across the country. Because of this, state highway departments have had to pull back on proposed projects and furlough employees.

However, Tymon is hopeful that the House bill means more money will continue to come in. “We know we’ll still see states pull back on projects,” he said. Although they didn’t receive the $50 billion they originally asked for, the number of projects they’ll need to scale back “is a lot fewer than if the $15 billion wasn’t there.”

House Transportation Infrastructure Committee member, Rodney Davis, isn’t as convinced.

“$10 billion in a $3 trillion package for infrastructure?” he asked. “Seriously?”

Rep. David E. Price, chairman of the House Transportation-HUD Appropriations Subcommittee, defended the legislation. “A big part of the state and local aid goes [to] transportation,” he said. “That far outstrips any specific provisions.”

The American Trucking Associations is currently arguing for liability overhaul and tax relief, while the Owner-Operator Independent Drivers Association is pushing for measures such as driver compensation and hazard pay, as well as improved assistance for Small Business Administration. The group has also asked Congress for a suspension of heavy vehicle use tax and unified carrier registration fees.

Groups within the trucking industry that previously benefited from coronavirus spending bills are having to wait on asking for more.

According to John Bozzella, president and CEO at the Alliance for Automotive Innovation, the industry is not making a request, although a group of lawmakers from automaker states Ohio and Michigan have asked the House to focus on the U.S. auto industry for aid in the next bill.

He also said the $2 trillion coronavirus law brought liquidity for the industry that was needed, even though the current sales environment within trucking is in question.

A statement was released last month by the industry expressing concerns for the latest package, saying: “We are disheartened to see yet another massive aid package that is again lacking in assistance for our larger members and does not provide immediate liquidity relief for an industry in dire need. “

According to Fast Park’s Rob Chavez, the industry “has been decimated” and is unable to access help at the federal level. “It’s a month-to-month situation here,” Chavez said of his business, which is currently doing the work of 20 employees with just two. “It sounds almost ridiculous to say it, but companies weren’t built for no revenue.”

Recently, we reported on the Federal Motor Carrier Safety Administration’s relaxation of regulations regarding commercial driver license learner’s permit holders, which came as a response to a driver shortage during the high demand of shipments during the coronavirus pandemic.

Now, this emergency declaration has been expanded to allow commercial driver license skills tests to be conducted with in-cab camera systems, cellphones, and online testing instead of an examiner being physically present with an applicant.

The FMCSA explained that while the country adheres to social distancing rules and guidelines, states can also continue to allow supplies and equipment needed during this time to be shipped without interruption while also bringing new drivers into the industry by utilizing technology. In its announcement, the FMCSA said cameras, cellphones, and bluetooth are now able to be used in CDL skills testing in order to allow examiners “to not be physically present in the cab of the vehicle with the driver applicant while conducting the on-road test segment.”

The FMCSA also said states could use other methods of safe testing, such as having two employees in a spacious follow vehicle–allowing them to sit six feet apart–with one driving and one observing the applicant during his or her skills test. Additionally, one employee could drive a follow vehicle while a camera records the applicant, allowing the test to be viewed after the examiner has stopped driving.

Still, any state that plans to move forward with socially distancing skills examinations must submit a detailed plan explaining how the test conducted via technology will be equivalent to test standards by the American Association of Motor Vehicle Administrators.

“The plan should detail how the state intended to administer the test without compromising safety, observe the skills test from a second vehicle, leverage technology and score the road test, along with any other information the state believes will help the FMCSA determine whether the test administration is comparable to the AAMVA model,” said the agency.

FMCSA said it will consider keeping these amendments in place until the end of June.

“State driver licensing agencies must administer tests using a test examiner information manual that FMCSA determines is comparable to AAMVA’s 2005 CDL Test System Model CDL Manual,” the agency explained.

The original steps taken for commercial driver’s license regulatory relief during the COVID-19 crisis were made effective on March 28th and set to expire June 30th, or until the Trump Administration revokes its declaration of national emergency. These new relaxed regulations included allowing drivers with expired CDLs to continue operating commercial motor vehicles, allowing employers to make up for missed random drug and alcohol testing later in the year, and–perhaps the most surprising change–allowing drivers with commercial driver’s learner’s permits to operate CMVs without any observers.

With this amendment, the agency temporarily waived all requirements that a learner’s permit holder must be accompanied by a CDL holder observing from the front seat of a vehicle while the CLP holder operates the commercial vehicle.

The waiver also originally allowed State Driver Licensing Agencies to administer driving skills tests for out-of-state CDL applicants–regardless of where the learner’s permit holders were trained.

In addition to these changes, the FMCSA has also: waived requirements for CDLs due for renewal on or after March 1st, as well as for CLPs due for renewal, without requiring CLP holders to retake the general and endorsement knowledge tests; waived the 14-day-requirement for CLP holders to wait to take the CDL skills test; waived requirements regarding new medical examination and certification for CDL and CLP holders (as well as non-CDL drivers), as long as they have proof of a medical certification issued for at least 90 days that expired on or after March 1st; and waived requirements that CDL or CLP holders must provide SDLAs with a copy of a medical examiner’s certificate to maintain their medical certification status of “certified,” as long as they have proof of a valid medical certification that expired on or before March 1st.

Additionally, while motor carriers were previously required to select and test CDL holders at a 50% rate for drug testing and a 10% rate for alcohol testing this year, FMCSA will also allow some adjustments and delays for these mandatory random drug tests during this time.