Regulatory and Legislative Update - March 2024

Regulatory and legislative updates for March include the FMCSA awarding $180 million in grants to promote CMV safety, finalizing a rule governing billing practices, CVSA opening nominations for driver award, the FMCSA updating ELD guidance related to cross border transportation and more.

Contents

Regulation and Enforcement

• FMCSA to award $180 million in grants to promote CMV safety
• FMC finalizes rule governing billing practices for demurrage and detention
• Truck Leasing Task Force to Hold Hybrid Meeting at MATS
• CSVA schedules International Roadcheck for May 14-16
• CVSA opens nominations for driver award
• Comment periods still open in various proceedings
• Recreational activity providers exempted from authority registration
• FMCSA updates ELD guidance related to cross border transportation
• FMCSA removes five devices from list of registered ELDs
• Owner-operator seeks ELD exemption on grounds of device cost

Legislation

• House and Senate bills would void DOL rule on worker classification under FLSA

Courts

• Groups sue to overturn DOL rule on worker classification under FSLA

Advocacy and Comment

Regulation and Enforcement

FMCSA to award $180 million in grants to promote CMV safety

As authorized by the 2021 infrastructure law, FMCSA announced the availability of more than $180 million in grants to promote commercial motor vehicle safety. The grants are open to governmental agencies, academic institutions, and other training programs and non-profit organizations. Grants are available through five discretionary grant programs:

• High Priority Innovative Technology Deployment;
• High Priority Commercial Motor Vehicle Safety;
• Commercial Motor Vehicle Operator Safety Training;
• Commercial Driver’s License Program Implementation; and
• High Priority Enforcement Training and Support.

Grant applications for fiscal year 2024 are due by 5 p.m. Eastern on April 19. The full notice of funding opportunity announcements can be found at Grants.gov. For details regarding funding amounts, application requirements, and applicant and project eligibility, visit https://www.fmcsa.dot.gov/grants. FMCSA also is hosting virtual conferences on the FY 2024 opportunities March 12-14. Recordings will be posted later. For more information, visit https://www.fmcsa.dot.gov/fy24grantfundingopportunities.

FMC finalizes rule governing billing practices for demurrage and detention

The Federal Maritime Commission has published a final rule establishing requirements governing how common carriers and maritime terminal operators bill for demurrage and detention charges. A key provision is that a demurrage or detention invoice must go to either the shipper contracting for transportation or storage of cargo or the consignee receiving the goods. Therefore, parties simply providing transportation would not receive invoices.

The rule, which was mandated by a 2022 federal law reforming ocean shipping practices, clarifies who can be billed and within what timeframe and outlines the process for disputing bills. The rule is effective May 28. It was published in the Federal Register on February 26 and is available at https://www.federalregister.gov/d/2024-02926.

Truck Leasing Task Force to Hold Hybrid Meeting at MATS

FMCSA’s Truck Leasing Task Force (TLTF) will meet in person on March 21 at the Mid-America Trucking Show in Louisville, although the meeting also will be streamed for remote attendees and participants. The meeting is scheduled for 10 a.m. to 3 p.m. Eastern. The focus of the formal portion of the meeting will be a discussion of the impact of truck leasing agreements on the net compensation of commercial motor vehicle drivers. However, the meeting also will include two public comment periods totaling approximately two hours. To register for the TLTF meeting and to view a copy of the agenda, visit www.fmcsa.dot.gov/tltf.

CSVA schedules International Roadcheck for May 14-16

The Commercial Vehicle Safety Alliance has scheduled its annual International Roadcheck intensive roadside inspection focus for May 14-16. Each year, CVSA announces a special emphasis for the event. This year, Roadcheck will focus on tractor protection systems and alcohol and controlled substance possession. Tractor protection systems include the tractor protection valve, trailer supply valve and the anti-bleed back valve, all of which might be overlooked during routine inspections, CVSA said.

CVSA opens nominations for driver award

The Commercial Vehicle Safety Alliance is accepting nominations until May 10 for its 2024 International Driver Excellence Award (IDEA). Nominees must have at least 25 cumulative years of crash-free driving in a commercial motor vehicle and a clean driving record for the past three years. Other requirements are no felony convictions; no safety-related driving suspensions in the past three years; and no driver violations in the past three years, including form and manner violations. The 2024 recipient will receive a trip to attend the CVSA Annual Conference and Exhibition, where he or she will be recognized in a session and awards ceremony, and a $5,000 prize. The IDEA is open to the entire CMV industry. For more information, visit https://www.cvsa.org/programs/idea.

Comment periods still open in various proceedings

FMCSA is still accepting feedback on several issues, including owner-operator lease agreements, commercial driver’s licensing requirements, and a study related to driver detention. The following dockets are still open for comment:

• A request that commercial motor vehicle drivers who have signed lease-purchase agreements provide the agency with copies of leasing documents and copies of documents for all other financial products associated with their work as CMV lessees. FMCSA also seeks info from CMV lessors. Comments are due March 18. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-03205.
• A proposed rule to make the regulations governing commercial driver’s licenses more flexible in several areas while tightening the rules in certain other areas. Comments are due April 2. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-01710.
• FMCSA’s plan for conducting a study on driver detention. Comments are due March 18. For the Federal Register notice visit, https://www.federalregister.gov/d/2024-03256.

Recreational activity providers exempted from authority registration

FMCSA amended its regulations to implement the statutory exemption from its operating authority registration requirements for providers of recreational activities. The exemption applies to motor carriers operating a motor vehicle designed or used to transport between 9 and 15 passengers (including the driver), whether operated alone or with a trailer attached to the transport vehicle, if the motor vehicle is operated by a person that provides recreational activities within a 150 air-mile radius of the location at which passengers initially boarded the motor vehicle at the beginning of the trip. In response to comments on the proposed rule, FMCSA also added "off-highway vehicle driving and riding" to the list of activities defined as recreational under the rule. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-03782.

FMCSA updates ELD guidance related to cross border transportation

FMCSA has posted on its website new frequently asked questions (FAQs) regarding use of electronic logging devices in cross border transportation. The revised guidance, dated March 8, 2024, replaces FAQs that had been posted in April 2018. The FAQs and other FMCSA guidance are available at https://www.fmcsa.dot.gov/guidance.

FMCSA removes five devices from list of registered ELDs

FMCSA has removed CI ELD LOGS, CN ELD, KSK ELD, TT ELD 30, and TT ELD 1010 devices from the list of registered Electronic Logging Devices (ELD). FMCSA placed these ELDs on the Revoked Devices list due to the companies’ failure to meet the minimum requirements established in 49 CFR part 395, subpart B, appendix A. The removals are effective February 29, 2024.

Motor carriers using revoked devices must immediately discontinue their use and replace them within 60 days of the revocation. In the interim, carriers must revert to paper logs or logging software. For a list of registered and revoked ELDs, visit https://eld.fmcsa.dot.gov/List.

Owner-operator seeks ELD exemption on grounds of device cost

FMCSA is requesting comments by April 1 on an application from owner-operator Arbert Ibraimi for a 12-month exemption from the electronic logging device requirement on the grounds that as a new business he has limited funds to support the purchase of an ELD for his lone commercial motor vehicle. Ibraimi told FMCSA that he would use the funds saved from not implementing an ELD to monitor the safety of operations and to incorporate safety management controls. For the Federal Register notice, visit https://www.federalregister.gov/d/2024-04307.

Legislation

House and Senate bills would void DOL rule on worker classification under FLSA

Rep. Kevin Kiley (R-California) and Sen. Bill Cassidy (R-Louisiana) have introduced joint resolutions of congressional disapproval (H.J. Res. 116; S.J. Res. 63) of the Department of Labor (DOL) final rule on worker classification under the Fair Labor Standards Act (FSLA). The rule, which took effect on March 11, overturns a rule finalized during the Trump administration that had designated two “core factors” – control over work and opportunity for profit or loss – as key in weighing worker classification. Meanwhile, various groups are challenging the DOL rule in the same federal court that struck down the Biden administration’s effort to withdraw the Trump-era rule in 2021. (See article below.)

A joint resolution of congressional disapproval is a mechanism for voiding a rule implemented by the executive branch. However, even if the resolutions are passed by both the House and Senate, they can become law only the president signs it or Congress overrides a veto – neither of which is feasible given the current Congress or administration. Congress last year passed a joint resolution to block new environmental regulations on commercial trucks, but President Biden vetoed it.

The House bill has 54 co-sponsors. The Senate bill has 32 co-sponsors. For more information on H.J. Res. 116, visit https://www.congress.gov/bill/118th-congress/house-joint-resolution/116. For more information on S.J. Res 63, visit https://www.congress.gov/bill/118th-congress/senate-joint-resolution/63.

Courts

Groups sue to overturn DOL rule on worker classification under FSLA

The Coalition for Workforce Innovation (CWI) and various other groups, including the American Trucking Associations and the U.S. Chamber of Commerce, have filed an amended complaint in a federal court in Texas challenging the Department of Labor’s new rule regarding the test for classifying employees and independent contractors under the Fair Labor Standards Act. The rule, which replaced a DOL rule finalized during the Trump administration, took effect on March 11. In a related action, resolutions of congressional disapproval have been introduced in both the House and Senate. (See article above.)

In 2022, CWI and other parties were successful in obtaining a ruling from the same Texas federal court that DOL’s initial withdrawal of the Trump-era rule violated the Administrative Procedure Act for various reasons, including a finding that the action “left regulated parties without consistent guidance regarding the proper classification of workers” under FSLA. In the amended complaint, the groups argue that the latest rule “fails to address (and will only add to) the confusion over the proper classification of independent contractors, and will irreparably harm not just companies employment independent contractors nationwide, but the workers themselves.”

Advocacy and Comment

The issues set forth above include litigation and proposed congressional action which demonstrates the breadth and scope of the critical labor, safety, and fraud issues facing the trucking industry, owner operators, and small businesses in particular. In the election year, especially one as dysfunctional as this, little dispositive legislative or judicial action can be predicted, yet the above shows the opportunity and the need for legislative reform. To follow is information concerning FMCSA’s attendance at MATS to be followed up by the TCA’s Annual Convention the following week in Nashville in which these key issues will again be addressed. Hopefully readers attending MATS or TCA will respond to the request for support.

Are you Coming to MATS?

As noted, the Mid America Trucking Show will be held in Louisville March 21-23. The FMCSA regularly attends and sponsors open sessions to present its upcoming initiatives. This year, it is scheduled to address its regulatory agenda with a particular focus on the big issues affecting the independent contractor model, a new proposed safety fitness rule using artificial intelligence to augment SMS, data integrity, fraud prevention, and proposed changes to the new carrier application.

In separate sessions sponsored by CDL Drivers Unlimited, the following transportation professionals will offer their insight on these important issues and more:

Jim Heffernan with CDL Drivers Unlimited will start things off by discussing how stakeholders in the trucking industry can become involved and participate in advocacy toward the goal of competing on a level playing field.

The future of the independent contractor model which can effect approximately 700,000 small businesses will be analyzed and discussed with Bruce Lundegren, Assistant Chief Counsel for Safety, Security, and Transportation with the SBA Office of Advocacy, from the perspective of owner operator rights as small businesses protected by federal statutes and remedies.

The proposed reboot of SMS and the use of artificial intelligence will be discussed by transportation attorney Henry Seaton in the context of the FMCSA’s obligation to vet all carriers for safety compliance purposes and issue fair and objective audits.

FMCSA’s inability to issue safety ratings to new and small carriers and the prejudice suffered by new and small carriers who the agency does not vet will be discussed by Tommy Ruke with the Motor Carrier Insurance Education Foundation, an expert in insurance pricing, and others.

Rick Gobbell, former FMCSA director and a safety expert who teaches classes for enforcement officers, will present an effective and alternative method for FMCSA to reform its safety fitness rules and comply with Congress’ requirements that all carriers be vetted.

Dale Prax of Freight Validate will address the issue of fraud in trucking. In this session, proactive fraud prevention policies will be discussed with special attention on how the FMCSA’s proposed revision of the new authority application process can be modified to detect identifiable frauds before new applicants are authorized to operate.

The MATS format and the FMCSA’s participation will allow for open and candid discussions including the presentation of alternative proposals which can better meet the requirements of the National Transportation Policy. If you are coming, be prepared with questions for both the Agency and the sponsored breakout sessions. Your endorsement, financial support, and comments are needed. Please email ASECTT at asectt@gmail.com about the agenda items of greatest concern to you at MATS.

Finally, there are other judicial and legislative issues discussed above that are pending and related to the administrative agenda involving safety, fraud, the future of the owner operator model and administrative reform. Readers with questions involving these topics are welcome to submit them to the email above for discussion in Louisville as well.