Industry Groups Split Over Changes to FMCSA Civil Penalties Regulation
This story appears in the Jan. 23 print edition of Transport Topics.
Trucking groups are divided whether a proposal to restrict companies’ abilities to pay civil penalties to the Federal Motor Carrier Safety Administration while denying guilt would increase safety or bog the agency down with unnecessary litigation.
American Trucking Associations argued in a public comment filed this month that FMCSA would face a large backlog of litigation from companies that fight penalties instead of paying them.
“This result would be a reversal of the increased efficiency in enforcement procedures,” the group wrote.
The Owner-Operator Independent Drivers Association disagreed, writing that allowing a company to settle claims without admitting guilt “turns the enforcement process from one intended to improve highway safety . . . into a revenue-generating enterprise.”
FMCSA’s proposal would ensure that a company’s safety record encompasses all violations, instead of skipping the ones to which the company does not plead guilty, OOIDA said.
The agency proposed in December to clarify its rules to state that carriers, intermodal equipment providers, brokers and freight forwarders cannot submit payment for a violation with a written denial of that violation and be free from liability. Instead, FMCSA wants such payment to be regarded as an admission of guilt (12-19, p. 2).
The public comment period for the proposal closed Jan. 12. FMCSA has not yet indicated when or if it will issue a new final rule.
FMCSA started to allow denials in 2005, when it had a large backlog of litigation from its enforcement, it wrote. The move was meant to “increase the efficiency of agency administration enforcement procedures.”
This allowed FMCSA to decrease its backlog of cases that had been open for more than six months by about 70%, ATA said.
But FMCSA officials have more recently begun to reject denials of guilt that accompany payments, ATA said. Citing anecdotes, ATA said that the agency’s backlog is starting to build again.
“Motor carriers faced with [notices of claims] based on questionable facts will simply be encouraged to litigate the proceedings to the end, further re-directing FMCSA enforcement resources from the most high-risk carriers,” the group wrote.
OOIDA recognized the possibility of increased litigation as well, warning that FMCSA “must therefore be prepared to allocate the additional manpower and resources needed to resolve an increased number of disputed enforcement actions if the system is to continue to operate efficiently.”
The American Moving and Storage Association agreed with ATA, writing that companies that are not guilty of the accusations may admit guilt only to avoid legal costs associated with appeal.
“It strikes us as a bit of a guilty-until-proven-innocent approach that isn’t fair to non-violating companies who make a business decision to take the least expensive way out of a difficult situation,” AMSA said.
Groups submitting comments also disagreed on FMCSA’s proposal to prevent companies it shuts down from creating new companies in order to continue operating.
The Institute for Makers of Explosives said that some of its members who transport explosives own multiple fleets that could be considered the same fleet under the proposal. The group has “concerns” over the standards for declaring fleets to be one in the same, it said.
The standards FMCSA would consider include common officers, mailing addresses and facilities, it said. Those factors indicate that owners might be trying to evade laws or regulations by using another fleet they own, the agency wrote.
“The similarities between different entities may be caused by legal or other regulatory requirements,” IME wrote, urging FMCSA to clarify the standards it would use before finalizing the rule.
ATA questioned whether FMCSA has the legal authority to make such a regulation, noting that it has previously asked Congress for that authority.
