International Freight Forwarding Group Advocates for Logisics Industry Input in UN Goals

The International Federation of Freight Forwarders Associations (FIATA) has advised the United Nations (UN) to seek more input from the logistics sector in the creation of their post 2015 Sustainable Development Goals (SDG). Noting that the emphasis on the logistics industry in the current plan is insufficient, FIATA asserts that the expertise of those in the International Freight Forwarding logistics industry is central to boosting the global economy and achieving sustainable growth.

The UN's Rio+20 Conference, held in Brazil in June 2012, resulted in an agreement to launch a process to develop a set of (SDGs), building upon the UN's eight Millennium Development Goals. (The Millennium Development Goals address extreme poverty, HIV/AIDS, gender equality, maternal health, childhood mortality rates, education, environmental sustainability, and global partnerships.)

FIATA's position is based on the imitation lag hypothesis and the life cycle (product cycle) theory. Simply put, imitation lags--delays--occur when one country does not have the technology to adopt and diffuse the imported technology of another country. The life- or product cycle theory describes the trajectory of a new product or technology. It is created in Country 1, matures and is shared with economically similar countries. Production standardizes and is outsourced to developing countries. FIATA asserts that the logistics sector is central to international trade and drives global economic prosperity.

In a position paper published by FIATA, the organization states that their global go-between position affords them unique insight into national policies and the limitations of those policies to have impact on local international communities. FIATA says the relationship between national policies and local economies--and their impact on multiple sectors--needs further analysis before appropriate SDGs can be achieved.

In addition to increased input of the international freight forwarding logistics industry, FIATA has urged the UN to involve many civil societies and relevant stakeholders in their discussions. 

FMCSA (Federal Motor Carrier Safety Administration): Safety Rules Coming in 2014

The trucking industry is expecting finalization for two major safety rules early in 2014: 1) mandated electronic logs (e-logs); and 2) a searchable database with driver drug and alcohol tests. A third is on-tap for later in the year: carrier safety fitness.

Mandated E-Logs

A great deal of controversy has surrounded the issue of e-logs--also referred to as electronic onboard recorders. Many drivers reference similar devices in the past as avenues for coercion, describing log boxes that beep every hour and require input during delays and sleeper berth time. Many consider the harassment responsible for driver sleep deprivation and therefore detrimental to highway safety.

The FMCSA (Federal Motor Carrier Safety Administration) conducted lengthy surveys regarding the potential for coercion and possible measures to protect against it. Survey results are being used to develop a coercion plan. This plan will be publicized via a Notice of Proposed Rulemaking early 2014 and then opened for public feedback.

Searchable Database for Alcohol and Drug Tests

This proposal will require employers to report all positive test results and refusals to a clearinghouse. A prospective employer may--with the applicant's permission--access the database for individual records.

The database would be maintained by a third party, and records would come with rigorous privacy measures. Any driver testing positive would be required to complete a return-to-duty process and that would be reflected in the database.

Although employers would pay a fee to access the clearinghouse, drivers would be able to access their own records for free. Dispute and appeal procedures will be part of the final rule.

As with mandated e-logs, the final rule will be posted by notice and then opened for commentary.

Later in 2014...

A third major safety proposal is not expected to reach notice until later in 2014: standards for carrier safety fitness. As part of the Compliance, Safety, Accountability (CSA) Program, data in the Behavioral Analysis and Safety Improvement Categories will be used to determine whether or not a carrier is fit to operate.

Disagreement Over The New $75,000 Broker Bond

Reports of the impact of the recently enforced $75,000 broker bond on property brokers is mixed. In effect October 1, 2013, brokers were given a 60-day grace period to comply with the increased surety bond requirements. The grace period ended December 1, and the Federal Motor Carrier Safety Administration's (FMCSA's) database has seen a reduction of over 8,000 brokers out of roughly 21,500.

The increased requirement has seen its share of controversy. Backed by the Transportation Intermediary Association (TIA), American Trucking Associations, and the Owner-Operator Independent Drivers Association (OOIDA), it was considered better protection for freight carriers. Supporters argued the $10,000 bond had been in place for 30 years and was no longer adequate to cover losses suffered by carriers jilted by fraudulent brokers. The new and higher bond was touted as proper course to ensure professionalism and legitimacy in the industry.

Others felt it was an unfair hardship inflicted upon small brokers who do not do enough annual business to afford the increased bond. The Association of Independent Property Brokers & Agents (AIPBA) has been the most vocal opponent of the change. In previous negotiations, the AIPBA had agreed to a $25,000 bond that would cover inflation, but argued $75,000 was excessive, overly punitive to small business, and a means for mega-corporations to monopolize the industry.

Estimates of revoked brokerage licenses has varied. Discrepancies in the numbers of affected brokers may be due to whether or not reported statistics include warning notices sent in November, inclusion of those who voluntarily surrendered their licenses, and inactive brokers who were simply cleaned out of the database after December 1. AIPBA maintains that over 8,000 valid and active brokers were shut down. The organization's petition to the U.S. Court of Appeals remains pending.

In the meantime, brokers who have had their licenses revoked may be eligible for reinstatement if they meet the higher bonding requirements.

Shipping Advantages Provided By an NVOCC (Non Vessel Owning Common Carrier)

Today when an International shipper is looking for their best options, they might want to consider the benefits of using a Non Vessel Owned Common Carrier (NVOCC).  These shippers are able to accommodate the needs of both large and small companies.  Many government agencies also regularly utilize the services provided by a NVOCC. 

According to an article in Maritime Journal, “The N.V.O.C.C. is a freight forwarder who sells a combined transport package incorporating a sea transit. He is not a ship owner, nor does he appear to be normally involved in the chartering of ships although no doubt he could do this.”  

OTI 

Prior to a company becoming a NVOCC, they will need to obtain their ocean transportation intermediary (OTI) license.  This means they will have to be qualified as a shipper by following a variety of steps required by the Federal Maritime Commission. 

Bills of Landing 

A NVOCC operates in the same way as any other cargo carrier.  They are able to issues bills of landing (BOL).  This is a document that confirms that goods have been taken on board a vessel.  It verifies the goods will be shipped to a particular destination and consignee for end delivery.  

Experience 

Most NVOCC shippers will have all the experience necessary to handle a wide variety of cargo types.  They will be able to do importing as well as exporting.  NVOCC shippers can handle everything from over sized items to temperature sensitive cargo and more.  

Tariffs 

NVOCC will file tariffs with necessary government regulatory bodies.  This will generate the required public tariffs.  

Experience 

An experienced NVOCC will know every important aspect of cargo shipping.  They will know how to successfully book space with shipping companies.  A NVOCC will be able to provide all required documentation for the shippers they utilize.  They will be able to coordinate the efficient delivery of cargo domestically as well as internationally.  

If you would like to know more about how an NVOCC (Non Vessel Owned Common Carrier) can meet your cargo shipping needs we can help.  Contact us today and learn more.

Cargo Insurance Considerations

When shipping supplies to your firm or products to customers, safety comes first. You want to ensure that you do not incur any losses owing to damage of the package in transit. As such, cargo liability insurancebecomes vital.

Although many business owners do not understand the growing business in ship transport, they applaud the introduction of shipping insurance. As Forbes puts it, “The cargo shipping business is highly cyclical, a fact that many ship owners have not seemed to have grasped.” Regardless of this, many acknowledge the purpose of shipment insurance. This coverage has seen many be compensated by the insurance firms due to the damages caused on their goods.

Given the importance of cargo insurance, it pays to trust only the best company with your package. The insurance firm you pick for the purpose has to meet the standards needed for cargo insurance services. This is in regards to insurance premium, rates of insurance and the services offered among other factors. Before you select any insurance company, see to it that you look at its history, reputation and the relation it has had with other clients.

The nature of your products also counts when it comes to cargo insurance. A firm may choose not to insure some products. Therefore, you have to ascertain that the products you have are included in the firm’s list of goods insured. The nature of the goods will also lead to the variation in costs, rates and other factors.

Consider exactly what the firm is offering you. Often, insurers will compensate for damages caused by any factor including third parties. This covers all scopes of damage. However, there are those that will compensate only against the factors that you stipulate. As such, you need to verify with the insurance firm what factors of damage they insure against.

Also, consider their claim policies. Will it take forever for a claim to be compensated? You have to ensure that the firm you are planning to buy the cargo insurance quote from has a favorable claim policy. Understand their special clauses, process and formalities involved when making a claim and such factors beforehand. This way, you are able to gauge whether the company is right for you.

The above are some of the parameters that you have to consider prior to selecting a cargo insurance firm. To learn more about cargo liability insurance, contact us.

Why Every Shipper Needs A Freight Broker

You may have heard of freight brokers but are not sure of what they do. Simply defined, a freight brokeris a company that acts as a link between companies or individuals who need shipping services and certified motor carriers. It is worth noting that while brokers play a crucial role in cargo transportation, they do not in any way function as the carriers or shippers. The role of the broker is to identify the needs of shippers and then connect the shippers with carriers who are able to transport the goods at a reasonable price.

There are a number of reasons why you should consider using the services of a freight broker. For starters, you get the best prices for your shipments. It is the duty of the freight broker to find you the most affordable shippers available. Before settling on particular shippers, brokers take the time to compare bids from several companies.

Another reason to use freight brokers is that they help you save precious energy and time. Think of the amount of time you would spend searching for the most reputable and reasonably priced shippers. This is time that could be spent doing other important things. Having worked in the industry for a significant amount of time, the brokers know which brokers to use.

Though there are many freight brokers out, it is safe to say that they are all not equal. In order to choose the right broker, there are a number of things you should look for. Proper licensing is the first thing to look for. According to fleet owner: “Beginning Oct. 1 anyone acting as a broker or a freight forwarder, including motor carriers who broker loads, are required to register and obtain broker or freight forwarder authority from FMCSA. Brokers and freight forwarders will also not be subject to a minimum $75, 000 financial security requirement.” What this means is that you should only use freight brokers who have licenses from the FMCSA, or the Federal Motor Carrier Safety Administration. Hiring licensed brokers ensures that you are protected in case something goes wrong.

In the event that your shipment is lost or damaged, you need to be sure that you will be compensated. For this reason, you should choose a broker with insurance. In addition to liability insurance, good brokers also carry errors and omission insurance.

If you would like to know more about freight brokers GSIS is the company for you. Do not hesitate tocontact us today.

Pirate's Moving West

The recent attack by Somali-based extremists at a mall in Kenya has renewed discussion about Somali pirate attacks along key shipping routes.

The International Maritime Organization (IMO) initiated a long-term anti-piracy project in 1998, and it continues today. Through regional seminars and workshops for government officials from piracy-riddled areas and using evaluations and assessment missions, IMO has worked toward regional agreements for anti-piracy measures.

Although IMO's work has largely been toward creating a network of consistent and collaborative anti-piracy measures, their emphasis continues to be on self-protection. The best defense is a well-protected merchant ship.

There has been success in recent years, which has largely been attributed to $3 billion in annual spending on shipboard security and navy patrols. Thanks to increased shipboard defense spending, attacks off the Horn of Africa have fallen 70% since 2011. At a time when company and state budgets are seeing massive cuts, there is worry that reduced spending on shipboard defense measures will lead to a rise in Somali hijackings.

The conditions favoring Somali piracy have not changed. Poverty and instability in the region feed extremist movements. Merchant ships passing through the Gulf of Aden between Yemen and Somalia continue to be at risk.

With increased piracy activity, merchants and freight forwarders would likely see steep rises in ocean freight insurance premiums. A 2008 report on Ocean Piracy and Its Impact on Insurance described a dramatic increase in insurance rates after a surge of piracy activity between 2007 and 2008. In 2007, it cost $900 to insure a container. After a rise in pirate hijacking, that cost rose to $9,000 in 2008.

Regardless, all warn against complacency. Declines in pirate attacks have come at a significant financial cost. As conditions in Somalia remain unchanged and as companies examine budgets, defense against piracy remains imperative. A well-protected ship and insured cargo are the best defense against attacks.

The Need For Contingent Cargo Insurance

Whenever goods are transported across the country there is always a chance they may not make it to their destination.  If they do make it, they could be damaged.  This could be caused from ships being in bad storms, thefts, accidents and more.  In order to prepare for such a situation, there may be a need for added insurance beyond standard coverage for cargo.  

Contingent cargo insurance could be required if a freight broker is responsible for any lost cargo or damage not covered by other insurance.  The decision to purchase this insurance may be based on the type of contract between a shipper and the freight broker.  There are contracts that will make the freight broker responsible the cargo.  It’s also essential to have the right coverage if the carrier utilized fails to pay.  

This type of insurance enables brokers to establish a positive relationship with shippers and carriers.  It enables them to not be concerned about paying for losses on their own.  This can benefit the consumer by providing added protection in getting shipments to their destination.  

There are also policies available that cover any financial responsibilities associated with the transportation of the cargo.  There could be situations involving fraud committed by employees, pollution cleanup and more.  It can even cover such things as unintentionally breaking laws and regulations associated with moving different types of cargo.  

Contingent cargo insurance can also provide legal coverage should it be required.  In this situation all attorney fees are covered.  The expenses associated with any type legal defense are quite costly.  This type of coverage will be very valuable if any type of situation occurs that requires legal representation. 

If cargo is shipped by air, sea, truck and more it’s important to have an insurance plan that provides all the necessary coverage.  It is always best to analyze insurance needs based on the type of cargo, the shipping agreement and the method of transportation utilized. 

 

The $75,000 New Broker Bond and the 60 Day Phase in Period

As brokers and freight forwarders prepare for the $75,000 broker bond increase, the Federal Motor Carrier Safety Administration (FMCSA) has announced a 60-day phase-in period. The increased bond requirement deadline is October 1, 2013. Brokers and freight forwarders under FMCSA's jurisdiction must file BMC-84 or BMC-85 forms reflecting the new bond amount by this date. Notices will be sent to those not yet compliant on November 1, 2013. Then, the agency will begin revoking freight forwarder and broker operating authority registrations of those still not compliant on December 1, 2013.

The new $75,000 broker bond, part of MAP-21, still comes with its share of controversy. Although several organizations support the bond as a means  to guarantee brokers will pay freight bills as agreed and get rid of those who don't, others oppose it. The Association of Independent Property Brokers and Agents (AIPBA) filed suit against the FMCSA in July, asserting that the new bond will not accomplish what it intends (to weed out fraudulent brokers) and that it was established without regard for federal rulemaking procedures.

Small brokers worry of the bond's impact on their operations and capacity to remain competitive. While the increase may create only small ripples in large companies, it poses a significant hardship for smaller brokers. Some fear it will put small, reputable brokers out of business completely.

Although brokers are still required to have the new bond in place by October 1, the 60-day phase-in period may give those who need it a little extra time to prepare before losing licensure. Small brokers are urged to work with a good accountant and banker to strengthen the company's financial standing and secure credit.

AIPBA recommends small brokers seek legal counsel for what the bond and the additional phase-in time will mean for their companies. AIPBA is currently seeking clarification for what an October 1 canceled $10,000 bond will mean for a small broker. Will the broker be able to continue operations without a bond until December 1? Or will "patch bonds" be available through the transition period?

The MOL Comfort Ocean Calamity

The Carrier of Goods by Sea Act states that the carrier is responsible for vessel seaworthiness, the safety of goods in route, and the proper manning of the vessel. Items the carrier is not responsible for include negligence of the master navigator, fire, accidents at sea, acts of God, acts of war, seizure, mutiny, insufficiency of packing of goods, and other situations in which the ocean carrier's actual fault is in question. 

Without ocean freight insurance, a company can be held responsible and liable for such incidents. In order to protect your company and your assets, a viable and comprehensive insurance plan must be set in place.

In June of this 2013, the MOL Comfort ocean container vessel fractured in two separate sections during an incredible storm on the Indian Ocean. The vessel suffered extensive damage to the bow and stern; as a result, the ship surrendered all of its cargo to the sea. Presently, officials are still rooting for the cause to the catastrophe aboard the MOL that caused such devastating loss. 

A possibility that is currently under investigation points to structural weakness that caused the wreck of the UK container ship, the MSC Napoli, in 2007. The investigation into the UK ship's demise showed flaws which were concluded to have been caused by a change in the hull design of the ship. The MOL Comfort ship was constructed one year after the Napoli, at which time the change in design of the hull had not yet been corrected. 

Following the MOL disaster, Mitsui OSK lines pulled the six sister ships of the MOL in order to inspect their hulls. Each were designed and constructed around the same time and at the same shipyard as the MOL Comfort and the UK's MSC Napoli. It is feared investigation will show discrepancies in the hull designs. 

At this time, insurance agents in the US feel the MOL disaster will not effect current insurance rates for cargo carriers. It is certain Mitsui's MOL disaster will send shockwaves through the Japanese ocean shipping market because of he number of ships involved in the bad hull design. 

Ocean freight insurance is sometimes a company's only defense from potential disaster. It is important to have a thorough and comprehensive plan and agents that have the knowledge to protect your investment even in the most unique situations. For more information, please contact us.

FMCSA Helps Veterans Move From Military to Civilian Life

More than 300,000 new jobs are expected in commercial trucking before 2020, according to the Bureau of Labor Statistics. On July 3, FMCSA (Federal Motor Carrier Safety Administration) announced almost $1 million in new grants to help train veterans and military families to fill these positions. 

The grants were awarded to six colleges across the country as part of the Commercial Motor Vehicle Operator Safety Training (CMVOST) grant program and could provide training for as many as 300 new commercial transportation students. The announcement was publicly applauded by the Disabled Veterans National Foundation as a smart way to keep veterans competitive in the job market.

Programs that aim to support military service men and women and their families may be inspired by federal initiatives such as the White House's Joining Forces. Joining Forces, announced by First Lady Michelle Obama and Dr. Jill Biden, in part provides employment and educational resources for veterans and their families. 

Some note that military personnel are naturally suited for the commercial transportation industry, as many service men and women have received training in operating heavy equipment and have fulfilled roles in managing supply chains within the military. With this understanding, initiatives such as the CMVOST's grant program are part of the commercial transportation industry's commitment to helping veterans and their families transition from military to civilian life. For example, in May 2011, FMCSA relaxed commercial learner permit rules to waive the skills test for individuals demonstrating at least two years of safe driving experience in military equivalents of commercial motor vehicles.

Transportation Intermediaries Association (TIA) launched its own Veteran Initiative in March of this year. TIA, partnering with the U.S. Chamber of Commerce, Paralyzed Veterans of America, and Troops to Transportation Logistics (T2TL) seek to connect returning and disabled veterans with TIA members who are looking to hire. The program has been successful. By June, TIA noted that over 350 veterans had been identified as qualified candidates for positions at over 60 TIA companies.

FMCSA and Senator Charles Schummer Announce Steps to Reduce Bridge Strikes

200.  That's how many bridge strikes occur in NY state alone.  At least 2 trucks hit the Onondaga Parkway Bridge in upstate NY every year, despite 13 separate signs detailing the 10' 9" clearance, and a NYS Department of Transportation ban on truck traffic on that route.  In 2010, one of those strikes was responsible for 4 deaths and over 2 dozen injuries.  How does this keep happening?  One clear answer is the inappropriate use of GPS navigational devices by commercial vehicle operators.

In fact, 80% of bridge strikes by commercial vehicles in New York State have been attributed to the use of passenger vehicle-based GPS devices.  In an effort to alter this trend, the FMCSA (Federal Motor Carrier Safety Administration) and New York State Senator Charles Schumer have instituted a major campaign to increase driver education and understanding of the risks of using the wrong GPS devices to determine truck routes.

Senator Schumer, a long-time advocate of safe driving and sponsor of distracted driving legislation, has pushed hard for the Federal Department of Transportation to examine this issue and to determine methods to mitigate the damage to property as well as the safety risks involved. Although the originally focused on creating legislation limiting and carefully regulating the use of GPS navigation tools, he has now partnered with the FMCSA to develop recommendations and educational programs on the proper use of the technology.

As a result, the FMCSA has begun issuing official recommendations on the proper use of GPS devices in freight vehicle routing.  As part of the new CDL rules required by the Moving Ahead for Progress in the 21st Century Act (MAP-21), specific training in the appropriate use of GPS navigation tools has been proposed as a requirement for all new entry-level certification programs for commercial motor vehicle operators.  

Ongoing commercial driver education will also train and remind drivers to only use GPS systems designed specifically for the industry.  These specialized applications take into account the specifics of the truck they're in, including the height, weight and contents, and will route the trucks onto safe, appropriate roads. The GPS applications available to consumers focus on passenger vehicles only and frequently route trucks onto unsafe or restricted routes, causing them to crash into low overpasses and bridges.

Multiple education and awareness programs have also been developed, both by the industry and the FMCSA.  In partnership with Senator Schumer, a visor card has been designed and distributed reminding drivers of key items to keep in mind when using GPS navigation technology, including: a) use of commercial vehicle-specific technology only, and keeping any software up to date; b) avoiding distracted driving scenarios where the driver is more focused on the device than their driving, and c) ensuring that the driver has entered in all the relevant vehicle information into the system (height, weight) prior to travel so that the suggested routes are appropriate for that specific vehicle. The American Trucking Research Institute (ATRI) and the American Trucking Association (ATA) have also conducted major research studies on this issue as well as developing multiple education and outreach efforts to increase awareness of this issue. 

Freight Broker Insurance, do you need it?

There comes a time when a business owner can avoid  finger-pointing and a "who is ultimately responsible" type of situation if they are familiar with motor carrier safety rules, laws and even guidelines that can all be addressed with Freight Broker Insurance.  Business owners in this industry have a lot on their plates as they focus on operating their business.  Often they may not be fully aware of everything that can help protect them and the best interests of their operation.

 

Let's check out the "for instance" situation that was recently cited in the Transport Topics Issue of Trucking and Freight Transportation News - "Carriers that re-broker freight — again without separate broker authority and bond — usually are held to retain full liability as the carrier for the cargo (even though they did not transport it), but they will likely have no insurance protection for the actions of the brokered truck."  In cases like this often the business owners are not aware of what is necessary to protect them and their business in complicated and even ordinary situations.

 

This is why it is important to work with knowledgeable people who specialize in this type of industry.  First, you should consult with your insurance agent and possibly even check with your attorney. Together with your property and general liability package there are some other coverage options that you should consider.

 

It is recommended that brokers obtain vicarious auto liability insurance. That will enable your insurer to defend you if you are named in a lawsuit. Be aware that this type of coverage widely varies, so get an expert to help you review the terms and conditions to make sure it is right for you. Another option is contingent cargo coverage. This will help cover some of the gaps that might be contained in the policy that the carrier has in place. You can't be sure what exactly their policy covers, so it is a good idea to play it safe. This is also another type of insurance coverage that is not always the same in policies. You can easily find out more details if you simply contact us to learn more and get answer to your questions.

The FMCSA (Federal Motor Carrier Safety Administration) TACT (Ticketing Agressive Cars and Trucks) Program

The FMCSA (Federal Motor Carrier Safety Administration) has a major impact on safety standards for all commercial vehicles that travel the highways of the United States.  A goal of the FMCSA is to remove high risk carriers and drivers both at entry level and through education and maintenance programs. 

Key FMCSA programs include:

·         Border and International safety

·         The Commercial Driver's License program

·         Federal Motor Carrier Safety Regulations (FMCSR)

·         Hazardous Material Regulations (HMR)

·         Motor Carrier Safety Assistance Program (MCSAP)

·         Ticketing Aggressive Cars and Trucks (TACT)

 

The TACT program began in 2004 with the key state of Washington for the pilot program.  Its mission was to promote safe driving behaviors by educating car, bus and truck drivers on how to share the road safely.  Also to reduce CMV related accidents and crashes involving injuries and fatalities.

The hierarchy of the TACT program begins at the top with the FMCSA headquarters' outreach programs to divisional and regional areas.  From there it filters down to lead state coordinators and steering committees who communicate, enforce and evaluate programs like TACT to various state agencies such as:

·        Department of Transportation

·         Sheriff and Police Departments

·         Federal Highway Administration

·         State Trucking Associations

·         Government Highway Safety Representatives

 

The State Peer Exchange Network (T-Spen) helps to support and share the results and lessons of TACT and bring federal state and local resources together on the same page to educate the public. In 2004, there were five states participating; in 2009 13 states; and by 2011, 19 states and 3 individual US cities and counties were on board.  Improvements to the administration of TACT have included streamlining evaluations, grant funding and more outreach communication programs. 

In 2013 so far, the FMCSA has shut down 15 passenger carriers and carried out 13,500 roadside inspections and ticketed 1,500 drivers and vehicles for violations. The violations include unsafe lane changes, tailgating, failing to signal or yield right of way, speeding and any combinations of violations of 2 or more that is considered "aggressive behavior."

35th Annual TIA Convention And MAP 21  

For the 8th Consecutive year GSIS was in attendance for the TIA Convention. We made many new friends and thank all those in attendance for an educational and entertaining week.

 

The past 12 months in the 3PL industry have, like the economy, had its ups and downs. Most notably the introduction of MAP 21 of the Highway Authorization Bill. Last July President Obama forever changed the logistics field with the introduction of Map 21 (moving ahead for progress in the 21st century act). Since its introduction, MAP 21 has been implemented by DOT, FTA, FMCSA and FHWA with one goal in mind: to develop a national strategic freight plan. Just renewed by congress in April, MAP 21 is running full steam ahead. we can revisit some key points pertinent to our field:

 

1. Electronic Logging Devices- the law requires DOT to establish regulations mandating electronic logging devices (EOBR’s) for motor carriers currently required to complete paper logs. The regulations must be in place within 1 year and carriers will have two years thereafter to adopt/install the devices.

2. Freight Policy- DOT is creating a national freight plan that includes an assessment of the condition and performance of the national freight network and identification of highway freight bottlenecks. This is intended to improve freight efficiency from 80% to 90% off of interstate systems and 95% for interstate systems.

3. Truck Size and Weight- the act does not include an increase in size and weight limits except for an increase in allowable weight for idling reduction devices from 400 pounds to 550 pounds. States are also allowed to issue 120 day oversize-overweight permits to trucks responding to disasters if a national emergency is declared.

4. Performance Standards- each state and urban area is required to establish minimum performance standards related to highway and bridge maintenance, congestion, system reliability, safety, freight efficiency, air quality and project delivery. Failure to do so will result in the transfer of federal funds from non logistic areas in order to compensate.

5. Broker Bond- MAP-21 increases the broker bond to $75,000 and applies it to freight forwarders. It also tightens requirements on bonding companies to respond to carrier claims.

6. Proficiency Testing- all new employees entering the motor carrier field now must complete the DOT safety testing within 12 months rather than the previous standard of 18 months.

7. Transport of Agricultural Commodities & Supplies-increases air mileage from 100 to 150 and eliminates “in the state” from regulation; making it an "interstate" issue.

8. HAZMAT- Hazardous Materials Safety Administration (PHMSA) is to update its accident and release recordkeeping and reporting requirements. PHMSA is also to assist DOT in creating mandatory standardized training for HAZ enforcement officials.