The FMCSA To Cut $1.7 Billion in Costs From Paperwork Reduction

Good news for the trucking industry. U.S. Transportation Secretary Anthony Foxx announced on August 1, plans to reduce daily paperwork burdens on professional truck drivers thereby saving the industry an estimated $1.7 billion annually. Cost reductions will come after a change to requirements for daily Driver Vehicle Inspection Reports (DVIRs). Professional truck drivers will no longer be required to complete DVIRs unless a defect or deficiency is discovered.

Office of Management and Budget Director Sylvia Mathews Burwell declared this measure a significant step forward in the Obama Administration's May 2012 Executive Order to reduce regulatory burdens on the private sector. As quoted in the announcement posted by FMCSA (Federal Motor Carrier Safety Administration), Burwell applauded this change as a commonsense measure. "...the Department of Transportation is dramatically reducing paperwork burdens on the trucking industry, while continuing to protect public safety."
Currently, commercial truck drivers are required to conduct pre- and post-trip equipment inspections and file DVIRs after each inspection. Drivers must do so regardless of whether or not a problem is discovered. Internal studies indicated that only 5 percent of reports filed include issues. The DVIR process was assessed as the 19th most burdensome paperwork requirement, based on the number of hours needed to comply. The new proposal announced by Foxx will continue to require pre- and post-trip inspections. However, drivers will only be required to complete a DVIR if problems are identified.

Unchanged is the federal requirement for thorough annual safety inspections of all commercial vehicles in the U.S. Additionally, state and federal inspectors will continue to spot-check commercial vehicles randomly at terminals, weigh stations, truck stops, and at end points. Vehicles deemed problematic after inspections will continue to be removed from service until all noted safety problems are resolved.

The FMCSA Continues to Become More Efficent in Driver Compliance

Good news for the trucking industry. U.S. Transportation Secretary Anthony Foxx announced on August 1, plans to reduce daily paperwork burdens on professional truck drivers thereby saving the industry an estimated $1.7 billion annually. Cost reductions will come after a change to requirements for daily Driver Vehicle Inspection Reports (DVIRs). Professional truck drivers will no longer be required to complete DVIRs unless a defect or deficiency is discovered.

Office of Management and Budget Director Sylvia Mathews Burwell declared this measure a significant step forward in the Obama Administration's May 2012 Executive Order to reduce regulatory burdens on the private sector. As quoted in the announcement posted by FMCSA (Federal Motor Carrier Safety Administration), Burwell applauded this change as a commonsense measure. "...the Department of Transportation is dramatically reducing paperwork burdens on the trucking industry, while continuing to protect public safety." 

Currently, commercial truck drivers are required to conduct pre- and post-trip equipment inspections and file DVIRs after each inspection. Drivers must do so regardless of whether or not a problem is discovered. Internal studies indicated that only 5 percent of reports filed include issues. The DVIR process was assessed as the 19th most burdensome paperwork requirement, based on the number of hours needed to comply. The new proposal announced by Foxx will continue to require pre- and post-trip inspections. However, drivers will only be required to complete a DVIR if problems are identified.

Unchanged is the federal requirement for thorough annual safety inspections of all commercial vehicles in the U.S. Additionally, state and federal inspectors will continue to spot-check commercial vehicles randomly at terminals, weigh stations, truck stops, and at end points. Vehicles deemed problematic after inspections will continue to be removed from service until all noted safety problems are resolved. 

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.

The Bmc 84 Broker Bond may present some serious challenges to surety markets writing the bond

Many property brokers, freight forwarders and sureties are still trying to figure out all the fine details of the BMC-84 Surety Bond. Requirements of the bond were revised under the highway reauthorization law also known as MAP-21. The amount of the BMC-84 Surety Bond has been increased from $10,000 to $75,000. This new law mandates sureties to pay out claims in the following manner:

1. broker consents to payment
2. broker fails to respond following notice and the surety deems the claim as valid or
3. claim is unable to be resolved and is reduced to a judgement.

Sureties are now required to pay valid claims despite bond principal objections. Sureties must also respond to claims against the freight broker surety bond within 30 days. In addition, any action taken against a surety to recover a claim, entitles the prevailing party to recover attorney fees. However, it is not clear whether those costs can be collected along with the claim. Questions have also arisen concerning the possibility of the old BMC-84 freight broker's bond must be replaced with the new one. Some are asking if a rider or endorsement increasing the bond amount to $75,000 will comply with the new requirements. In answer, the FMSCA has announced that riders and endorsements will be accepted. One last big concern is the fact that there are still no clear cut guidelines outlining how a surety can be relieved of its liability even when the total amount of the bond had been paid out in claims.

With all these questions hanging in the air, sureties are anxiously hoping the new rules will be clarified soon

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.

Tips for FMCSA Registration and Compliance 

Motor carriers face a variety of regulations that they must follow based on many aspects. The FMCSA (Federal Motor Carrier Safety Administration) requires different types of licenses and insurances for motor carriers. The system can easily become complicated, especially if you are unsure about what motor carrier classification you are under. In addition, freight brokers face different requirements than common or contract carriers. Here are some starting tips that every motor carrier business should be aware of.

Do I Need a USDOT Number?

The answer to this question is almost always yes. The minor exception to this rule is if a motor carrier has non-hazardous material and both the vehicle and cargo never leave the state they are registered in. However, many states have additional programs that require a USDOT number even if the cargo is not hazardous. Contact your state's Office of Motor Carrier Safety to clarify if your motor carriers are required to have a USDOT number. 

The Process to Receive a USDOT Number

In order to apply for a USDOT number a Motor Carrier Identification Report must be filled out. There is no fee for this application and it can be found at this website. Information will need to be written down such as the past year's carrier mileage, the company operation, and information about passengers and cargo. There is also an online registration assistant to make the process run much more smoothly.

Insurance Requirements

• If a business is a common carrier, or provides for-hire truck transportation and is open to the public, the FMCSA requires liability insurance, but insurance for cargo is not necessary.
• If a business is a contract carrier, or hires specific individuals and requires a contract, only liability insurance is necessary.
• Both common and contract carriers carrying household goods are required to have liability insurance and cargo insurance.
• If you are a broker, or your business manages the transportation of property through motor carriers, the FMCSA requires a surety bond or trust fund agreement.

Invest in Reliable Insurance

These tips only cover very basic information about the FMCSA's requirements. It is incredibly important to make sure you are following all of your federal and state requirements. Global Solutions Insurance Services can provide reliable insurance for motor carriers. Both domestic and international logistics insurance can be provided. GSIS also has experienced staff that can help customize your insurance to fit your business' needs. If you are interested in more information, please do not hesitate to contact us at 310-379-9660 and we would be happy to assist you with any questions you may have about our services

Federal Maritime Commission Calls for Comments on Proposed Changes to OTI Bond

The Federal Maritime commission is accepting feedback on proposed changes to the OTI Bond. The purpose of these amendments is to adapt to a changing market. The new regulations will affect the licensing, financial responsibility requirements and duties of Ocean Transportation Intermediary's. The FMC's aim is to improve transparency and regulatory effectiveness as well as streamlining processes and reducing regulatory burden. Opinions are due by July 31, 2013 and can be sent to Karen V. Gregory, Secretary Federal Maritime Commission 800 North Capitol Street, N.W.Washington, D.C. 20573-0001 Phone: (202) 523-5725 Email: secretary@fmc.gov. 

These can be sent as confidential or non confidential. For non confidential, include an original as well as five paper copies and if possible a PDF to secretary@fmc.gov. Include Docket No. 13-05, Comments on Ocean Transportation Intermediary Regulation Revisions in your subject line. 

If you want your comments to be kept confidential, they must be sent by mail or courier. These must include a transmittal letter marked confidential and detail the extent of the confidential treatment being requested. Responses to requests including confidential material must contain the complete filing and be marked by the filer as "Confidential Restricted" with the confidential segments marked very clearly on each page. Confidential filings must contain an original and a copy of the public version which shall leave out confidential segments and be clearly marked "confidential materials excluded" on each affected page. For submissions or parts of submissions asking for confidential treatment, the Commission will allow such to the extent of the law.

Any questions about the filing process or treatment of confidential material should be directed to the Commission's secretary, Karen V. Gregory at the address or phone number above.