Latest Industry News Briefs Courtesy of PMTA

September 2018

ATA Pledges to Create Greater Opportunities in Trucking

Arlington, VA… Leaders from the American Trucking Associations pledged that the trucking group would provide at least 50,000 people enhanced career opportunities as part of today’s Trump administration announcement to provide pathways to better careers for a half a million Americans.

“ATA is proud to be part of this effort to provide enhanced career opportunities to hard-working Americans. Our nation’s economy depends on our trucks moving goods from ports, factories and farms to stores and homes – and we depend on the millions of men and women who drive those trucks, maintain those trucks, load and unload those trucks and route those trucks,” said ATA President and CEO Chris Spear. “We appreciate President Trump and Secretary Acosta making this a priority and having the vision to follow through with today’s executive order. We hope that through this workforce development effort, we will be able to connect more Americans to family-supporting incomes and address the persistent shortage we face in attracting enough well-trained workers to our industry. The economy is strong and unemployment is low, but there are critical shortages of skilled workers in sectors of the economy, like truck drivers, technicians and mechanics. We support these efforts to help ensure Americans have the skills and training needed to support the modern economy.”

ATA was represented at today’s White House event by past ATA Chairman Dan England, chairman of the board at C.R. England Inc., Salt Lake City.

“C.R. England believes in providing hard-working Americans a path to a better life,” England said. “That’s why we work so hard at our driving schools and training facilities, giving people a place to learn important and valuable skills that can keep our industry and our economy moving.

“Our industry is under constant pressure to bring in new drivers and new technicians to replace an aging workforce and to keep up with the demands of a modern, just-in-time economy,” he said. “Today’s announcement underscores our commitment, and ATA’s commitment, to doing all we can to provide opportunities for careers in trucking.”

ATA pledged to offer enhanced career opportunities to 10,000 people a year, every year, for the next five years, bringing the total commitment to 50,000.

ATA Truck Tonnage Index Fell 0.4% in June

Arlington, VA… American Trucking Associations’ advanced seasonally adjusted (SA) For-Hire Truck Tonnage Index fell 0.4% in June after rising 0.4% in May. In June, the index equaled 113 (2015=100), down from 113.4 in May.

ATA revised the May increase from the originally reported 0.7% to 0.4%.

Compared with June 2017, the SA index increased 7.8%, up from May’s 7.4% year-over-year increase. Year-to-date, compared with the first half of last year, tonnage increased 7.9%, far outpacing the annual gain of 3.8% in 2017.

The not seasonally adjusted index, which represents the change in tonnage actually hauled by the fleets before any seasonal adjustment, equaled 116.3 in June, which was 1.1% below the previous month (117.6).

“In the second quarter, we saw the tonnage index jump 1.8% from the previous quarter and 8.4% from a year earlier,” said ATA Chief Economist Bob Costello. “This robust growth fits with what is likely to be a very strong GDP reading for the second quarter. I expect the growth in tonnage to moderate, but remain at very high levels in the months ahead.”

Trucking serves as a barometer of the U.S. economy, representing 70.6% of tonnage carried by all modes of domestic freight transportation, including manufactured and retail goods. Trucks hauled nearly 10.5 billion tons of freight in 2016. Motor carriers collected $676.2 billion, or 79.8% of total revenue earned by all transport modes.

ATA calculates the tonnage index based on surveys from its membership and has been doing so since the 1970s. This is a preliminary figure and subject to change in the final report issued around the 10th day of the month. The report includes month-to-month and year-over-year results, relevant economic comparisons and key financial indicators.

Canadian Premiers ID ELDs Among Trucking Issues Needing Attention

During a meeting on internal trade issues, premieres from across Canada agreed on accelerating the removal of intraprovincial trade barriers and identified several trucking-specific issues in need of attention.

In their official communication, the premiers stated:

“Some differences in provincial and territorial regulations may be appropriate to address local safety considerations but the trucking industry has raised some differences in regulations that can constitute barriers to fair competition and effective trade. Examples of barriers include restrictions on the use of wide base single tires, size and weight restrictions, and an area for future cooperation, electronic logging devices.”

The statement released by the premiers is meant to provide leadership guidance to the work of the Regulatory Reconciliation and Cooperation Table (RRCT) established under the Canadian Free Trade Agreement to break down trade and regulatory barriers.

“The Canadian Trucking Alliance (CTA) applauds the premiers for taking leadership on these important issues in our sector. We look forward to working with the RRCT and other government bodies to address these matters,” said CTA president Stephen Laskowski.

The premiers have also recognized CTA’s request to ensure that all provinces duplicate ELD requirements for intraprovincial fleets across Canada:

“As provinces and territories consider mandating for intraprovincial travel, a consistent in approach will enable more accurate monitoring of a drivers’ HOS, enhance road safety, and provide a level and competitive playing field for all carriers,” the communication states.

“ELDs ensure the highest level of compliance with federal hours of service rules for truck drivers, so the quicker we get them in every truck that currently requires a paper log book the better and safer we’ll be as an industry,” said Laskowski. “We want to see an ELD rule enforced on every commercial truck in Canada by 2020. Hopefully, this announcement by the premiers will remove any barriers which might have been in the way of achieving that timeline.”

The premiers also addressed single, wide-based tires by identifying a series of patchwork regulations and barriers for trucking companies wanting to use this fuel-efficient technology, as well as noting the many different spring weight restrictions across each province.

CTA: Driver Inc is a Tax Mirage

The Canadian Trucking Alliance is warning truck drivers and carriers that using the so-called Driver Inc employment scheme could ultimately come back to bite them.

The use of Driver Inc. as a recruitment tool is becoming so widespread that without quick intervention by the Government of Canada and provincial worker compensation boards all carriers may soon have to consider adopting the payment system to compete for drivers, says CTA.

The Driver Inc. model is based on commercial vehicle operators, who do not own or operate their own vehicle, becoming incorporated and receiving payment from their carrier with no source deductions. This practice opens the door to the possibility of widespread tax evasion by those engaged in Driver Inc.

“Against the backdrop of a severe driver shortage facing our sector, the Driver Inc. payment system is unfortunately becoming a preferred way to attract contract drivers to fleets. However, CTA believes that contract drivers who are utilizing company vehicles, without any financial risk/responsibility to own/operate the vehicle, contravenes the historical definition of driver-contractor status in our sector,” said Stephen Laskowski, president, CTA. “To now rule against this historic principle, effectively changing the definition, would turn our industry upside down.”

Throughout 2018 CTA has been working with the Canada Revenue Agency (CRA) to clarify their position on Driver Inc as a legal payment system while urging the agency to commit enforcement in this area.

In response, the CRA advised CTA that while it can’t comment on any particular company, it is working with CTA to provide industry additional information about determining whether a driver is an employee, incorporated employee (personal service business – PSB) or an independent contractor as well as tax implications for drivers that fall into each of these categories. CRA also told CTA that ensuring a worker, in this case a driver, is correctly characterised is a very important part of the payer’s job. Income paid to drivers must always be reported, and the law requires that businesses report this income on either a T4 for employees or T4A for contractors.

“Incorporating yourself as a driver, without owning/operating your own truck, has significant labour law and tax implications. Many drivers and companies utilizing this system seem to think Driver Inc is some previously undiscovered tax oasis. It’s not; it’s a mirage.,” explains Laskowski. “The tax filing implications make the Driver Inc. model a very questionable approach to legitimately increasing drivers’ take-home pay. Obviously not declaring your income is a highly illegal method to increasing pay, made easier by the fact that CRA does not always find businesses that don’t issue T4A’s to contractor drivers.”

Consequently, CTA is urgently requesting CRA commence a country-wide enforcement campaign to ensure companies and drivers engaged in the Driver Inc. model are paying their fair share of taxes by filing as a Personal Services Business (PSB) and implement a policy requiring all truck drivers to be issued either a T4 or a T4A in 2018, added Laskowski.

CTA is expecting a policy and enforcement decision from CRA on the issue of Driver Inc, PSB filing implications this fall while seeking an enforcement ruling from Employment and Social Development Canada regarding the labour implications of Driver Inc. CTA is also asking each provincial trucking association to engage their local workers’ compensation boards to ensure Driver Inc drivers and companies are paying their legally required coverage payments.

‘We believe Driver Inc. is costing the Canadian government millions in lost tax revenue from drivers not filing as a PSB or simply not properly reporting their income. If governments do not do something soon to protect the law-abiding, tax paying part of the industry, it could soon add up to billions in lost dollars as the majority of truck drivers will trend towards accepting only one form of payment – Driver Inc,” said Laskowski. ‘The sad reality is in certain parts of the country we are not far off from this scenario. We need clarity, enforcement, and we need it soon.”

As part of its 2018 prebudget submission, CTA is requesting more resources for CRA to dedicate and increase enforcement of Driver Inc in the trucking sector. Specifically, CTA is asking for a massive blitz of drivers and carriers improperly utilizing the Driver Inc model.

“If carriers and drivers are properly paying and filing as a PSB then they should have no worries. Those drivers and companies using the PSB system as a shell game to avoid paying their fair share of taxes should be concerned,” added Laskowski, who warns that potential back taxes and penalties against carriers and drivers who have been improperly filing as a PSB could be significant, notwithstanding additional interventions by ESDC and provincial workers compensation boards”

Drivers or carriers who would like CRA information and explanations on Driver Inc and PSBs - when they’re made available this fall - can e-mail CTA at [email protected]

Motor Coaches With Passengers May Be Required To Enter Weigh Stations

The Oregon Department of Transportation does not generally require loaded motor coaches to enter Oregon weigh stations. However, to assist motor coach operators in gaining compliance with the Oregon weight-mile tax and registration requirements, we will be conducting soft-enforcement operations throughout the state at various times.

We wanted to let you know that we expect to do more of these from August through the end of the year.

This will require all motor coaches with a gross vehicle weight over 20,000 pounds to enter weigh stations to determine if the motor coach/bus is operating within their declared weight.

The weigh station will be signed during these operations to notify motor coach operators to enter.

A warning rather than a citation will be issued for failure to operate within the declared weight on the first occasion. This gives operators the opportunity to adjust their declared weight and comply with Oregon requirements.

Our goal is to identify under-declared weight issues and educate motor coach operatorsearly in the process, prior to an audit or other enforcement action. Motor coaches inviolation will be processed quickly to avoid any unnecessary delay to passengers. Safety issues that pose an imminent hazard will be addressed as necessary.

These operations will allow us to verify motor coach operators are complying with the new registration requirements. Our staff will be available during these operations to answer any questions.

NATSO Statement on Chairman Shuster’s Infrastructure Proposal

Alexandria, VA… NATSO, the trade association representing the nation’s truckstops and travel plazas, issued the following statement in response to the draft infrastructure proposal put forth by Rep. Bill Shuster (R-Pa.), Chairman of the House Transportation and Infrastructure Committee. The statement can be attributed to Lisa Mullings, President and CEO of NATSO.

“For too long, Congress has been unable to muster the political will necessary to invest in the nation’s highways and bridges. We hope that Chairman Shuster’s Discussion Draft, which takes into consideration both the immediate and long-term need to boost infrastructure revenues and shore up the Highway Trust Fund, rekindles the important discussion that began in earnest earlier this year but fizzled in recent months.

We are pleased that Congressman Shuster has proposed to raise the gasoline and diesel motor fuels taxes, which have stagnated for more than two decades while construction costs and motor vehicle fuel efficiency have continued to climb. NATSO, along with many in the transportation community, have long argued that increasing the gasoline and diesel motor fuels taxes are a key part of any infrastructure funding solution.

We also applaud Chairman Shuster for recognizing that tolling existing interstates and commercial rest areas are not viable solutions to financing infrastructure and meeting revenue needs.

NATSO looks forward to continuing this dialogue and welcomes the opportunity to work with Congress to advance infrastructure funding solutions that inevitably stand to ensure the nation’s economic prosperity.”

NATSO Testifies on EPA’s 2019 Renewable Volume Obligations Under the Renewable Fuel Standard (RFS)

Alexandria, Va. -- A travel center executive testifying on behalf of NATSO told the Environmental Protection Agency (EPA) that the Agency needs a transparent process to guide its assessment of small refinery waiver requests to ensure that such exemptions don’t continue to undermine the law’s intent and decrease demand for biofuels.

Testifying at an EPA field hearing in Michigan on the 2019 proposed renewable volume obligations (RVOs) under the RFS, Beth Westemeyer, Director of Business Development for Anew Travel and Fuel Centers, the retail arm of Zeeland Farm Services in Zeeland, Mich., said that over the past decade the RFS has succeeded because it allows fuel retailers to offer biofuel blends to consumers at a price that is less expensive than purely petroleum-based products.

Small refinery waivers fundamentally impact the entire intent of the RVO process, however, by lowering demand for biofuels and diminishing the value of the investments the industry has made in response to Congressional policy.

“Without knowing to what extent these exemptions are undercutting the annual mandate, businesses like mine are left in limbo while renewable fuels markets plummet,” Westemeyer testified. “Granting the requests secretly is patently inequitable and comes uncomfortably close to government-sanctioned market manipulation. It was upsetting to learn that in the context of this RVO proposal, [EPA] asked the public not to comment on the small refinery exemptions that have been issued. This is despite the fact that the small refinery waivers fundamentally impact the entire intent of the RVO process.”

Annual renewable fuel volume obligations established under the RFS are designed to create market certainty and encourage fuel retailers to invest in the infrastructure necessary to incorporate and sell biodiesel. Westemeyer said the hardship waivers “contradict the purpose of the RFS of displacing petroleum-based fuels with renewable substitutes that have more favorable emissions characteristics.”

Westemeyer urged EPA to develop a transparent, rules-based process to guide the Agency’s assessment of small refinery waiver requests.

OOIDA Looks Forward To Hours-Of-Service Improvements

Grain Valley, MO… The Owner-Operator Independent Drivers Association supports government efforts to modernize hours-of-service regulations and looks forward to an anticipated Advanced Notice of Proposed Rulemaking from the Federal Motor Carrier Safety Administration.

The Association’s members have often pointed out to their representatives in Washington DC that current regulations are overly complex, provide no flexibility, and in no way reflect the physical capabilities or limitations of individual drivers.
“We know that these messages have struck a chord with lawmakers and with the agency and that the response is to look closely at the regulations and the need for reform,” said OOIDA president Todd Spencer.

OOIDA members have told lawmakers their concerns about regulations that force them to be on the road when they are tired, during busy travel times and in adverse weather or road conditions. Their schedules are also at the mercy of shippers and receivers, and other obstacles that create a conflict between operating both safely and in compliance.

“The hours-of-service regulations for commercial truck drivers need to be updated to match the realities of freight movement and to truly improve highway safety,” said Spencer. “The trucking industry is in a situation where we have never had more regulations and greater enforcement and compliance. Yet, truck-related crash numbers are going in the wrong direction. It’s time for a new approach.”

OOIDA petitioned the FMCSA earlier this year and expressed support for proposed legislation that came soon after, both of which would reform current regulations that dictate rest breaks for truck drivers.

OOIDA’s petition recommended that drivers be allowed to take rest breaks once per 14-hour period for up to three consecutive hours as long as the driver is off-duty. It also suggested eliminating the 30-minute break requirement.

On the legislative side, the Responsible and Effective Standards for Truckers, or REST Act, H.R.5417, is similar in that it would allow drivers to take one rest break per shift, for up to three consecutive hours. This single off-duty period would not be counted toward the driver’s 14-hour, on-duty allowance. The bill would not extend the total, allowable drive time limits.
The bill was introduced by Rep. Brian Babin (TX-36) and would also eliminate the existing 30-minute rest break requirement

“We look forward to the agency’s response to our petition and to seeing what they recommend in their notice,” said Spencer. “We think our proposal is a solid start, but we are open to ideas in how to make the regulations into something that is truly safe and addresses the flexibility needed for long-haul truckers.”