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News Archives:
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Dec 27, 2007

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New Mexico
Trucking Association
4809 Jefferson St. N.E.
Albuquerque, NM 87109
  
505 884-5575
505 884-3661 (fax)
  

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December 27 , 2007

FMCSA's Comprehensive
Safety Analysis (CSA) 2010

CSA 2010 is a major initiative of the Federal Motor Carrier Safety Administration (FMCSA)
to improve the effectiveness of the agency’s compliance and enforcement programs. The
goal is to achieve greater reduction in crashes and fatalities while maximizing resources
of FMCSA. The four major elements of CSA 2010 are measurement, intervention, safety
evaluation and information technology – COMPASS. The Behavioral Analysis Safety
Improvement Categories (BASIC) measurement system has seven categories ranging
from unsafe driving to crash experience. Based on the motor carrier’s BASIC scores,
safety evaluations are determined. The data is scored which then triggers the intervention
process. Intervention is addressed by eight various enforcement levels increasing in severity
beginning with a warning letter and including inspections and investigations. A field test of
the CSA 2010 operational model will begin in Colorado, Georgia, Missouri and New Jersey
in February 2008. FMCSA plans to release an advance notice of proposed rulemaking on
CSA 2010 in spring or summer 2008 and is now seeking feedback on the project. Concerns
can be submitted on the FMCSA Web site or by contacting  For additional information, please visit the FMCSA Website.

IRS Issues Guidance on
Sub-S Corporations Health Insurance Deductions

The U.S. Internal Revenue Service, in Notice 2008-1, to be published by the Service in Internal Revenue Bulletin 2008-2 the middle of January, has revised its rules on when a shareholder in a Subchapter S (closely held) corporation may deduct health insurance premiums paid for by the corporation.  For tax purposes, a SubS corp. is a partnership with respect to shareholders that own more than 2% of the company’s stock.  Such a shareholder is not an employee, but, for most tax purposes, a self-employed partner.  The IRS now says that health insurance premiums paid (or reimbursed) by the SubS to a 2% shareholder may be excluded from the company’s receipts but must be included in the gross income of the shareholder, who may, however, then deduct it on the shareholder’s personal income tax return as a health insurance premium paid by a self-employed individual.  It doesn’t matter, according to the Notice, whether the insurance is purchased in the name of the company or the shareholder, or whether the company or the shareholder pays for it, provided that if it was the shareholder, the company then reimbursed the shareholder.  Prior IRS guidance, issued in 2006, had indicated that at least a sole shareholder of a SubS could not take advantage of this deduction.

EPA Denies California's Request to Regulate Greenhouse Gases

U.S. EPA yesterday blocked California's request to implement statewide regulations beginning in 2009 for automobile greenhouse gas emissions, igniting not only a certain court battle but also a likely political fight that could play a central role in Congress' efforts to craft comprehensive climate change legislation.  EPA Administrator Stephen Johnson stated that the agency rejected California's waiver request in large part because the Energy Bill, signed into law by President Bush earlier in the day, boosted fuel economy standards nationwide -- essentially negating the need for states to take independent actions.  The Energy Bill mandates fuel economy standards of 35 miles per gallon by 2020 for cars and light trucks, which Johnson argued would exceed the California regulations that EPA pegged at roughly 33.8 mpg by 2016.  Johnson believes that setting national fuel economy standards is a more logical approach than if individual states were to act alone.  Johnson further noted that climate change was a problem that did not affect California to any significantly greater extent than other parts of the country.  As many as 17 other states had adopted or were considering the California regulations, potentially affecting nearly half the country's new vehicle purchases. 

Immediate Outlook Bleak
for Freight Traffic

The trucking industry has a tremendous amount of potential in the long run, unfortunately, the short run may be kind of tough. That’s according to Bob Costello, chief economist for the American
Trucking Associations. Speaking at an industry meeting in Birmingham, Ala., in October, Costello
said the biggest challenge facing the industry will be its ability to haul all the freight that has to be hauled over the next 10 years. In the meantime, freight slowed considerable in the third quarter and is expected to be soft in 2008 as well. Costello said he was more optimistic about economic conditions last spring, but is less so now. Tonnage is down more than 2% from last year. Loads are up only about 0.17%, or essentially flat from last year. Flatbed loads are down, which fits with the current slowdown in the housing market as flatbeds haul a lot of building materials. Costello said there won’t be any real improvement in residential investment until 2009.

Costello noted that “real” revenue per
mile (with inflation taken out) was 30% lower in 2006 than it was in 1980. “That’s what de-regulation was all about,” he said. “On average, it takes an industry that has been deregulated from 25 – 30 years to get back the revenue that deregulation forced out. Trucking capacity is fairly high, Costello said, with demand up less than a percent while fleet size is up 23% over 2006. Costello looks for real growth in GDP to be about 2% in 2007 and 2008 but he expects the goods economy (the things truckers haul) to grow faster than the GDP in the second half of 2008. Indicators showing some of this weakness include almost 12,000 trucking jobs lost in 2007.

Other factors that were expected to have an impact on freight volumes during the holiday season is a “smoothing out” of the traditional holiday shipping bump that begins in the fall. That season has “elongated,” Costello says and one of the reasons for this is the increased use of gift cards. More gift cards mean retailers don’t have to have as much product on hand for November and December sales, but will need more than usual in January and February. Fuel prices will also be a drag on the industry. Truckers will have spent $107.4 billion on fuel by the end of 2007 and more price spikes could be coming. Added together, less freight higher fuel costs can mean a tough time for some carriers in the coming months. Still, Costello sees great promise in the long term freight market. Getting to that point could be a challenge.

N.M. SMC Pulls Together a Load of Toys for Families of Our Troops Overseas

What a great effort, at the December meeting of the Safety Management Council a whole pickup load of toys were donated to the families of out NM National Guard troops serving overseas at this Christmas and New Year time frame.  When the Guard volunteers picked them up from the Association offices they told us that the timing was perfect, they had planned a Christmas party for all the kids on the following Wednesday after our meeting.  I want to thank all the members who contributed and in fact there were several non-members who donated that had heard about our efforts in casual conversation with Council members.   Thank you all and God Bless each and everyone of you.

Immigration Revises Form I-9 for Employer Verification of New Hires

U.S. Citizenship and Immigration Services has revised the Employment Eligibility Verification Form I-9 that all employers must use for new hires. The revision removes five documents previously allowed as proof of identity. For all individuals hired on or after November 7, 2007, the amended Form I-9 with the revision date of June 5, 2007 “(Rev. 06/05/07)N” must be used. Form I-9 can be downloaded at www.uscis.gov, or forms can be ordered at 800-870-3676.

NMTA Annual Meeting Set for
May 1-3, 2008

The NMTA Annual Meeting, Golf Championships and the State Truck Driving Championships will be held on May 1-3, 2008.

The President’s Reception, Annual Meeting and Awards Banquet will be, once again, held at the Hyatt Regency Downtown Albuquerque.  The Truck Driving Championships will be held at the Conway Freight locations that I know you are all familiar with, on Saturday May 3.

The Golf Tournament will be held at the Desert Greens Golf Course on the Thursday morning.  Make sure you have these dates blocked out, you will be receiving communications from time to time leading up to the event.

Hours of Service Hearing Reset

The Senate Commerce Committee’s Surface Transportation Subcommittee rescheduled a hearing on truck driver's hours of service for Dec. 19. FMCSA Administrator, John Hill, was invited to testify. ATA had also been invited to testify. In its testimony, ATA communicated its strong support for retention of the 11 and 34-hour provisions based on the industry's safety improvements while operating under these rules since 2004.

Safety Advocates Sue FMCSA over HOS Interim Final Rule

Public Citizen has asked the U.S. District Court of Appeals to invalidate the hours-of-service Interim Final Rule. The motion also asked the court to direct FMCSA to issue an IFR with a 10-hour daily driving limit, and no 34-hour restart. Public Citizen, Citizens for Reliable and Safe Highways, Parents Against Tired Truckers, Advocates for Highway and Auto Safety, and the International Brotherhood of Teamsters filed their motion with the court on December 19. FMCSA—and the American Trucking Associations as an intervener in the case—are entitled to file separate responses to the motion by January 7. The court will probably issue a ruling on the motion after briefings conclude in mid-January. In the meantime, truckers are still allowed to drive 11 hours and use the 34-hour restart.

NTSB Recommends EOBRs for All Trucks

The National Transportation Safety Board (NTSB) has told the Federal Motor Carrier Safety Administration that electronic on-board recorders are needed on all heavy trucks, not just those with a history of noncompliance with the hours-of-service rules. In NTSB’s December 17 recommendations, the agency said EOBRs are needed for carriers and regulators to assess hours-of-service compliance. In FMCSA’s January 18, 2007, proposed rule, only carriers with a 10 percent or greater HOS violation rate during two compliance reviews in a two-year period would be mandated to use EOBRs for two years.

California Bans Certain APUs for 2007 Engines

Beginning January 1, 2008, California will ban the use of diesel-powered auxiliary power units (APUs) for trucks with 2007 model-year engines, unless the APU has been retrofitted with a CARB-approved diesel particulate filter. As a reminder, the new five-minute idling limit is also effective January 1. The five-minute limit now includes using the sleeper berth for sleeping or resting.

California Sleeper Berth Idling Exemption Ends

Effective January 1, 2008, the use of a sleeper berth for sleeping or resting will no longer be exempt from California’s five-minute main engine idle limit. A minimum fine of $300 may be issued to a driver found exceeding the limit. The California Air Resources Board developed a website to provide drivers with information regarding various idle reduction technologies that are currently available.

FMCSA Enforcing HazMat Rules

According to ATA, the Federal Motor Carrier Safety Administration is now enforcing rules released in January 2005 that restrict which carriers can get a hazardous materials permit.

Under the rules, FMCSA may not issue a hazardous materials safety permit to a motor carrier that has a crash rate, driver, vehicle or hazardous material out-of-service rate in the top 30 percent of the national average pursuant to 49 CFR 385.407. For more information on this or other FMCSA rules, go to the FMCSA website.