EQNEED) Inc. Trucking Letters and Issues frozen in time during 2001 –2

 

This letter was with other letters and books that all got sent back and is only submitted for historical record.

 

 

 

 

 

 

NAFTA Reflection on the Inspector Generals Report, letter to Honorable Representatives of the American People of the U. S Senate (May 28, 2001)

 


U. S. Senate May 28, 2001
Washington, D.C. 20510-3704

Dear Honorable Representatives of the American People of the U. S Senate:

I request that you consider supporting OOIDA and Rep. James Oberstar (D-MN) resolution to delay granting Mexican trucks authority to operate in the U.S. under NAFTA until a prescribed comprehensive plan to ensure their safety is in place; announced at a press conference by Rep. Oberstar and co-sponsor Rep. Jack Quinn (R-NY) in Washington on Thursday, May 24. Representatives of OOIDA, trade unions and a number of congressmen attended the event from border districts. Thirty-one additional lawmakers are listed as original co-sponsors of the resolution (see below):

1) Hon. Robert A. Borski
2) Hon. Sherrod Brown
3) Hon. Richard A. Gephardt
4) Hon. Edolphus Towns
5) Hon. Tim Holden
6) Hon. John D. Dingell
7) Hon. Bob Filner
8) Hon. Ciro D. Rodriguez
9) Hon. William O. Lipinski
10) Hon. Bill Pascrell, Jr.
11) Hon. Joe Baca
12) Hon. Michael M. Honda
13) Hon. John Elias Baldacci
14) Hon. Jack Quinn
15) Hon. Shelley Berkley
16) Hon. Bob Clement
17) Hon. Nick J. Rahall, II
18) Hon. Robert E. (Bud) Cramer, Jr.
19) Hon. Peter A. DeFazio
20) Hon. Elijah E. Cummings
21) Hon. Jerry F. Costello
22) Hon. Eddie Bernice Johnson
23) Hon. Jerrold Nadler
24) Hon. Max Sandli
25) Hon. James P. McGovern
26) Hon. Juanita Millender-McDonald
27) Hon. Jim Matheson
28) Hon. Rick Larsen
29) Hon. Marion Berry
30) Hon. Susan A. Davis
31) Hon. Frank Mascara

Sen. Ernest Hollings (D-SC) and Rep. Jim Oberstar (D-MN) initially requested the U.S. Department of Transportation's Inspector General to analysis and issue a status report relating to safety and enforcement regulations before an increase of an estimated 190,000 Mexican trucks are allowed complete access to the U. S. highways and byways. ¡§The status report released on May 8 found plenty of critical gaps in current procedure and recommended specific actions to ensure that Mexican trucks coming across the border are safe. The IG did not have the benefit of reviewing the Federal Motor Carrier Safety Administration (FMCSA) strategies scheduled for release in June 2001. FMCSA spokesman Dave Longo says the official implementation plan was not available for the Inspector General's office to review because it wasn't done.

The IG's report reflects the following assessment:

The enforcement effort has a long way to go before the government can assure that cross border trucking is not dangerous to the public;

During fiscal year 2000, federal and state inspectors performed more than 46,000 inspections on Mexican trucks at the border. For those inspected, the out-of-service rate declined, from 44 percent in 1997 to 36 percent in 2000. This contrasts with a 24 percent out-of-service rate for U.S. trucks nationwide. While the report acknowledges the decline in the out-of-service rate, the study shows that those numbers are not necessarily assuring;

A direct correlation exists between the condition of Mexican trucks entering the United States and the level of inspection resources at the border. FMCSA studies show the out-of-service rate for Mexican trucks inspected at Otay Mesa, CA, where inspectors are present during all commercial operating hours, was 23 percent compared to 50 percent at one crossing in El Paso, TX, where neither federal nor state inspectors were present during all operating hours;

The IG's report determined that FMCSA shouldn't assume Border States will deploy inspectors at all border crossings during all hours of commercial operations to ensure the safety of Mexican trucks and to enforce federal registration requirements. Arizona, New Mexico and Texas did not provide inspectors during all operating hours. For all six Arizona crossings, commercial vehicle enforcement officers perform safety inspections on a part-time basis. At the New Mexico and Texas border crossings none of the inspectors are full-time inspectors. In addition, it cannot be assumed that the additional $18 million FMCSA requested in its 2002 budget will be used to staff inspection facilities with state personnel. Texas would only hire additional inspectors for the border if state lawmakers authorized the inspectors, and not because additional grant funds were provided. The Texas legislature is scheduled to adjourn May 28 and won't convene again until 2003;

The IG points out that enforcement capabilities differ at each border crossing. At 20 crossings, FMCSA inspectors did not have dedicated telephone lines to access databases, such as those for validating a commercial driver's license. At 19 crossings, inspectors had space to inspect only one or two trucks at a time. According to the report, at 14 crossings, inspectors had only one or two spaces to park vehicles placed out of service. Also, the out-of-service space was shared with the inspection space at the majority of these crossings;

The Inspector General found that verification and enforcement of registration information at the border remains inconsistent. During recent visits to border facilities, the IG's office found that FMCSA continues to rely on the U.S. Customs Service and federal safety inspectors at border crossings to review certificates of registration and ensure compliance with operating authority statues. FMCSA inspectors reviewed the certificates of registration as part of the safety inspections performed at the border crossings. The U.S. Customs Service, however, is not required to review certificates of registration as Mexican trucks enter the United States, and did not routinely do so at each border crossing;

The IG's office also found that reviews of certificates of registration by state safety inspectors continued to differ from state to state. Since 1992, California has had a state law to fine Mexican motor carriers operating without a certificate of registration or operating beyond the commercial zone. State inspectors in Arizona, New Mexico or Texas did not routinely review the certificates of registration because state laws are not compatible with federal requirements regarding operating authority, (no operating authority has ever been required by Arizona, New Mexico or Texas). Consequently, unless the truck happens to be selected for a safety inspection by a federal inspector at the border, the certificate of registration will probably not be reviewed;

The Inspector General recommended that FMCSA increase the number of federal safety inspectors at the border to at least 139 (in March 2001 there were 50) to enforce federal registration and safety requirements during all port operating hours and provide the requisite inspection facilities.

The reports acknowledged that Mexico has made some progress in establishing safety requirements for its motor carrier operations. According to the Inspector General's report, Mexico recently issued a rule requiring all commercial drivers to log hours of service, issued a standard for its inspections of commercial vehicles and automated its information systems for motor carriers, commercial drivers and vehicles;

The IG's report recommended FMCSA finalize and execute a comprehensive plan that identifies specific actions and completion dates for the implementation of NAFTA's cross-border provisions and that reasonably ensures safety at the southern border and as commercial vehicles cross the United States. Information relating to NAFTA cross-border trucking status report was obtained by OOIDA web site and written by Keith Goble, OOIDA staff writer. Information can be verified at DOT Web Site.
http://www.oig.dot.gov


No doubt this analysis reflects the present situation and in April 2001 Mexican Truckers illustrated their lack of understanding for U. S. Federal DOT regulations relating to truck safety.

According to the Nogales International newspaper, April 9, 2001, about 75 Mexican owner-operators and contract haulers blocked the two commercial lanes at the Nogales Port of Entry, causing about 1,300 trucks to be stuck in a 10-mile line of traffic. Mexican truckers accused the Arizona DOT of "unjust inspections of commercial vehicles." The angry drivers said the ADOT was targeting drivers instead of truck owners. Citations for unsafe vehicles have ranged up to $11,000 for faulty brakes and worn tires.

U.S. government, representatives of the drivers and industry officials hashed out their differences and reassessed policy about who is cited for violations. Frank Valenzuela, a spokesman in Phoenix with the state Arizona Department of Public Safety (DPS), told reporters that the drivers were ultimately responsible for the safety of the trucks they drive. The Arizona DPS reached an agreement with representatives of drivers who blocked the Nogales Port of Entry but 1,300 trucks were stranded for several hours.


About half of the protesters drive trucks for the produce industry, while most of the others drive rigs for the maquiladoras -- (assembly plants) in Mexico. If a Mexican trucker received five citations, it would mean the loss of his license to drive in the United States. "What happened last week is that DPS inspectors both put vehicles out of service and cited drivers," said Beau Johnson, chief of DPS enforcement during a press conference at the port. "Drivers will still face citations for serious equipment violations and those who repeatedly cross the border with problem vehicles will also be cited," he said. Mexican trucks have gone from a 70 percent out-of-service rate to between 40 to 48 percent today, Johnson noted. "The average for U.S. trucks is about 18 to 24 percent for comparison," he said. "That's better, but we need to continue lowering the rate." The blockade at the port hit on the same day President Bush released his budget, which included $154 million for inspectors and facilities to handle increased Mexican truck traffic at the border ports under NAFTA. Cox News Service and several other major newspapers April 10, 2001 reported that the U.S. Department of Transportation that the Bush administration plans to allow Mexican trucks full access to U.S. highways starting Jan. 1, 2002. The plan would require Mexican rigs to comply with U.S. safety regulations and have insurance with U.S.-registered agents, according to published reports.  Information was obtained from OOIDA's Web site.

I wonder if Mexican truckers really comprehend what U. S. Truckers must adhere to where it relates to Federal and State laws? Is 154 million dollars enough to increase federal inspectors in the quantity necessary for an increase of 190,000 Mexican trucks with unrestricted access to U. S. highways/byways?

Addressing NAFTA cross-border trucking is not the only alarming problems facing the trucking industry. When the news reports The trucking Industry has requested 19 year old Drivers be allowed to drive interstate, proposing a comprehensive training program.  I must ask:  Who represents the trucking industry? I thought Small Trucking Businesses and Owner-Operators made up the largest percentage of the trucking industry! Experienced drivers are finding there's no profit in trucking. Tell me how any trucking company can make a profit averaging $1.17 RPM when Small Trucking Businesses and Owner Operators are loosing money hauling cargo, freight and or produce when their lucky enough to receive on a rare occasion $1.30 per mile? In many states your lucky to receive $1.00 per mile and C. R. England posting their minimum rate of $1.00 per mile for refer loads should caution everyone what Mexican Carriers and Owner Operators will one day receive for transporting cargo, freight and or produce in the year 2002 in the U. S. of America.

Already in the past 120 days, some 3,600 mostly small fleets or more have ceased operations. Closings have enabled large truckload carriers such as Celadon to alleviate their chronic driver shortage. "There is no shortage of drivers," said Paul Will, Celadon's CFO. "There is a shortage of qualified drivers."


The Trucking Industry is in trouble and next year when 190,000 Mexican Trucks are allowed to travel the highways and byways of the U. S., safety violations, accidents and Small Trucking Business closures will increase. Majority of American Owner-Operators and Small Trucking Businesses will not travel every highway/byway of Mexico because city-to-city Mexican police will extort money and bandito's will steal their trucks. I've lived in Mexico for several years. When I lived in Mexico, one of my pickups was stolen and I was routinely pulled over by the police because my F250 4by4 Super Cab Ford Pickup was new. At the minimum, Mexican DOT escorts of a group of American Trucks driving the highways and byways of Mexico will be necessary before every U. S. Owner Operators and Small Trucking Businesses will fill safe to enter Mexico, traveling to Mexico City, etc. There are trucking companies that do travel to Mexico and are familiar with international commerce infrastructure.

The Indianapolis-based Celadon Trucking Company will benefit from the full opening of the U.S.-Mexican border to all North American carriers.

 

Incorporated in 1986, Celadon was formed primarily to provide trucking services for Chrysler Corp. to and from its Mexican assembly plants (sic). Since that time, Celadon has grown to be largest U.S. carrier in and out of Mexico, moving 150,000 trailer loads annually south of the border. Cross-border traffic accounts for 65 percent of its business. Overall, Mexican traffic is growing at 17 percent a year; nearly twice the rate at what domestic truckload traffic is growing.

No truckload carrier has suffered worse from the driver shortage than Celadon. It had four straight losing quarters last year when it could not find enough drivers for its trucks. For the 2000 fiscal year ended last June 30, it had a net loss of $2 million on $351.6 million revenue, compared with $4.8 million earnings on $281.8 million revenue in 1999. Celadon Group's stock has plummeted nearly 90 percent in the past year. It was trading at $33 last March when dot-com-crazed investors mistook the company for an Internet play because of its plans for something called "TruckersB2B," a cooperative buying service for small fleets. At press time last week, Celadon shares were trading around $3.50.

Even ING Barings, which managed Celadon's recent public securities offering and makes a market in the shares of the company, says Celadon is risky even with its current "strong buy" recommendation. A recent ING Barings summary of the company warns that although Celadon's shares are undervalued (its book value is $7.26), ownership "may be suitable for only small-cap, high-risk accounts given its limited float and financial position."

Celadon also has been on an acquisition binge. It bought the assets of General Electric Transportation Services for $8.2 million in 1997. In 1998, it acquired Gerth Transport of Canada. In 1999, it acquired Zipp Express to strengthen its Midwest position. Those acquisitions have changed Celadon's driver mix as well. Prior to those acquisitions, 82 percent of Celadon's capacity was provided by company-owned and leased equipment. As of last June 30, owner-operators now account for 40 percent of its capacity. Of its 2,560 tractors as of June 3, 2000, 1,024 were owner-operators.

 

Celadon is hoping to get back into the black this fiscal year. Last year, its truckload operations posted $8.8 million operating income while TruckingB2B.com had a $4.7 million operating loss. But Celadon is weighted down by debt at $49.7 million, compared with $18.7 million in the 1999 fiscal year. It recently completed a $67 million credit agreement with ING (U.S.) Capital LLC. Net interest on that debt rose by $1.8 million last year, or 24.3 percent, to $9.2 million in fiscal 2000, compared with $7.4 million of interest expense in fiscal 1999, the company said. Its trucking operation has seen a steady deterioration in operating ratio - from 93.1 in 1998, 94.6 in 1999 to 97.5 last year. That's because its fleet size remained static at around 1,950-seated tractors for the past two years. Celadon revamped its driver-recruiting department last summer, adding 100 new drivers this year and has plans for adding 100 later in the year.

"Fleet growth is critical," said David A. Shatto, Celadon's executive vice president of operations. He noted that every seated truck adds $4,000 a month to Celadon's bottom line. Celadon has been trying in the last few years to wean itself off the now Daimler Chrysler traffic. Through diversification, it is doing that. Daimler Chrysler represented 37 percent of Celadon's total revenue in 1998, but only 24 percent last year. That was a conscious decision as Daimler Chrysler increasingly has become known in the industry as a tough shipper on both original equipment inbound auto parts and after-market replacement parts. No other Celadon shipper accounts for more than 10 percent of its revenue. All the non-Chrysler business was up 8 percent in the most recent quarter, Celadon officials said.

Besides avoiding the Schneiders and J.B. Hunts that dominate the east-west domestic truckload traffic in this country, Celadon's north-south strategy is well timed in the NAFTA age. It knows the territory south of the border, the customs and the infrastructure.  There also are hard economic gains through use of Mexican drivers. An American driver at Celadon earns on average 39.4 cents a mile, or 34 percent of its average rate of $1.17 a mile. But a Mexican driver earns just 11.8 cents a mile, or 15 percent of the average rate; as reported by John Schulz, Traffic World.

There are brokers that are presently brokering loads for $1.10 per mile or lower allocated to Small Trucking Businesses and Owner-Operators. January 1, 2002 rate per mile will be below $1.00 per mile allocated to Mexican Motor Carriers and Owner-Operators, forcing EXPERIENCED¡¨ U. S. Owner-Operators and Small Trucking Businesses to either quit or shut their trucks down. U. S. Motor Carriers may find it more cost effective to register their trucks and originate a trucking business in Mexico if Mexican trucks are not held accountable to U. S. FMCSA, FHWA, DOT, IFTA, SSR, IRP, States Weight and Mile Distance Tax regulations and driving hours on duty laws. Examine this possibility critically; the outcome is essential to the well being of the trucking industry. Mexican Trucking Businesses and Owner-Operators pay Mexican Federal Tax not U. S. Federal Tax and Mexican Federal Tax is less then U. S. Federal Tax.

In order to compete in the trucking industry January 1, 2002, at a time when rate per mile is lower than summer months; Mexican Motor Carriers will be accepting less then a $1.00 per mile from brokers/shippers (whom will take advantage of the crisis) hauling cargo, freight and produce throughout the U. S. on every highway/byway.


Those U. S. Small Trucking Businesses and Owner-Operators still afloat will be forced to take action in order to survive. There is no reason to believe that cargo, freight, or produce won't be hauled for less then a $1.00 per mile January 1, 2002. U. S. Motor Carriers such as C. R. England were advertising their minimum at a $1.00 per mile (Refer) on the Internet and brokered loads in many western states are a $1.00 per mile or less for Flatbed, Dry Van or Refer. Small Trucking Businesses and Owner-Operators are unable to transport freight, cargo or produce for less then a $1.35 per mile and because no one can consistently receive a $1.35 per mile, business closures are occurring and at an alarming rate and unless someone takes action, introducing common sense legislation, a minimum of 100,000 trucking businesses will either quit or shut their trucks down within the first quarter of 2002. Those willing to continue will not earn enough revenue for new truck/trailer payments transporting cargo, freight or produce at a $1.00 per mile and under.

If it becomes evident that there is a clear advantage to operating under Mexican DOT authority, others will originate a Mexican Trucking Business and register their trucks with Mexico DOT. The cost to register your truck with Federal Mexico DOT Plates is under $2,500.00, allowing unrestricted access to all highway/byways in Mexico. The cost of originating a trucking business or corporation is under $1,000.00 and obtaining your dual citizenship can be achieved for under $600.00. The Mexican Goverment accepts street address accompanied with Post Office Boxes for your business or corporation. The majority of U. S. Small Trucking Businesses and Owner-Operators will not travel throughout Mexico without an escort but would benefit from opening a Mexican Trucking Business, operating under Mexico DOT authority; if Mexican Motor Carriers become exempt from ¡§U. S. FMCSA, FHWA, DOT, IFTA, SSR, IRP, States Weight and Mile Distance Tax regulations and driving hours on duty laws.

Will it be more cost effective to register your truck in Mexico, originate a Mexican Business and pay Mexican Federal Taxes rather than U. S. Federal Taxes?

Very Respectfully,

 

 

BRUCE WAYNE HENION

 

 

How Often Can A Broker Offer $2.00 per mile? (August 9, 2001)

 

 

Last year my cousin sold his 1995 Freightliner to a friend of mine. Together they bobtailed from Nebraska to Oregon where my friend Mike and I live. Mike went through the truck equipping it with new tires but chose not to drive it because he couldn’t find anyone who could pay him a $1.35 per mile. My cousin quit long haul for several months, starting back up with the purchase of a 1997 Freightliner hauling for a company allocating him $.82 per mile pulling the companies dry van. His payments on the truck, a whopping $1700.00 per month was eating away at his monthly take home.

My cousin showed up at my house today with Mike and informed me he was turning in his Freightliner and buying back the truck he sold to Mike. I’ve been storing Mike’s truck on our farm. Mike was happy to sell his truck back to its original owner, and my cousin skimping by each month further in debt is happier but doesn’t know what to do, so he keeps on driving, hoping rates will one day increase. He told me he doesn’t make enough so his wife must work, their economic plight bordering on poverty.

He believes Mexican trucks will enter the U. S. and one day take his job. Of course Freightliner isn’t too happy and trucks across our nation no longer have their value unless you’re forced to finance your truck. You can buy a 1997 International, Freightliner, Kenworth, Peterbuilt, etc., at any auction with a sleeper, new tires and under 500,000 miles for under $10,000.00. I watched three sold several weeks ago for as low as $8,500.00.

If Mexican trucks are allowed in the U. S., heaven forbid, maybe truck sales will increase, especially since there so cheap.

Although safety is paramount in regards to increased truck traffic, rate per mile is on the top of my list of concerns.

Recently Senator Gordon Smith answered one of my questions on a local radio show (KAMP) relating to Mexican trucks. Smith expressed the house and senates concerns regarding truck/driver safety issues, insurance, etc. In closing he said “We have enough trucks on the road already.”

I wish President Bush believed this, but I think when it comes right down to it, the President must know something us Americans haven’t been told relating to the strength of the U. S. economy. In a recession, freight, cargo and produce must be hauled. Will Americans be able to transport the goods in 2002 for less then a $1.00 per mile, when shippers realize their products are not selling?

Will the fuel surcharge if passed, which by the way I have supported from the begging, increase shipper’s transportation cost or in some cases decrease the amount brokers receive?

Will the rate per mile truckers are presently forced to endure for offering transportation services to an industry unwilling to allocate reasonable rates, decrease in order to off set the cost shippers will face if the fuel surcharge becomes law?

We all know Mexican trucks will transport anything for less then a $1.00 per mile. U. S. based trucking companies have already set the example transporting anything for a $1.00 per mile or less. I could issue reports on load after load where the rate for dry van freight was $.90 per mile out of CO, MT, AZ, CA, OR, WA, NM, etc. I should just list every state.

If the President allows Mexican trucks in the U. S. after reviewing Senator Murray and Senator Shelby’s remarks addressed to Mr. Bush, released July 24, 2001, Mexican Motor Carriers, etc., will demand fuel surcharge benefit but relief from everything imposed on Canadian and U. S. Motor Carriers.

My word, where are we headed?

I have read report after report relating to gold, banks, environment, natural resources, trucking, and many other topics from ESA to CARA, and I can tell you the U. S. will suffer from decisions the 107th congress will and have made.

Minimum standard rates is the only guarantee that can be offered for us in the trucking business if we don’t want to become extinct, yet because of trucking deregulation we have nothing that will guarantee us the “American dream.”

It’s difficult to comprehend deregulation, especially since the trucking industry is one of the most regulated industries in the world. Sometimes I wish ICC were still here, especially when I deal with those entities that have sprung up as ICC’s replacement. At least ICC would go the bat for Motor Carriers with brokers, enforcing a 15-day pay period.

Now days your lucky if your paid in 60 days or at all. After all, how far can a brokers $10,000.00 bond go when a shipper files bankruptcy?

And those of you that have used factoring companies know only to well, if the shipper doesn’t pay your loan shark, they come back to you.

Yet every sacrifice we the truckers make for shippers, that’s right, sacrifice; shippers still won’t stand alongside us and are praying for a new group of suckers who will take brokered loads for less then a $1.00 per mile.

NuWest Commodities Exchange and I won’t broker a load for less then a $1.00 per mile or take more then .08 freight forwarding fee and when were forced to take a brokered load from another broker in an area we’re not strong, we take it in the shorts and Motor Carriers leased on suffer. We credit check our shippers, make every effort to pay within 30 days and although we offer factoring, we discourage it.

Since shippers won’t say it, I will:

1). I am pleased to transport your goods and products in the snow, wind, and sleet, and when there is a flood if my truck wasn’t a casualty, you can count on my services.

2). Often I wait 45 to 60 days to be paid from your broker, and my broker tells me he must wait 45 to 60 to 90 days to be paid from you. I am thankful to have the opportunity to serve you and allow you the time you need to place an order on your product, manufacture your product, sell your product, and collect revenue on your product. Of course I wish my Texaco fuel bill could be paid 90 days from the time I charged my fuel.

3). Thank you for your willingness to allow me to provide transportation services to you for under a dollar per mile.

4). Thank you for your silent support for a fuel surcharge.

5). Thank you for believing rates must be higher:

AS OF AUGUST 8, 2001, STEPDECK LOADS ARE AVAILABLE FROM RIALTO, CA to MODESTO, CA (45’ CONTAINERS UNDER 16,000 LBS) FOR A FLAT RATE OF $700.00 div. by 360 miles = $2.00 per mile) – 541-327-3445

 

BRUCE WAYNE HENION

 

 

Motor Carrier Fuel Cost Equity Act of 2001 (HR2161) On Line Petition, Submitted August 2001 by IMFEDUP.net

 

 

The Motor Carrier Fuel Cost Equity Act of 2001, HR2161, was originally introduced in the 106th Congress as HR4441, where it passed unanimously in the House in October 2000 but failed to make it to the floor of the Senate before its adjournment. Members of the House of Representatives reintroduced mandatory fuel surcharge legislation June, 13 2001.

 

HR2161 would make it mandatory that motor carriers, brokers and freight forwarders add a fuel surcharge adequate to cover the increased cost of fuel if it exceeds $1.10 by five cents. It will also mandate that the surcharge be paid by the party paying for the transportation service and that it be passed through in full to the party who pays for the fuel.

 

Original sponsors of HB2161:

 

Nick Rahall (D. WVA)

Roy Blunt (D MO)

 

Original Co sponsors of HB2161:

 

Allan B. Mollohan (R WVA)

Robert W. Ney (D OH)

Collin C. Peterson (R MN)

Ted Strickland (R OH)

William O. Lipinski (R IL)

Corrine Brown (R FL)

 

Additional Co sponsors of HR2161:

 

John Doolittle (R-CA)

David Bonoir (D-MI

Nicholas Lampson (D-TX)

Tim Holden (D-PA).

 

John J. Head, President of FEDUP, is interested and involved with many aspects of the trucking industry and the issues that directly affect truckers. John has introduced an online petition that will be sent to The House Highway and Transit Committee to let them know how important we, the members of the trucking community, feel HR2161is.

 

This is an important piece of legislation and the survival of the independent trucker, the owner-operator leased to trucking companies as well as company drivers who work for small trucking businesses and small carriers.

 

The language of the petition speaks for itself. Simply read the petition and if, upon doing so, you also agree that passage of this bill is vital to the survival of key members of this industry, sign the petition. By signing this petition you are not obligating yourself to anything. Your personal information will not be shared with any person, organization or business. By signing this online petition you are simply telling the members of one particular committee in Congress that you care what happens to the American Trucker and you vote for his or her survival - and the survival of their livelihood. And you vote for your own continued ability to count on each of them to deliver your groceries and clothing to the market; your books and magazines, writing paper and pens and pencils to the store; your automobiles to the dealer and your gasoline to the service station. http://www.petitiononline.com/HB2161

 

 

BRUCE WAYNE HENION

 

 

 

BRUCE WAYNE HENION

 

Reference Sources:

 

The U.S. and Mexico: Trade Issues

http://usinfo.state.gov/regional/ar/mexico/trade.htm

 

Mexico Government & Politics

http://www.mexonline.com/mexagncy.htm

 

Bureau of Western Hemisphere Affairs March 2002 - Background Note: Mexico PROFILE http://www.state.gov/r/pa/bgn/1838.htm

 

Region in Focus - Office of International Information Programs, U.S. Department of State.  http://usinfo.state.gov/regional/ar/mexico

 

Market Assessment of Mexico Truck Services In dollar value, the Mexican market for trucking services amounted to US $6,410.1 million in 1997. A growth rate of 4.2 percent is expected for 1998, which would bring the market to US $6,679.3 million. In 1999, the Mexican market for trucking services is expected to grow one percent to US $6,749.4 million. Over the following two years, the Mexican market for these services was expected to grow at three percent per year, as reported by U.S. Department of Commerce November 5, 1998. http://strategis.ic.gc.ca/SSG/1/dd74837e.html

Bureau of Transportation Statistics - "Conducts research and analysis in several areas pertaining to international transportation, trade and travel. The Bureau also undertakes a number of statistical programs in these areas." http://www.bts.gov/itt

 

Bureau of Transportation Statistics
400 7th Street, SW • Room 3103 • Washington, DC 20590
L'Enfant Plaza Metrorail Station (7th and D Streets)
800-853-1351 •
answers@bts.gov

 

HIGHWAYS IN MEXICO (1993 est.):

 

Total: 245,433 km paved: 88,601 km (including 4,286 km of expressways) unpaved: 156,832 km http://199.79.179.77/itt/latin/mexico.html

 

Transportation Secretary on Safe Operation of Mexican Trucks in U.S., 27 June 2002 - (Says foundation is in place for expanding cross-border operations) http://usinfo.state.gov/regional/ar/mexico/02062702.htm

 

Secretary of Transportation Norman Mineta June 27, 2002 announced that the Department of Transportation (DOT) is "confident that we have achieved our goal of setting a firm safety foundation" for Mexican trucks to operate in the United States, as required under the terms of the North American Free Trade Agreement (NAFTA).

 

In June 27 testimony before the U.S. Senate, Mineta said that the DOT has successfully completed the steps called for by Congress in the 2002 Transportation and Related Agencies Appropriations Act.

 

The DOT has hired over 200 individuals to serve as Border Inspectors and Safety Auditors in an effort to comply with congressional requirements, Mineta indicated. The Department's safety oversight regulations were also revised to ensure Mexican trucks operating in the United States meet the same standards as their U.S. and Canadian counterparts, he said. Moreover, new regulations regarding vehicle inspections for Mexican carriers have been issued and funding has been allocated to improve border infrastructure.

 

Mineta is currently reviewing a recent report on border operations by the DOT Inspector General to determine if the border can be safely opened to Mexican trucks, and he must certify that opening the border to commercial traffic from Mexico does not pose an unacceptable risk to the American public. In addition, President Bush must act to implement the transportation access provisions of NAFTA before Mexican motor carriers will be allowed to operate outside of the border commercial zones they are currently confined to in the United States.

 

Mineta said the DOT will continue to fully address all necessary issues "to allow the border to open in the near future."

http://usinfo.state.gov/regional/ar/mexico/02062702.htm

 

 

 

 

 

 

 

 

 

 

Fuel Surcharge Sample letter to Customers (August 14, 2001)



Small business and owner-operators do not need government approval or to file application with DOT in order to implement a fuel surcharge. Notify your customers with a faxed memo.

Presently, unless your a large trucking company, it is difficult to convince your broker or shipper to allocate fuel surcharge. Although some brokers would accept a fuel surcharge or rather not oppose it, most brokers will not actively support HR2161.

There are some Shippers who allocate fuel surcharge but many that don't.

You can use this letter for a guideline

Fuel Surcharge Sample letter to Customers (August 14, 2001)

 

Dear xxxx,

As you are no doubt aware, fuel prices have spiraled upward at various times for many years.

Fuel prices are expected to climb and no one really knows if they will exceed the high cost truckers paid for fuel during 2000 and early on in 2001. We do know however that OPEC doesn't want the price of a barrel of crude oil to decline from its average price of $25.00 to $28.00 a barrel, the latter having a crippling effect on my trucking business.

John Q. Trucking Company has acted in good faith to resist seeking price relief as long as we possibly could. Due to the critical nature of the current situation, we can no longer continue to absorb the increased cost.

Therefore, we would like to encourage you to support HR2161, the Fuel Surcharge House Bill.

Eeffective xxx, we must implement a temporary fuel surcharge of xxx percent on all shipments. The fuel surcharge will remain independent from our base rates and will be shown as a separate entry on our freight bill.

The fuel surcharge amount will be a percentage of the net linehaul charges.Our pricing is based on the U.S. National Average Diesel Fuel Index.

We will review this data and our actual costs on a weekly basis.

We deeply appreciate your understanding and partnership with us in helping to share the burden of these fuel cost increases.

We hope that the index and our fuel costs will begin to decline in the near future.

We look forward to the day when fuel prices return to normal and the fuel surcharge become inapplicable.

Respectfully,

Information relating to Fuel Surcharge is intended for the benefit of truckers and was originally submitted by OOIDA and is available at OOIDA, Landline magazine.

My views are those of a small trucking business and agent for a Freight Forwarding firm and trucking company with Owner-Operators leased on.

 

BRUCE WAYNE HENION

 

 

How to implement a fuel surcharge (August 14, 2001)

 

 

"The U. S. House Surface Transportation Subcommittee, upon approval of HR 4441, established the following formula based on the assumption that base rates would be increased over time to adequately reflect increased costs, and that the surcharge requirement would be in place at the time of any dramatic increase in the cost of fuel:

 

An adequate fuel surcharge is computed using the difference between the current national average retail on highway diesel price as published by the U. S. Department of Energy, and the most current previous 52-week national average price, divided by a set average fuel consumption rate of five miles per gallon times the number of paid miles driven as determined under the Department of Defense Military Traffic Management Command’s Defense Table of Official Distances. The national average fuel price for 1999 sets a more realistic baseline prior to this year’s price run-up.

 

The DOE’s 52-week national average price of diesel fuel for 1999 was a dollar twelve point zero five cents per gallon, and the current DOE national fuel price average as of Oct. 29, 2000, is $1.648. This equals an average fuel cost increase of 52.75 cents per gallon, divided by five miles per gallon, which means you must receive 10.5 cents per mile surcharge to cover your increased cost of fuel.

 

"As of July 21, House sponsors of fuel surcharge legislation included:"

 

Representative Nick Rahall (D-WV), who introduced the bill.

Representative Roy Blunt (R-MO), who cosponsored the legislation and testified in support of it.

Representative Robert Ney (R-OH)

Representative Corrine Brown (D-FL)

Representative William Lipinski (D-IL)

Representative Peter Visclosky (D-IN)

Representative David Bonior (D-MI)

Representative Elijah Cummings (D-MD)

Representative Ted Strickland (D-OH)

Representative Alan Mollohan (D-WV)

Representative Robert Wise, Jr. (D-WV)

 

"How to implement a fuel surcharge:" (OOIDA)

 

With the price of diesel fuel spiraling upward, if you have not incorporated a fuel surcharge into your operation, here's how to do it:

 

Base your fuel surcharge on the U.S. National Average Diesel Fuel Index. The index is published by the Energy Information Administration of the U.S. Department of Energy and every Monday it is updated. You can get the information by calling 202-586-6966 or you can go to the web site: http://www.eia.doe.gov/pub/oil_gas/petroleum/data_publications/weekly_petroleum_status_report/current/txt/table18f.txt

 

You’ll find a table if you go to the web site. Along with the prices of fuel in different U.S. areas, it will give the U.S. retail averages of on-highway diesel in cents per gallon.

 

The averages include taxes.

 

Table 18. U.S. Retail On-Highway Diesel Fuel Prices

 

On-Highway Diesel Fuel U.S. Average

 

Week ending 02/28 146.1

Week ending 03/06 149.0

Week ending 03/13 149.6

Week ending 03/20 147.9

 

You can set up an index of your own based on these averages. Most companies start the fuel surcharge at $1.10 (and 1 percent). A good method would be to build your index on 10 cent increments. With the national average more than $1.47 or more, you should build an index that sets the $1.47 in the middle, allowing for increases/decreases.

 

Something like this:

 

When the U.S. National Average Diesel Fuel Index is:

 

At least But less than OOIDA recommended fuel surcharge will be

 

1.10 1.20 1.0% (of net linehaul charges)

1.20 1.30 2.0%

1.30 1.40 3.0%

1.40 1.50 4.0%

1.50 1.60 5.0%

1.60 1.70 6.0%

1.70 1.80 7.0%

1.80 1.90 8.0%

1.90 2.00 9.0%

 

Because the national average is calculated each Monday afternoon, it would be a good idea to make your weekly adjustments on Tuesday or Wednesday.

 

NOTE: Small business owner-operators do not need government approval or to file application with DOT in order to implement a fuel surcharge. Notify your customers with a faxed memo.

 

MTMC finalizing fuel surcharge program:

 

OOIDA advocates higher amount and a direct pass-through The Military Traffic Management Command is in the final stages of drafting a fuel surcharge program for motor carriers that would automatically adjust surcharges as fuel prices go higher. In the past, motor carriers incurring high diesel costs faced long delays in receiving MTMC fuel surcharges, but MTMC's Commanding General, Maj. Gen. Kenneth L. Privratsky, promises a new plan.Privratsky's aim is to make the surcharges automatic by linking them directly to the price of fuel. To achieve that goal, a joint MTMC-industry fuel board was formed Nov. 10. The board is chaired by Col. Clark Hall, chief-of-staff, who says he does not expect motor carriers to absorb increased fuel prices out of profit margin. Hall says the fuel surcharge is a necessity for military readiness. "We do not want drivers refusing military cargoes," said Hall. The policy drafted provides an effective date of April 1, 2001. How will it work?

 

When the Department of Energy's posted fuel price (http://www.eia.doe.gov ) exceeds the neutral range amount, the carrier will be entitled to the specific fuel rate "adjustment" percentage based on the applicable fuel cost per gallon range. For example, if the national average is $1.52, the carrier will be entitled to a fuel-related surcharge of three percent. The fuel adjustment will automatically apply to shipments picked up on the 15th of the month through the 14th day of the following month. If fuel climbs to $1.70, the rate adjustment would be 4 percent. If fuel skyrockets and mc's are paying two bucks a gallon, the adjustment would be 7 percent. However, if fuel is $1.30 or lower, there will be no adjustment.

 

The surcharge is automatically recalculated monthly and adjusted upward or downward depending on the DOE EIA national average price on the first Monday of the month. An overwhelming majority of the carriers that move MTMC's shipments utilize owner-operators to provide the transportation. Todd Spencer, executive vice president of the Owner-Operator Independent Drivers Association says the OOIDA membership is "very concerned with fuel prices and policies that can assure reliable transportation services to MTMC." Spencer says he has reviewed the MTMC fuel surcharge proposal and suggests two items for modification.

 

"First, the formula in the proposal seems inadequate to significantly offset the increased costs truckers are incurring as a result of higher fuel prices," Spencer told MTMC's Ruth Tetrault in a letter dated Dec. 21. "The $1.30 starting figure is higher than it should be to accurately reflect the run up in fuel prices that truckers have experienced. That run-up actually started in the second quarter of 1999 when fuel prices averaged $1.00 per gallon. The $1.30 figure you use as a baseline reflects fuel prices that had already moved upward by 30 percent. "Spencer speculated that few, if any, rate increases have been assessed by carriers providing the services. "This simply means increased costs of transportation have been absorbed indirectly by motor carriers," he said, "and directly by the owner-operator truckers who actually provide the transportation service." "The shortcomings of the proposed formula are even more apparent when you factor in regional differences in fuel prices. Just for this week (12/18/00)," he noted, "the difference between the national average and the California average fuel price is $.25 per gallon. "Spencer said OOIDA believes the MTMC fuel surcharge policy should clearly stipulate that 100 percent of fuel surcharge revenues should go to the entity responsible for paying for the fuel.”

 

OOIDA's comments of the draft proposal:

 

MTMC's Fuel-Related Rate Adjustment Policy by Todd Spencer, OOIDA executive vice president Deember. 21, 2000 - The Owner-Operator Independent Drivers Association (OOIDA) is the professional association that represents the interests of the nation's more than 350,000 owner-operator truckers. Approximately 80% of these owner-operator truckers lease their equipment and services to motor carriers on a long-term basis.

 

An overwhelming majority of the carriers that move MTMC's shipments utilize owner-operators to provide the transportation. OOIDA represents those owner-operators and has since 1973. We and our members are very concerned with fuel prices and policies that can assure reliable transportation services to MTMC.

 

After reviewing the proposal, I would suggest two items be considered for modification. First, the formula in the proposal seems inadequate to significantly offset the increased costs truckers are incurring as a result of higher fuel prices. In reviewing fuel price information from the past, I note that the average price per gallon was approximately $1.30 at this time last year. While I understand that a baseline must start someplace, in our view, the $1.30 figure is higher than it should be to accurately reflect the run up in fuel prices that truckers have experienced. That run-up actually started in the second quarter of 1999. Fuel prices averaged $1.00 per gallon on 3/19/99. The $1.30 figure you use as a baseline reflects fuel prices that had already moved upward by 30%.

 

To more accurately reflect the increased costs, we would suggest establishing the baseline at the point where fuel prices first started climbing. In further justification for this lower baseline, you might review invoices or amounts charged by carriers for providing transportation services on MTMC shipments. I would speculate that few, if any, rate increases have been assessed by carriers providing the services. This simply means increased costs of transportation have been absorbed indirectly by motor carriers and directly by the owner-operator truckers who actually provide the transportation service.

 

My second thought in this area for your consideration is in regard to using nationwide DOE average pricing. The difference between national average prices and regional average prices can be substantial. Just for this week (12/18/00), the difference between the national average and the California average fuel price is $.25 per gallon. A substantial number of military moves take place in the west where fuel prices are much higher than the national average. We believe these regional differences should be reflected in a surcharge formula.

 

Lastly, we believe the MTMC fuel surcharge policy should clearly stipulate that 100% of fuel surcharge revenues should go to the entity responsible for paying for the fuel. Current industry practices show that an alarmingly high number of carriers fail to pass through the full amount of fuel surcharges collected. In many instances, 20-35% of fuel surcharge revenues are pocketed by port agents or carriers and not passed through to the entity that bears the burden of increased fuel costs. In some instances, none of the fuel surcharge revenues are passed through to the person that actually pays for the fuel!

 

We believe that for a carrier, port agent or other entity to not fully pass through the full amount of fuel surcharge revenues to the party responsible for paying for the fuel undermines the reasonable intent of MTMC with this policy and to that end, represents a threat to military preparedness. A 100% pass through should be stipulated in the policy. In conclusion, we applaud the MTMC for having the foresight to address this serious issue in transportation and stand willing to help in any way we can in finalizing a policy."

 

Information relating to Fuel Surcharge is intended for the benefit of truckers and was originally submitted by OOIDA and is available at OOIDA, Landline magazine. My views are those of a small trucking business and agent for a Freight Forwarding firm and trucking company with Owner-Operators leased on.

 

BRUCE WAYNE HENION

 

Fuel Surcharge is worth fighting for - August 14, 2001

Fuel Surcharge is worth fighting for. Every time I speak to a trucker on the phone I tell them about FEDUP's fuel surcharge petition.

What are you doing?

Do you want fair compensation for high cost of fuel out of your control?

Maybe you think fuel will remain stable and not rise again and again, year after year?

The Motor Carrier Fuel Cost Equity Act of 2001, HR2161, was originally introduced in the 106th Congress as HR4441, where it passed unanimously in the House in October 2000 but failed to make it to the floor of the Senate before its adjournment. Members of the House of Representatives reintroduced mandatory fuel surcharge legislation June, 13 2001.

HR2161 would make it mandatory that motor carriers, brokers and freight forwarders add a fuel surcharge adequate to cover the increased cost of fuel if it exceeds $1.10 by five cents. It will also mandate that the surcharge be paid by the party paying for the transportation service and that it be passed through in full to the party who pays for the fuel.

Original sponsors of HB2161:

Nick Rahall (D. WVA)
Roy Blunt (D MO)

Original Co sponsors of HB2161:

Allan B. Mollohan (R WVA)
Robert W. Ney (D OH)
Collin C. Peterson (R MN)
Ted Strickland (R OH)
William O. Lipinski (R IL)
Corrine Brown (R FL)

Additional Co sponsors of HR2161:

John Doolittle (R-CA)
David Bonoir (D-MI)
Nicholas Lampson (D-TX)
Tim Holden (D-PA).

John J. Head, President of FEDUP, is interested and involved with many aspects of the trucking industry and the issues that directly affect truckers. John has introduced an online petition that will be sent to The House Highway and Transit Committee to let them know how important we, the members of the trucking community, feel HR2161 is.

 

This is an important piece of legislation and the survival of the independent trucker, the owner-operator leased to trucking companies as well as company drivers who work for small trucking businesses and small carriers.

The language of the petition speaks for itself.
http://www.petitiononline.com/HB2161  Simply read the petition and if, upon doing so, you also agree that passage of this bill is vital to the survival of key members of this industry, sign the petition. By signing this petition you are not obligating yourself to anything. Your personal information will not be shared with any person, organization or business. By signing this online petition you are simply telling the members of one particular committee in Congress that you care what happens to the American Trucker and you vote for his or her survival - and the survival of their livelihood. And you vote for your own continued ability to count on each of them to deliver your groceries and clothing to the market; your books and magazines, writing paper and pens and pencils to the store; your automobiles to the dealer and your gasoline to the service station.

 

BRUCE WAYNE HENION

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EQNEEDF views on Politics, Environment, Energy, Health, National, and Foreign Affairs

2001 Trucking Issues –2

                ENERGY QUEST, former National Energy Efficient Development Inc.

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