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U.S. House to FMCSA: No arbitrary insurance increases

Raising financial responsibility would not make highways safer

(Grain Valley, Mo., June 4, 2015) – The Owner-Operator Independent Drivers Association and its members thank the U.S. House of Representatives for listening to the concerns of small-business truckers by voting to stop the Federal Motor Carrier Safety Administration from arbitrarily raising financial requirements for commercial motor carriers. Today, in a bipartisan vote, the House struck down an amendment seeking to remove a provision supported by truckers and other industry stakeholders, which halts the FMCSA's rush to raise these requirements.

The FMCSA is currently developing an increase in federally mandated levels of financial responsibility coverage for property and passenger motor carriers. OOIDA and other industry groups have told Congress that the initiative, which the FMCSA is basing on increases in medical inflation, would place significant financial burdens on motor carriers without any improvement to highway safety.

"Congress never intended financial requirements to be tied to increases in medical inflation or to cover the worst-case crashes, and the legislative and regulatory history on that is clear," said Todd Spencer, Executive Vice President of OOIDA.

"In a worst-case crash, FMCSA's own report admits that there is no requirement high enough to cover all damages. But there may be other ways to address covering the damage costs of catastrophic and worst-case crashes."

The Association has pointed out that FMCSA's own data shows that more than 99 percent of crash damages are covered under the current requirements. Even by increasing requirements by 500 percent or more, only a fraction of a percent of crashes would be affected, showing that these requirements are covering all but worst-case crashes.

The amendment was proposed as part of H.R. 2577, Transportation, Housing and Urban Development appropriations bill. Final passage of the bill in the House is scheduled for next week, with Senate action also expected in the coming months.

OOIDA and other industry stakeholders had sent a letter last month to Congress urging them to stop the FMCSA from advancing a rule that would harm small trucking businesses and other transportation providers. The letter was sent to the U.S. House Transportation-HUD Appropriations Subcommittee and signed by national, regional and state associations representing a wide range of transportation entities, including school buses, motor coaches, agriculture, truckers and others.

FMCSA's efforts have been proceeding largely based on a very flawed study which focused on increased health care costs and did not even consider the entire passenger carrier segment. This action comes despite data from the agency and insurance claims showing that current requirements cover damages in more than 99 percent of all crashes."

The agency is responsible for ensuring that an undue burden is not placed on small businesses and that there is no disruption to transportation services.

The FMCSA's approach to date has largely ignored these core requirements as well as any need to show data-driven safety benefits from this sweeping rulemaking. As such, our organizations urge Congress to take action and halt the FMCSA from advancing rulemakings that would increase financial responsibility for both for-hire and private property and passenger motor carriers.

The Owner-Operator Independent Drivers Association is the only national trade association representing the interests of small-business trucking professionals and professional truck drivers. The Association currently has more than 150,000 members nationwide. OOIDA was established in 1973 and is headquartered in the Greater Kansas City, Mo., area.