Trucking Group Slams FMCSA’s Handling of Broker Investigation as “Dog and Pony Show”
Washington D.C. – The Acting Administrator of the Federal Motor Carrier Safety Administration (FMCSA) is drawing criticism from a trucking group following comments he made this week about the Agency’s ongoing investigation into alleged abuses by freight brokers.
FMCSA chief Jim Mullen was a guest at the Truckload Carrier Association’s (TCA) Virtual Safety & Security meeting on Tuesday, June 23.
Mullen gave updates on a host of issues the Agency is currently faced with.
However, the biggest headlines from Mullen’s appearance came from his comments about the Agency’s ongoing investigation into allegations that freight brokers are not complying with federal rate transparency regulations.
Trucking groups such as the Small Business in Transportation Coalition (SBTC) and the Owner Operator Independent Driver’s Association (OOIDA) are demanding the FMCSA not only enforce the now famous 49 CFR 371.3 — which requires brokers to provide a copy of the transaction record to carriers, at the carriers request, upon delivery of the load — but also prevent brokers from circumventing the regulation by requiring carriers to waive their right to request the information.
Where does the FMCSA stand on all of this?
Mullen indicated that while the Agency does have the authority to hold brokers accountable for violating 371.3, it cannot prevent brokers from requiring carriers to waive their rights under 371.3.
“We are confined by our regulatory and statutory authorities and we take that very seriously,” he said. “I think that perhaps we just have a difference of opinion with some groups on exactly the scope of those authorities.”
He further explained the Agency’s position this way:
Now there are many people that will say to us, ‘Hey look you’re missing the point Mullen. The brokers are trying to circumvent the process by requiring the waiver and if the motor carrier doesn’t waive it, they get black balled.’ I understand the concept. But the regulation says what it says and I think most people understand that the regulation is very specific.
The SBTC and OOIDA have each filed petitions for rulemaking, a bit different in scope, but with similar intent, which is to 1) ensure brokers provide a copy of the transaction record to the carrier, and 2) effectively ban the use of 371.3 waiver provisions.
Despite Mullen’s insistence the Agency lacks the authority to prevent brokers from using 371.3 waivers, he revealed plans to move forward with a Federal Register Notice and a public comment period on both of these petitions.
If the Agency doesn’t have the authority to enforce the proposed rules, then why move forward on the petitions?
Administrator Mullen is not required by statute to move forward with a Notice and public comment period on petitions such as the ones filed by the SBTC and OOIDA.
So, why would the Agency pursue this course of action if it’s stated position is in opposition to what is being asked for in the petitions?
James Lamb, president of the SBTC, tells Transportation Nation Network (TNN) he believes the answer is simple.
“This is now a dog and pony show for the White House and the United States Department of Justice (DOJ) to show they are giving us consideration before they steamroll over this and railroad both OOIDA and the SBTC,” Lamb contends.
As TNN has reported, the FMCSA recently came under scrutiny by White House Chief of Staff Mark Meadows for not enforcing 371.3 more aggressively.
Further, TNN recently updated readers on the progress of the DOJ’s ongoing investigation into alleged violations of the 1890 Sherman Antitrust Act, which criminalizes corporate collusion for the purpose of price fixing.
Click HERE to read more.
While Mullen did not specifically reference displeasure from the White House or the developing DOJ investigation, he did indicate public and media pressure is a factor in the Agency’s decision making process on this issue.
I read the trade journals. I know there’s a difference of opinions on this. I know that some folks are dissatisfied at the pace by which the Agency is working and that some folks are dissatisfied that we aren’t already taking action against those brokers who do have it in their broker/carrier agreement, and I would say this is what the process is for, hence why we’re going to do the Notice and comment period.
This is not nearly all of what Mullen revealed on this issue during his TCA appearance.
TNN will have much more on this in the coming days, so stayed logged on to TransportationNation.com.