35th Annual TIA Convention And MAP 21

For the 8th Consecutive year GSIS was in attendance for the TIA Convention. We made many new friends and thank all those in attendance for an educational and entertaining week.

The past 12 months in the 3PL industry have, like the economy, had its ups and downs. Most notably the introduction of MAP 21 of the Highway Authorization Bill. Last July President Obama forever changed the logistics field with the introduction of Map 21 (moving ahead for progress in the 21st century act). Since its introduction, MAP 21 has been implemented by DOT, FTA, FMCSA and FHWA with one goal in mind: to develop a national strategic freight plan. Just renewed by congress in April, MAP 21 is running full steam ahead. we can revisit some key points pertinent to our field:

1. Electronic Logging Devices- the law requires DOT to establish regulations mandating electronic logging devices (EOBR’s) for motor carriers currently required to complete paper logs. The regulations must be in place within 1 year and carriers will have two years thereafter to adopt/install the devices.
2. Freight Policy- DOT is creating a national freight plan that includes an assessment of the condition and performance of the national freight network and identification of highway freight bottlenecks. This is intended to improve freight efficiency from 80% to 90% off of interstate systems and 95% for interstate systems.
3. Truck Size and Weight- the act does not include an increase in size and weight limits except for an increase in allowable weight for idling reduction devices from 400 pounds to 550 pounds. States are also allowed to issue 120 day oversize-overweight permits to trucks responding to disasters if a national emergency is declared.
4. Performance Standards- each state and urban area is required to establish minimum performance standards related to highway and bridge maintenance, congestion, system reliability, safety, freight efficiency, air quality and project delivery. Failure to do so will result in the transfer of federal funds from non logistic areas in order to compensate.
5. Broker Bond- MAP-21 increases the broker bond to $75,000 and applies it to freight forwarders. It also tightens requirements on bonding companies to respond to carrier claims.
6. Proficiency Testing- all new employees entering the motor carrier field now must complete the DOT safety testing within 12 months rather than the previous standard of 18 months.
7. Transport of Agricultural Commodities & Supplies-increases air mileage from 100 to 150 and eliminates “in the state” from regulation; making it an “interstate” issue.
8. HAZMAT- Hazardous Materials Safety Administration (PHMSA) is to update its accident and release recordkeeping and reporting requirements. PHMSA is also to assist DOT in creating mandatory standardized training for HAZ enforcement officials.

FMC Chairman Cordero Voices Commitment To Increase Exports And Reduce Regulatory Burdens

On April 16, Commissioner Mario Cordero, who replaced Commissioner Richard A. Lidinsky as Chairman of the U.S. Federal Maritime Commission (FMC) earlier in April, testified to Congress regarding the Fiscal Year 2014 FMC budget. In his presentation, Chairman Cordero outlined two primary ways the Commission could promote our nation’s economic recovery:

(1) working to ensure the competitiveness of our Nation’s ports and maritime transportation system to make sure that it efficiently supports growing exports; and

(2) providing maritime businesses regulatory relief so they and their customers can hire more American workers.

Because more than 80% of international trade relies on ports, Chairman Cordero stated that the efficiency of our transportation system–including the OTI (Ocean Transportation Intermediary), ocean common carriers, and marine terminal operators–is key to relieving congestion at ports, decreasing delays, and lowering transportation costs.

Chairman Cordero also reiterated a commitment to continue assisting U.S. exporters in 2013. Agricultural exporters can look forward to a container shipping rate index for a few targeted export commodities such as grains, cotton, hay, and frozen meat. It is anticipated that with such an index exporters could plan and hedge their transportation costs.

Other new developments include a searchable database of NVOCC (Non Vessel Owned Common Carriers) on the FMC website. Small businesses that want to start exporting, as well as individuals shipping personal goods, can use the search tool to find nearby licensed and bonded freight forwarders.

Chairman Cordero and the FMC have committed to continued efforts to reduce regulatory burdens, thereby initiating cost savings and flexibility for the shipping industry and its customers. Progress was made in 2012. Chairman Cordero cited the following:

• Changes to procedural rules to improve just, speedy, and inexpensive resolutions in administrative proceedings.
• Revisions in tariff exemptions which eliminate record keeping requirements for negotiated rate arrangements offered by U.S.-based NVOCCs.
• Initiation of dialogue on a proposed rule that would expand these tariff exemptions to foreign-based unlicensed NVOCCs.
• Reviews of regulations concerning the licensing and oversight of OTI (Ocean Transportation Intermediaries), the process for review of filed agreements, and rules regarding service contract filings.

Chairman Cordero stated that the Commission will continue to solicit input from the shipping public and the regulated industry about how to streamline and improve its rules.