[Congressional Record Volume 146, Number 125 (Tuesday, October 10, 2000)]
[House]
[Pages H9569-H9573]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
MOTOR CARRIER FUEL COST EQUITY ACT OF 2000
Mr. SHUSTER. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 4441) to amend title 49, United States Code, to provide a
mandatory fuel surcharge for transportation provided by certain motor
carriers, and for other purposes, as amended.
The Clerk read as follows:
H.R. 4441
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Motor Carrier Fuel Cost
Equity Act of 2000''.
SEC. 2. MANDATORY FUEL SURCHARGE.
(a) In General.--Chapter 137 of title 49, United States
Code, is amended by adding at the end the following:
[[Page H9570]]
``Sec. 13714. Fuel surcharge
``(a) Mandatory Fuel Surcharge.--
``(1) Assessment of surcharge.--Any motor carrier, broker,
or freight forwarder subject to jurisdiction under chapter
135 regularly providing truck-load transportation service
shall assess under each contract or agreement for such
service the payor of transportation charges a surcharge under
this section, or a surcharge or other fuel cost adjustment
permitted under section 13715, for fuel used in the
transportation provided to such payor commencing when an
increase in the price of such fuel surpasses the benchmark in
paragraph (2). A surcharge assessed under this section by the
motor carrier, broker, or freight forwarder shall be
calculated on the basis of mileage or percentage of revenue
(whichever basis the motor carrier, broker, or freight
forwarder elects) and shall be the amount necessary to
compensate the motor carrier, broker, or freight forwarder or
other person responsible for paying for fuel for the
difference in the price of fuel between the Current Fuel
Price and the Fuel Price Norm determined under paragraph (2).
``(2) Benchmark.--
``(A) In general.--The benchmark referred to in paragraph
(1) is the difference between the Current Fuel Price and the
Fuel Price Norm, when such difference exceeds $0.05.
``(B) Current fuel price.--The Current Fuel Price referred
to in paragraph (1) and subparagraph (A) shall be determined
from the latest weekly Energy Information Administration's
Average Retail On-Highway Diesel Prices, National U.S.
Average, as published by the Department of Energy.
``(C) Fuel price norm.--The Fuel Price Norm referred to in
paragraph (1) and subparagraph (A) shall be determined by
calculating the latest 52-week average of the Average Retail
On-Highway Diesel Prices referred to in subparagraph (B).
``(b) Implementation.--The surcharge referred to in
subsection (a)(1) shall be--
``(1) calculated on the date the shipment is tendered to
the motor carrier, broker, or freight forwarder;
``(2) itemized separately on the motor carrier, broker, or
freight forwarder's invoices; and
``(3) paid by the payor of the related transportation
charges.
``(c) Factors.--For purposes of calculating a surcharge
under this section--
``(1) average fuel economy is 5 miles per gallon for
calendar year 2000 and shall be determined on January 1 of
such year thereafter by the Secretary of Transportation; and
``(2) mileage means the number of paid miles driven as
determined under the Department of Defense, Military Traffic
Management Command's `Defense Table of Official Distances'.
``(d) Limitation on Authority.--Notwithstanding any other
provision of this part, any action to enforce this section
under section 14704 may only be brought by the motor carrier,
broker, or freight forwarder that provided the transportation
services against the payor of the transportation charges or
by the payor of the transportation charges against the motor
carrier, broker, of freight forwarder that provided the
transportation services. In such action, a court shall only
have the authority to determine whether a fuel surcharge
assessed under this section has been assessed or paid. A
court shall not have the authority in such action to review
any other charges imposed by the provider of the
transportation services. Neither the Secretary of
Transportation nor the Surface Transportation Board shall
have regulatory or enforcement authority relating to
provisions of this section.
``(e) Effective Period.--Subsections (a) through (d) and
section 13715 shall be in effect beginning the 60th day
following the date of enactment of this section and ending
September 30, 2003.
``Sec. 13715. Negotiated fuel adjustments
``(a) In General.--Nothing in section 13714 shall be
construed to abrogate provisions relating to fuel cost
adjustments in any transportation contract or agreement in
effect on the date of enactment of the Motor Carrier Fuel
Cost Equity Act of 2000 and any renewal of such a contract or
agreement thereafter. Nothing in this section and sections
13714 and 14102 shall be construed to prohibit any motor
carrier, broker, or freight forwarder from including any
reasonable privately negotiated fuel cost adjustment
provision in any contract or agreement to provide
transportation.
``(b) Continuation of Authority.--Nothing in section 13714
shall impair the ability of any person to enter into any
contract or agreement after the date of enactment of the
Motor Carrier Fuel Cost Equity Act of 2000 that provides for
a fuel adjustment under this section or section 13714 during
any period in which no fuel surcharge is required under
section 13714.''.
(b) Clerical Amendment.--The analysis for chapter 137 of
such title is amended by adding at the end the following:
``13714. Fuel surcharge.
``13715. Negotiated fuel adjustments.''.
SEC. 3. CONFORMING AMENDMENT.
Section 14102 of title 49, United States Code, is amended
by adding at the end the following:
``(c) Mandatory Pass-Through to Cost Bearer.--
``(1) In general.--A motor carrier, broker, or freight
forwarder providing transportation or service using motor
vehicles not owned by it and using fuel not paid for by it--
``(A) shall pass through to the person responsible for
paying for fuel any fuel surcharge required pursuant to
section 13714, or fuel cost adjustment permitted under
section 13715, or provided for in transportation contracts or
agreements;
``(B) shall disclose in writing to the person responsible
for paying for fuel the amount of all freight rates and
charges and fuel surcharges under section 13714 and fuel cost
adjustments permitted under section 13715 applicable to such
transportation or service; and
``(C) is prohibited from--
``(i) intentionally reducing compensatory transportation
costs (other than the fuel surcharge) to the person
responsible for paying for fuel for the purpose of adjusting
for or avoiding the pass through of the fuel surcharge; and
``(ii) intentionally imposing a fuel cost adjustment in
accordance with section 13715 for the purpose of avoiding any
payment under this section or section 13714.
``(2) Limitation on authority.--Notwithstanding any other
provision of this part, the person responsible for paying for
fuel may only bring an action to enforce this section under
section 14704 against the motor carrier, freight forwarder,
or broker providing the transportation services with vehicles
not owned by it. Neither the Secretary of Transportation nor
the Surface Transportation Board shall have regulatory or
enforcement authority relating to provisions of this
subsection.
``(3) Effective period.--Paragraphs (1) and (2) shall be in
effect beginning the 60th day following the date of enactment
of this section and ending September 30, 2003.''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Pennsylvania (Mr. Shuster) and the gentleman from West Virginia (Mr.
Rahall) each will control 20 minutes.
The Chair recognizes the gentleman from Pennsylvania (Mr. Shuster).
Mr. SHUSTER. Mr. Speaker, I yield myself such time as I may consume.
Today, the House is considering H.R. 4441, the Motor Carrier Fuel
Cost Equity Act of 2000. Earlier this year, the Subcommittee on Ground
Transportation held a hearing to examine the price spikes in gasoline
and diesel markets. At this meeting, a number of options were discussed
to bring relief to those hardest hit by those spikes, such as enabling
truckers to negotiate rates that reflect their increased fuel costs.
Three months later, the subcommittee convened a panel of truck drivers,
shippers and representatives from motor carriers and other
transportation intermediaries to hear testimony on the gentleman from
West Virginia's (Mr. Rahall) bill, H.R. 4441, to require a mandatory
fuel surcharge.
The Committee on Transportation and Infrastructure then worked for
several months to address the concerns raised and to craft a bill we
could all support. The bill we are considering today includes numerous
changes to the original bill.
In July, the Subcommittee on Ground Transportation approved a
substitute amendment by voice vote and later that day the full
committee approved the subcommittee's amendment unanimously, which is
generally the way our committee works. H.R. 4441 helps trucking
companies and particularly independent operators weather the diesel
fuel price spikes in the same way that the large trucking companies
have been able to do for years. By including a fuel surcharge as part
of the total transportation bill, these small business truckers, these
independent truckers, will not see their already slim margins disappear
when the price of diesel fuel rises sharply and suddenly.
This bill, as amended in committee, has my support. I urge its
passage here today.
Mr. Speaker, I reserve the balance of my time.
Mr. RAHALL. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would first like to express my deep appreciation to
the gentleman from Pennsylvania (Mr. Shuster) for bringing this piece
of legislation to the floor. I commend the statesmanlike manner in
which he has just conducted himself in the statement he made prior to
consideration of this bill. I have known that to be true through our
many years of work together on the Committee on Transportation and
Infrastructure. We have worked in a very gentlemanly manner and in a
bipartisan manner, I might add, as well. I commend the gentleman from
Minnesota (Mr. Oberstar), the ranking member, for his support of this
legislation and his help as well.
It is supported, as the chairman has said, by a bipartisan group of
Members, including the assistant whip on the majority side the
gentleman from Missouri (Mr. Blunt). This bill seeks to address a real
and pressing crisis facing an important segment of our trucking
industry. That problem is twofold: First, owner-operators are being hit
hard by high diesel fuel prices and simply do not have the market clout
to negotiate the same sort of arrangement
[[Page H9571]]
that the larger companies can to offset those costs. Unable to cope
with high diesel prices, many owner-operators are simply unable to
continue in business. In fact, fuel prices were the primary factor in
the 1,365 trucking company bankruptcies which occurred during the first
6 months of this year. Second, coupled with a national driver shortage,
just-in-time deliveries are being threatened, fewer transportation
alternatives for shippers are available, and consumers could face a
rise in the price of various goods and commodities.
As such, the pending legislation provides owner-operators, shippers
and consumers with a safety net by ensuring that any fuel surcharges
assessed are ultimately passed on to the entity which actually
purchases the fuel. And just what is a fuel surcharge? It is a long
established practice in the industry under which a shipper pays to the
trucking companies the difference between what is deemed to be a
baseline cost of diesel fuel and any sudden and dramatic increases in
the cost of that fuel, such as what we are experiencing today.
Independent owner-operators, however, are not in the position to
negotiate fuel surcharges or, where they exist, be paid the fuel
surcharge. And when you consider that two-thirds of the trucking
operations in the country today operate six or fewer trucks, we are
talking about a sizable segment of the industry.
The pending legislation, as originally introduced, would have imposed
a mandatory fuel surcharge program. It has been modified to fully take
into account privately negotiated fuel surcharge programs. No existing
fuel surcharge arrangement would be abrogated and any future privately
negotiated programs of this nature would not be precluded.
Let me repeat. Any current and future privately negotiated fuel
surcharge agreements are fully respected by the pending legislation.
And I repeat that a third time. Past, current or future privately
negotiated fuel surcharge agreements are fully respected.
The essential feature of this bill is that it provides a private
right of action as a means to ensure that the entity which actually
pays for the fuel receives the surcharge. No Federal Government
enforcement. No cost to the taxpayers. Just simply equity and fairness.
Mr. Speaker, America watched the economies of Britain and France
thrown into chaos on the issue of diesel fuel prices. I have already
noted the large number of industry bankruptcies taking place in this
country.
{time} 1745
Coupled with a shortage of up to 80,000 truck drivers, we have a
formula for disaster in the making.
I might add that high fuel prices have also had a devastating effect
on the Nation's port drivers as well. Their poor working condition has
come to the attention of the Teamsters Union, which is exploring ways
to organize these truck drivers and is working to bring public
attention to their plight.
In conclusion, Mr. Speaker, I say let us strike a blow for the little
guy, the small businessman, and for the integrity of our economy by
passing the pending legislation.
Mr. Speaker, I reserve the balance of my time.
Mr. SHUSTER. Mr. Speaker, I yield 7 minutes to the gentleman from
Wisconsin (Mr. Petri), the distinguished chairman of the Subcommittee
on Ground Transportation.
Mr. PETRI. Mr. Speaker, I thank the gentleman from Pennsylvania (Mr.
Shuster) for yielding me this time.
Mr. Speaker, I rise to speak on H.R. 4441, the bill before us today.
Before I do, I just think I would like to take a minute to point out
that this may be the last piece of legislation that comes out of the
subcommittee that I have had the privilege of chairing for the last 6
years. Under the rules that have been set in the House since 1994, we
have term limits for chairmen and subcommittee chairmen, so I will not
be chairing that subcommittee in the next Congress, should I be
fortunate enough to be reelected.
During those 6 years I have had the opportunity to work with a
remarkable ranking Democrat on that subcommittee, and that is my
colleague from West Virginia (Mr. Rahall). Our committee has been, I
think, the most productive committee, as a whole, in the Congress of
the United States over this period of time, and that is something that
no one person could bring about. Only a group of people working
cooperatively together were able to accomplish that.
That means that that is a bipartisan accomplishment, and I think that
while we clearly do not agree on everything that this committee has to
deal with or this Congress has to deal with, we all agree, regardless
of party on our Committee on Transportation and Infrastructure, on the
importance of transportation infrastructure and transportation
investment and a need to keep up on the public side of the ledger with
investment and needed infrastructure to keep our economy strong and
growing; and we have worked together, industry, labor, the safety
community, the environmental community, in this effort.
The door has always been open of our chairman, of the gentleman from
West Virginia (Mr. Rahall), and I hope I can say that of myself, to
listen to different people with ideas on legislation and to do what we
could to bring them together to a common productive result.
This legislation before us today is just one example of that spirit.
Its prime author is a member of the minority party; but it is before us
today, and I think it is going to receive bipartisan support. It came
out of a hearing that our committee had, or perhaps a series of
hearings on the fuel crisis; meeting with industry groups and the
Teamsters Union and others to explore different ideas about what we
could do as a Congress to react to this crisis to help the little guy,
to help the person who does not have the power in the marketplace to
impose pass-through clauses and provisions as some of the larger
truckers do, so that they are not overwhelmed by swings in energy
prices, but do have an opportunity to adjust and to continue in
business; and that is the basic purpose of the act before us.
This reflects, I think, the sensitivity and the concern that my
colleague, the gentleman from West Virginia (Mr. Rahall), and that we
all have to try to do something constructive in this area. I think that
this crisis continues. I am sure, regardless of what happens in the
upcoming election, our committee will be eager and responsive to deal
with the problems that people in the transportation sector have.
The bill before us, H.R. 4441, as has been mentioned, seeks to ease
the effect of sudden and dramatic increases in the cost of fuel on the
trucking industry by ensuring that these added costs can be recovered.
Under the provisions of the bill, the spike in the price of diesel fuel
will trigger a mandatory surcharge to be assessed to the party paying
for the transportation costs of the motor carrier transporting the
goods. This automatic surcharge is imposed when there is a 5 cent
disparity between the latest week's national average and the previous
year's national average for diesel fuel. In this way, those businesses
hit hardest by surges in the fuel market will be able to recoup
additional costs by passing them along to the shipper as part of the
total bill.
This past July, the Committee on Transportation and Infrastructure
approved a substitute amendment that represents a bipartisan effort to
perfect the original text of the bill. This substitute permits
companies to include privately negotiated fuel adjustments; and,
second, it clarifies the provision and provides the right to sue to
collect the surcharge; and, third, it includes a sunset provision that
terminates the mandatory surcharge at the end of budget year 2003. At
that point, Congress will be able to review the effectiveness of the
bill before us.
Mr. Speaker, our committee is the largest committee in the Congress;
our subcommittee is the largest subcommittee in the Congress. The
potential for chaos, or at least disorder and delay, was perhaps great;
but in fact the cooperation and the achievement instead have been
great. We hear a lot about the decline of civility and an increase of
partisan bickering in this Congress; and I think the fact of the matter
is, those who go about their business quietly achieving results
sometimes are lost among the din but are, in truth, a growing number.
This committee has prospered in this Congress. Members have sought to
be on
[[Page H9572]]
the committee. The fact that people seek to be on this committee shows
that most Members of this House, when given the chance, want to be a
part of a productive team.
So I just want to say that as we conclude the second session of this
Congress with the passage of this important legislation, H.R. 4441, I
appreciate the spirit that has enabled us to reach this point; and I
commend it to some other committees in this Congress.
Mr. RAHALL. Mr. Speaker, I yield myself 30 seconds.
Mr. Speaker, I certainly want to commend the gentleman from Wisconsin
(Mr. Petri) for his excellent statement and say to him as well that it
has been my pleasure to serve with him for the last 6 years under his
chairmanship of the Subcommittee on Ground Transportation. It has truly
been an enjoyable experience, not necessarily the position where my
chair is; but certainly serving next to the gentleman from Wisconsin
(Mr. Petri) has been a delight. He has always held comprehensive and
very timely hearings on not only this issue but other issues. He has
spoken of the bipartisanship of our committee and the camaraderie, and
I certainly salute him and wish him Godspeed.
Mr. SHUSTER. Mr. Speaker, I reserve the balance of my time.
Mr. RAHALL. Mr. Speaker, I yield such time as he may consume to the
gentleman from Minnesota (Mr. Oberstar), the distinguished ranking
member of our committee.
Mr. OBERSTAR. Mr. Speaker, I thank the gentleman from West Virginia
(Mr. Rahall) for yielding me this time.
Mr. Speaker, I, first of all, want to congratulate our full committee
chairman, the gentleman from Pennsylvania (Mr. Shuster), on his superb
leadership over these 6 years. This may not be the last bill we bring
to the floor of the House. We certainly have plenty of time for another
bill on pipeline safety. We could do that yet. But over the years of
his chairmanship, he has done a superb job reconciling differences;
bringing people together; building America; investing in the Nation's
future; strengthening the Nation's infrastructure. It has been an
extraordinary record of achievement, not only in our field of
transportation and related issues but also I think, as the gentleman
from Wisconsin (Mr. Petri) alluded to, in a time when politics is rife
and rancor is rampant both inside and outside this body, the Committee
on Transportation and Infrastructure has proceeded in a cooperative,
bipartisan spirit of understanding and keeping our eye on the objective
and doing something good for America.
In addition, in the last Congress this committee handled more than 24
percent of all the bills enacted into law. So far in this Congress, at
least in this session of the Congress, nearly a third of all the bills
that moved through the House moved through this committee and about 25
percent of all of those were enacted into law. That is an extraordinary
record. One does not get those just by being good scouts. It is done by
working together, resolving differences, coming to the floor with a
unified product that can win the respect and the majority vote in the
House.
This bill before us today, the Motor Carrier Fuel Cost Equity Act of
2000, is an example. I commend the chairman of the subcommittee, the
gentleman from Wisconsin (Mr. Petri), the gentleman from West Virginia
(Mr. Rahall), the ranking member of the subcommittee, who initiated the
legislation and whose sensitivity to the problems of this segment of
the trucking industry has made it possible for us to be here today. He
listened. He understood the problems. He told the small motor carriers
who have less influence in transportation markets than the larger motor
carriers that he would initiate legislation on their behalf; would take
the action; would first get a hearing and then see if we could draft
legislation, which he did. Now we are here on this floor today, and I
hope this bill moves not only through our body but the other body and
on to the President for signature into law.
Fuel costs represent a larger proportion of small carriers' operating
budgets. Assuming that freight rates are based on true costs, it is
obvious small carriers have greater difficulty passing along price
increases that represent a larger portion of their operating costs than
do the large carriers.
Data provided in 1998 by carriers with $3 million or more in annual
revenue show that fuel costs represent only 5 to 6 percent of large
carrier operating budgets. Those percentages may be one or two points
higher today due to recent price increases. Owner-operators typically
do not report cost information to the Department of Transportation. We
understand, however, from our discussions with the industry that fuel
costs really represent about 30 percent of an owner-operator's
operating budget. Obviously, those conditions put the smaller carriers
at a disadvantage in a fuel price inflationary era such as we are now
experiencing. Seventy percent of owner-operators have lease
arrangements with larger carriers, and they ought to be treated fairly
by the carriers they lease to. This bill requires that the fuel
surcharge paid by shippers be passed on through to whoever is paying
for fuel under the lease arrangement. Most often, that is the
independent owner-operator.
So the gentleman from West Virginia deserves high praise for
recognizing the very real and personal hardships faced by independent
truckers and their families, brought on by these higher fuel prices.
The gentleman has been out in the highways and the byways and listened
to those who drive the trucks, listened to those who face the financial
cost price squeeze and recognize that independent truckers should be
treated fairly when the Nation goes through the kind of fuel price
spikes that we have been experiencing these last several months.
{time} 1800
This bill goes a long way toward providing the kind of relief that
those hard-pressed, hard-working men and women need in these difficult
times. I urge the passage of this legislation.
Mr. SHUSTER. Mr. Speaker, I am pleased to yield 5 minutes to the
distinguished gentleman from Missouri (Mr. Blunt).
Mr. BLUNT. Mr. Speaker, I thank the chairman for yielding time to me,
and thank him and the ranking member for their support of this
legislation. I certainly am appreciative that the gentleman from West
Virginia (Mr. Rahall) saw this problem and drafted legislation, and I
was glad to join him as one of the early cosponsors of this bill, H.R.
4441.
This Motor Carrier Fuel Cost Equity Act is a bill that is really
designed to bring temporary emergency relief to an industry that, maybe
more than any other industry in the country, has been caught in a
devastating situation by these rapid increases in fuel prices.
This is an industry where the cost of fuel is everything, and it is
an industry where so many trucks are operated by the people who own
those trucks. Their entire livelihood is dependent on what happens in
that truck that month. Their entire livelihood is dependent on what the
repair costs of the trucks are, what the fuel costs, what the tire
costs are.
Many of these owner-operators, I see them in my district, are
husband-and-wife driving teams, sometimes with a child that is not
ready for school yet riding right along with them and seeing the
country.
But their plans were made, their bids were offered, their
arrangements were entered into anticipating a much lower cost in the
price of fuel, so we have seen this huge increase in fuel in the last
several months. Over 70 percent of motor carriers have six or fewer
trucks. These are men and women who haul almost all of our produce,
livestock, consumer goods, building materials, raw materials. They are
the indispensable engine that drives this economy. They fill in the
gaps where people need a load taken here or taken there, where people
have not really adequately planned to have everything they needed done
done, but there is an independent owner-operator there ready to do that
job.
As they have seen these fuel prices go up 70 percent, reaching record
high prices in just the last month, thousands of truckers have gone out
of business. Fuel prices are only predicted to go even higher in the
next few months, putting in peril the future of thousands of small
businessmen and businesswomen.
Safety is an issue as they are more and more stressed to pay the
bills with
[[Page H9573]]
the bids that they have out there. They have many problems. This bill
helps small businesses at no cost to taxpayers. There is no Federal
enforcement. It helps truckers cope with the high cost of diesel by
ensuring that any fuel charge assessed is paid to the person who
actually purchased the fuel.
We need to end this series of bankruptcies among small truckers. We
need to be sure that we keep competition in this marketplace.
Competition is ultimately what keeps prices down and makes our economy
work. I am wholeheartedly in support of this bill.
Mr. BEREUTER. Mr. Speaker, this Member rises today to express his
opposition to H.R. 4441, the Motor Carrier Fuel Cost Equity Act. This
legislation would require any motor carrier, broker or freight
forwarder regularly providing truckload transportation service, to
assess the payer of transportation a fuel surcharge whenever an
increase in the price of fuel surpasses the benchmark difference
between the current fuel price and the fuel price norm by five cents.
Most assuredly, this Member is very concerned about truckers,
especially small and independent trucking firms, regarding the burden
of high costs of fuel. However, H.R. 4441 is very ill-considered
legislation because it decreases the pressure on the petroleum industry
to keep prices down by placing the burden of higher prices on consumers
across America. This tactic is clearly a mistake. Federal regulations
requiring companies to forward increased prices to consumers will not
decrease fuel prices. This Member is committed to helping the small and
independent truckers who are hurting from higher gasoline prices by
working to decrease the price of fuel.
Mr. RAHALL. Mr. Speaker, I have no further requests for time, and I
yield back the balance of my time.
Mr. SHUSTER. Mr. Speaker, I yield back the balance of my time.
The SPEAKER pro tempore (Mr. Dickey). The question is on the motion
offered by the gentleman from Pennsylvania (Mr. Shuster) that the House
suspend the rules and pass the bill, H.R. 4441, as amended.
The question was taken; and (two-thirds having voted in favor
thereof) the rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
____________________