[Federal Register Volume 64, Number 45 (Tuesday, March 9, 1999)]
[Proposed Rules]
[Pages 11414-11431]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-5682]


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DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

49 CFR Part 350

[FHWA Docket No. FHWA-98-4878]
RIN 2125-AE46


Motor Carrier Safety Assistance Program (MCSAP)

AGENCY: Federal Highway Administration (FHWA), DOT.

ACTION: Notice of proposed rulemaking (NPRM); request for comments.

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SUMMARY: The FHWA proposes to amend the regulations governing the Motor 
Carrier Safety Assistance Program (MCSAP) by incorporating provisions 
of the Transportation Equity Act for the 21st Century (TEA-21), Pub. L. 
105-178, 112 Stat. 107 (1998). This action would broaden the scope of 
the MCSAP beyond enforcement activities and programs by requiring 
participating States to assume greater responsibility for improving 
motor carrier safety. Proposed amendments would require States to 
develop performance-based plans reflecting national priorities and 
performance goals, revise the MCSAP funding distribution formula, and 
create a new incentive funding program. The effect of this action would 
be to implement the performance-based program requirements of TEA-21 
and provide States greater flexibility in designing programs to address 
national and State goals for reducing the number and severity of 
commercial motor vehicle (CMV) crashes. Many of these revisions have a 
congressionally mandated deadline of FY 2000 (October 1, 1999).

DATES: Comments to this NPRM should be received no later than May 10, 
1999. Late comments will be considered to the extent practicable.

ADDRESSES: Signed, written comments should refer to the docket number 
appearing at the top of this document and must be submitted to the 
Docket Clerk, U.S. DOT Dockets, Room PL-401, 400 Seventh Street, SW., 
Washington, DC 20590-0001. All comments received will be available for 
examination at the above address between 9 a.m. and 5 p.m., e.t., 
Monday through Friday, except Federal holidays. If you desire 
notification of receipt of comments, include a self-addressed, stamped 
envelope or postcard.

FOR FURTHER INFORMATION CONTACT: Mr. Brian McLaughlin, Office of Motor 
Carrier Safety & Technology, (202) 366-9579, or Mr. Charles Medalen, 
Office of the Chief Counsel (HCC-20), (202) 366-1354, Federal Highway 
Administration, U.S. Department of Transportation, 400 Seventh Street, 
SW., Washington, D.C. 20590.

SUPPLEMENTARY INFORMATION:

Electronic Access

    Internet users may access all comments received by the U.S. DOT 
Dockets, Room PL-401, by using the universal resource locator (URL): 
http://dms.dot.gov. It is available 24 hours each day, 365 days each 
year. Please follow the instructions on-line for more information and 
help.
    You may download an electronic copy of this document using a 
personal computer, modem, and suitable communications software from the 
U.S. Government Printing Office Electronic Bulletin Board Service at 
(202) 512-1661. Internet users may reach the Federal Register home page 
at URL: http://www.nara.gov/fedreg and from the U.S. Government 
Printing Office databases at URL: http://www.access.gpo.gov/nara.

[[Page 11415]]

Background

    The Motor Carrier Safety Assistance Program (MCSAP) is a Federal 
grant-in-aid program. It is an outgrowth of a very successful pilot 
program implemented in a few States in 1980 to reduce truck and bus 
crash involvement by combining uniform safety inspections with size and 
weight enforcement activities. The character of the program has evolved 
from a pilot program to a mature and effective commercial motor vehicle 
(CMV) safety program with participation by all eligible jurisdictions. 
The MCSAP was first authorized in the Surface Transportation Assistance 
Act of 1982 (STAA) (secs. 401-404, Pub L. 97-424, 96 Stat. 2097, 2154) 
and reauthorized in the Commercial Motor Vehicle Safety Act of 1986 
(sec. 12014, Pub. L. 99-570, 100 Stat. 3207, 3207-186) and again in the 
Intermodal Surface Transportation Efficiency Act of 1991 (ISTEA) (secs. 
4001-4004, Pub. L. 102-240, 105 Stat. 1914). The original authorization 
contained certain eligibility requirements for financial assistance, 
including agreement to adopt and enforce safety regulations compatible 
with the Federal Motor Carrier Safety Regulations (FMCSRs) and 
Hazardous Materials Regulations (HMRs). The regulatory compatibility 
requirement remains today and ensures a permanent and consistent 
enforcement and safety presence throughout the nation.
    The Motor Carrier Safety Act of 1984 (Title II of Pub. L. 98-554, 
98 Stat. 2832, 2838) created the Commercial Motor Vehicle Safety 
Regulatory Review Panel (Safety Panel) to analyze State CMV safety 
requirements and develop recommendations on how to achieve 
compatibility with the Federal regulations. The Safety Panel 
recommended, in part, that the FHWA establish procedures for the 
continual review and analysis of the compatibility of State safety laws 
and regulations with Federal requirements through the MCSAP. Consistent 
with these recommendations, the FHWA incorporated an annual review 
process as a MCSAP eligibility criterion. Sec. 208 of the 1984 Act also 
authorized the Secretary to preempt those State laws and regulations 
affecting interstate CMV safety found to be inconsistent with Federal 
laws and regulations. Such a finding would have the effect of rendering 
inconsistent State laws and regulations unenforceable.
    The MCSAP implementing regulations, published in 1984, included two 
types of grants. Small fixed-amount development grants were available 
to assist all States in achieving minimum program conditions. 
Implementation grants, based upon an allocation formula, were available 
to those States meeting the funding conditions for reimbursement of the 
Federal share (80 percent) of the cost of eligible enforcement 
activities. The grant agreement was based on an approved State 
Enforcement Plan (SEP) detailing activities proposed for the succeeding 
fiscal year.
    The ISTEA reauthorized the MCSAP through FY 1997 and expanded the 
scope of the program to include CMV safety initiatives beyond the 
traditional inspection activities (e.g., hazardous materials training, 
adoption and reporting of uniform truck and bus crash data elements, 
commercial driver license (CDL) enforcement, and traffic enforcement 
activities).
    The ISTEA also allowed for in-kind contributions by States to be 
counted toward their matching shares, increased the availability of 
allocated funds for expenditure by the State to the year of allocation 
plus one year, and specifically authorized discretionary reallocation 
of unobligated funds. The regulations implementing ISTEA sought to 
improve program effectiveness and transform the MCSAP into a more 
performance-based program by encouraging innovation and initiative by 
participating States. The regulations established special funding 
categories rewarding those States designing comprehensive programs for 
select activities and using their State CMV safety data in identifying 
critical needs and then developing and implementing specific safety 
performance outcomes, such as reduced crash rates.

New Legislation

    The TEA-21 was signed into law on June 9, 1998. Sec. 4003 of TEA-21 
authorizes the MCSAP at the following funding levels from FY 1998 
through FY 2003: $79 million for FY 1998, $90 million for FY 1999, $95 
million for FY 2000, $100 million for FY 2001, $105 million for FY 
2002, and $110 million for FY 2003.
    Section 4002 of the TEA-21 adds a new section 31100 to title 49 of 
the U.S. Code which describes the purpose of the grant program. The 
goals and directives outlined in that section closely parallel the 
concepts and principles of a performance-based program. These changes 
are intended to foster greater coordination and cooperation between 
State and Federal jurisdictions in improving CMV safety. The changes 
would also give States more flexibility to address their particular 
safety issues through the MCSAP. Section 4002 of the TEA-21 also states 
current program goals of (1) investing in activities achieving maximum 
crash reductions, (2) assessing and improving statewide program 
performance by setting program outcome goals, improving information and 
analysis systems, and monitoring program effectiveness, (3) ensuring 
adequate training of enforcement personnel, and (4) advancing promising 
technologies and safe operating procedures.
    Section 4003 of the TEA-21 expands the definition of ``commercial 
motor vehicle'' to include vehicles with a gross vehicle weight (GVW) 
or gross vehicle weight rating (GVWR) of at least 10,001 pounds. This 
amendment will simplify enforcement in cases where a vehicle with a GVW 
of more than 10,001 pounds does not have a corresponding manufacturer's 
GVWR plate or is being operated in excess of the manufacturer's GVWR. 
It also revises the hazardous materials portion of the definition of 
``commercial motor vehicle'' in 49 U.S.C. 31101 to make it consistent 
with the ``commercial motor vehicle'' definition in 49 U.S.C. 31132.
    A key provision of TEA-21 is the section 4003 requirement that 
MCSAP participating States implement performance-based CMV safety 
programs by FY 2000. This provision shifts the emphasis of State 
programs from measuring activity levels or inputs, (e.g., the number of 
vehicles inspected) to focusing program effort on outcomes (e.g., 
reductions in CMV crashes, fatalities, and injuries). States have 
reacted very positively to this change and all participating MCSAP 
jurisdictions have implemented performance-based programs.
    Section 4003 also revises the grant eligibility criteria and the 
State plan format to require references to ``improving'' CMV safety and 
``hazardous materials'' enforcement. This proposed amendment emphasizes 
that the principal goal of the MCSAP is being expanded beyond simply 
enforcing regulations to that of encouraging States to assume the 
responsibility for finding ways to actively improve CMV safety. It also 
reinforces the concept that it is equally important to adopt and 
enforce both the FMCSRs and the HMRs. Additional proposed revisions 
include (1) establishing programs ensuring proper and timely correction 
of safety violations noted during roadside inspections, and (2) 
ensuring that roadside inspections are conducted at locations that will 
adequately protect the safety of both drivers and enforcement 
personnel. These provisions would codify and reinforce

[[Page 11416]]

longstanding best practices of State CMV safety programs.
    The legislation expands existing requirements that State agencies 
coordinate the Commercial Vehicle Safety Plans (CVSP), originally 
called the State Enforcement Plan, with the State Highway Safety Plans 
under 23 U.S.C. 402. The TEA-21 mandates States participating in MCSAP 
to coordinate the CVSP and data collection and information systems with 
the State agency administering highway safety programs under title 23, 
U.S.C. The January 1, 1994, deadline for SAFETYNET participation would 
be deleted from the regulations since all States have met the 
requirement. Each jurisdiction receiving MCSAP funding is required to 
participate in SAFETYNET and other information systems. There is also a 
new requirement for States to exchange information in a timely manner. 
These revisions would encourage States and agencies within a State to 
share best practices and develop broader-based safety programs.
    Section 4003(f) of TEA-21 removes the current funding set-asides 
for research and development, traffic enforcement, hazardous materials 
training, public awareness, and demonstration of technologies and 
methodologies. These set-asides were created to encourage uniform State 
implementation of significant national programs but limited States' 
flexibility in allocating their MCSAP resources. They are being 
replaced by new allocation criteria allowing the administrative 
flexibility needed for States to design programs targeting their unique 
safety problems as well as meeting national priorities. The new funding 
allocation allows up to 5 percent of MCSAP funds to be designated for 
States, local governments and other persons using and training 
qualified personnel for high priority activities and programs that 
improve CMV safety and compliance with safety regulations. Up to 5 
percent of MCSAP funds will also be available to States, local 
governments, and other persons using and training qualified personnel 
to carry out border CMV safety programs, enforcement activities, and 
projects. The Secretary may also reimburse State agencies, local 
governments, or other persons up to 100 percent for public education 
activities relating to border or high priority activities, programs, 
and projects.
    The overall MCSAP would consist of four parts:
    1. Basic Program Funds emphasizing uniform roadside driver and CMV 
safety inspections, data collection and reporting, traffic enforcement, 
drug and alcohol enforcement, educational activities, compliance 
reviews, and current complementary activities. These funds would 
include a performance factor that redistributes some Basic Program 
Funds to States that achieve improved CMV crash performance.
    2. Incentive Funds that encourage States to improve CMV crash 
performance and to meet other safety performance criteria.
    3. High Priority and Border Activity Funds.
    4. Administrative set-aside of 1.25 percent to cover program 
administration and State personnel training costs.

The Proposal

    The purpose of this proposal is to (1) improve the effectiveness of 
the MCSAP by implementing performance-based, results-oriented programs, 
(2) implement TEA-21 revisions to the MCSAP, (3) provide an improved 
grant distribution scheme which supports and enhances the performance-
based concept and rewards States for their safety program improvements, 
(4) rewrite the MCSAP regulations to be consistent with our zero-base 
efforts to eliminate redundancy and clarify requirements, (5) define 
key terms such as ``performance-based program,'' ``Basic Program 
Funds,'' ``Incentive Funds,'' ``national program elements,'' ``traffic 
enforcement'' as it pertains to the MCSAP, and (6) make other 
conforming amendments reflecting changes in the law and new program 
direction.

Format Changes to the MCSAP Regulations

    In 1992, the FHWA initiated a complete review of the FMCSRs, a 
process known as a zero-base initiative, to revise and reformat the 
regulations. The majority of these revised regulations will be 
published as a separate NPRM in the near future. Because of the 
importance of the MCSAP grant program to State CMV safety enforcement 
efforts, these revised regulations are being separately proposed at 
this time. Consistent with this effort, the existing Appendix A--
Guidelines To Be Used in Preparing State Enforcement Plan, Appendix B--
Form of State Certification, and Appendix C--Tolerance Guidelines for 
Adopting Compatible State Rules and Regulations, would be eliminated 
and the pertinent information would be incorporated into the 
corresponding sections of the new, proposed regulatory text.
    The FHWA has made a special effort to ensure that the language used 
in this proposal is logically presented, clearly formatted, and easily 
understood. The following three techniques have been used:
    1. Question and Answer Format: The FHWA constructed the proposed 
rules so that each section heading asks a question, and the answer to 
the question becomes the regulatory requirement.
    2. The Active Voice: A sentence constructed using the active voice 
is usually easier to understand than one using the passive voice.
    3. ``Plain English'': On October 4, 1993, the President issued 
Executive Order 12866, stating ``all information provided to the public 
by the agency shall be in plain, understandable language.'' (Section 
6(a)(3)(f)). This proposal uses basic English and simple sentence 
structure. We have minimized the use of complex, technical, and legal 
terms as much as possible and adopted a more conversational writing 
style.

Consolidation of Appendices

    The proposal incorporates into the rule text what is currently set 
apart in Appendices A, B, and C.
    The following table shows where each section of the current 
regulations would appear in the new format:

                          Part 350.--Commercial Motor Carrier Safety Assistance Program
----------------------------------------------------------------------------------------------------------------
                   Current regulation                                      Proposed regulation
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350.1--Purpose.........................................  350.103
350.3--Definitions.....................................  350.105
350.5--Policy..........................................  350.101
350.7--Objective.......................................  350.101
350.9--Conditions for basic grant approval.............  350.107, 350.201
350.11--Adopting and enforcing compatible laws and
 regulations (generally):
    350.11(a)..........................................  350.201(a)

[[Page 11417]]

 
    350.11(b)..........................................  350.331(c)
    350.11(c)..........................................  Removed.
    350.11(d)..........................................  350.105 (compatible/compatibility)
    350.11(e)..........................................  350.203
    350.11(f)..........................................  350.331(d)
    350.11(g)..........................................  350.173
    350.11(h)..........................................  350.335(a)
    350.11(i)..........................................  350.335(b)
350.13--State Enforcement Plan (SEP) for a basic grant.  350.213
350.15--Certification of compliance by State...........  350.209
350.17--Maintenance of effort..........................  350.301
350.19--Grant application submission...................  350.205
350.21--Distribution of funds:
    350.21(a)..........................................  350.303
    350.21(b)..........................................  350.305
    350.21(c)..........................................  350.323(a)
    350.21(d)..........................................  350.323(b)
    350.21(e)-(f)......................................  350.313, 350.315, 350.317, 350.319, 350.321, 350.323,
                                                          350.325, 350.327, 350.329
    350.21(g)..........................................  350.307
350.23--Acceptance of State plan.......................  350.205, 350.207
350.25--Effect of failure to submit a satisfactory       350.205, 350.207
 State plan.
350.27--Procedure for withdrawal of approval...........  350.215
350.29--Eligible costs.................................  350.311, 350.315
350 App A--Guidelines To Be Used in Preparing State      350.213 The SEP has been renamed the Commercial Vehicle
 Enforcement Plan.                                        Safety Plan (CVSP).
350 App B--Form of State Certification.................  350.211
350 App C--Tolerance Guidelines for Adopting Compatible
 State Rules and Regulations:
    paragraph 1........................................  Removed.
    paragraph (2)(a)...................................  350.337
    paragraph (2)(b)...................................  350.337
    paragraph (3)(a)...................................  Removed.
    paragraph (3)(b)...................................  350.341(a)
    paragraph (3)(c)...................................  350.341(b)
    paragraph (3)(d)...................................  350.341(c)
    paragraphs (3)(d)(1)-(d)(11).......................  350.343
    paragraph (3)(e)...................................  350.341(d)
    paragraph (3)(f)...................................  350.341(e)
    paragraph (3)(g)...................................  350.341(f)
    paragraph (3)(h)...................................  350.341(g)
    paragraph (3)(i)...................................  350.341(h)
    paragraph (3)(j)...................................  350.203
----------------------------------------------------------------------------------------------------------------

Substantive Program Changes to the MCSAP Regulations

    This section introduces new and revised terms for the MCSAP program 
and discusses proposed changes affecting the character of the MCSAP 
program.

Definitions

    Removals: The term ``basic allocation'' would be removed and 
replaced by either the term ``Basic Program Funds'' or ``Incentive 
Funds.'' The term ``basic grant'' would be removed and replaced by the 
term ``Basic Program Funds.''
    Additions: Five new terms are proposed and would be defined under 
Sec. 350.105: ``Basic Program Funds,'' ``Border Activity Funds,'' 
``High Priority Activity Funds,'' ``Incentive Funds,'' ``North American 
Standard Inspection,'' and ``Performance Factor.''
    Revisions: Three terms would be revised. The term ``commercial 
motor vehicle'' (CMV) would be broadened to include vehicles with a 
gross vehicle weight (GVW), gross vehicle weight rating (GVWR), gross 
combination weight (GCW), or gross combination weight rating (GCWR) of 
at least 10,001 pounds. The definition would also include CMVs hauling 
placardable amounts of hazardous materials as described in the HMRs (49 
CFR part 172, subpart F). This proposal would match the hazardous 
materials portion of the definition of a CMV found in 49 U.S.C. 31132.
    The term ``compatible/compatibility'' would reflect new regulations 
of the Research and Special Programs Administration requiring 
transporters of hazardous materials to comply with the HMRs for both 
interstate and intrastate operation.

MCSAP Changes

    With the enactment of TEA-21, the Congress has endorsed and 
promoted the performance-based approach to MCSAP by all but eliminating 
activity-specific funding set-asides from previous legislation. The 
TEA-21 creates two new funding categories within the MCSAP:

High Priority Activities and Projects

    The proposed rule would define this category as national program 
activities designed to improve CMV safety and compliance with CMV 
safety regulations, including public awareness efforts, education, and 
technology demonstration. The Secretary may designate up to 5 percent 
of available MCSAP funds each year for this purpose.
    The proposed high priority funding allocation would allow the FHWA 
to continue funding uniform national

[[Page 11418]]

emphasis area programs while allowing States to allocate formula funds 
to address their own most pressing safety problems. The TEA-21 ensures 
that high priority funds can be awarded to States, local governments, 
and other persons that use and train qualified officers and employees 
in coordination with State CMV safety agencies, through grants, 
contracts, and cooperative agreements. Should High Priority Activity 
Funds be available in a given fiscal year, the FHWA will solicit grant 
proposals from the States.

Border Commercial Motor Vehicle Safety and Enforcement Programs

    The new legislation establishes funding for border activities to 
provide national resources to assist States along the nation's borders 
with the added safety responsibilities they face with the full 
implementation of the NAFTA. The Secretary may designate up to 5 
percent of available amounts for the MCSAP allocation in a fiscal year 
for States, local governments, and other persons for carrying out CMV 
safety programs and enforcement activities and projects at the borders 
of the United States. These amounts would be allocated to State 
agencies, local governments, and other persons that use and train 
qualified officers and employees in coordination with State CMV safety 
agencies.

Commercial Vehicle Safety Plan (CVSP)

    The FHWA proposes to change the requirements relating to what a 
State would include in the CVSP in order to reflect a performance-based 
program. The TEA-21 eliminates the current statutory requirement that 
States enact an out-of-service (OOS) verification program. Instead, 
States would be required, as part of the CVSP, to certify that they 
have a process in place for timely and proper correction of all CMV 
safety violations noted during inspections. States would also be 
required to ensure that all inspections are conducted in locations that 
adequately protect the safety of both drivers and enforcement 
personnel. The new CVSP format would incorporate these provisions into 
the CVSP Certification. States would be required to expand their 
current practice of coordinating the State CVSP with the Highway Safety 
Plan developed under 23 U.S.C. 402. The TEA-21 requires that States 
coordinate their plan, data collection, and information systems with 
State highway safety programs under title 23, U.S.C. The FHWA strongly 
encourages State MCSAP agencies to take a leadership role in 
coordinating planning, data collection, and information systems with 
State highway safety programs under title 23. The guidelines for 
preparing the CVSP would be removed from appendix A to Part 350 and 
incorporated into the regulatory text of Sec. 350.213.

Adoption and Implementation of Performance-Based Programs

    The TEA-21 also requires that all States adopt and implement a 
performance-based MCSAP by the year 2000. This mandate has already been 
achieved because participating States began developing performance-
based, results-oriented programs and CVSPs in FY 1998. The FHWA 
recognizes and emphasizes that adopting a performance-based grant 
program is an evolutionary process requiring continual improvement and 
enhancement.
    States have always been required to include an evaluation of their 
program in the annual safety plan. For the most part, success was 
measured by the number of activities conducted rather than outcomes 
achieved. Even though these evaluations helped States identify program 
improvements, a results-oriented program would better enable States to 
identify problems and develop effective solutions. Adopting a 
performance-based program gives the added benefit of allowing a State 
to better support program decisions and more accurately measure the 
effectiveness of individual activities and the overall program.
    The following is a discussion of key sections proposed for the 
CVSP:
    State Agency Goal or Mission--This section would contain a brief 
statement describing the mission of the MCSAP lead agency.
    Program Evaluation--This section would contain a comprehensive 
evaluation of the effectiveness of prior years' program activities as 
defined by the State. The evaluation period should be at least 2 years 
and could be up to 5-10 years. States would describe the methodology 
and results of the evaluation. States would comprehensively discuss 
progress toward individual performance objectives listed under the 
``Objectives'' section of the previous years' CVSP and identify any 
safety or performance problems discovered. States would identify those 
problems in the new or modified CVSP. The discussion would set forth 
the original problem, the intended objectives (activities and 
strategies), performance measures achieved, recommended modifications 
to the CVSP, if any, and the actual final outcome. States may carry 
over objectives from one year to the next. However, modified or new 
objectives would have to be discussed in the new or modified CVSP and 
approved before implementation. The State would need to identify the 
specific period defined in its evaluation discussion (e.g., 2 years, 5 
years, etc.).
    The issue of what period of time must or should be covered by 
States in a program evaluation has created confusion for many years. In 
order to assess progress in achieving safety goals, States must have a 
process to measure the impact of their program efforts. In past years, 
many States have indicated that they could not provide evaluation data 
for the previous fiscal year's program activities in the current year 
CVSP. States indicated this could not be done either because program 
activities were still underway or that program data had not yet been 
fully collected, processed, or evaluated. This led to CVSPs containing 
limited evaluation data.
    What the agency proposes with this rule is for States to provide 
trend data in their CVSP as a means of evaluating program progress made 
to date. Ideally, these evaluations would include a breakdown of impact 
by fiscal or calendar year. In the absence of available data for the 
year immediately preceding the current CVSP, the agency requests that 
the States include trend analysis for the program area in question 
using the most current data available.
    National Program Elements--Each CVSP would address, in a 
performance-based manner, the national elements described in 
Sec. 350.109: (a) driver/vehicle inspections, (b) traffic enforcement, 
(c) compliance reviews, (d) public education and awareness, and (e) 
data collection and upload. Even if a State plans no activities for a 
given element, it would be required to explain the basis for that 
resource allocation.
    Problem Statement--This would be a brief, yet definitive, statement 
for each identified safety or performance problem to be addressed in 
the plan. The statement would be supported by data or other 
information. States would provide specific detail about what is 
contributing to or causing the problem (if known), or whether further 
research is needed to identify these factors. A hypothetical problem 
statement follows: ``The 1997 Inspection System Report indicates that 
30 percent of inspection reports for the State were rejected. We have 
determined that the error rate was caused because inspectors improperly 
recorded U.S. DOT identification numbers, resulting in an inability to 
match the inspection with a known carrier (non-match).''

[[Page 11419]]

    Performance Objectives--This section would clearly tie the 
objectives of the plan to the problems identified. Each objective would 
clearly state, in measurable terms, what the plan intends to 
accomplish. Objectives would be realistic and have an adequate time 
frame for achievement. Here is an example of a performance objective 
for the hypothetical problem statement above: ``Decrease the non-match 
rate for the State inspection reports to 20 percent or less in FY 99.''
    Strategy--This section would describe the general, measurable 
method(s) to be used to accomplish each objective. Here is an example 
of a strategy for the hypothetical performance objective above: 
``Improve inspectors'' knowledge of proper carrier identification and 
recording procedures.''
    Activity--States would specify how they intend to use resources to 
implement the strategy identified above. Here are three sample 
activities for the hypothetical strategy above: (1) Send 30 inspectors 
to the ``Inspection Recording Techniques'' training class conducted by 
the National Training Center by 9/30/99, (2) Use laptop and OMC 
inspection software, (3) Provide ``supervised'' inspection activities 
(on-the-job training), and (4) Provide all inspectors with training in 
carrier identification techniques.
    Performance Measures--This section would list quantitative guides 
used to rate the progress and effectiveness of the program. These 
guides would be listed for individual elements of the CVSP or the 
overall plan. This information would be used for on-going program 
monitoring and the annual evaluation. An example of a performance 
measure is ``Thirty inspectors complete Inspection Recording Techniques 
training by 9/30/99.''
    Performance Monitoring--This section would discuss the method the 
State would use to monitor how effectively the CVSP is being 
implemented. The State would clearly designate (1) who will monitor the 
CVSP, (2) how frequently the plan will be monitored, (3) to whom 
reports would be submitted, and (4) how reports will be submitted. The 
information derived from this process would demonstrate the State's 
progress toward achieving its objectives, provide a tool for improving 
the plan, and provide interim data for evaluation.
    Resources--States would provide a comprehensive description of all 
resources required to accomplish proposed objectives. Resources would 
be consistent with eligible expenses under Sec. 350.311, including 
personnel, equipment, materials and supplies, information systems, and 
contractual services needed to accomplish those objectives. States 
would describe resources and estimate the total dollar expense. States 
are encouraged to be creative and consider joint ventures with other 
States as well as using existing Federal government, university, and 
commercial resources.
    Additional Activities--This section would indicate, in a 
performance-based manner, planned enforcement activities in which the 
State is involved (e.g., vehicle size and weight, alcohol/controlled 
substance checks, drug interdiction).

Local Jurisdictions

    This NPRM provides a process for making High Priority and Border 
Activity Funds available to local jurisdictions as well as lead MCSAP 
State agencies. This provision could enhance MCSAP effectiveness by 
providing additional enforcement and safety resources in every State. 
The FHWA has long considered local agency participation to be critical 
in improving enforcement/compliance activities and building a uniform 
enforcement presence throughout the nation. This proposed provision is 
not intended to enable local agencies to circumvent lead agency 
authority. The FHWA would require local agencies to coordinate 
activities with the lead State MCSAP agency, to the extent practicable, 
in order to ensure national and State program uniformity and sharing of 
best practices. The FHWA would provide grants directly to local 
agencies only in cases where it is not possible to work through the 
lead MCSAP agency. It is critical that inspections and other compliance 
or enforcement activities be conducted uniformly. Therefore, we would 
require local agencies and MCSAP agencies to coordinate development of 
the CVSP and implementation of program activities. The basic conditions 
being proposed for local agencies to qualify for these funds are 
consistent with the conditions established for the State's MCSAP 
agency.

Improved Allocation Formula and Processes

    The same five formula factors, updated yearly, have been used to 
allocate Basic Program Funds since the beginning of the MCSAP in 1984. 
The national motor carrier safety program is being restructured to 
focus on strategic safety investments, increased flexibility for 
grantees, updated information systems and analysis, and improved driver 
programs. The Basic Program Funds allocation formula is used to 
determine the amount of funds the States participating in the MCSAP are 
eligible to receive. While the reauthorization of the program was 
pending, the FHWA reexamined the formula to explore possible changes to 
the factors to reflect and support a performance-based approach.
    During the reauthorization process, the Congress supported the use 
of performance as a criterion for allocating MCSAP funds. The FHWA, 
therefore, proposes to link some portion of this formula funding to 
safety performance. To minimize program disruption in the States, the 
FHWA recommends a gradual transition from allocating essentially all 
MCSAP funds based upon formula factors to allocating a portion of MCSAP 
funds to States based upon their CMV safety performance. For example, 
after deducting the high priority, border, and administrative takedown 
funds, in the year 2000, 90 percent of the remaining appropriated funds 
will be allocated as Basic Program Funds according to the formula. The 
remaining 10 percent of the funds available for allocation will be 
placed in an incentive account from which States will receive 
additional funds based on safety improvements. In the year 2001, to 
encourage continued improved safety performance, the split is proposed 
at 85 percent for the Basic Program Funds and 15 percent for the 
Incentive Funds. In the year 2002, the split is proposed at 80 percent 
and 20 percent. In 2003, the split is proposed at 75 percent and 25 
percent. The following chart sets forth the proposed allocation of 
MCSAP funds for a 4-year period.

                                                            Proposed MCSAP Funds Distribution
--------------------------------------------------------------------------------------------------------------------------------------------------------
                      Fiscal year                           2000       Percent      2001        Percent       2002       Percent      2003       Percent
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total MCSAP Funds.....................................   $95,000,000  ........  $100,000,000  ..........  $105,000,000  ........  $110,000,000  ........
Administrative Takedown...............................     1,187,500  ........     1,250,000  ..........     1,312,500  ........     1,375,000  ........
High Priority Activities..............................     4,750,000  ........     5,000,000  ..........     5,250,000  ........     5,500,000  ........
Border Activities.....................................     4,750,000  ........     5,000,000  ..........     5,250,000  ........     5,500,000  ........

[[Page 11420]]

 
Basic Program Funds...................................    75,881,250        90    75,437,500          85    74,550,000        80    73,218,750        75
Incentive Funds.......................................     8,431,250        10    13,312,500          15    18,637,500        20    24,406,250        25
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Incentive Funds would be used to reward those States achieving 
improved safety performance or that meet specified safety performance 
criteria.

The MCSAP Formula Workgroup

    In 1997, the FHWA convened a MCSAP Formula Workgroup. The Workgroup 
was comprised of OMC representatives from each of the nine FHWA 
Regions, FHWA Headquarters, and a team from Oak Ridge National 
Laboratory. This Workgroup had the following five objectives:
    1. Review the current Basic Program Funds formula and its factors 
in a historical context of fairness, equity, and safety impact.
    2. Understand the needs of each of the States and Territories and 
provide an analytical approach to the reexamination of the formula.
    3. Consider potential new factors and evaluate their impact upon 
recipients of MCSAP funds.
    4. Discuss options for building safety performance measurements 
into the process of apportioning funds to the States.
    5. Produce a Basic Program Funds formula which more effectively 
apportions the available funds as fairly as possible as an incentive 
for improved CMV safety performance.
    During the most recent Basic Program Funds formula review, the 
Workgroup re-examined the five current formula factors (road mileage, 
vehicle miles traveled, registrations, population, and fuel 
consumption). Each factor was examined for reliability, stability over 
time, and for correlation with other factors to ensure that they were 
not redundant. The Workgroup found that truck registration data do not 
measure CMV activity, because vehicles may be registered in one State 
but operate primarily in another State. The Workgroup also recognized 
that CMV registration often reflects where registration costs are the 
lowest, rather than where the vehicle is operated. Furthermore, the 
quality of registration data is suspect since vehicle registration 
numbers can fluctuate greatly year by year. The four remaining factors 
were considered valid because they continue to provide a measure of 
overall traffic volume, indicate the potential for crashes, relate to 
motor carrier activity levels, are easy to understand, and are derived 
from reliable sources. The Workgroup also decided that annual 
population estimates issued by the U.S. Bureau of the Census are 
preferred to the decennial census because the annual figures more 
accurately represent the current population and its gradual change over 
the years does not cause extreme fluctuation of the funding allocation.

Potential New Factors

    The Workgroup discussed a large number of potential Basic Program 
Funds formula factors. These factors were identified in an attempt to 
better and more fairly quantify the level of CMV activity within any 
given State or Territory. The following sixteen potential formula 
factors were considered and ultimately rejected for the reasons 
provided.
    1. Cost of Living. Proposed funding increases need to be driven by 
CMV safety program requirements rather than the general condition of 
the U.S. economy.
    2. Intelligent Transportation System (ITS) activities. MCSAP funds 
are safety enforcement-oriented. Other funding sources are available to 
develop new technology.
    3. Intermodal Activities. There are no reliable data sources 
available at the current time.
    4. Number of CMV Crashes. The Motor Carrier Management Information 
System (MCMIS) crash file is not yet sufficiently populated to be 
considered ready for rigorous use as a funding factor.
    5. Number of Commercial Buses. There is no reliable source of data 
at this time.
    6. Number of Commercial Driver's Licenses (CDL). The current system 
does not purge records of inactive drivers, creating difficulty in 
establishing an accurate count of active CMV drivers.
    7. State Contribution/Effort. This factor is a very difficult 
number to quantify and verify.
    8. Land Area. Land area was not considered to be a fair factor 
because larger geographical areas do not necessarily represent more 
motor carrier activity.
    9. Commercial Truck VMT. This factor is not easy to derive from 
``Highway Statistics'' data since that publication reports the total 
VMT of all vehicles. Neither the International Registration Plan (IRP) 
nor the International Fuel Tax Agreement (IFTA) can be used as a source 
of data because they currently lack uniformity and consistency.
    10. Hazardous Materials. It is very difficult to establish a 
reliable, easily verifiable number of motor carriers.
    11. Number of Commercial Motor Carriers. The MCMIS carrier census 
file does not contain information on the number of intrastate motor 
carriers. It is difficult to derive the number of intrastate motor 
carriers within a State using the MCMIS and other data sources (e.g., 
the Truck Inventory and Use Survey [TIUS]).
    12. Lane Miles. Lane miles are highly correlated with road miles 
which is a well-understood current factor.
    13. Miles of Interstate Highways. Interstate miles are also highly 
correlated with road miles.
    14. Miles of National Highway System (NHS). NHS miles are also 
highly correlated with road miles. The category, however, is too 
restrictive by itself to be a factor.
    15. Three-year Moving Average of Population Estimates. The annual 
population estimates are easier to use and more accurate and 
verifiable.
    16. Traffic Density Index. Traffic density was defined by VMT/road 
miles, VMT/lane miles, and commercial VMT/lane miles. All three 
definitions were tested. Analysis suggested that the traffic density 
index at the State level does not accurately reflect the potential for 
crash involvement.

Proposed Allocation Formula

    After extensive analysis, the Workgroup proposed that the following 
four factors be included in the Basic Program Funds formula for 
determining funds allocation to the States:
    1. Road Miles. This factor measures crash exposure, is easily 
understood, applies to all types of vehicles, is very stable over time, 
and is recognized by the States.
    2. Total vehicle miles traveled (VMT). This is acceptable for the 
same reasons listed in number 1.
    3. Annual population estimates. Population is a factor which is 
recognized by the States. The annual estimates are preferred because 
they are highly correlated to the decennial

[[Page 11421]]

census yet most accurately reflect population sizes each year versus 
every 10 years.
    4. Special fuel consumption. This factor reflects the level of 
motor carrier activity within a State, is derived from an audited 
program for all States, and is based on actual fuel usage within a 
State.
    The Workgroup recommends that each factor be equally weighted at 25 
percent. The rationale for this decision is that the resulting MCSAP 
allocations would likely correlate with the crash rates reported by the 
Fatal Analysis Reporting System (FARS). The formula, using four factors 
equally weighted, would allocate the greatest share of formula funds to 
the States with the largest number of crashes, and would provide 
funding levels largely consistent with current formula allocations.
    In order to achieve a balanced program and ensure every State is 
afforded an opportunity to participate in the MCSAP, the apportionment 
formula was adjusted for maximum and minimum allocations. The ceiling 
amount was held at 4.944 percent of the total amount available for 
allocation. The Territories receive a fixed amount of $250,000 (their 
1996 formula funding level without the Traffic Enforcement and 
Hazardous Materials earmarked funds). The minimum allocation for the 
States and Puerto Rico was raised to $350,000 or 0.44 percent of the 
formula funds available for allocation, whichever is greater. The 
rationale for setting higher minimum allocations for the States and 
Puerto Rico than for the Territories is because the Territories have 
low population levels, road miles, and VMT (no statistics are provided 
for special fuel consumption).
    The FHWA proposes a Basic Program Funds allocation formula based 
upon the four equally-weighted factors computed considering maximum and 
minimum limits.

Performance Factor

    After calculating a State's Basic Program Funds using the formula, 
the FHWA proposes to adjust the State's basic program funding level by 
applying a factor based upon a State's performance in reducing its CMV 
crash rate. ``Crash rate'' is defined as the number of fatal crashes 
involving large CMVs, as measured by the FARS, divided by the State's 
annual population estimate. If the crash rate for the most recent 
calendar year for which data are available exceeds the individual 
State's 10-year average crash rate, the State's Basic Program Funds 
allocation would be decreased by the amount that the crash rate 
increased, up to a maximum penalty of 1 percent for each consecutive 
year of increase in the State crash rate.
    The methodology for incorporating the performance factor would be 
as follows:
    1. For the FY 2000 distribution, the FHWA would calculate a State's 
10-year average crash rate period from 1988 through 1997. The 10-year 
average crash rate would be calculated by dividing [the number 
representing the State's aggregate number of large truck involved fatal 
crashes as reported in FARS from 1988 through 1997] by [the number 
representing the State's aggregate annual population estimate as 
reported by the U.S. Census Bureau for the same 10-year period].
[GRAPHIC] [TIFF OMITTED] TP09MR99.051

    2. The FHWA would then calculate the State's 1998 crash rate. The 
formula would be as follows:
[GRAPHIC] [TIFF OMITTED] TP09MR99.052

    3. If a comparison reveals the State's crash rate has increased, 
the State would be penalized by the amount representing the rate of 
increase. For example, if the 10-year average crash rate for the period 
from 1988-1997 is .001865, and the 1998 crash rate is .001878, the 
factor would be calculated as follows: .001878 minus .001865 equals 
.000013 The number .000013 divided by .001865 times 100 equals 0.70 
percent. The State would, therefore, lose 0.70 percent of its FY 2000 
Basic Program Funds. The maximum forfeiture for FY 2000 would be 1 
percent.
    .001878 - .001865 = .000013
    .000013  .001865  x  100 = .70% increase in rate
    4. If a comparison reveals that the crash rate has decreased, the 
State would be eligible for an upward adjustment of its Basic Program 
Funds allocation. The funds forfeited by States under the performance 
adjustment would be redistributed equally among those States where the 
crash rate improves. These adjustments would be made prior to 
distribution of funds.
    5. The performance factor would limit the penalty for a State with 
an increased crash rate to no more than 1 percent for each consecutive 
year the crash rate increased. For example, if a State were to 
experience an increase in crash rate in year 1, the penalty would be a 
maximum of 1 percent. If in year 2, the State crash rate remained level 
with year 1, the State would receive its full Basic Program Funds 
allocation. If in year 2, the State crash rate went down, the State 
would receive the full Basic Program Funds allocation plus an upward 
adjustment to reflect its improved crash rate. If in year 2, the crash 
rate went up, the State would lose a maximum of 2 percent. If the crash 
rate continues to be above the 10-year average rate in consecutive 
years, the maximum forfeiture will increase to 2 percent, 3 percent, 
and 4 percent, in the second, third, and fourth occurrences, 
respectively.
    6. The calculations in steps 1 through 5 would be repeated in FY 
2001 through 2003, adjusting the variables as follows:

[[Page 11422]]



----------------------------------------------------------------------------------------------------------------
                                                                             Most recent data   Maximum penalty
                    Calculation year                     Ten-year variable    year variable      cap (percent)
----------------------------------------------------------------------------------------------------------------
2001...................................................          1989-1998               1999                  2
2002...................................................          1990-1999               2000                  3
2003...................................................          1991-2000               2001                  4
----------------------------------------------------------------------------------------------------------------

Incentive Funding

    The primary objective of the MCSAP is to reduce CMV-involved 
crashes and resultant fatalities, injuries, and property damage. The 
agency is using a performance-based approach to encourage grant 
recipients to improve highway safety performance. To that end, the FHWA 
proposes to reward those States that reduce CMV-involved fatal crashes, 
CMV-involved fatal crash rates, and/or have programs that meet 
specified safety performance criteria. Eligibility for Incentive Funds 
is not conditioned upon the results of the performance factor 
computation. Incentive Funds would be awarded as follows:
    1. Reduction of CMV-involved fatal crashes. States achieving any 
reduction would be awarded five shares.
    2. Reduction of CMV-involved crash rates. States reducing the CMV-
involved crash rate would be awarded four shares.
    3. Timely reporting of CMV crash data within FHWA policy 
guidelines. States uploading CMV crash reports within policy guidelines 
would be awarded three shares.
    4. Status verification of all CDLs through the Commercial Driver's 
License Information System (CDLIS), National Law Enforcement 
Telecommunication System (NLETS), or State licensing authority as part 
of the State inspection process. States certifying that all CDLs are 
verified as part of the vehicle/driver inspection process, through 
CDLIS, NLETS, or the State licensing authority, would be awarded two 
shares.
    5. Reporting of inspection data within FHWA policy guidelines. 
States uploading CMV inspection reports within policy guidelines would 
be awarded one share.
    The total of all States' shares would be divided into the dollar 
amount of Incentive Funds available, thereby establishing the value of 
one share. Each State's incentive allocation would then be determined 
by the number of shares it has received that year.
    The FHWA would assist States in finalizing the MCSAP budget request 
by estimating the potential Incentive Funds available to them for the 
upcoming fiscal year.

Compatibility

    In addition to the annual regulatory review for compatibility of 
State laws and regulations required to be submitted with the CVSP, the 
FHWA is proposing to require a State to submit, within 30 days after 
enactment, to the appropriate FHWA field office for review, a copy of 
any law or regulation affecting CMV safety. The FHWA is also proposing 
to eliminate the current tolerances in Appendix C, Paragraph 2(a) 
related to hazardous materials enforcement. As of October 1, 1998, the 
HMRs are applicable to transportation of hazardous materials by 
highway, and departmental policy is to promote the full involvement of 
State CMV safety enforcement resources in ensuring compliance with 
these regulations. Therefore, all States will be required to achieve 
full compatibility for both interstate and intrastate hazardous 
materials transportation within three years after the effective date of 
October 1, 1998.

Rulemaking Analyses and Notices

    All comments received before the close of business on the comment 
closing date indicated at the beginning of this document will be 
considered and will be available for examination in the docket at U.S. 
DOT Dockets, room PL-401, 400 Seventh Street, SW., Washington, D.C. 
20590-0001 or using the Department of Transportation Docket Management 
System located at the Internet address http://dms.dot.gov. Comments 
received after the comment closing date will be filed in the docket and 
will be considered to the extent practicable. In addition to late 
comments, the FHWA will also continue to file relevant information that 
becomes available after the comment closing date in the docket. 
Interested persons should continue to examine the docket for new 
material. Nevertheless, the FHWA may issue a final rule at any time 
after the close of the comment period.

Executive Order 12866 (Regulatory Planning and Review) and DOT 
Regulatory Policies and Procedures

    The FHWA has determined that this document does not constitute a 
significant regulatory action for the purposes of Executive Order 12866 
or a significant regulation under the regulatory policies and 
procedures of the DOT. These proposed changes to the FMCSRs would not 
cause an annual impact on the economy of over $100 million, and they 
would not adversely affect a sector of the economy in a material way. 
These changes would not create an inconsistency or otherwise interfere 
with another agency's actions, nor do they raise novel legal or policy 
issues. These changes merely implement a recently enacted legislative 
mandate directing the FHWA to amend its regulations pertaining to the 
MCSAP. This NPRM proposes to broaden the scope of the MCSAP beyond 
enforcement activities and programs by requiring participating States 
to assume greater responsibility for improving motor carrier safety. It 
proposes to revise the MCSAP funding distribution formula, create a new 
incentive funding program, and require States to develop performance-
based CMV safety plans. Thus, in light of this analysis, especially the 
finding that the economic impact of this action is likely to be 
minimal, the FHWA has determined that a full regulatory evaluation is 
not required.

Regulatory Flexibility Act

    In compliance with the Regulatory Flexibility Act (5 U.S.C. 601-
612), the FHWA has evaluated the effects of this rule on small 
entities. It is anticipated that this rulemaking will have little or a 
non-significant impact upon small entities. The proposed changes merely 
implement TEA-21 provisions pertaining to the MCSAP affecting only 
States and local jurisdictions. This NPRM provides a process for making 
high priority activity, border activity, and information system funds 
available to local jurisdictions as well as MCSAP agencies. The basic 
conditions being proposed for local agencies to qualify for these funds 
are consistent with the conditions local agencies must follow now to 
receive funds through the MCSAP agency. The number of local agencies 
that would receive direct funding would be minimal since the FHWA would 
provide grants directly to local agencies only where it is not possible 
to work through the lead MCSAP agency. In all circumstances, the local 
agencies would not be required to participate unless they found that it 
was in their best interest. Therefore, the

[[Page 11423]]

FHWA hereby certifies that this proposed action will not have a 
significant economic impact on a substantial number of small entities.

Unfunded Mandates Reform Act

    This proposed rule would not impose a Federal mandate resulting in 
the expenditure by State, local, and tribal governments, in the 
aggregate, or by the private sector, of $100 million or more in any one 
year (2 U.S.C. 1532).

Executive Order 12612 (Federalism Assessment)

    This action has been analyzed using the principles and criteria 
contained in Executive Order 12612. The proposed changes would 
implement TEA-21 provisions. The MCSAP is a grant-in-aid type program 
whereby Federal financial assistance is provided to States. The basic 
nature of the program and the level of total funding for the program 
are not affected by these proposed changes. The proposed changes do not 
limit the policy making discretion of the States. Therefore, this 
rulemaking does not have sufficient Federalism implications to warrant 
the preparation of a Federalism assessment.

Executive Order 12372 (Intergovernmental Review)

    The regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this program. Catalog of Federal Domestic Assistance 
Program Number 20.217, Motor Carrier Safety.

Paperwork Reduction Act

    This rulemaking does not impose new information collection 
requirements. The only potential change to the existing information 
collection requirement would be the number of affected parties. These 
changes will be submitted to the Office of Management and Budget (OMB) 
for approval in accordance with the Paperwork Reduction Act of 1995, 44 
U.S.C. 3501-3520.
    Title: Motor Carrier Safety Assistance Program (MCSAP).
    OMB Number: 2125-0536.
    Affected Public: State MCSAP lead agencies and local jurisdictions 
seeking MCSAP funding.
    Abstract: Sections 401-404 of the Surface Transportation Assistance 
Act of 1982 (STAA) established a program of financial assistance to the 
States' implementation of programs for the enforcement of (a) Federal 
rules, regulations, standards, and orders applicable to commercial 
motor vehicle safety and (b) compatible State rules, regulations, 
standards, and orders. This grant-in-aid program is known as the Motor 
Carrier Safety Assistance Program (MCSAP). The Intermodal Surface 
Transportation Efficiency Act of 1991 (ISTEA) added programs, such as 
drug interdiction, traffic enforcement, and size and weight activities 
conducted in conjunction with CMV inspections to the core program 
established by the STAA. Sections 4002 and 4003 of the Transportation 
Equity Act for the 21st Century (TEA-21) further enhance the MCSAP by 
increasing enforcement activities in key areas where the primary 
responsibility for CMV enforcement falls upon local agencies. This NPRM 
proposes to make special allocation grants for high priority activities 
and projects or border activities available to local agencies in 
addition to MCSAP State lead agencies. State and local jurisdictions 
applying for the MCSAP are required to submit a Commercial Vehicle 
Safety Plan, a certification that their laws and regulations are 
compatible with the FMCSRs and HMRs, and periodic evaluations of their 
program to the FHWA.
    Need: This information is necessary to enable the FHWA to determine 
whether a State or local agency meets the statutory and administrative 
criteria to be eligible for a grant. It is necessary for activities and 
accomplishments to be reported so that FHWA may monitor and evaluate an 
agency's progress under its approved plan and make the determinations 
and decisions required by 49 CFR 350.
    Estimated Total Annual Burden: 14,498 hours.
    Comments: Comments concerning the paperwork burden and burden hour 
estimates in this proceeding may be directed to OMB and the FHWA, 
respectively, by addressing them to: Office of Management and Budget, 
Office of Information and Regulatory Affairs, Washington, DC 20503 and 
Federal Highway Administration, Forms Clearance Officer Earl Coles 
(HMS-12), Office of Information and Management Services, 400 Seventh 
Street, SW., Washington, DC 20590.

National Environmental Policy Act

    The agency has analyzed this action for purposes of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and it has 
determined that this action would not have any effect on the quality of 
the environment.

Regulation Identification Number

    A regulation identification number (RIN) is assigned to each 
regulatory action listed in the Unified Agenda of Federal Regulations. 
The Regulatory Information Service Center publishes the Unified Agenda 
in April and October of each year. The RIN contained in the heading of 
this document can be used to cross reference this action with the 
Unified Agenda.

List of Subjects in 49 CFR Part 350

    Grant programs--transportation, Highway safety, Motor carriers, 
Motor carrier safety.

    Issued: February 24, 1999.
Kenneth R. Wykle,
Administrator, Federal Highway Administration.

    In consideration of the foregoing, the FHWA amends title 49, Code 
of Federal Regulations, chapter III, as follows:
    1. Part 350 of chapter III of title 49, Code of Federal 
Regulations, is revised to read as follows:

PART 350--COMMERCIAL MOTOR CARRIER SAFETY ASSISTANCE PROGRAM

Subpart A--General

Sec.
350.101  What is the Motor Carrier Safety Assistance Program 
(MCSAP)?
350.103  What is the purpose of this part?
350.105  Definitions used in this part.
350.107  What jurisdictions are eligible for MCSAP funding?
350.109  What are the national program elements?
350.111  What constitutes ``traffic enforcement'' for the purpose of 
the MCSAP?

Subpart B--Requirements for Participation

350.201  What conditions must a State meet to qualify for Basic 
Program Funds?
350.203  What happens to a participating State's Basic Program and 
Incentive Funds if it adopts an incompatible law or regulation?
350.205  How and when does a State apply for MCSAP funding?
350.207  What response does a State receive to its CVSP submission?
350.209  How does a State demonstrate that it satisfies the 
conditions for Basic Program funding?
350.211  What is the format of the certification required by 
Sec. 350.209?
350.213  What must a State CVSP include?
350.215  What are the consequences of a State failing to perform 
according to an approved CVSP or otherwise failing to meet the 
conditions of this part?

Subpart C--Funding

350.301  What level of effort must a State maintain to qualify for 
MCSAP funding?
350.303  What are the State and Federal shares of expenses incurred 
under an approved CVSP?

[[Page 11424]]

350.305  Are U.S. Territories subject to the matching funds 
requirement?
350.307  How long are MCSAP funds available to a State?
350.309  What activities are eligible for reimbursement under the 
MCSAP?
350.311  What specific items are eligible for reimbursement under 
the MCSAP?
350.313  How are MCSAP funds allocated?
350.315  How may Basic Program Funds be used?
350.317  What are Incentive Funds and how may they be used?
350.319  What are permissible uses of High Priority Activity Funds?
350.321  What are permissible uses of Border Activity Funds?
350.323  What criteria are used in the Basic Program Funds 
allocation?
350.325  How is the performance factor determined?
350.327  How may States qualify for Incentive Funds?
350.329  How may a State or a local agency qualify for High Priority 
or Border Activity Funds?
350.331  How does a State ensure its laws and regulations are 
compatible with the FMCSRs and HMRs?
350.333  What are the guidelines for the compatibility review?
350.335  What are the consequences if my State has laws or 
regulations incompatible with the Federal regulations?
350.337  How may State laws and regulations governing motor 
carriers, CMV drivers, and CMVs in interstate commerce differ from 
the FMCSRs and still be considered compatible?
350.339  What are tolerance guidelines?
350.341  What specific variances from State laws and regulations 
governing motor carriers, CMV drivers and CMVs engaged exclusively 
in intrastate commerce are allowed?
350.343  How may a State obtain a new exemption for State laws and 
regulations for a specific industry involved exclusively in 
intrastate commerce and not be subject to Federal jurisdiction?
350.345  How does a State apply for additional variances from the 
tolerance guidelines?

    Authority: 49 U.S.C. 31100-31104, 31108, 31136, 31140-31141, 
31161, 31310-31311, 31502; and 49 CFR 1.48.

Subpart A--General


Sec. 350.101  What is the Motor Carrier Safety Assistance Program 
(MCSAP)?

    The MCSAP is a Federal grant program that provides financial 
assistance to States to reduce the number and severity of crashes and 
hazardous materials incidents involving commercial motor vehicles 
(CMV). The goal of the MCSAP is to reduce CMV-involved crashes, 
fatalities, and injuries through consistent, uniform, and effective CMV 
safety programs. Investing grant monies in appropriate safety programs 
will increase the likelihood that safety defects, driver deficiencies, 
and unsafe motor carrier practices will be detected and corrected 
before they become contributing factors to a crash. The MCSAP also sets 
forth the conditions for participation by States and local 
jurisdictions and promotes the adoption and enforcement of safety 
rules, regulations, and standards compatible with the Federal Motor 
Carrier Safety Regulations (FMCSRs) and Federal Hazardous Material 
Regulations (HMRs).


Sec. 350.103  What is the purpose of this part?

    The purpose of this part is to ensure the FHWA, States, and other 
political jurisdictions work in partnership to establish programs to 
improve motor carrier, CMV, and driver safety to support a safe and 
efficient transportation system.


Sec. 350.105  Definitions used in this part.

    Administration--means the Federal Highway Administration (FHWA).
    Administrative Takedown Funds--funds deducted by the FHWA each 
fiscal year from the amount made available for the MCSAP for expenses 
incurred in the administration of the MCSAP, including expenses to 
train State and local government employees and develop related training 
materials.
    Administrator--means the Federal Highway Administrator.
    Basic Program Funds--means the total MCSAP funds less the High 
Priority Activity, Border Activity, Administrative Takedown, and 
Incentive Funds.
    Border Activity Funds--funds provided to States, local governments, 
and other persons carrying out programs, activities, and projects 
relating to CMV vehicle safety and regulatory enforcement supporting 
the North American Free Trade Agreement (NAFTA) at the U.S. border. Up 
to 5 percent of total MCSAP funds are available for these activities.
    Commercial Motor Vehicle (CMV)--means a motor vehicle that has any 
of the following three characteristics:
    (1) A gross vehicle weight (GVW), gross vehicle weight rating 
(GVWR), gross combination weight (GCW), or gross combination weight 
rating (GCWR) of 4,537 kilograms (10,001 pounds) or more.
    (2) Regardless of weight, designed or used to transport 16 or more 
passengers, including driver.
    (3) Regardless of weight, used in the transportation of hazardous 
materials and is required to be placarded under the HMRs (49 CFR Part 
172, Subpart F).
    Commercial Vehicle Safety Plan--The grant application document for 
States seeking to participate in the Motor Carrier Safety Assistance 
Program. The application must be approved by the Office of Motor 
Carriers for States to qualify for MCSAP funds. The plan consists of an 
assessment of the previous year's achievements, the State's projected 
activities for the coming year, based upon identified problems, and 
evaluation measures which allow the State to assess program outcomes. 
It must also contain an itemized budget and a budget summary, and the 
State's projected training plan for the new year. The CVSP must be 
accompanied by a Certification of Compliance, and a copy of any new or 
revised State law that bears on any item listed in the Certificate.
    Compatible or Compatibility--means that State laws and regulations 
applicable to interstate commerce and to intrastate movement of 
hazardous materials are identical to the FMCSRs and HMRs. State laws 
applicable to intrastate commerce are either identical to the FMCSRs or 
fall within the established limited variances under Sec. 350.341 of 
this part.
    High Priority Activity Funds--funds provided to States, local 
governments, and other persons carrying out activities and projects 
that are of high priority and improve CMV safety and CMV safety 
regulation compliance. Up to 5 percent of total MCSAP funds are 
available for these activities.
    Incentive Funds--funds awarded to States achieving reductions in 
CMV involved fatal crashes, CMV crash rate, or meeting specified CMV 
safety program performance criteria.
    Motor Carrier--means a for-hire motor carrier or private motor 
carrier. The term includes a motor carrier's agents, officers, or 
representatives responsible for hiring, supervising, training, 
assigning, or dispatching a driver or concerned with the installation, 
inspection, and maintenance of motor vehicle equipment or accessories 
or both.
    North American Standard Inspection--The methodology used by State 
CMV safety inspectors when they conduct safety inspections of CMVs. 
This consists of various levels of inspection of the vehicle or driver 
or both. The inspection criteria are developed by the Office of Motor 
Carriers with the Commercial Vehicle Safety Alliance, an association of 
States, Canadian Provinces, and Mexico whose members agree to adopt 
these standards for inspecting commercial motor vehicles in their 
jurisdiction.
    Performance Factor--An adjustment to a State's annual Basic Program 
Funds

[[Page 11425]]

based upon its CMV crash rate for the last full year for which data is 
available.


Sec. 350.107  What jurisdictions are eligible for MCSAP funding?

    All of the States, the District of Columbia, the Commonwealth of 
Puerto Rico, the Commonwealth of the Northern Marianas, American Samoa, 
Guam, and the Virgin Islands are eligible to receive MCSAP grants 
directly from the FHWA. For purposes of this subpart, all references to 
``State'' or ``States'' include these jurisdictions.


Sec. 350.109  What are the national program elements?

    The national program elements include the following five 
activities:

    (a) driver/vehicle inspections;
    (b) traffic enforcement;
    (c) compliance reviews;
    (d) public education and awareness; and
    (e) data collection.


Sec. 350.111  What constitutes ``traffic enforcement'' for the purpose 
of the MCSAP?

    Traffic enforcement means those activities carried out by duly 
authorized State or local enforcement officials which include stopping 
CMVs operating on highways, streets, or roads after having been 
detected as being in violation of State or local motor vehicle or 
traffic laws (e.g., speeding, following too closely, reckless driving, 
improper lane change). To be eligible for funding through the grant, 
the enforcement official must conduct an inspection of the CMV or 
driver or both prior to releasing the driver or CMV or both for 
resumption of operations.

Subpart B--Requirements for Participation


Sec. 350.201  What conditions must a State meet to qualify for Basic 
Program Funds?

    Your State must meet the following twenty-two conditions:
    (a) Assume responsibility for improving motor carrier safety and 
adopting and enforcing State safety laws and regulations that are 
compatible with the FMCSRs and HMRs.
    (b) Implement a performance-based program by the beginning of 
Fiscal Year 2000 and submit a CVSP which will serve as the basis for 
monitoring and evaluating your State's performance.
    (c) Designate in its certification the lead State agency 
responsible for implementing the CVSP.
    (d) Ensure that only agencies having the legal authority, 
resources, and qualified personnel necessary to enforce the FMCSRs and 
HMRs or compatible State laws or regulations are assigned to perform 
functions in accordance with the approved CVSP.
    (e) Allocate adequate funds for the administration of the CVSP 
which includes the enforcement of the FMCSRs, HMRs, or compatible State 
laws or regulations.
    (f) Maintain the aggregate expenditure of funds by the State and 
its political subdivisions, exclusive of Federal funds, for CMV safety 
programs and related programs eligible for funding under this part at a 
level at least equal to the average expenditure for its last three full 
Federal or State fiscal years before December 18, 1991.
    (g) Provide legal authority for a right of entry and inspection 
adequate to carry out the CVSP.
    (h) Prepare and submit, upon request, all reports as required in 
connection with the CVSP or other conditions of the grant to the FHWA.
    (i) Adopt uniform reporting requirements and use uniform forms to 
record work activities performed under the CVSP as may be established 
and required by the FHWA.
    (j) Require registrants of CMVs to declare, at the time of 
registration, their knowledge of applicable FMCSRs, HMRs, or compatible 
State laws or regulations.
    (k) Grant maximum reciprocity for inspections conducted under the 
North American Standard Inspection through the use of a nationally 
accepted system that allows ready identification of previously 
inspected CMVs.
    (l) Conduct CMV size and weight enforcement activities funded under 
this program only to the extent those activities do not diminish the 
effectiveness of other CMV safety enforcement programs.
    (m) Coordinate the CVSP, data collection and information systems 
with State highway safety programs under title 23, U.S.C.
    (n) Ensure participation in SAFETYNET and other information systems 
by all appropriate jurisdictions receiving funding under this section.
    (o) Ensure information is exchanged with other States in a timely 
manner.
    (p) Emphasize and improve enforcement of State and local traffic 
laws and regulations related to CMV safety.
    (q) Promote activities in support of national priorities and 
performance goals, including the following three activities:
    (1) Activities aimed at removing impaired CMV drivers from the 
highways through adequate enforcement of restrictions on the use of 
alcohol and controlled substances and by ensuring ready roadside access 
to alcohol detection and measuring equipment.
    (2) Activities aimed at providing an appropriate level of training 
to MCSAP personnel to recognize drivers impaired by alcohol or 
controlled substances.
    (3) Interdiction activities affecting the transportation of 
controlled substances by CMV drivers and training on appropriate 
strategies for carrying out those interdiction activities.
    (r) Enforce requirements relating to the licensing of CMV drivers, 
including checking the status of commercial driver's licenses.
    (s) Require the proper and timely correction of CMV safety 
violations noted during inspections carried out with MCSAP funds.
    (t) Enforce registration and financial responsibility requirements 
of 49 U.S.C. 31138 and 31139.
    (u) Adopt and maintain consistent, effective, and reasonable 
sanctions for violations of CMV, driver, and hazardous materials 
regulations.
    (v) Conduct roadside inspections at locations that are adequate to 
protect the safety of drivers and enforcement personnel.


Sec. 350.203  What happens to a participating State's Basic Program and 
Incentive Funds if it adopts an incompatible law or regulation?

    A State that currently has compatible laws and regulations 
pertaining to interstate and intrastate CMV safety but adopts a law or 
regulation which results in an incompatible rule (i.e., neither 
identical to the FMCSRs or within the tolerance guidelines), would not 
be eligible for Basic Program Funds or Incentive Funds.


Sec. 350.205  How and when does a State apply for MCSAP funding?

    (a) The lead agency, designated by the Governor, must submit your 
State's CVSP to the State Director, Office of Motor Carriers (OMC), 
FHWA, on or before August 1 of each year.
    (b) This deadline may, for good cause, be extended by the OMC State 
Director for a period not to exceed 30 calendar days.
    (c) For a State to receive funding, the CVSP must be complete and 
include all required documents.


Sec. 350.207  What response does a State receive to its CVSP 
submission?

    (a) The FHWA will notify your State, in writing, within 30 days of 
receipt of the CVSP whether:
    (1) The plan is approved.
    (2) Approval of the plan is withheld because the CVSP does not meet 
the requirements of this part, or is not adequate to ensure effective 
enforcement of the FMCSRs and HMRs

[[Page 11426]]

or compatible State laws and regulations.
    (b) If approval is withheld, your State will then have 30 days from 
the date of the notice to modify and resubmit the plan.
    (c) Disapproval of a resubmitted plan is final.


Sec. 350.209  How does a State demonstrate that it satisfies the 
conditions for Basic Program funding?

    (a) The Governor, the State's Attorney General, or other State 
official specifically designated by the Governor, must submit a 
certification that the State is in compliance the requirements of 
Sec. 350.201 of this part.
    (b) Your State must submit the certification along with its CVSP, 
and supplement it with a copy of any State law, regulation, or form 
pertaining to CMV safety adopted since the State's last certification, 
if any, that bears on the items contained in Sec. 350.201 of this part.


Sec. 350.211  What is the format of the certification required by 
Sec. 350.209?

    Your State's certification must be consistent with the following 
content: I (name), (title), on behalf of the State (Commonwealth) of 
(State), as requested by the Federal Highway Administrator as a 
condition of approval of a grant under the authority of 49 U.S.C. 31102 
as amended, do hereby certify as follows:
    1. The State has adopted commercial motor carrier and highway 
hazardous materials safety rules and regulations that are compatible 
with the FMCSRs and the HMRs.
    2. The State has designated (name of State CMV safety agency) as 
the lead agency to administer the CVSP for the grant sought and (names 
of agencies) to perform defined functions under the plan. These 
agencies have the legal authority, resources, and qualified personnel 
necessary to enforce the State's commercial motor carrier, driver, and 
highway hazardous materials safety laws or regulations.
    3. The State will obligate the funds or resources necessary to 
provide a matching share to the Federal assistance provided in the 
grant to administer the plan submitted and to enforce the State's 
commercial motor carrier safety, driver, and hazardous materials laws 
or regulations in a manner consistent with the approved plan.
    4. The laws of the State provide the State's enforcement officials 
right of entry and inspection sufficient to carry out the purposes of 
the CVSP, as approved, and provide that the State will grant maximum 
reciprocity for inspections conducted pursuant to the North American 
Inspection Standard, through the use of a nationally accepted system 
allowing ready identification of previously inspected CMVs.
    5. The State requires that all reports relating to the program be 
submitted to the appropriate State agency or agencies, and the State 
will make these reports available, in a timely manner, to the FHWA on 
request.
    6. The State has uniform reporting requirements and uses FHWA 
designated forms for record keeping, inspection, and other enforcement 
activities.
    7. The State has in effect a requirement that registrants of CMVs 
declare their knowledge of the applicable Federal or State CMV safety 
laws or regulations.
    8. The State will maintain the level of its expenditures, exclusive 
of Federal assistance, at least at the level of the average of the 
aggregate expenditures of the State and its political subdivisions 
during the past three full State or Federal fiscal years immediately 
before December 18, 1991. These expenditures must cover at least the 
following four program areas, if applicable:

    a. Motor carrier safety programs in accordance with Sec. 350.301,
    b. Size and weight enforcement programs,
    c. Traffic safety, and
    d. Drug interdiction enforcement programs

    9. The State will ensure that violation fines imposed and collected 
by the State are consistent, effective, and equitable.
    10. The State will ensure timely and proper correction of 
violations discovered during inspections conducted using MCSAP funds.
    11. The State will ensure that the CVSP is coordinated with the 
State highway safety plan under 23 U.S.C. 402. The name of the 
Governor's highway safety representative (or other authorized State 
official through whom coordination was accomplished) is (Name) .
    12. The State has participated in SAFETYNET since (Date) .
    13. The State has undertaken efforts to emphasize and improve 
enforcement of State and local traffic laws as they pertain to CMV 
safety.
    14. The State will ensure that roadside inspections will be 
conducted at a location that is adequate to protect the safety of 
drivers and enforcement personnel.

Date
 ---------------------------------------------------------------------

Signature
 ---------------------------------------------------------------------


Sec. 350.213  What must a State CVSP include?

    Your State's CVSP must reflect a performance-based program, and 
contain the following thirteen items:
    (a) A statement of the State agency goal or mission.
    (b) A comprehensive evaluation of the effectiveness of the prior 
years' activities in reducing CMV accidents, injuries and fatalities, 
and improving driver and motor carrier safety performance. Evaluation 
data should measure program progress in one-year increments. This may 
be calendar year or fiscal year or any other 12-month period of time 
chosen by the State. The evaluation should show trends supported by 
safety and program performance data collected over several years. It 
should identify safety or performance problems in the State and those 
problems should be addressed in the new or modified CVSP.
    (c) A brief narrative describing how the State program addresses 
the national program elements listed in Sec. 350.109. The plan should 
address these elements even if there are no planned activities in one 
of the program areas. The rationale for the resource allocation 
decision should be explained.
    (d) A definitive problem statement for each objective which is 
supported by data or other information. The CVSP must identify the 
source of the data, and who is responsible for its collection, 
maintenance, and analysis.
    (e) Performance objectives, stated in quantifiable terms, to be 
achieved through the State plan. Objectives should include a measurable 
reduction in highway accidents or hazardous materials incidents 
involving CMVs. The objective may also include documented improvements 
in other program areas (e.g., legislative or regulatory authority, 
enforcement results, or resource allocations).
    (f) Strategies to be employed to achieve performance objectives. 
Strategies may include driver/vehicle roadside inspections, compliance 
reviews, training, public or industry outreach, drug or alcohol 
enforcement, CDL activities, or use of technology used to address 
identified problems and stated objectives to improve CMV safety.
    (g) Specific activities intended to achieve the stated strategies 
and objectives. This item should also describe what resources will be 
used in carrying out each activity and should be related to preparation 
of the CVSP budget for the State. Planned activities must be eligible 
under this program as defined in Sec. 350.309.
    (h) Specify quantifiable performance measures, as appropriate. 
These

[[Page 11427]]

performance measures will be used to assist the State in monitoring the 
progress of its program and preparing an annual evaluation.
    (i) A description of the State's method for ongoing monitoring of 
the progress of its plan. This should include who will conduct the 
monitoring, the frequency with which it will be carried out, and how 
and to whom reports will be made.
    (j) A budget supported by the CVSP describing the expenditures for 
allocable costs such as personnel and related costs, equipment 
purchases, printing, information systems costs, and other eligible 
costs consistent with Sec. 350.311.
    (k) A budget summary including planned expenditures for that fiscal 
year in each national program area.
    (l) The results of the annual review to determine the compatibility 
of State laws and regulations with the FMCSRs and HMRs.
    (m) A copy of any new law or regulation affecting CMV safety 
enforcement that was enacted by the State since the last CVSP was 
submitted.


Sec. 350.215  What are the consequences of a State failing to perform 
according to an approved CVSP or otherwise failing to meet the 
conditions of this part?

    (a) If your State is not performing according to an approved plan 
or not adequately meeting conditions under Sec. 350.201, the 
Administrator may issue a written notice of proposed determination of 
nonconformity to the Governor of the State or the official designated 
in the plan. The notice will set forth the reasons for the proposed 
determination.
    (b) Your State will then have 30 days from the date of the notice 
to reply. Your reply must address the deficiencies or incompatible 
situation cited in the notice and provide documentation as necessary.
    (c) Based upon your State's reply, the Administrator will make a 
final decision.
    (d) In the event your State fails to reply to a notice of proposed 
determination of nonconformity in accordance with the provisions of 
paragraph (b) of this section, the proposed determination becomes the 
Administrator's final decision.
    (e) Any adverse decision will result in immediate cessation of 
Federal funding under this part.
    (f) Any State aggrieved by an adverse decision under this section 
may seek judicial review under 5 U.S.C. chapter 7.

Subpart C--Funding


Sec. 350.301  What level of effort must a State maintain to qualify for 
MCSAP funding?

    (a) Your State must maintain the average aggregate expenditure 
(monies spent during the base period of the three full Federal or State 
fiscal years before December 18, 1991) of State funds for motor carrier 
and highway hazardous materials safety enforcement purposes, in the 
year in which the grant is sought.
    (b) Your State may use either the Federal or State Fiscal years.
    (c) In determining the State's maintenance of effort, you should 
not include:
    (1) Federal funds received for support of motor carrier and 
hazardous materials safety enforcement,
    (2) State matching funds, or
    (3) State funds used for federally sponsored demonstration or pilot 
CMV safety programs.
    (d) You must include costs associated with activities performed 
during the base period by State or local agencies currently receiving 
or projected to receive funds under this Part. You must include only 
those activities which meet the current requirements for funding 
eligibility under the grant program.


Sec. 350.303  What are the State and Federal shares of expenses 
incurred under an approved CVSP?

    (a) The FHWA will reimburse up to 80 percent of the eligible costs 
incurred in the administration of an approved CVSP.
    (b) In-kind contributions are acceptable in meeting your State's 
matching share if they represent eligible costs as established by 49 
CFR Part 18 or agency policy.


Sec. 350.305  Are U.S. Territories subject to the matching funds 
requirement?

    The Administrator waives the requirement for matching funds for the 
Virgin Islands, American Samoa, Guam, and the Commonwealth of the 
Northern Marianas.


Sec. 350.307  How long are MCSAP funds available to a State?

    The funds obligated to a State will remain available for the rest 
of the fiscal year in which they were obligated and the next full 
fiscal year. The State must account for any prior year's unexpended 
funds in the annual CVSP. Funds must be expended in the order in which 
they are obligated.


Sec. 350.309  What activities are eligible for reimbursement under the 
MCSAP?

    The primary activities eligible for reimbursement are:
    (a) The five national program elements contained in Sec. 350.109 of 
this part.
    (b) Sanitary food transportation inspections performed under 49 
U.S.C. 5708.
    (c) The following three activities, when accompanied by an 
appropriate inspection and inspection report:
    (1) Enforcement of size and weight regulations conducted at 
locations other than fixed scales (i.e., specific geographic locations 
where the weight of the vehicle can significantly affect the safe 
operation of the vehicle, or seaports where intermodal shipping 
containers enter and exit the United States).
    (2) Detection of the unlawful presence of controlled substances in 
a CMV or on the driver or any occupant of a CMV.
    (3) Enforcement of State traffic laws and regulations designed to 
promote the safe operation of CMVs.


Sec. 350.311  What specific items are eligible for reimbursement under 
the MCSAP?

    All reimbursable items must be necessary, reasonable, allocable to 
the approved CVSP, and allowable under this part and 49 CFR Part 18, 
Uniform Administrative Requirements for Grants and Cooperative 
Agreements to State and Local Governments. The eligibility of specific 
items is subject to review by the FHWA. The following six types of 
expenses are eligible for reimbursement:
    (a) Personnel expense, including recruitment and screening, 
training, salaries and fringe benefits, and supervision.
    (b) Equipment and travel expenses, including per diem, directly 
related to the enforcement of safety regulations, including vehicles, 
uniforms, communications equipment, special inspection equipment, 
vehicle maintenance, fuel, and oil.
    (c) Indirect expenses for facilities, except fixed scales, used to 
conduct inspections or house enforcement personnel, support staff, and 
equipment to the extent they are measurable and recurring (e.g., rent 
and overhead).
    (d) Expenses related to data acquisition, storage, and analysis 
specifically identifiable as program related to develop a data base to 
coordinate resources and improve efficiency.
    (e) Clerical and administrative expenses, to the extent necessary 
and directly attributable to the MCSAP.
    (f) Expenses related to the improvement of real property (e.g., 
installation of lights for the inspection of vehicles at night, minor 
modifications to existing structures). Acquisition of real property, 
land, or buildings are not eligible costs.

[[Page 11428]]

Sec. 350.313  How are MCSAP funds allocated?

    (a) After deducting administrative expenses authorized in 49 U.S.C. 
31104(e), the MCSAP funds are allocated as follows:
    (1) Up to 5 percent of the MCSAP funds for each Fiscal Year may be 
distributed for High Priority Activities and Projects at the discretion 
of the Administrator.
    (2) Up to 5 percent of the MCSAP funds for each Fiscal Year may be 
distributed for Border CMV Safety and Enforcement Programs at the 
discretion of the Administrator.
    (3) The remaining funds will be allocated among qualifying States 
in two ways:
    (i) As Basic Program Funds in accordance with Sec. 350.313 of this 
part,
    (ii) as Incentive Funds in accordance with Sec. 350.313 of this 
part.
    (4) The Basic Program Funds allocation may be subject to a 
performance factor, as provided in Sec. 350.325 of this part.
    (b) The funding provided in paragraphs (a)(1) and (a)(2) of this 
section may be awarded through contract, cooperative agreement, or 
grant. Local jurisdictions may qualify to participate in these 
programs. The FHWA will annually notify States if it intends to solicit 
State grant proposals for any portion of this funding.
    (c) The funding provided under paragraphs (a)(1) and (a)(2) of this 
section may be made available to State agencies, local governments, and 
other persons that use and train qualified officers and employees in 
coordination with State Motor Vehicle Safety agencies.
    (d) Table 1 of this section describes the distribution of MCSAP 
funds, as follows:

                                                 Table 1 of Sec.  360.313(D).--MCSAP Funds Distribution
--------------------------------------------------------------------------------------------------------------------------------------------------------
                 Fiscal year                      2000       Percent      2001        Percent         2002         Percent         2003         Percent
--------------------------------------------------------------------------------------------------------------------------------------------------------
Total MCSAP funds...........................   $95,000,000  ........  $100,000,000  ..........      $105,000,000  ........       $110,000,000  .........
Administrative takedown.....................     1,187,500  ........     1,250,000  ..........         1,312,500  ........          1,375,000
High priority activities....................     4,750,000  ........     5,000,000  ..........         5,250,000  ........          5,500,000
Border activities...........................     4,750,000  ........     5,000,000  ..........         5,250,000  ........          5,500,000
Basic program funds.........................    75,881,250        90    75,437,500          85        74,550,000        80         73,218,750         75
Incentive funds.............................     8,431,250        10    13,312,500          15        18,637,500        20         24,406,250         25
--------------------------------------------------------------------------------------------------------------------------------------------------------

Sec. 350.315  How may Basic Program Funds be used?

    Basic Program Funds may be used for any eligible activity 
consistent with Sec. 350.309 of this part.


Sec. 350.317  What are Incentive Funds and how may they be used?

    Incentive Funds are monies, in addition to Basic Program Funds, 
provided to the States that achieve reduction in CMV-involved fatal 
crashes, CMV crash rate, or that meet specified CMV safety performance 
criteria. Incentive Funds may be used for any eligible activity 
consistent with Sec. 350.309 of this part.


Sec. 350.319  What are permissible uses of High Priority Activity 
Funds?

    (a) The FHWA may generally use these funds to support, enrich, or 
evaluate State CMV safety programs and to accomplish the five 
objectives listed below:
    (1) Implement, promote, and maintain national programs to improve 
CMV safety.
    (2) Increase compliance with CMV safety regulations.
    (3) Increase public awareness about CMV safety.
    (4) Provide education on CMV safety and related issues.
    (5) Demonstrate new safety related technologies.
    (b) These funds will be allocated, at the discretion of the FHWA, 
to States, local governments, and other organizations that use and 
train qualified officers and employees in coordination with State 
safety agencies.
    (c) The FHWA will notify the States when such funds are available.
    (d) The Administrator may designate up to 5 percent of the annual 
MCSAP funding for these projects and activities.


Sec. 350.321  What are permissible uses of Border Activity Funds?

    The FHWA may generally use such funds to develop and implement a 
national program addressing CMV safety and enforcement activities along 
the United States' borders.
    These funds will be allocated, at the discretion of the FHWA, to 
States, local governments, and other organizations that use and train 
qualified officials and employees in coordination with State safety 
agencies. The FHWA will notify the States when such funds are 
available. The Administrator may designate up to 5 percent of the 
annual MCSAP funding for these projects and activities.


Sec. 350.323  What criteria are used in the Basic Program Funds 
allocation?

    (a) The funds are distributed proportionally to the States using 
the following four, equally weighted (25 percent), factors.
    (1) Road miles (all highways).
    (2) All vehicle miles traveled (AVMT).
    (3) Population--annual census estimates as issued by the U.S. 
Census Bureau.
    (4) Special fuel consumption (net after reciprocity adjustment) as 
collected by the FHWA.
    (b) Distribution of Basic Program Funds is subject to a maximum and 
minimum allocation as illustrated in Table 2 to this section, as 
follows:

 Table 2 of Sec.  350.323(B).--Basic Program Fund Allocation Limitations
------------------------------------------------------------------------
          Recipient            Maximum allocation    Minimum allocation
------------------------------------------------------------------------
States and Puerto Rico......  4.944% of the Basic   $350,000 or 0.44% of
                               Program Funds.        Basic Program
                                                     Funds, whichever is
                                                     greater.
U.S. Territories............            $250,000 (fixed amount)
------------------------------------------------------------------------


[[Page 11429]]

Sec. 350.325  How is the performance factor determined?

    (a) The performance factor is determined by calculating the ratio 
of fatal crashes in your State involving large trucks as compiled by 
the Fatal Analysis Reporting System (FARS) administered by the National 
Highway Traffic Safety Administration (NHTSA), and population estimates 
in your State as reported annually by the U.S. Census Bureau. This 
ratio is known as the ``crash rate.'' The performance factor adjustment 
is calculated using the crash rate as follows:
    (1) For each State, an average crash rate is computed for the 10-
calendar-year period prior to the previous full calendar year or the 
most recent year that data are available.
    (2) If the crash rate for the most recent calendar year for which 
data is available exceeds the 10-year average crash rate, the State's 
allocation will be reduced by the amount the crash rate increased. The 
maximum reduction cannot exceed 1 percent.
    (3) If the crash rate continues to be above the 10-year average 
crash rate, in subsequent consecutive years, the maximum forfeiture 
will increase by up to 1 percent each year.
    (4) If the State's most current crash rate is not above the 10-year 
average crash rate, there will be no reduction.
    (b) The funds withheld from States because of the performance 
adjustment will be redistributed equally among those States showing a 
crash rate improvement.


Sec. 350.327  How may States qualify for Incentive Funds?

    (a) Your State may qualify for Incentive Funds if it can 
demonstrate that its CMV safety program has shown improvement in any or 
all of the following five categories:
    (1) Reduction of CMV-involved fatal crashes.
    (2) Reduction of CMV-involved crash rate.
    (3) Upload CMV crash data within FHWA policy guidelines.
    (4) Verification, during the roadside inspection process, of the 
status and validity of all CDLs through CDLIS, NLETS, or the State 
licensing authority.
    (5) Upload of CMV inspection data within FHWA policy guidelines.
    (b) Incentive Funds will be distributed based upon the following 
five safety and program performance factors:
    (1) The number of CMV-involved fatal crashes for the most recent 
calendar year for which data are available is compared to the 10-year 
average number of CMV fatal crashes ending with the preceding year. The 
number of CMV-involved fatal crashes, as reported to FARS, will be 
computed for the 10-year average. Five shares will be awarded for any 
reduction.
    (2) The crash rate for the most recent calendar year for which data 
are available is compared to the average 10-year crash rate. Four 
shares will be awarded for any reduction.
    (3) Three shares will be awarded States that upload CMV crash 
reports within FHWA policy guidelines.
    (4) Two shares will be awarded States that certify that all CDLs 
are verified, as part of the inspection process, through CDLIS, NLETS, 
or the State licensing authority.
    (5) One share will be awarded States that upload CMV inspection 
reports within FHWA policy guidelines.
    (c) The total of all States' shares will be divided into the dollar 
amount of Incentive Funds available, thereby establishing the value of 
one share. Each State's incentive allocation will then be determined by 
the number of shares it has that year, multiplied by the dollar value 
of one share.
    (d) States may use Incentive Funds for any eligible CMV safety 
purpose.
    (e) Incentive Funds are subject to the same State matching 
requirements as Basic Program Funds.
    (f) A State must annually certify compliance with the applicable 
incentive criteria to receive Incentive Funds.
    (g) A State may submit the required certification as part of its 
CVSP or separately.


Sec. 350.329  How may a State or a local agency qualify for High 
Priority or Border Activity Funds?

    (a) States must meet the requirements of Sec. 350.201 of this part;
    (b) Local agencies must meet the following nine conditions:
    (1) Prepare a proposal in accordance with Sec. 350.201 of this 
part.
    (2) Coordinate the proposal with the State lead MCSAP agency to 
ensure the proposal is consistent with State and national CMV safety 
program priorities.
    (3) Certify your local jurisdiction has the legal authority, 
resources, and trained and qualified personnel necessary to accomplish 
the following three activities:
    (i) Enforce the FMCSR's or HMR's.
    (ii) Enforce compatible State regulations.
    (iii) Implement a special grant activity.
    (4) Designate a person who will be responsible for implementation, 
reporting, and administering the approved proposal and will be the 
primary contact for the project.
    (5) Agree to fund up to 20 percent of the proposed request.
    (6) Agree to prepare and submit all reports required in connection 
with the proposal or other conditions of the grant.
    (7) Agree to use the forms and reporting criteria required by the 
State lead MCSAP agency and/or the FHWA to record work activities to be 
performed under proposal.
    (8) Certify effective and equitable sanctions for violations of CMV 
and driver laws and regulations that are consistent with those of the 
State.
    (9) Certify participation in national data bases appropriate to the 
project.


Sec. 350.331  How does a State ensure its laws and regulations are 
compatible with the FMCSRs and HMRs?

    (a) Your State must review any new law or regulation enacted, or 
any proposed law or regulation affecting CMV safety as soon as 
possible, but in any event immediately after enactment or issuance, for 
compatibility with the FMCSRs and HMRs.
    (b) If your review determines that the new law or regulation is 
incompatible with the FMCSRs and/or HMRs, you must immediately notify 
the OMC State Director.
    (c) Your State must conduct an annual review of its laws and 
regulations for compatibility and report the results of that review as 
a part of the annual CVSP in accordance with Sec. 350.209(b) of this 
part with a certification of compliance, no later than August 1 of each 
year. The report must include the following two items:
    (1) A copy of your State law, regulation, or policy relating to CMV 
safety that was adopted since your State's last report.
    (2) A certification, executed by your State's Governor, Attorney 
General, or other State official specifically designated by the 
Governor, stating that the annual review was performed and that State 
CMV safety laws remain compatible with the FMCSRs and HMRs. If State 
CMV laws are no longer compatible, the certifying official shall 
explain why not.
    (d) As soon as practical after the effective date of any amendment 
to the FMCSRs or HMRs, but no later than three years after that date, 
your State must amend its laws or regulations to make them compatible 
with the FMCSRs and/or HMRs, as amended.


Sec. 350.333  What are the guidelines for the compatibility review?

    (a) The law or regulation must apply to all segments of the motor 
carrier industry (i.e., for-hire and private motor carriers of property 
and passengers).

[[Page 11430]]

    (b) Laws and regulations reviewed for the CDL compliance report are 
excluded from the compatibility review.
    (c) Definitions of words or terms must be consistent with those in 
the FMCSRs and HMRs.
    (d) Your State must identify any law or regulation that is not the 
same as the corresponding Federal regulation and evaluate it in 
accordance with Table 3 to this section, as follows:

           Table 3 to Sec.  350.333.--Guidelines for the State Law and Regulation Compatibility Review
----------------------------------------------------------------------------------------------------------------
Law or regulation has same effect       Applies to
     as corresponding Federal          interstate or      Less stringent or            Action authorized
            regulation              intrastate commerce     more stringent
----------------------------------------------------------------------------------------------------------------
Yes..............................  ....................  ...................  Compatible--Interstate and
                                                                               intrastate commerce enforcement
                                                                               authorized.
No...............................  Intrastate..........  ...................  Refer to Sec.  350.341.
No...............................  Interstate..........  Less stringent.....  Enforcement prohibited.
No...............................  Interstate..........  More stringent.....  Enforcement authorized if the
                                                                               State can demonstrate the law or
                                                                               regulation has a safety benefit
                                                                               or does not create an undue
                                                                               burden upon interstate commerce.
----------------------------------------------------------------------------------------------------------------

Sec. 350.335  What are the consequences if my State has laws or 
regulations incompatible with the Federal regulations?

    (a) Upon a finding by the FHWA, based upon its own initiative or 
upon a petition of any person, including any State, that your State 
law, regulation or enforcement practice pertaining to CMV safety, in 
either interstate or intrastate commerce, is incompatible with the 
FMCSRs or HMRs, the FHWA may initiate a proceeding under Sec. 350.215 
of this part for withdrawal of your State's funding.
    (b) Any decision regarding the compatibility of your State law or 
regulation with the HMRs that requires an interpretation will be 
referred to the Research and Special Programs Administration of the DOT 
for such interpretation before proceeding under Sec. 350.215 of this 
part.


Sec. 350.337  How may State laws and regulations governing motor 
carriers, CMV drivers, and CMVs in interstate commerce differ from the 
FMCSRs and still be considered compatible?

    All State laws and regulations governing motor carriers, CMV 
drivers, and CMVs may only vary from the Federal requirements applying 
to the transportation of migrant workers under Part 398 of this 
subchapter and still be considered compatible for purposes of MCSAP 
funding.


Sec. 350.339  What are tolerance guidelines?

    Tolerance guidelines set forth the limited deviations from the 
FMCSRs allowed in your State's laws and regulations. These variances 
apply only to motor carriers, CMV drivers and CMVs engaged exclusively 
in intrastate commerce and not subject to Federal jurisdiction.


Sec. 350.341  What specific variances from State laws and regulations 
governing motor carriers, CMV drivers, and CMVs engaged exclusively in 
intrastate commerce are allowed?

    (a) A State may exempt from all or part of their regulations CMVs 
with a GVW, GVWR, or GCWR less than 11,801 kg (26,001 lbs.) and engaged 
exclusively in intrastate commerce unless the vehicle meets either of 
the following two conditions:
    (1) Transports hazardous materials requiring a placard.
    (2) Is designed or used to transport 16 or more people including 
the driver.
    (b) State laws and regulations may not grant exceptions or 
exemptions based upon the type of transportation being performed.
    (c) A State may retain those exceptions and exemptions from their 
motor carrier safety laws and regulations that were in effect before 
April 1988, are still in effect, and apply to specific industries 
operating exclusively in intrastate commerce.
    (d) State laws and regulations must not include exemptions based 
upon the distance a motor carrier or driver operates from the work 
reporting location. This prohibition does not apply to those exemptions 
already contained in the FMCSRs nor to the extension of the mileage 
radius exemption, contained in 49 CFR 395.1(e), from 100 to 150 miles.
    (e) Hours of service--State hours-of-service limitations applied to 
intrastate transportation may vary to the following extent:
    (1) A 12-hour driving limit, provided driving a CMV after having 
been on duty more than 16 hours is prohibited.
    (2) Driving prohibitions for drivers who have been on duty 70 hours 
in 7 consecutive days or 80 hours in 8 consecutive days.
    (f) Age of CMV driver--All CMV drivers must be at least 18 years 
old.
    (g) Grandfather clauses--States may provide grandfather clauses in 
their rules and regulations if such exemptions are uniform or in 
substantial harmony with the FMCSRs.
    (h) Driver qualifications:
    (1) Drivers who do not meet the physical qualification standards in 
Sec. 391.41 of this subchapter may continue to be qualified to operate 
a CMV in intrastate commerce if the following three conditions are met:
    (i) The driver was qualified under existing State law or regulation 
at the time the State adopted physical qualification standards 
compatible with the Federal standards in 49 CFR 391.41.
    (ii) The otherwise non-qualifying medical or physical condition has 
not substantially worsened.
    (iii) No other non-qualifying medical or physical condition has 
developed.
    (2) The State may adopt or continue programs granting waivers to 
drivers with medical or physical conditions that would otherwise be 
non-qualifying under the State's equivalent of 49 CFR 391.41 if the 
waivers are based upon sound medical judgment combined with appropriate 
performance standards ensuring no adverse impact on safety.


Sec. 350.343  How may a State obtain a new exemption for State laws and 
regulations for a specific industry involved exclusively in intrastate 
commerce and not be subject to Federal jurisdiction?

    The FHWA strongly discourages exemptions and exceptions for 
specific industries, but will consider such requests if the State 
submits documentation containing information supporting evaluation of 
the following 10 factors:
    (a) Type and scope of the industry exception requested, including 
percentage of industry affected, number

[[Page 11431]]

of vehicles, mileage traveled, number of companies involved.
    (b) Type and scope of the requirement to which the exception or 
exemption would apply.
    (c) Safety performance of that specific industry (e.g., accident 
frequency, rates and comparative figures).
    (d) Inspection information (e.g., number of violations per 
inspection, driver and vehicle out-of-service information).
    (e) Other CMV safety regulations enforced by other State agencies 
not participating in the MCSAP.
    (f) Commodity transported (e.g., livestock, grain).
    (g) Similar variations granted and the circumstances under which 
they were granted.
    (h) Justification for the exception or exemption.
    (i) Identifiable effects on safety.
    (j) State's economic environment and its ability to compete in 
foreign and domestic markets.


Sec. 350.345  How does a State apply for additional variances from the 
tolerance guidelines?

    Any State may apply to the FHWA Administrator for a variance from 
the tolerance guidelines. The variance will be granted only if the 
State satisfactorily demonstrates that the State law, regulation or 
enforcement practice:
    (a) Achieves substantially the same purpose as the similar Federal 
regulation,
    (b) Does not apply to interstate commerce, and
    (c) Is not likely to have an adverse impact on safety.

[FR Doc. 99-5682 Filed 3-8-99; 8:45 am]
BILLING CODE 4910-22-P