[Federal Register Volume 69, Number 105 (Tuesday, June 1, 2004)]
[Notices]
[Pages 30989-30990]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-12334]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

[Docket No. NHTSA-2001-10044; Notice 4]


Reliance Trailer Co., LLC.; Grant of Application for Renewal of 
Temporary Exemption From Federal Motor Vehicle Safety Standard No. 224

    This notice grants the application by Reliance Trailer Co., LLC, of 
Spokane, Washington (Reliance), for a renewal of a temporary exemption 
for its dump body trailer from the Federal Motor Vehicle Safety 
Standard No. 224, Rear Impact Protection (FMVSS No. 224). In accordance 
with 49 U.S.C. 30113(b)(3)(B)(i), the basis for the grant is that 
compliance would cause substantial economic hardship to a manufacturer 
that has made a good faith effort to comply with the standard.
    The National Highway Traffic Safety Administration (NHTSA) 
published a notice of receipt of the application on January 16, 2004, 
and afforded an opportunity for comment.\1\
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    \1\ See 69 FR 2644.
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I. Background

    Reliance is a small volume manufacturer of dump body trailers built 
to work specifically with asphalt paving equipment. On October 16, 
2001, Reliance was issued a two-year hardship exemption from the 
requirements of FMVSS No. 224.\2\ Despite their efforts since 2001, 
Reliance had been unable to bring their dump body trailers in 
compliance with FMVSS No. 224. Accordingly, Reliance petitioned for 
renewal on September 24, 2003. We note that because Reliance did not 
apply for a renewal more than 60 days prior to expiration of the 
original exemption, their exemption lapsed on October 1, 2003.\3\ This 
exemption is effective as of the day of this notice, and will remain in 
effect until June 1, 2006.
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    \2\ For additional background information on the company please 
see original petition (66 FR 53471).
    \3\ See 49 CFR 555.8(e).
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II. Why Reliance Needs a Renewal of a Temporary Exemption

    FMVSS No. 224 requires, effective January 26, 1998, that all 
trailers with a GVWR of 4536 kg or more, including Reliance's dump body 
trailers, be fitted with a rear impact guard that conforms to Standard 
No. 223, Rear Impact Guards.
    In the original petition, Reliance argued that a rear impact guard 
would prevent its trailers from properly connecting with, and 
discharging asphalt into paving equipment. According to petitioners, 
compliance with FMVSS No. 224 would render their dump body trailers 
useless for performing their intended function. During the two-year 
temporary exemption period, Reliance anticipated acquiring the revenue 
necessary to design a complex retractable rear impact guard that would 
allow for proper interaction with paving equipment. However, 
petitioners now state that they have not been able to arrive at a 
practical, and economic solution for complying with the requirements of 
FMVSS No. 224. Accordingly, Reliance has asked for an additional two 
year time period in which they can derive financial resources necessary 
for further attempts to bring their dump body trailers into compliance 
with FMVSS No. 224 without negating their intended function.

III. Why Compliance Would Cause Substantial Economic Hardship and How 
Reliance Has Tried in Good Faith To Comply With the Requirements of 
Standard No. 224

    In addition to their inability to design a practicable rear impact 
guard, Reliance experienced a significant economic downturn in the past 
three years. Specifically, petitioner's financial statements show a 
profit of $69,284 for the fiscal year 2000; an operating loss of 
$1,181,900 for the fiscal year 2001; and an operating loss of 
$2,477,700 for the 2002 fiscal year. This represents a cumulative loss 
over a 3 year period of $3,590,316.\4\ These economic losses forced 
Reliance to shut down one of their manufacturing facilities in 
Lynnwood, Washington, and the company is in the midst of further 
restructuring and consolidation. In 2003, Reliance produced only 12 
dump body trailers, which is significantly less than the output in the 
previous two years. In short, Reliance has not been able to generate 
profits necessary to continue their efforts to develop a dump body 
trailer that can effectively interact with paving equipment. According 
to Reliance, denial of this petition would cause further economic harm 
to the company because their product would become useless to their only 
customer--the paving industry.
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    \4\ To see Reliance petition for renewal of their temporary 
exemption, please go to http://dms.dot.gov/search/searchFormSimple.cfm and enter Docket No. NHTSA-2001-10044.
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    With respect to petitioner's efforts to comply with FMVSS No. 224, 
Reliance explored the possibility of implementing moveable, 
retractable, or removable rear impact guards. However, it was decided 
that moveable and retractable guards would interfere with paving 
machines to which a Reliance trailer attaches. This is because the 
hopper for the paving equipment occupies the space directly behind the 
rear axle. Reliance anticipates that removable guards would not be 
reinstalled because they would need to be removed every time the 
trailer was used.

IV. Why a Renewal of an Exemption Would Be in the Public Interest and 
Consistent With the Objectives of Motor Vehicle Safety

    Petitioners contend that the renewal of their exemption would be in 
the

[[Page 30990]]

public interest for the following reasons. First, Reliance argues that 
denial of this petition request would reduce their payroll by 15 to 18 
employees. Second, Reliance argues that an exemption would allow the 
company to continue providing paving equipment needed by road building 
industry.
    According to Reliance, this exemption will facilitate their efforts 
to continue seeking a practicable and financially viable solution that 
would allow dump body trailers with rear impact guards to functionally 
interact with paving equipment.

V. Comments Received on the Reliance Petition

    The agency received no comments on the petition for renewal of the 
exemption.

VI. The Agency's Findings

    The agency is granting the Reliance petition for the following 
reasons:
    1. The Reliance petition clearly demonstrates the financial 
difficulties experienced by the company, with cumulative losses in the 
past three years exceeding $3,500,000.
    2. The application indicates that Reliance has made a good faith 
effort to bring their dump body trailers into compliance with Federal 
safety standards.
    3. Traditionally, the agency has found that the public interest is 
served in affording continued employment to a small volume 
manufacturer's work force. In this instance, denial of the petition 
would likely decrease Reliance payroll by 15 to 18 employees.
    4. Because these trailers will be manufactured in limited 
quantities and because typical hauls are short with a minimal amount of 
time spent traveling on highways, the agency finds that this exemption 
will likely have a negligible impact on the overall safety of U.S. 
highways. At the same time, the public interest is served because these 
special-purpose, road construction trailers perform an important 
function by facilitating road construction and maintenance.
    5. The agency notes that there is no substantial difference between 
Reliance petition and other hardship applications that we have granted 
in the past. For example, we recently granted an exemption to another 
manufacturer of similar dump body trailers. On February 13, 2003, 
Columbia Body Manufacturing Co. received a three-year exemption from 
the requirements of FMVSS No. 224.\5\
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    \5\ For details on that exemption, please see 68 FR 7406.
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    6. The term of this exemption will be limited to two years and the 
agency anticipates that this time period will enable Reliance to derive 
revenues necessary to continue their efforts to bring their dump body 
trailers in compliance with FMVSS No. 224.
    In consideration of the foregoing, it is hereby found that 
compliance with the requirements of Standard No. 224 would cause 
substantial economic hardship to a manufacturer that has tried in good 
faith to comply with the standard. It is further found that the 
granting of an exemption would be in the public interest and consistent 
with the objectives of traffic safety.
    In accordance with 49 U.S.C. 30113(b)(3)(B)(i), Reliance is granted 
NHTSA Temporary Exemption No. EX 04-1, from the requirements of 49 CFR 
571.224; Standard No. 224, Rear Impact Protection. The exemption shall 
remain in effect until June 1, 2006.

FOR FURTHER INFORMATION CONTACT: George Feygin in the Office of Chief 
Counsel, NCC-112, (Phone: (202) 366-2992; Fax (202) 366-3820; e-mail: 
[email protected]). (49 U.S.C. 30113; delegations of 
authority at 49 CFR 1.50. and 501.8)

    Issued on: May 25, 2004.
Jeffrey W. Runge,
Administrator.
[FR Doc. 04-12334 Filed 5-28-04; 8:45 am]
BILLING CODE 4910-59-P