[Federal Register Volume 72, Number 102 (Tuesday, May 29, 2007)]
[Proposed Rules]
[Pages 29472-29481]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-2652]
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DEPARTMENT OF TRANSPORTATION
Federal Motor Carrier Safety Administration
49 CFR Part 367
[Docket No. FMCSA-2007-27871]
RIN 2126-AB09
Fees for Unified Carrier Registration Plan and Agreement
AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This proposed rule would establish annual fees and a fee
bracket structure for the Unified Carrier Registration Agreement as
required under the Unified Carrier Registration Act of 2005, enacted as
Subtitle C of the Safe, Accountable, Flexible, Efficient Transportation
Equity Act: A Legacy for Users.
DATES: You must submit comments on or before June 13, 2007.
ADDRESSES: You may submit comments, identified by DOT DMS Docket Number
FMCSA-2007-27871, by any of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
Agency Web Site: http://dms.dot.gov. Follow the
instructions for submitting comments on the DOT electronic docket site.
Fax: 1-202-493-2251.
Mail: Docket Management Facility; U.S. Department of
Transportation, 400 Seventh Street, SW., Nassif Building, Room PL-401,
Washington, DC 20590-0001.
Hand Delivery: Room PL-401 on the plaza level of the
Nassif Building, 400 Seventh Street, SW., Washington, DC, between 9
a.m. and 5 p.m., Monday through Friday, except Federal Holidays.
Instructions: All submissions must include the agency name and
docket number (FMCSA-2004-27871) or Regulatory Identification Number
(RIN) for this rulemaking (RIN 2126-AB09). Note that all comments
received will be posted without change to http://dms.dot.gov, including
any personal information provided. Please see the Privacy Act heading
for further information.
Docket: For access to the docket to read background documents or
comments received, go to http://dms.dot.gov at any time or to Room PL-
401 on the plaza level of the Nassif Building, 400 Seventh Street, SW.,
Washington, DC, between 9 a.m. and 5 p.m., Monday through Friday,
except Federal Holidays.
Privacy Act: Anyone is able to search the electronic form for all
comments received into any of our dockets by the name of the individual
submitting the comment (or signing the comment, if submitted on behalf
of an association, business, labor union, etc.). You may review DOT's
complete Privacy Act Statement in the Federal Register published on
April 11, 2000 (65 FR 19477) or you may visit http://dms.dot.gov.
Comments received after the comment closing date will be included in
the docket and we will consider late comments to the extent
practicable. FMCSA may, however, issue a final rule at any time after
the close of the comment period.
FOR FURTHER INFORMATION CONTACT: Mr. Greg Parks, Regulatory Development
Division, (202) 366-5370, FMCSA, Department of Transportation, 400
Seventh Street, SW., Washington, DC 20590 or by e-mail at:
[email protected].
SUPPLEMENTARY INFORMATION
I. Legal Basis for the Rulemaking
This proposed rule involves the fees to be set for the Unified
Carrier Registration Agreement established by 49 U.S.C. 14504a, enacted
by section 4305(b) of the Safe, Accountable, Flexible, Efficient
Transportation Equity Act: A Legacy for Users (SAFETEA-LU) (119 Stat.
1144, 1764 (2005)). New section 14504a establishes the Unified Carrier
Registration Plan, ``an organization * * * responsible for developing,
implementing, and administering the unified carrier registration
agreement'' (49 U.S.C. 14504a(a)(9)). The Unified Carrier Registration
Agreement is ``an interstate agreement governing the collection and
distribution of registration and financial responsibility information
provided and fees paid by motor carriers, motor private carriers,
brokers, freight forwarders and leasing companies * * * '' (49 U.S.C.
14504a(a)(8)).
Congress also repealed the statutory provisions of 49 U.S.C. 14504
governing the Single State Registration System (SSRS) (SAFETEA-LU
section 4305(a)).\1\ The legislative history indicates that the purpose
of the UCR Plan and Agreement is both to ``replace the existing
outdated system [SSRS]'' for registration of interstate motor carrier
entities with the States and to ``ensure that States don't lose current
revenues derived from SSRS'' (S. Rep. 109-120, at 2 (2005)).\2\
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\1\ This repeal became effective on January 1, 2007, in
accordance with section 4305(a).
\2\ The Senate bill's provisions were enacted ``with
modifications.'' H. Conf. Rep. No. 109-203, at 1020 (2005).
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The statute provides for a 15-member Board of Directors for the UCR
Plan and Agreement to be appointed by the Secretary of Transportation.
The establishment of the UCR Board (``Board'') was announced in the
Federal Register on May 12, 2006 (71 FR 27777). Among its
responsibilities, the Board must submit to the Secretary of
Transportation \3\ a recommendation for the initial annual fees to be
assessed motor carriers, motor private carriers, freight forwarders,
brokers and leasing companies under the UCR Agreement (49 U.S.C.
14504a(d)(7)(A)). FMCSA then is directed to set the fees within 90 days
after receiving the Board's recommendation and after notice and
opportunity for public comment (49 U.S.C. 14504a(d)(7)(B)).
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\3\ The Secretary's functions under section 14504a have been
delegated to the Administrator of the Federal Motor Carrier Safety
Administration. 49 CFR 1.73(a)(7), as amended, 71 FR 30833 (May 31,
2006).
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II. Statutory Requirements for UCR Fees
The statute specifies several relevant factors that must be
considered by the Board and FMCSA in setting the fees (see 49 US.C.
14504a(d)(7)(A), (f)(I) and (g)). It specifies that fees are to be
determined by FMCSA based upon the recommendation of the Board. In
[[Page 29473]]
recommending the level of fees to be assessed in any agreement year,
and in setting the fee level, both the Board and FMCSA shall consider
the following factors:
1. Administrative costs associated with the Unified Carrier
Registration Plan and Agreement.
2. Whether the revenues generated in the previous year and any
surplus or shortage from that or prior years enable the participating
States to achieve the revenue levels set by the Board.
3. Provisions governing fees in 49 U.S.C. 14504a(f)(1).
Subsection (f)(1) provides that the fees charged must satisfy the
following criteria:
a. Fees charged to a motor carrier, motor private carrier, or
freight forwarder in connection with the filing of proof of financial
responsibility under the UCR Agreement shall be based on the number of
commercial motor vehicles owned or operated by the motor carrier, motor
private carrier, or freight forwarder.\4\
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\4\ The statute generally defines ``commercial motor vehicles''
for this purpose as including both self-propelled and towed vehicles
(49 U.S.C. 14504a(a)(1)(A) and 31101(1)).
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b. Fees charged to a broker or leasing company in connection with
the filing of proof of financial responsibility under the UCR Agreement
shall be equal to the smallest fee charged to a motor carrier, motor
private carrier, and freight forwarder, or to the smallest fee charged
under the UCR Agreement.
Section 14504a(f)(1) also stipulates that for the purpose of
charging fees the Board shall develop no more than 6 and no less than 4
brackets of carriers (including motor private carriers) based on the
size of the fleet, i.e., the number of commercial motor vehicles owned
or operated. Finally, the fee scale is required to be progressive in
the amount of the fee.
Overall, the fees assessed under the UCR Agreement must produce a
level of revenues established by the statute. Section 14504a(g)
establishes the revenue entitlements for States that choose to
participate in the UCR Plan. That section provides that a participating
State, which participated in the SSRS in the registration year prior to
the enactment of the Unified Carrier Registration Act of 2005 (i.e.,
the 2004 registration year), is entitled to receive revenues under the
UCR Agreement equivalent to the revenues it received in 2004.
Participating States that also collected intrastate registration fees
from interstate motor carrier entities (whether or not they
participated in SSRS) are also entitled to receive revenues of this
type under the UCR Agreement equivalent to the amount received in the
2004 registration year. The section also requires that States which did
not participate in SSRS in 2004, but which choose to participate in the
UCR Plan, will receive revenues not to exceed $500,000 per year.
III. UCR Board Fee Recommendation
As mentioned in I. above, the statute provides for a 15-member
Board of Directors for the UCR Plan and Agreement to be appointed by
the Secretary of Transportation. Section 14504a(d) specifies that the
UCR Board of Directors must consist of representatives from the
following groups:
U.S. Department of Transportation: One individual, either the FMCSA
Deputy Administrator or another Presidential appointee from the
Department as selected by the Secretary. The FMCSA Deputy Administrator
was selected to represent the Department.
State Chief Administrative Officers: Four directors, one from each
of the FMCSA service areas (as defined by FMCSA on January 1, 2005 \5\)
from among the chief administrative officers of the State agencies
responsible for administering the UCR Agreement. Directors appointed in
this category include: Mr. Charles ``Buddy'' Covert, Director,
Transportation Administrative Division, West Virginia Public Service
Commission for the FMCSA Eastern Service Center; Ms. Angel O. Oliver,
Supervisor, Credentialing Unit, Motor Carrier Division, Texas
Department of Transportation (TXDOT) for the FMCSA Southern Service
Center; Ms. Ruth Sluzacek, Director of Motor Carrier Services, Iowa
Motor Vehicle Division, Iowa Department of Transportation, for the
FMCSA Midwestern Service Center; and Mr. Frank Laqua, Administrator of
Motor Carrier Services, North Dakota Department of Transportation for
the Western Service Center.
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\5\ FMCSA has designated four Service Center areas. The Eastern
Service Center includes: Maine, New Hampshire, Vermont,
Massachusetts, Rhode Island, Connecticut, Pennsylvania, New Jersey,
New York, Maryland, Delaware, West Virginia, Virginia, Puerto Rico
and the District of Columbia. The Southern Service Center includes:
North Carolina, South Carolina, Tennessee, Arkansas, Oklahoma,
Texas, Louisiana, Mississippi, Alabama, Georgia, Florida, and
Kentucky. The Midwestern Service Center includes: Iowa, Illinois,
Indiana, Kansas, Michigan, Missouri, Minnesota, Nebraska, Ohio, and
Wisconsin. The Western Service Center includes: American Samoa,
Alaska, Arizona, California, Colorado, Guam, Hawaii, Idaho, Montana,
New Mexico, Nevada, North Dakota, Northern Mariana Islands, Oregon,
South Dakota, Utah, Washington, and Wyoming.
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State Agencies: Five directors from among the professional staffs
of State agencies responsible for overseeing the administration of the
UCR Agreement who must be nominated by the National Conference of State
Transportation Specialists (NCSTS), a non-profit organization founded
in 1959 and consisting of State agencies involved in transportation
safety, insurance and consumer protection. Directors appointed in this
category include: Mr. Avelino A. Gutierrez, Staff Counsel, New Mexico
Public Regulation Commission (NMPRC); Ms. Barbara Hague, Special
Projects Coordinator, Missouri Department of Transportation Motor
Carrier Services (MODOT); Mr. Dave Lazarides, Director of Processing
and Information, Illinois Commerce Commission, Transportation Bureau;
Mr. William Leonard, Director of the Freight Compliance and Safety
Bureau, New York Department of Transportation (NYDOT); and Mr. Terry
Willert, Chief, Transportation Section, Colorado Public Utility
Commission (COPUC).
Motor Carrier Industry: Five directors must represent the motor
carrier industry. At least one of the five motor carrier industry
representatives must be from ``a national trade association
representing the general motor carrier of property industry'' and one
of them must be from ``a motor carrier that falls within the smallest
fleet fee bracket.'' FMCSA recognizes the American Trucking
Associations, Inc. (ATA) as the national trade association representing
the general motor carrier of property industry. ATA is a national
affiliation of State trucking organizations representing the national,
State and local interests of the 50 affiliated State trucking
associations; and the interests of specialized areas of the trucking
industry through conferences and councils. The ATA representative is
Mr. Robert Pitcher, Vice President, State Laws Division. The agency has
selected the Owner-Operator Independent Drivers Association (OOIDA) as
the organization from which to appoint an individual to represent motor
carriers comprising the smallest fleet fee bracket. OOIDA is a national
trade association representing the interests of small trucking
companies and drivers. The OOIDA representative is Mr. Rick Craig,
Treasurer and Director of Regulatory Affairs. The statute gives the
Secretary discretion to appoint the remaining three industry
representatives. In order to ensure participation on the Board by
segments of the industry newly subject to the SSRS replacement system,
the Secretary appointed three members as follows: (1) One director from
the Transportation Intermediaries Association (TIA), Mr.
[[Page 29474]]
Robert Voltmann, President and CEO, (2) one director from the National
Private Truck Council (NPTC), Mr. Richard P. Schweitzer, General
Counsel, and (3) one director from Wal-Mart Stores, Inc. (Wal-Mart),
Mr. Craig Sharkey, Associate General Counsel, Logistics Division. TIA
represents transportation intermediaries such as brokers, freight
forwarders, and shippers doing business in domestic and international
commerce. NPTC is a national trade association representing private
motor carrier fleets. With nearly 7,000 tractors, over 40,000 trailers,
and annual sales over $285 billion, Wal-Mart is the nation's largest
private motor carrier.
As required by section 14504a(d)(7), the UCR Board prepared and
submitted to FMCSA a recommendation of initial fee brackets and annual
fees for calendar year 2007. The Board assigned a Revenue and Fees
Subcommittee to calculate the overall revenue requirement and to
recommend fees and brackets. The Board then reviewed the analysis
conducted by the Revenue and Fees Subcommittee and selected a bracket
structure and fees that it recommended to FMCSA.\6\ The Board's fee
recommendation is available in the Department's DMS.
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\6\ The FMCSA Deputy Administrator recused himself from the
Board's deliberations regarding the fee recommendation to prevent
any real or potential conflict of interest due to his position
within FMCSA in reviewing the Board's recommendation and setting the
fees under the statute.
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A. Participating Jurisdictions
The Board first canvassed the States to determine how many States
would participate in the UCR Agreement. The Board set a deadline of
November 1, 2006, for the submission of plans by the States with their
intent to participate in 2007. Although the State of Tennessee
submitted its plan on November 6, 2006, the Board, on November 7, 2006,
voted to allow Tennessee to participate for 2007.
Of the 38 States that participated in SSRS in 2006, all but two,
California and North Carolina, agreed to participate in the UCR in
registration year 2007.\7\ Of the thirteen States \8\ that did not
participate in SSRS, only Oregon agreed to participate in the UCR for
registration year 2007.
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\7\ Participating SSRS States include: Alabama, Arkansas,
Colorado, Connecticut, Georgia, Idaho, Illinois, Indiana, Iowa,
Kansas, Kentucky, Louisiana, Maine, Massachusetts, Michigan,
Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire,
New Mexico, New York, North Dakota, Ohio, Oklahoma, Rhode Island,
South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia,
Washington, West Virginia, and Wisconsin.
\8\ The District of Columbia, which is not participating, is
considered a State for this purpose. 49 U.S.C. 13102(21).
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B. Certification of State Revenues
To develop a nationwide figure for the replacement revenues needed
under the UCR Agreement, the Board next asked SSRS States to provide
information on the revenues they received for the registration year
2004, the year specified in the statute as mentioned above. In their
responses, the SSRS States that agreed to participate under the UCR
Agreement for 2007 certified their revenue figures for 2004. The total
certified SSRS State revenue figure was $101,272,400, as shown in
Appendix E to the Board's recommendation.
SAFETEA-LU caps the maximum revenue figure for UCR States that did
not participate in SSRS at $500,000 per year (49 U.S.C. 14504a(g)(3)).
Because only one non-SSRS State agreed to participate in the UCR for
registration year 2007 (Oregon), the Board added $500,000 to the total
entitlement figure, bringing the total State revenue requirement under
the UCR to $101,772,400.
C. Administrative Costs
Under section 14504a(d)(7) of the statute, the costs incurred by
the Board to administer the UCR Agreement are eligible for inclusion in
the total revenue to be collected. The Board considered that these
administrative costs would include, but would not be limited to,
meeting costs and start up costs of a web-based registration system
that will allow the motor carrier industry to register and pay required
fees on-line. In addition, the administrative costs would include costs
of a repository for the administration of the Board and a depository
for the revenues generated under the UCR Agreement to be distributed
among the participating States. The Board estimated $5,000,000 for
administrative expenses for the first year of the UCR Plan and
Agreement, as shown in Appendix F to the Board's recommendation.
D. Revenue Target
The Board's revenue target for 2007 is $107,306,262, which is
composed of $101,772,400 for State revenue as discussed above in
``III.B. Certification of State Revenues,'' plus the Board's estimate
of $5,000,000 for administrative expenses as discussed above in
``III.C. Administrative Costs''. The Board also included in its revenue
target recommendation to FMCSA an additional amount of $533,862, equal
to one-half of one percent of the State revenue total and
administrative expenses. The Board stated that it added this additional
amount as a reserve to offset the risk of faulty data.
E. Carrier Population
The Board's recommendation is based on the premise that revenues
will be generated ``from all motor carrier entities involved in
interstate commerce.'' Each of the five categories of motor carrier
entities is defined by statute (in some cases with modifications or
additions found in section 14504a) as shown in Table 1 below.
Table 1.--Categories of Motor Carrier Entities
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Category Definition in 49 U.S.C.
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Motor Carrier............................. 13102(14) and 14504a(a)(5).
Motor Private Carrier..................... 13102(15).
Freight Forwarder......................... 13102(8) [Freight forwarders
that operate motor vehicles
are treated as motor
carriers. 13903(b) and
14504a(b)].
Broker.................................... 13102(2).
Leasing Company........................... 14504a(a)(4).
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To estimate the number of carriers subject to the UCR Agreement,
the Board sought an approach that would provide a number of carriers
for which active status could be estimated to allow for a conservative
universe of interstate carriers. FMCSA maintains the most comprehensive
databases describing the entities that are subject to the UCR
Agreement. The Motor Carrier Management Information System (MCMIS) and
the License and Insurance System (L&I) maintained by FMCSA house
information about the known universe of the motor carrier industry (in
MCMIS) and brokers and freight forwarders (in L&I). Carriers that
operate commercial motor vehicles in interstate commerce are required
to register with FMCSA by providing carrier census data and acquiring a
USDOT number. The carrier census data resides in MCMIS, and similar
information on brokers and freight forwarders is in the L&I System. The
States have access to data derived from MCMIS through the SafetyNet
system. To determine an estimate of the active population of motor
carriers, the Board used the SafetyNet system maintained by New York
State to identify carriers. The Board filtered data from the SafetyNet
data base to exclude carriers that neither had updated their MCS-150
census file nor had an inspection, crash, safety audit, or compliance
review recorded within the past 12 months (March 1, 2006, through
[[Page 29475]]
February 26, 2007). Applying the filters to approximately 730,000
carriers listed in the data base, the Board filtered out almost 380,000
carriers, leaving an estimated total number of active interstate
carriers of 350,698. The Board then considered freight forwarders and
brokers. The total number of these entities listed in the Licensing and
Insurance (L&I) System, as provided by FMCSA, was approximately 19,000.
Freight forwarders that also operate commercial motor vehicles were
excluded to avoid double counting, because they are already included in
SafetyNet. After excluding the entities with a USDOT number in the L&I
System, the Board estimated the total number of freight forwarders and
brokers as 14,575. Summing the 350,698 active interstate carriers and
14,575 freight forwarders and brokers, the Board arrived at a total
affected population of 365,273.
F. Number of Fee Brackets
In establishing the number and composition of the brackets, under
the statute the Board had the option of choosing among four, five, or
six brackets for the distribution of the 365,273 entities it determined
would be expected to pay the fee as set forth above in ``III.E.
Estimate of Carrier Population.'' Given the huge range of fleet sizes
(from none to over 100,000 commercial motor vehicles), the Board
decided to use the maximum allowable number of brackets, thereby
helping to reduce the range of sizes within individual brackets. The
Board decided to make the first bracket include no more than two CMV s,
recognizing the large fraction of very small carriers, as shown in
Table 2 below in ``III.G. Fee Levels for Each Bracket.'' The Board's
analysis of the population showed that 182,782 of the total of 365,273
carriers, or more than half of the carriers, operated just one or two
commercial motor vehicles (e.g., one tractor and one trailer). The
Board also decided that a ``high-end'' bracket with more than 1,000
commercial motor vehicles was necessary. The Board performed a special
analysis of carriers with more than 1,000 commercial motor vehicles and
calculated the high-end (sixth) bracket under the assumption that, due
to errors in reporting and uncertainty in the data, only 75 percent of
the carriers indicating more than 1,000 commercial motor vehicles
actually operate that many. Based on a survey it undertook, the Board
estimated that only 85 percent of the number of carriers listed in
MCMIS as having more than 1,000 power units actually operated that many
vehicles. Addition of trailers to the universe of power units adds an
additional degree of uncertainty and inaccuracy. The Board, therefore,
decided to further reduce the reliability rate for the top bracket to
75 percent, to account for the inclusion of trailers. This adjustment
reduced the total number of motor carrier entities to 365,071.
The Board assigned the second bracket to contain carriers having no
more than five motor vehicles because it found, based on its analysis
of the distribution of motor vehicles across carriers as shown in Table
2, that just over 70 percent of all carriers (182,782 + 72,910/365,071)
have fewer than six motor vehicles. The remaining three brackets were
assigned in such a way that they built a reasonable bridge between 6
and 1,000 motor vehicles: One bracket covered carriers with 6 through
20 motor vehicles, the next covered carriers with 21 through 100 motor
vehicles, and the next covered carriers with 101 through 1000 motor
vehicles.
G. Fee Levels for Each Bracket
As discussed above under ``III. D. Revenue Target,'' the Board's
target revenue figure with administrative costs and reserve is
$107,306,262. To determine how to allocate that sum among the six
brackets, the Board relied upon an interactive model that calculated
the number of entities in each bracket; the revenues generated by each
bracket at different fee amounts; total revenues; and any surplus or
deficit from the $107,306,262 target figure. The Board also considered
fairness in terms of fees per motor vehicle while assigning the fees
for each bracket. The Board agreed to make sure that the maximum fee
per commercial motor vehicle in a given bracket would be no higher than
the maximum fee per commercial motor vehicle in the next smaller
bracket, a criterion that was unanimously regarded as fair by the
Board. In addition, the Board obtained data from a few States on the
average fees currently paid under SSRS to provide the Board with a
benchmark figure. Using these tools and after deliberations and debate,
the Board agreed upon the proposed fee amounts.
The fees recommended by the Board range from a low of $39 for
carriers in the lowest bracket (0 to 2 CMVs) to a high of $37,500 (the
1001-or-greater CMVs bracket). The Board estimated that this fee
structure would generate $107,352,364 in revenues, meeting the target
figure with a projected reserve of $579,964 for the UCR registration
year 2007. Table 2 provides the bracket and fee structure recommended
by the Board to FMCSA on April 2, 2007. The table is based on Page 10
of the report submitted by the Board to USDOT and FMCSA dated March
23,2007, entitled ``Report of the Revenues and Fees Subcommittee
Recommended Fee Structure Discussion Pursuant to the Unified Carrier
Registration Agreement.''
Table 2.--Bracket and Fee Structure Recommended by the Board
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Motor vehicles
Bracket ------------------------ Entities Fee per Revenue
From To entity
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B1............................................. 0 2 182,782 39 $7,128,498
B2............................................. 3 5 72,910 116 8,457,560
B3............................................. 6 20 73,130 231 16,893,030
B4............................................. 21 100 27,946 806 22,524,476
B5............................................. 101 1,000 7,695 3,840 29,548,800
B6............................................. 1,001 200,000 608 37,500 22,800,000
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Total...................................... .......... .......... 365,071 .......... 107,352,364
================================================================
.......... .......... .......... UCR 107,306,262
Board's
Target
.......... .......... .......... Surplus 46,102
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[[Page 29476]]
IV. FMCSA Fee Determination
Section 14504a requires FMCSA and the Board to consider the
relevant factors laid out in detail above in ``II. Statutory
Requirements for UCR Fees.'' That statutory section also requires FMCSA
to consider the recommendation of the UCR Board and the same statutory
requirements in setting the UCR fees. FMCSA carefully examined the
Board's entire fee recommendation including the methodology and
specific findings of the Board. FMCSA also independently considered the
factors specified in SAFETEA-LU, and verified and utilized the data and
analysis provided by the Board in its fee recommendation. As discussed
in detail below, FMCSA has concluded that the Board's recommendations
are reasonable and that the Board considered all required factors
specified by SAFETEA-LU. The Board satisfied the requirements for
establishing the fees to be charged under the unified carrier
registration agreement in the following areas:
A. Participating Jurisdictions
States may choose to participate in the UCR Plan and Agreement for
2007 by submitting the State plan that complies with section 14505a(
e). The Board provided adequate opportunity for all States to
participate in the UCR Plan and Agreement for registration year 2007,
even going so far as to make an exception for the State of Tennessee
when it filed its plan after the cutoff date set by the Board. The
Board's allowance of participation by Tennessee is permitted by section
14504a(e)(1), which establishes a final deadline of August 10, 2008 for
participation by the States.
B. Certification of State Revenues
The Board's calculation of the total revenue to be collected under
the UCR was properly based upon the revenues collected by the
participating States (both under SSRS and for intrastate registrations
of interstate carriers) for the calendar year 2004. The Board provided
FMCSA with the certifications from every participating State so FMCSA
could independently verify the amounts, as shown in Table 3. From Table
3, it can be seen that the Board included the revenue collected by the
States that participated in the SSRS as well as the UCR Agreement while
determining the revenue required from the UCR Agreement. The addition
of $500,000 for the inclusion of Oregon to the UCR Agreement is also in
accordance with the revenue requirement. FMCSA has verified that the
Board has accurately reflected in its recommendations the revenue
entitlements certified by each participating State for 2007. In
accordance with 49 U.S.C. 14504a(g)(4), FMCSA proposes to approve the
amount of revenue under the UCR Agreement which each State
participating in 2007 is entitled, as specified in Table 3. The Board's
addition of a revenue reserve, equal to one half of one percent of the
State revenue entitlement and administrative costs, offsets the risk of
faulty data, especially on trailers. The intent of this addition is to
offset the risk of undercollection, rather than to accumulate excess
revenues.
BILLING CODE 4910-EX-M
[[Page 29477]]
[GRAPHIC] [TIFF OMITTED] TP29MY07.004
BILLING CODE 4910-EX-C
C. Administrative Costs
The Board provided an estimate of the administrative costs
associated with the unified carrier registration plan and agreement, as
required by section 14504a(d)(7)(A)(i)). The Board's estimate includes
the following:
The Board estimated the cost of setting a web-based
registration and payment system as $2,000,000. FMCSA believes, based
upon our experience with development of information technology (IT)
systems, that this amount may be within the range of appropriate
costs for the rapid development of IT systems. However, FMCSA
requests comments on the reasonableness of the Board's estimate.
The Board assumed that approximately half of the
revenue will be collected online ($50,000,000) and that credit card
operating expenses would amount to 3 percent, or $1,500,000. FMCSA
believes this to be a reasonable estimate, based on its own
investigation into the cost of credit card payments. FMCSA found
that the expenses associated with accepting payments through credit
cards arise from discount rate, fixed transaction fee, chargeback
fee and other miscellaneous fees. A typical merchant discount rate
ranges from 1.5 to 3 percent, the fixed transaction fee can cost
between 20 and 30 cents per transaction, and chargeback fees range
from 10 to 25 dollars per chargeback. Given that the costs could be
as high as 3 percent as a result of the discount rate alone, the
Board's estimate of a total cost of 3 percent of the payments
charged is within the normal range.
The Board intends to send a UCR application package to
all interstate carriers currently listed in MCMIS, approximately
700,000 carriers. Communication costs of $650,000 for 700,000
mailings appears to be reasonable, given postage and printing costs.
[[Page 29478]]
The Board estimated the travel cost to total $100,000,
based on the Board's projection of five meetings per year and 15
Board members. This total amounts to $1,333 per member per meeting,
which FMCSA agrees is a reasonable estimate.
Help desk and assistance cost to address phone queries
is projected at $150,000 (5 full-time employees*40 hours/week*50
weeks*$25 per hour). FMCSA considers this estimate to be somewhat
high, but not unreasonable given uncertainty about the volume of
inquiries.
The Depository cost of $500,000 is only 0.5% of the
total revenue collected ($100 million). Charging a fee of 0.5% of
the total money managed is not unusual.
D. Revenue Target
The Board's calculation of the revenue target to be collected under
the UCR was properly based upon the revenues collected by the
participating States for the calendar year 2004, plus $500,000 for each
non-SSRS State as required by the statute, plus administrative costs.
The Board also included a one half of one percent addition to all fees
as a ``reserve.'' Because the Board's fees recommendation pertains to
the first year in which fees will be collected, the Board did not need
to address whether revenues generated in the previous year and any
surplus or shortage from that or prior years would enable the
participating States to achieve the revenue levels set by the Board, as
required by section 14504a(d)(7)(A)(ii).
E. Carrier Population
The Board based its fee recommendation on a reasonable estimate of
the number of commercial motor vehicles owned or operated by motor
carriers, motor private carriers, and freight forwarders, as specified
by section 14504a(f)(l)(A)(i). The key question of whether the
recommended fee structure would generate enough revenue to meet the
statutory requirement depended on the Board's estimates of the number
of motor carrier entities in each size category. FMCSA carefully
reviewed the method the Board used to make these estimates and
replicated to a high level of accuracy the Board's estimates of the
number of affected entities and the size distribution using its own
data base. Using the same filters employed by the Board, FMCSA was able
to generate the distribution and population of active carriers from the
MCMIS database. The time frame for the filters in FMCSA's analysis was
the calendar year 2006 while that of the Board was March 1, 2006 to
February 26, 2007. In spite of this difference, FMCSA's estimate of the
total affected population data differs from the Board's estimate by
less than one percent. The high degree of correspondence between the
two estimates gave FMCSA confidence that it understood the Board's
analysis and that the Board's estimates are reasonable.
FMCSA worked with the Board to select the filters that were used to
remove database entries that might not represent active interstate
carriers, thereby ensuring that the filters used were reasonable:
Carriers were included only if they showed recent evidence of activity.
FMCSA also reviewed the Board's estimate of the total number of freight
forwarders and brokers and concluded that it was likely to result in an
accurate estimate. Though there was no attempt to filter them on the
basis of signs of recent activity, FMCSA expects that even if any such
measures were taken to determine whether they are active, the overall
change that would occur in the total carrier population would be
insignificant. FMCSA reached this conclusion based on the fact that the
14,575 freight forwarders and property brokers found in the L&I system
represented only four percent of the total affected population, and
(because they are included in the bracket with the smallest fee) an
even smaller fraction of total revenue.
FMCSA notes that the Board did not separately consider the number
of leasing companies when calculating the affected population or the
revenues that the fees would raise. Because leasing companies that do
not operate motor vehicles are assigned to the lowest bracket, and thus
will pay no more than $39 per year, this omission is not significant.
FMCSA estimates, on the basis of data from the US Census that there are
only about 2,000 leasing companies that would be affected by the UCR
rule. NAICS code 53212 (Truck, utility trailer, and recreational
vehicle rental and leasing) represents the industry into which leasing
companies fall. There are a total of 3,942 Truck rental (Product line
code 52503) and 2,723 Truck leasing (Product line code 52504)
establishments, for a total of 6,647 establishments. At most 6,647
leasing companies are affected by the rule. Because many firms have
multiple establishments, the number of separate firms is considerably
smaller. Although the Census does not show the exact number of firms,
it does give enough information on firms with multiple establishments
to determine a reasonable upper bound on total firms. The census data
show that the largest 50 firms in this industry own a total of 4,115
establishments. The other firms must then own the remaining 2,532
establishments. Even assuming that all the remaining firms own only one
establishment each, the total number of firms cannot be greater than
the sum of 2,532 single-establishment firms and the 50 largest firms,
or 2,582. At $39 each, the total revenues owed by this sector would be
about $101,000. This amount is less than a tenth of one percent of
total UCR revenues and would not change the fee in any bracket by more
than the rounding error. Accordingly, inclusion of this amount would
have a negligible or perhaps no impact on the proposed fee structure
and fee levels. We do, however, invite comment on this point.
As Table 4 shows, FMCSA's estimates of the population of carriers
in the various brackets corresponds closely to the estimates prepared
by the Board. The high degree of correspondence between the two
estimates, as shown in Table 4, gave FMCSA confidence that it
understood the Board's analysis and that the Board's estimates are
reasonable.
Table 4.--Comparison of Carrier Size Distribution Estimates
------------------------------------------------------------------------
Bracket FMCSA Board % Difference
------------------------------------------------------------------------
B1............................. 182,782 184,290 0.8
B2............................. 72,910 74,070 1.6
B3............................. 73,130 73,567 0.6
B4............................. 27,946 27,969 0.1
B5............................. 7,695 7,641 0.7
B6............................. 810 797 1.6
----------------------------------------
Total...................... 365,273 368,334 0.8
------------------------------------------------------------------------
[[Page 29479]]
The Board used a 75 percent reliability factor while calculating
the number of companies that own more then 1,000 motor vehicles. The
Board determined the reliability rate to be 85 percent for carriers
that own more than 1,000 power units based on their in-depth analysis.
Though the Board provided no quantitative basis for lowering the
reliability factor to 75 percent after the inclusion of trailers, FMCSA
agrees that the addition of trailers to the universe of power units
increases the degree of uncertainty and unreliability in the data, and
that the change to 75 percent was reasonable.
F. Number of Fee Brackets
The Board's recommendation satisfied the requirements of section
14504a(f)(1)(C) by specifying no more than 6 brackets of carriers based
on the size of the fleet. FMCSA adopts as reasonable the six brackets
and the fleet size distribution among the brackets.
G. Fee Levels for Each Bracket
FMCSA found that the Board recommended a fee scale that is
progressive in the amount of the fee, as required by section
14504a(f)(1)(D), when assessed from bracket to bracket. There are six
brackets, each one defined by carrier size in terms of the numbers of
CMVs. The fees per carrier clearly increase as the size of the carriers
in the brackets increases, thereby meeting the Board's understanding of
a fee scale that is progressive.
The fee levels for brokers and leasing companies are based on the
smallest fee charged under the UCR agreement, as specified by section
14504a(f)(1)(A)(ii). As mentioned above under ``IV.D. Revenue Target,''
the Board added one half of one percent to its revenue requirement to
create what it termed a revenue reserve of $533,862. FMCSA examined the
rationale for adding this amount and determined that it had a
reasonable basis. FMCSA noted that the Board provided for fees that
would collect an extra $533,862 because of the additional uncertainty
resulting from data on trailers. Though it would be difficult to
determine the true extent to which the accuracy of data on trailer use
and ownership differs from that for power units, FMCSA did observe that
the prevalence of trip-leasing of trailers is greater than that for
trucks or tractors. The use of trip leases could create problems for
the collection of revenues under UCR: The statute specifies that only
commercial motor vehicles controlled under a long-term lease are to be
included for the purpose of determining the applicable UCR fees (49
U.S.C. 14504a(f)(2)). However, the MCS-150 form includes a category for
trip-leased vehicles. That data may be included in the MCMIS database,
but motor carrier entities may choose to exclude trip-leased vehicles
when selecting their fee bracket. The statute also provides alternative
methods by which motor carrier entities may calculate the number of
commercial motor vehicles in their fleet for the purpose of determining
the applicable fees (49 U.S.C. 14504a(f)(3)). These factors all
introduce a degree of uncertainty in the fleet sizes upon which the
fees are based, and, therefore, in the total amount of fees collected.
By examining data on a large subset of the carrier population,
FMCSA determined that omitting all trip-leased vehicles from carriers'
vehicle counts could reduce the UCR revenues collected from the first
five brackets by on the order of $1 million. Because carriers are not
likely to omit all trip-leased vehicles, it appears that the Board
would be justified in anticipating a loss of a half million for the
first five brackets. There would be additional losses for the top
bracket, but FMCSA considers those losses to be taken into account
appropriately by the 75 percent factor used in projecting revenues from
the top bracket. Thus, FMCSA concluded that the Board's \1/2\ percent
addition to the revenue requirement is a reasonable response to the
risk of undercollection of revenues due to uncertainty about the
treatment of trailers FMCSA found that the Board's recommended fee
structure, as modified, meets the requirements of the statute. As shown
in Table 3, there are six brackets, each one defined by carrier size in
terms of the numbers of commercial motor vehicles. The fees per carrier
increase as the size of the carriers in the brackets increases, thereby
meeting the statute's requirement that the fees be progressive.
Finally, leasing companies and brokers are included in Bracket 1, which
has the lowest fee per entity, as required.
To get a better sense of the distribution of the fees, FMCSA
calculated the average fee per motor vehicle by carrier size. Table 5
shows these averages for six carrier size groups that correspond to the
fee brackets in the recommended fee structure.
Table 5.--Fee per Motor Vehicle
------------------------------------------------------------------------
Motor vehicles Average fee
--------------------------------------------------------- per motor
From To vehicle ($)
------------------------------------------------------------------------
0......................... 2........................... 26
3......................... 5........................... 31
6......................... 20.......................... 23
21........................ 100......................... 19
101....................... 1,000....................... 15
1,001..................... 106,771..................... 8
Mean for all carriers................................... 15
Range................................................... 0.35-39.00
------------------------------------------------------------------------
Based on a careful evaluation and a point-by-point comparison of
the Board's process with the statutory requirements, and upon an
independent analysis and consideration of the required statutory
provisions, FMCSA proposes to adopt the Board's recommended fees and
fee structure.
H. Fee Collection Process
The Board provided FMCSA with information on the process it
anticipates following to collect the revenues under the UCR Plan and
Agreement. The Board indicated that the participating States (see Table
3 above) will send a mailing to all active interstate carriers residing
in FMCSA's Motor Carrier Management Information System (MCMIS) and to
all brokers and freight forwarders found in FMCSA's Licensing and
Insurance database. In the mailing the Board will provide contact
numbers for all participating States, informational Web sites, and the
Board may also establish a national call center to answer questions and
direct covered entities to the appropriate State officials. The
application form in the mailing will direct the entity to pay an amount
based on the number of Commercial Motor Vehicles listed in their MCMIS
data. The application will also allow carriers to amend that data for
UCR purposes. The mailing will also direct covered entities that are
domiciled in a participating State to register in that State and to pay
the required fee to their State of registration or ``base'' State.
Entities located in non-participating jurisdictions will be directed to
register in the participating State that has the highest percentage of
their operations. Entities that operate only in non-participating
jurisdictions will be directed to choose a participating State located
in their FMCSA Service Center Region. Canadian and Mexican entities
will also be directed to choose the participating State with the
highest percentage of their operations or to choose a contiguous State
such as Maine, New York or Michigan for a Canadian entity. Covered
entities will be given a set timeframe in which to register and
enforcement will not begin for at least 90 days after the beginning
[[Page 29480]]
of registrations. The Board notes that this process is preliminary and
final procedures will be worked out between the participating States
and the UCR Board of Directors.
V. Regulatory Analyses and Notices
Executive Order 12866 (Regulatory Planning and Review) and DOT
Regulatory Policies and Procedures
FMCSA has concluded that this action is a significant regulatory
action within the meaning of Executive Order 12866 due to its subject
matter.
This rule is not significant based on the size of the fees to be
collected under the UCR. The costs of the rule are required pursuant to
an explicit Congressional mandate in SAFETEA-LU. Because a majority of
the fees under the proposed rule will replace fees currently being paid
under the SSRS system, the total cost of the proposed rule will be
substantially less than $100 million per year. New entities paying fees
under UCR that did not pay under SSRS are estimated to account for
slightly less than half the fees, or about $50 million in new costs per
year. The Agency has prepared a preliminary regulatory analysis
analyzing the rule. A copy of the preliminary analysis document is
included in the docket referenced at the beginning of this notice.
Regulatory Flexibility Act and Small Business Regulatory Enforcement
Fairness Act
In compliance with the Regulatory Flexibility Act (RFA), as amended
by the Small Business Regulatory Enforcement Fairness Act (SBREFA), (5
U.S.C. 601-612), FMCSA has considered the effects of this proposed
regulatory action on small entities. The fees being proposed in this
rule would affect large numbers of small entities because the proposed
rule sets fees for hundreds of thousands of carriers of all sizes, and
small entities are defined to include all entities that are not
dominant in their industries. In previous rulemakings, FMCSA identified
for-hire carriers with fewer than 145 power units i.e., trucks or
tractors) as small. FMCSA estimates that carrier size to be equivalent
to about 300 CMVs. Thus, all of the for-hire carriers in Brackets 1
through 4 would be considered small, as would many of those in Bracket
5.
After careful consideration, however, FMCSA has determined that the
recommended UCR fee will, in every case involving a viable small
entity, be well below the threshold level of one percent of revenues
used for determining significant impacts. This conclusion is based on
the observation that the maximum fee per vehicle is $39, which is less
than one percent of the annual salary of even a single employee working
40 hours per week for 50 weeks per year and earning the current Federal
minimum wage of $5.15. Because an entity without sufficient revenues to
pay even one employee per vehicle would not be viable, it is clear that
the recommended UCR fees will not reach the threshold of one percent of
revenues. Additionally, more than 50 percent of the fees collected
under the new UCR system were already being paid by many of these
entities under the SSRS system, meaning the UCR fees will simply serve
as substitutes for the SSRS fees these firms were previously being
assessed. Thus, FMCSA certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
Unfunded Mandates Reform Act of 1995
This rulemaking would not impose any unfunded Federal mandate, as
defined by the Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1532, et
seq.) that will result in the expenditure by State, local, and tribal
governments, in the aggregate, or by the private sector, of $120
million or more in any 1 year.
Executive Order 12988 (Civil Justice Reform)
This proposed rule meets applicable standards in sections 3(a) and
3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize
litigation, eliminate ambiguity, and reduce burden.
Executive Order 13045 (Protection of Children)
FMCSA has analyzed this proposed action under Executive Order
13045, Protection of Children from Environmental Health Risks and
Safety Risks. We have determined preliminarily that this rulemaking
would not create an environmental risk to health or safety that would
disproportionately affect children.
Executive Order 12630 (Taking of Private Property)
This proposed rule would not affect a taking of private property or
otherwise have taking implications under Executive Order 12630,
Governmental Actions and Interference with Constitutionally Protected
Property Rights.
Executive Order 13132 (Federalism)
This proposed rule has been analyzed in accordance with the
principles and criteria contained in Executive Order 13132. FMCSA has
preliminarily determined that this rulemaking would not have a
substantial direct effect on States, nor would it limit the policy-
making discretion ofthe States. Nothing in this proposal would preempt
any State law or regulation. As detailed above, the UCR Board of
Directors includes substantial State representation. The States have
already had notice of this action and opportunity for input through
their representatives. FMCSA also requests comments on any substantial
direct effect on the States as outlined in Executive Order 13132.
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.
Paperwork Reduction Act
The Paperwork Reduction Act of 1995 (44 US.C. 3507(d) requires that
FMCSA consider the impact of paperwork and other information collection
burdens imposed on the public. We have determined that there are no
current new information collection requirements by FMCSA associated
with this proposed rule.
National Environmental Policy Act
The agency analyzed this final rule for the purpose of the National
Environmental Policy Act of 1969 (NEPA) (42 D.S.C. 4321 et seq.) and
determined under our environmental procedures Order 5610.1, issued
March 1,2004 (69 FR 9680), that this action is categorically excluded
(CE) under Appendix 2, paragraph 6.h of the Order from further
environmental documentation. The CE under Appendix 2, paragraph 6.h
relates to establishing regulations and actions taken pursuant to the
regulations implementing procedures to collect fees that will be
charged for motor carrier registrations and insurance.
We have also analyzed this rule under the Clean Air Act, as amended
(CAA), section 176(c) (42 D.S.C. 7401 et seq.), and implementing
regulations promulgated by the Environmental Protection Agency.
Approval of this action is exempt from the CAA's General Conformity
requirement since it involves policy development.
[[Page 29481]]
Executive Order 13211 (Energy Effects)
FMCSA has analyzed this proposed rule under Executive Order 13211,
Actions Concerning Regulations That Significantly Affect Energy Supply,
Distribution, or VSE. We have determined preliminarily that it would
not be a ``significant energy action'' under that Executive Order
because it would not be likely to have a significant adverse effect on
the supply, distribution, or use of energy.
List of Subjects in 49 CFR Part 367
Commercial motor vehicle, Financial responsibility, Motor carriers,
Motor vehicle safety, Registration, Reporting and recordkeeping
requirements.
For the reasons discussed in the preamble, the Federal Motor
Carrier Safety Administration proposes to amend 49 CFR part 367 as
follows:
PART 367--STANDARDS FOR REGISTRATION WITH STATES
1. The authority citation for part 367 is amended to read as
follows:
Authority: 49 U.S.C. 13301, 14504, 14504a; and 49 CFR 1.73.
2. Add a new Subpart A heading preceding Sec. 367.1 to read as
follows:
Subpart A--Single State Registration System
3. Add a new Subpart B to read as follows: Subpart B--Fees Under
the Unified Carrier Registration Plan and Agreement
Subpart B--Fees Under the Unified Carrier Registration Plan and
Agreement
----------------------------------------------------------------------------------------------------------------
Fees Under the Unified Carrier Registration Plan and Agreement for Registration Year 2007
-----------------------------------------------------------------------------------------------------------------
Number of commercial
motor vehicles owned or Fee per company for
operated by exempt or exempt or non-exempt Fee per company for
Bracket non-exempt motor motor carrier, motor broker or leasing
carrier, motor private private carrier, or company
carrier, or freight freight forwarder
forwarder
----------------------------------------------------------------------------------------------------------------
B1................................... 0-2.................... $39.................... $39
B2................................... 3-5.................... 116....................
B3................................... 6-20................... 231....................
B4................................... 21-100................. 806....................
B5................................... 101-1,000.............. 3,840..................
B6................................... 1,001 and above........ 37,500.................
----------------------------------------------------------------------------------------------------------------
Issued on: May 23, 2007.
John H. Hill,
Administrator.
[FR Doc. 07-2652 Filed 5-24-07; 10:37 am]
BILLING CODE 4910-EX-M