Proposed Rule: Motor Carrier Safety Standards: New Entrant Safety Assurance Process

Thursday,
December 21, 2006
Part II
Department of
Transportation
Federal Motor Carrier Safety
Administration
49 CFR Parts 365, 385, 387, and 390

New Entrant Safety Assurance Process;
Proposed Rule
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76730 Federal Register / Vol. 71, No. 245 / Thursday, December 21, 2006 / Proposed Rules
DEPARTMENT OF TRANSPORTATION deficiencies in basic safety management Public Participation: The DMS is
controls are corrected before the new available 24 hours each day, 365 days
Federal Motor Carrier Safety entrant is granted permanent each year. You can get electronic
Administration registration. submission and retrieval help and
DATES: We must receive your comments guidelines under the ‘‘help’’ section of
49 CFR Parts 365, 385, 387, and 390 the DMS web site. If you want us to
by February 20, 2007.
[Docket No. FMCSA–2001–11061] notify you of receiving your comments,
ADDRESSES: You may submit comments, please include a self-addressed,
RIN 2126–AA59 identified by DOT DMS Docket Number stamped envelope or postcard or print
FMCSA–2001–11061, by any of the the acknowledgement page that appears
New Entrant Safety Assurance Process following methods: after submitting comments on-line.
• Federal eRulemaking Portal: http:// Comments received after the comment
AGENCY: Federal Motor Carrier Safety www.regulations.gov. Follow the
Administration (FMCSA), DOT. closing date will be included in the
instructions for submitting comments. docket, and we will consider late
ACTION: Notice of Proposed Rulemaking • Agency Web site: http:// comments to the extent practicable.
(NPRM); request for comments. dms.dot.gov. Follow the instructions for FMCSA may, however, issue a final rule
submitting comments on the DOT at any time after the close of the
SUMMARY: FMCSA proposes changes to
electronic docket site. comment period.
the New Entrant Safety Assurance
• Fax: 1–202–493–2251.
Process that would raise the standard of Legal Basis for the Rule
• Mail: Docket Management Facility;
compliance for passing the new entrant
U.S. Department of Transportation, 400 Title 49 U.S.C. 31144 requires the
safety audit. The agency has identified
Seventh Street, SW., Nassif Building, Secretary of Transportation (Secretary)
11 regulations that it believes are
Room PL–401, Washington, DC 20590– to determine whether an owner or
essential elements of basic safety
0001. operator is fit to operate safely. Section
management controls necessary to
• Hand Delivery: Room PL–401 on 210 of the Motor Carrier Safety
operate in interstate commerce and
the plaza level of the Nassif Building, Improvement Act of 1999 [Public Law
proposes that failure to comply with any
400 Seventh Street, SW., Washington, 106–159, 113 Stat. 1764, December 9,
one of the 11 regulations would result
DC, between 9 a.m. and 5 p.m., Monday 1999] (MCSIA) added § 31144(g) 1
in automatic failure of the audit. Under
through Friday, except Federal directing the Secretary to establish
this proposal, carriers would also be
Holidays. regulations to require each owner and
subject to the current safety audit
evaluation criteria in Appendix A of Instructions: All submissions received operator granted new operating
part 385. Additionally, if a roadside must include the agency name and authority to undergo a safety review
inspection discloses certain violations, docket number or Regulatory within 18 months of starting operations.
the new entrant would be subject to Identification Number (RIN) for this In issuing these regulations, the
expedited actions to correct these rule. All comments received will be Secretary was required to: (1) Establish
deficiencies. The agency proposes to posted without change to http:// the elements of the safety review,
eliminate Form MCS–150A—Safety dms.dot.gov, including any personal including basic safety management
Certification for Application for USDOT information provided. For detailed controls; (2) consider their effects on
Number. The agency also intends to instructions on submitting comments small businesses; and (3) consider
check compliance with the Americans and additional information on the establishing alternate locations where
with Disabilities Act and certain rulemaking process, see the ‘‘Public such reviews may be conducted for the
household goods-related requirements Participation’’ heading of the convenience of small businesses. The
SUPPLEMENTARY INFORMATION section of Secretary was also required to phase in
in the new entrant safety audit, if they
apply to the new entrant’s operation. this document. For a summary of DOT’s the new entrant safety review
However, failure to comply with these Privacy Act Statement or information on requirements in a manner that takes into
requirements would not impact the how to obtain a complete copy of DOT’s account the availability of certified
outcome of the safety audit. These Privacy Act Statement please see the motor carrier safety auditors. Congress
changes would not impose additional ‘‘Privacy Act’’ heading under mandated increased oversight of new
operational requirements on any new Rulemaking Analyses and Notices. entrants because studies indicated these
entrant carrier. All new entrants would Docket: For access to the docket to operators had a much higher rate of
continue to receive educational read background documents or non-compliance with basic safety
information on how to comply with the comments received, go to http:// management requirements and were
safety regulations and be given an dms.dot.gov at any time or to Room PL– subject to less oversight than established
opportunity to correct any deficiencies 401 on the plaza level of the Nassif operators.
found. FMCSA recognizes many new Building, 400 Seventh Street, SW., In addition to expanding the
entrants are small businesses that are Washington, DC, between 9 am and 5 Secretary’s authority under § 31144,
unaware of these requirements and pm, Monday through Friday, except Section 210 of MCSIA was a specific
continue to need the agency’s Federal Holidays. statutory directive consistent with the
assistance. Finally, FMCSA would make FOR FURTHER INFORMATION CONTACT: Mr. more general pre-existing legal authority
clarifying changes to some of the Arturo H. Ramirez, (202) 366–8088, provided by the Motor Carrier Safety
Chief, Enforcement and Compliance
existing new entrant regulations and 1 MCSIA originally codified section 31144(g) as
establish a separate new entrant Division, Federal Motor Carrier Safety
§ 31144(c) and directed that it be added at the end
application procedure and safety Administration (MC–ECE), 400 Seventh of 49 U.S.C. 31144 following preexisting
oversight program for non-North Street, SW., Washington, DC 20590– subsections (c), (d), and (e). Section 4114(c)(1) of
America-domiciled motor carriers. 0001. Office hours are from 7:45 a.m. to the Safe, Accountable, Flexible, Efficient
4:15 p.m., ET, Monday through Friday, Transportation Equity Act: A Legacy for Users
FMCSA believes this proposal would (Public Law 109–59, 119 Stat. 1144, August 10,
improve its ability to identify at-risk except Federal holidays. 2005) (SAFETEA-LU) recodified this provision as
new entrant carriers and ensure SUPPLEMENTARY INFORMATION: § 31144(g).
Federal Register / Vol. 71, No. 245 / Thursday, December 21, 2006 / Proposed Rules 76731
Act of 1984 (the 1984 Act) [49 U.S.C. applicant must complete the Factor 3—Operational: Parts 392 and
App. 2505 (1988)], which requires the application, including Form MCS– 395.
Secretary to prescribe regulations on 150A—Safety Certification for Factor 4—Vehicle: Parts 393 and 396
commercial motor vehicle safety. The Application for USDOT Number, which and inspection data for the last 12
regulations required by the 1984 Act requires the carrier to certify procedures months.
must prescribe minimum safety are in place for basic safety management Factor 5—Hazardous Materials: Parts
standards for commercial motor controls. Following completion of the 171, 177, 180 and 397.
vehicles (CMVs). At a minimum, the application forms, FMCSA registers the Factor 6—Accident: Recordable
regulations shall ensure: (1) CMVs are new entrant and assigns a United States Accident Rate per Million Miles.
maintained, equipped, loaded, and Department of Transportation (USDOT) For each instance of noncompliance
operated safely; (2) the responsibilities Number. For-hire motor carriers, unless with an acute regulation, 1.5 points are
imposed on operators of CMVs do not providing transportation exempt from assessed against the carrier. For each
impair their ability to operate the ICCTA registration requirements, also instance of noncompliance with a
vehicles safely; (3) the physical are required to obtain FMCSA operating critical regulation, 1 point is assessed.
condition of operators of CMVs is authority under 49 U.S.C. 13902, prior For factors 1–5, if the combined
adequate to enable them to operate the to commencing operations. The new violations of acute and critical
vehicles safely; and (4) the operation of entrant safety monitoring period begins regulations for each factor are equal to
CMVs does not have a deleterious effect when FMCSA issues the new entrant three or more points, the carrier is
on the physical condition of the provisional registration via a USDOT determined not to have basic safety
operators (49 U.S.C. 31136(a)). Number and continues for 18 months. management controls for that individual
This NPRM proposes changes to the To maintain its provisional registration, factor. If the recordable accident rate
New Entrant Safety Assurance Process a new entrant must comply with all (factor 6) is greater than 1.7 recordable
to improve the agency’s ability to FMCSA regulations and applicable accidents per million miles for an urban
identify at-risk new entrant motor hazardous materials regulations. carrier (1.5 for all other carriers), the
carriers through screening and ensure Within the first 18 months of a new carrier is determined to have inadequate
deficiencies are corrected before entrant’s operation, FMCSA will basic safety management controls (i.e.,
granting them permanent registration. conduct a safety audit (SA) of the the carrier fails the factor). If the
As such, it implements the § 31136(a)(1) carrier’s operations to educate the carrier’s accident rate is anywhere
mandate that FMCSA regulations ensure carrier on compliance with the Federal
CMVs are maintained and operated between zero and 1.5 (1.7 for urban
Motor Carrier Safety Regulations carriers), the carrier is considered to
safely. It does not propose any new (FMCSRs) and Hazardous Materials
operational responsibilities on drivers have adequate safety management
Regulations (HMRs) and to determine if controls in factor 6. A new entrant fails
pursuant to §§ 31136(a)(2)–(4). the carrier is exercising basic safety the SA if it fails three or more separate
Regulatory History management controls as defined in 49 factors. Currently, FMCSA is studying a
In response to the MCSIA statutory CFR 385.3. An SA is not a compliance new approach to assessing the severity
mandate, on May 13, 2002, FMCSA review. It does not result in a safety of violations as part of its announced
published an interim final rule (IFR) rating. These terms are defined in CSA 2010 initiative (69 FR 51748). This
titled New Entrant Safety Assurance § 385.3. initiative may ultimately replace the
Process (67 FR 31978), which became During the SA, FMCSA gathers ‘‘acute and critical’’ methodology
effective January 1, 2003. Although information by reviewing the carrier’s described here.
operating authority has generally been compliance with ‘‘acute’’ and ‘‘critical’’ If the SA discloses the new entrant’s
construed in the past to mean provisions of the FMCSRs and basic safety management controls are
registration of for-hire carriers subject to applicable HMRs. Acute regulations are adequate, the carrier retains the new
the jurisdiction transferred from the those where the consequences of non- entrant registration and continues to be
former Interstate Commerce compliance are so severe as to require monitored until the end of the 18-month
Commission following enactment of the immediate corrective actions by a motor period. FMCSA will grant permanent
ICC Termination Act of 1995 [Public carrier, regardless of the overall basic registration only if the new entrant
Law 104–88, 109 Stat. 888, December safety management controls of the motor successfully completes the monitoring
29, 1995] (ICCTA), FMCSA interpreted carrier (e.g., allowing a driver with a period. If the basic safety management
Section 210 of MCSIA as extending this suspended license to operate a vehicle). controls are inadequate, the new entrant
concept to all carriers subject to Federal Critical regulations are defined as those is given an opportunity to correct the
safety jurisdiction (see 67 FR 31979, where noncompliance relates to deficiencies. To provide that
May 13, 2002). For this reason, FMCSA management or operational controls and opportunity, FMCSA notifies the new
applied the New Entrant Safety are indicative of breakdowns in a entrant that unless the deficiencies are
Assurance Process to all domestic and carrier’s management controls (e.g., remedied, the registration will be
Canada-domiciled new entrants, allowing a driver to operate a vehicle revoked in 45 days (for carriers using
regardless of whether they needed to before his/her medical exam). Parts of passenger vehicles with a capacity to
register with FMCSA under 49 U.S.C. the FMCSRs and HMRs having similar transport 16 or more passengers or
13901. Mexico-domiciled new entrants characteristics are combined together vehicles transporting hazardous
are covered under a separate application into six regulatory areas called materials as defined under 49 CFR
‘‘factors.’’ The SA scoring evaluates
process and safety monitoring system § 383.5) or 60 days (for all other new
(see 67 FR 12652, 67 FR 12701, and 67 each of the following factors and entrants). FMCSA may extend the
FR 12757 published March 19, 2002). determines the adequacy of the carrier’s compliance period if it determines the
Under the current New Entrant Safety safety management controls based on new entrant is making a good faith effort
Assurance Process, FMCSA provides this evaluation. The six factors are: to remedy the problems. If, within the
applicants with an application package Factor 1—General: Parts 387 and 390. 45 or 60 days, the new entrant fails to
including, upon request, educational Factor 2—Driver: Parts 382, 383, and respond to the notice or fails to correct
and technical assistance materials. The 391. the deficiencies, FMCSA issues an out-
of-service order prohibiting further 2. § 382.211—Using a driver who has and fatalities involving large trucks and
operations in interstate commerce and refused to submit to an alcohol or buses. For this mission to succeed,
revokes the new entrant registration. controlled substances test required carriers must operate safe vehicles. To
under part 382. accomplish this, vehicles must be
Discussion of the Proposed Rule
3. § 382.215—Using a driver known to periodically inspected and kept in safe
FMCSA decided to publish an NPRM have tested positive for a controlled operating condition. Therefore, a new
rather than a final rule because today’s substance. entrant would fail the safety audit if it
action proposes substantive changes to 4. § 383.37(a)—Knowingly allowing, does not inspect its vehicles
the May 13, 2002 IFR. These proposals requiring, permitting, or authorizing an periodically or operates any vehicle
would benefit from further notice and employee with a commercial driver’s declared out-of-service before making
comment before promulgation as a final license which is suspended, revoked, or the required repairs.
rule. Following is a discussion of these canceled by a State or who is Further, driver fatigue has been
proposed changes. disqualified to operate a commercial identified as a contributing factor in
Strengthening the Safety Audit motor vehicle. many CMV crashes. To achieve the
5. § 383.51(a)—Knowingly allowing, highest level of safety, carriers must
In FY 2000, FMCSA published a requiring, permitting, or authorizing a have a system to safeguard the public
report titled ‘‘Analysis of New Entrant driver to drive who is disqualified to against fatigued drivers by ensuring
Motor Carrier Safety Performance and drive a commercial motor vehicle. their drivers adhere to the agency’s
Compliance Using SafeStat,’’ which 6. § 387.7(a)—Operating a motor hours-of-service limitations. Hours-of-
compared the safety performance of new vehicle without having in effect the service violations comprise the largest
entrant carriers to that of experienced required minimum levels of financial percentage of driver out-of-service
carriers. A copy of the report is in the responsibility coverage. violations at the roadside. One effective
docket for this rule. The report 7. § 391.15(a)—Using a disqualified safety management control for
indicated new entrant carriers had driver. preventing fatigued drivers from
significantly higher crash involvement 8. § 391.11(b)(4)—Using a physically operating a CMV is to have in place a
than experienced carriers. New entrant unqualified driver. system requiring drivers to submit
carriers had significantly worse driver 9. § 395.8(a)—Failing to require a records of duty status or other records,
safety compliance and performance driver to make a record of duty status. as appropriate. This recordkeeping
compared to experienced carriers. To a 10. § 396.9(c)(2)—Requiring or requirement is fundamental to an
lesser degree, new entrant carrier permitting the operation of a effective driver monitoring system.
vehicle safety compliance and commercial motor vehicle declared Finally, the agency believes it is
performance were also worse than for ‘‘out-of-service’’ before repairs are made. essential for the traveling public to
experienced carriers. For these reasons, 11. § 396.17(a)—Using a commercial receive adequate compensation for
FMCSA intends to ensure all new motor vehicle not periodically personal injuries or property damage
entrant carriers have basic safety inspected. caused by CMVs operating on the
programs and controls in place before The agency believes carriers highways. Therefore, carriers lacking
granting permanent registration. committing these violations do not have required minimum financial
In response to comments to the 2002 the basic safety management controls in responsibility would not be permitted to
IFR (see the section below titled place to safely operate in interstate operate.
‘‘Discussion of Comments’’), as well as commerce. The working group FMCSA emphasizes that the purpose
feedback from FMCSA field staff and identified, and FMCSA accepted, these of the proposed revision is to improve
State partners administering the New 11 infractions because they are so basic the safety management of new entrants,
Entrant Safety Assurance Process, the to ensuring safety that no carrier should not to remove them from operations.
Administrator convened an internal be allowed to operate if any of these The agency believes the regulations
working group in the summer of 2003 to violations are found and not corrected. identified above are evidence of
review and improve the process. The For example, implementation of an whether a new entrant has a systemic
working group identified 11 regulatory alcohol and controlled substances program to ensure it has the basic safety
violations which reflect a clear lack of testing program is a fundamental management controls to operate in
basic safety management controls yet requirement for any interstate carrier. A interstate commerce.
are not properly weighted by the carrier that has implemented a program As discussed above, when a new
existing SA. Under the current system, to ensure its drivers do not operate after entrant fails an audit, even for one of the
a new entrant could commit one of testing positive for drugs or alcohol will automatic failures described above, it
these 11 violations and still pass the SA. reduce the risk of that carrier/driver will be afforded due process and given
The group recommended that FMCSA being involved in a fatal accident. time to correct its failures and improve
strengthen the SA pass/fail criteria to Allowing drivers who refuse to submit its safety management controls. This
give more appropriate weight to these to drug or alcohol testing to drive proposal emphasizes FMCSA’s
11 basic safety management indicates the carrier does not have an commitment to highway safety and
requirements and clarify several vague effective drug and alcohol testing would allow the agency to ensure new
regulatory requirements. program. Similarly, only qualified entrants are not permitted to operate
Based on this recommendation, drivers should be permitted to drive. A without first correcting serious
FMCSA proposes that committing any carrier does not exercise sufficient deficiencies in a timely manner.
one of the following 11 regulatory safety management controls if it uses FMCSA believes it is incumbent upon
violations would result in an automatic drivers who are disqualified from all new entrant carriers to be informed
failure of the SA: operating a CMV, physically about, and familiar with, the FMCSRs
1. § 382.115(a)/§ 382.115(b)—Failing unqualified, or who have had their prior to receiving a safety audit. To this
to implement an alcohol and/or commercial driver’s license suspended, end, FMCSA provides outreach and
controlled substances testing program revoked, or canceled. educational materials to carriers to help
(domestic and foreign motor carriers, Additionally, the primary mission of them prepare for the audit. Carriers
respectively). the agency is to reduce crashes, injuries discovered to have committed one of the
11 violations identified above, after entrant carriers, expanding the higher than the industry average for
having been informed of the need to expedited action provisions would also similar motor carrier operations’’
comply prior to receiving permanent make the treatment of Mexico-domiciled requirement under § 385.307. From an
registration, and found to have not new entrants and all other new entrants operational standpoint, the ‘‘50 percent
corrected the deficiency, will not be more uniform. or more threshold’’ would provide for
permitted to continue to operate. This change would improve the New more effective and efficient monitoring
Establishing these 11 violations as Entrant Safety Assurance Process by of new entrant performance because it is
grounds for failing the safety audit tightening scrutiny of new entrants a non-subjective and easily measured
would promote public safety by before and after the safety audit. New rate.
encouraging new entrants to correct entrants discovered with these
Applicability of Proposed Requirements
serious deficiencies in their safety violations could be identified during a
to Current New Entrants
management controls and reducing the roadside inspection or by any other
number of potentially unsafe carriers means even if the agency had not yet The changes in today’s notice of
operating on the nation’s highways. conducted a safety audit. proposed rulemaking, if promulgated as
It should be noted that most of these Discovery of certain violations during a final rule, would apply to motor
11 regulations correspond to a roadside inspection or by any other carriers still subject to the current new
requirements necessary for Mexico- means would subject the new entrant to entrant safety monitoring process on the
domiciled long-haul carriers to obtain expedited action. If the carrier had not final rule’s effective date. Assuming all
authority to operate in the United already submitted to an audit, the changes are adopted, these new entrants
States, as established by Congress under carrier would be flagged for review as would be subject to expedited
Section 350(a)(1)(B) of the Fiscal Year soon as practicable. If the carrier already enforcement action for committing any
2002 DOT Appropriations Act [Public had submitted to an audit before of the seven violations or actions
Law 107–87, Title III, sec. 350, 115 Stat. discovery of an ‘‘expedited action identified under the section ‘‘Expedited
864, Dec. 18, 2001]. The requirements violation,’’ FMCSA would send the Action.’’ If a current new entrant has not
applicable to Mexico-domiciled long- carrier a letter requesting evidence of had a safety audit prior to the final rule
haul carriers are: corrective action within 30 days of the effective date, it would be audited in
• Verification of a controlled notice or the carrier’s registration would accordance with the safety audit
substances and alcohol testing program be revoked. Additionally, if FMCSA procedures adopted in the final rule,
consistent with 49 CFR part 40; determined the violation warranted a including the applicable 11 automatic
• Verification of a carrier’s system of more thorough review of the carrier’s failure factors identified under the
compliance with hours-of-service rules, operation, the agency would schedule a section ‘‘Strengthening the Safety
including hours-of-service records; compliance review. The following Audit.’’ However, the automatic failure
• Verification of proof of financial actions would trigger expedited action factors would not be retroactively
responsibility; against the motor carrier: applied to safety audits completed prior
• An evaluation of that motor • Using a driver who does not have to the final rule’s effective date. The
carrier’s safety inspection, maintenance, a valid commercial driver’s license. safety audit outcomes determined prior
and repair facilities or management • Operating vehicles that have been to the final rule’s effective date would
systems, including verification of placed out-of-service for violations of remain unchanged by the final rule.
records of periodic vehicle inspections; the Federal Motor Carrier Safety
and Form MCS–150A—Safety Certification
Regulations or compatible State laws for Application for USDOT Number
• Verification of drivers’ and regulations without taking
qualifications, including a required necessary corrective action. The purpose of the MCS–150A is for
commercial driver’s license. • Being involved in, through action or a new entrant to certify it has a system
omission, a hazardous materials in place to ensure compliance with the
Expedited Action
incident involving— FMCSRs and applicable HMRs.
Under existing § 385.307(a), having • A highway route controlled However, based on the SAs conducted
‘‘an accident rate or driver or vehicle quantity of certain radioactive to date, FMCSA has found many new
violation rate that is higher than the materials (Class 7). entrants certified on the MCS–150A
industry average for similar motor • Any quantity of certain explosives they are knowledgeable about the
carrier operations’ triggers an expedited (Class 1, Division 1.1, 1.2, or 1.3). FMCSRs and applicable HMRs and have
SA or compliance review of the new • Any quantity of certain poison in place the safety management controls
entrant. (The reference to a ‘‘driver or inhalation hazard materials (Zone A necessary to conduct interstate
vehicle violation rate’’ is an error and or B). operations, but are not, in fact, in
should read ‘‘driver or vehicle out-of- • Being involved in, through action or compliance with the FMCSRs and
service rate.’’) The agency proposes to omission, two or more hazardous applicable HMRs. Therefore, while the
replace the abbreviated expedited action materials incidents involving hazardous intent of the MCS–150A is valid, in
provisions under § 385.307(a) with the materials other than those listed above. practice it fails. Consequently, FMCSA
same ‘‘Expedited Action’’ provisions • Using a driver who tests positive for is proposing to eliminate the form.
applicable to Mexico-domiciled carriers controlled substances or alcohol or who Conforming amendments are proposed
under § 385.105. As the agency stated in refuses to submit to required drug or to eliminate mention of the MCS–150A
proposing the expedited action alcohol tests. throughout the regulations.
• Operating a motor vehicle that is
provisions for Mexico-domiciled

carriers, we believe these violations not insured as required. Timing of Administrative Reviews
pose the greatest threat to public safety • Having a driver or vehicle out-of- The administrative review provisions
and raise serious questions about a service rate of 50 percent or more based in current § 385.327 are ambiguous with
carrier’s willingness and ability to on at least three inspections within a respect to the time during which a
conduct safe operations. See 66 FR consecutive 90-day period. carrier is allowed to file a request for
22416 (May 3, 2001). In addition to The last item above would replace the administrative review and when it must
identifying potentially unsafe new ‘‘vehicle or driver violation rate that is file a request for administrative review,
if it wants the review to be completed § 385.306 clarifies what action may be adequacy). If FMCSA concludes the re-
before its registration is revoked. taken against any carrier not providing applicant has taken adequate corrective
FMCSA is proposing to revise the truthful and complete information on its action, it would grant the application
section to clarify that, if a new entrant MCS–150. and the re-applicant would not be
disagrees with the findings of an SA, the If a carrier obtains a new USDOT subject to a second SA. The carrier
new entrant must file a request for an Number after being ordered to cease would remain a new entrant, retain the
administrative review within 90 days of operations based on a failed safety same USDOT Number and continue to
the date of the notice of audit failure or audit, prior Unsatisfactory rating, failure be monitored for 18 months from the
within 90 days of the notice of its to pay a civil penalty or any other date the new application is approved.
corrective action being insufficient. reason, and the information is For-hire motor carriers must also
However, if a new entrant wants a discovered after the carrier received reapply for operating authority under 49
decision before the revocation takes another USDOT Number, the agency U.S.C. § 13902, if their operating
effect, the new entrant must file a will revoke the carrier’s new registration authority was revoked.
request for review within 15 days of the and may also take additional If FMCSA revokes a new entrant’s
date of the notice of audit failure. enforcement action against the carrier. If registration because it refused to submit
Requests filed after 15 days will be a carrier obtains a new USDOT Number, to an audit, the new entrant would be
considered, but it is possible the but was not subject to an outstanding required to submit an updated MCS–
revocation would take effect before the order to cease operations under a 150, retain the same USDOT Number,
administrative review process is previous number, the agency may and submit to an SA as soon as
completed, even if the new entrant determine the new USDOT Number practicable once the new application is
eventually prevails and its registration should not be revoked and, instead, link approved. FMCSA intends to flag these
is restored. the history of the two companies by carriers so they will receive an SA as
identifying in our database the new soon as practicable once they reenter the
‘‘Chameleon’’ Carriers USDOT Number as the primary active program. In all instances, a carrier
The agency is concerned about number. The old USDOT Number reapplying for new entrant authority
carriers attempting to evade would be listed in the database as one would be prohibited from operating in
enforcement actions and/or out-of- under which the carrier has also done interstate commerce until its new
service orders issued against them by re- business, and its safety history, application is approved. As in the case
registering as new entrants and including enforcement actions against above, a new 18-month monitoring
operating as different entities under new the carrier, would be imputed to the period would start upon approval of the
USDOT Numbers. We call these entities new entity. new application.
‘‘chameleon’’ carriers. A carrier that ceased interstate To retain historical information on a
Such a carrier might attempt to operations and wishes to reapply should revoked new entrant’s past performance,
conceal its former identity by leaving submit an updated MCS–150 and list its FMCSA would require the new entrant
blank the response to items 16 and 17 old USDOT Number when applying. to retain the same USDOT Number
on the ‘‘Motor Carrier Identification The agency would reactivate the when reapplying for registration. This is
Number—Application for USDOT USDOT Number upon approval of the consistent with what FMCSA has done
Number’’ (Form MCS–150). Items 16 application. in the past and is currently doing
and 17 of the MCS–150 request the whenever a carrier is placed out-of-
carrier’s USDOT Number or MC or MX Reapplication Process
service and subsequently remedies
Number. In other cases, the carrier may Current § 385.329(a) states a new whatever deficiencies resulted in the
attempt to hide the fact that its USDOT entrant whose new entrant registration out-of-service order.
Number is revoked by falsifying the has been revoked and whose operations
response to item 28 on the MCS–150, have been placed out-of-service must Household Goods
which asks whether the carrier’s wait 30 days after the revocation date to Currently, the SA does not evaluate
USDOT Number registration is currently reapply. Current § 385.329(b) states the compliance with FMCSA’s household
revoked by FMCSA, and if so, requires motor carrier will be required to initiate goods (HHG) regulations (49 CFR part
the carrier to list this number. Item 30 the application process ‘‘from the 375). In order to strengthen its oversight
on the MCS–150 requires the carrier to beginning,’’ demonstrate it has corrected of the HHG industry, FMCSA is
certify the information provided on the the deficiencies resulting in revocation, proposing to include questions
MCS–150 is true, correct and complete. and otherwise ensure it has adequate regarding HHG requirements in the
Unfortunately, some carriers basic safety management controls. Some audit. Because the HHG requirements
deliberately fail to disclose information have interpreted ‘‘from the beginning’’ are not safety related, however, FMCSA
regarding their history in order to evade to mean the carrier must resubmit all would not count the answers toward the
civil penalties assessed against the documents submitted when the new pass/fail determination. Instead, any
company or to circumvent out-of-service entrant initially applied for new entrant violations found would be enforced
orders and other operational restrictions registration and, if the application is through other means (e.g., a compliance
by obtaining new USDOT Numbers. accepted, undergo another SA and review).
Often these chameleon carriers go receive a new USDOT Number. The
undetected until the agency conducts an agency proposes to address the Americans With Disabilities Act
SA or compliance review. reapplication issue by establishing two The SA also does not evaluate
The agency is committed to ensuring separate procedures based upon what compliance by passenger carriers with
only safe carriers are permitted to caused the revocation. the Americans with Disabilities Act of
continue operating on our nation’s Under proposed § 385.329(b), a new 1990 [Public Law 101–336, 104 Stat.
highway. FMCSA has the authority to entrant whose registration is revoked for 327, July 26, 1990] (ADA). DOT
correct, modify, or revoke new entrant failing the safety audit would reapply by regulations at 49 CFR part 37 prohibit
registration issued inadvertently, or submitting an updated Form MCS–150 discrimination against individuals with
obtained by fraud, misrepresentation or and providing evidence of corrective disabilities in the provision of
other wrongful means. Proposed action (which FMCSA would review for transportation services, and require
certain vehicles to be readily accessible performed may subject the new entrant Arbitral Panel Report 3 dated February
to and usable by such individuals. In to the penalty provisions in 49 U.S.C. 6, 2001, and the provisions of Section
order to strengthen its oversight over § 521(b)(2)(A).’’ The term ‘‘initial’’ 350 of the FY 2002 Department of
ADA issues, FMCSA is proposing to before the word ‘‘refusal’’ unnecessarily Transportation Appropriations Act. The
include questions regarding ADA limits FMCSA’s ability to impose NAFTA Arbitral Panel (the Panel) noted
compliance in audits of new entrant penalties against recalcitrant carriers. that: (1) The United States is not
passenger carriers. As with violations of Therefore, FMCSA is proposing to required to treat applications from
the HHG requirements, FMCSA would remove the word ‘‘initial’’ before the Mexico-domiciled trucking firms in
not count the answers toward the pass/ word ‘‘refusal’’; this change would exactly the same manner as applications
fail determination. Instead, any permit FMCSA to consider any refusal from U.S. or Canadian firms, as long as
violations found would be enforced by as a basis for imposing penalties. they are reviewed on a case by case
forwarding apparent violations to the basis; and (2) given the different
U.S. Department of Justice or, if the The New Entrant Safety Assurance enforcement mechanisms in place in the
carrier is a recipient of DOT financial Process and Non-North America- United States and Mexico, it may be
assistance, through DOT administrative Domiciled Motor Carriers justifiable for the United States to
enforcement action. Congress ratified the Central address legitimate safety concerns
American Free Trade Agreement in the through different methods of ensuring
Other Changes
summer of 2005. In preparation for compliance with the U.S. regulatory
Today’s proposal would amend regime. Similarly, the Panel found it
implementation of this treaty, FMCSA
§ 385.319, which concerns the new may not be unreasonable for the United
examined the agency’s programs to
entrant’s responsibilities for remedying States to implement different
deficient safety management practices ensure that any CMVs entering the
United States from Central American procedures with respect to service
discovered during the safety audit. It providers from another NAFTA country
adds an additional category of passenger countries were operating safely. Central
American motor carriers, and indeed if necessary to ensure compliance with
carriers to the description of which its own local standards by these service
carriers must remedy deficiencies any motor carrier from a country other
than the United States, Canada, or providers.
within 45 days of notification by Mexico’s motor carrier safety
FMCSA—new entrants that haul Mexico (non-North America-domiciled
motor carriers), are not covered by regulatory system lacks several of the
passengers in a vehicle used or designed components that are central to the U.S.
to transport between 9 and 15 FMCSA’s existing New Entrant
oversight programs. There are 64 system. As the Panel found, the U.S. is
passengers for compensation.2 The responsible for the safe operation of
corrective action periods in § 385.319(c) carriers from Central American
countries that have registered with the motor carriers within U.S. territory,
were modeled after the 45- and 60-day regardless of the carriers’ country of
effective dates of Unsatisfactory safety agency to operate CMVs in the United
States. origin, and FMCSA believes we must
ratings in 49 CFR 385.11. Section 385.11 ensure each carrier is safe to protect
subjects all motor carriers transporting The registered Central American U.S. highway users. The safety
passengers by CMV to the 45-day carriers are domiciled in Guatemala, El monitoring process for Mexico-
requirement, including CMVs designed Salvador, Belize, Honduras, Panama, domiciled carriers provides FMCSA
to transport between 9 and 15 and Nicaragua. The average vehicle fleet with the necessary level of assurance, in
passengers for compensation. The May size for these carriers is one or two a manner consistent with the Panel’s
2002 IFR inadvertently failed to apply tractor-trailers. Sixty-three of the 64 findings, and the relevant provisions of
the 45-day requirement to small vehicle carriers classified their operations as NAFTA. It ensures that Mexican motor
passenger carriers, subjecting them private motor carriers of property. A carriers seeking U.S. operating authority
instead to the 60-day period applicable single carrier listed its operation type as are capable of complying with the U.S.
to property carriers not hauling private motor carrier of passengers safety regulatory regime.
hazardous materials requiring (business). Most of the Central The New Entrant Safety Assurance
placarding. We propose to amend American carriers contracted with the Process for U.S. and Canada-domiciled
§ 385.319(c), as well as §§ 385.323, same processing agent located in carriers is based upon an in-depth
385.325, and 385.327 to make them Brownsville, Texas, to file the USDOT understanding of the safety systems in
consistent with § 385.11. Section Number application with FMCSA. Each each country and a long history of cross-
385.319 has also been rewritten to cross of the carriers, including the passenger border truck and bus operations.
reference the definition of CMVs carrier, listed general freight or motor Because FMCSA lacks understanding
relating to hazardous materials carriers vehicles as its cargo type. and experience with the safety systems
in 49 CFR 390.5 for purposes of FMCSA has considered several of Central American and other non-
consistency. options for a safety monitoring process North American countries, the agency
Current § 385.337(a) states: ‘‘The deems it appropriate to adopt an
for non-North America-domiciled motor
initial refusal to permit an SA to be alternate method of overseeing the
carriers, including (1) subjecting them to
2 Under existing FMCSA regulations, most of the the safety monitoring process for compliance and safety of non-North
FMCSRs do not apply to the transportation of Mexico-domiciled carriers; (2) America-domiciled-motor carriers. The
passengers in such vehicles within a 75 air-mile subjecting them to the New Entrant alternate oversight method for non-
radius of the driver’s work reporting location, or Safety Assurance Process for U.S. and North America-domiciled motor carriers
when the carrier is not directly compensated. See

49 CFR § 390.3(f)(6). However, section 4136 of Canada-domiciled carriers; or (3) is similar to FMCSA’s oversight program
SAFETEA–LU eliminated the 75 air-mile distance developing an alternate oversight for Mexico-domiciled motor carriers. It
limitation. Therefore, all carriers transporting program compatible with existing also is consistent with sec. 210(a) of
passengers in CMVs designed to carry between 9
and 15 passengers will be subject to the new entrant regulatory authority. MCSIA because it would require a safety
requirements, provided such carriers are directly The safety monitoring system for
compensated. In a separate rulemaking, § 390.3(f)(6) 3 In the Matter of Cross-Border Trucking Services,
will be amended to achieve consistency with this

Mexico-domiciled carriers is based Secretariat File No. USA–MEX–98–2008–01, Final
statutory change. upon standards set out in the NAFTA Panel, (February 6, 2001).
review of a new entrant non-North out-of-service order resulting from a A. Proposed Application Process for
America-domiciled motor carrier within compliance review compared to Non-North America-Domiciled Motor
the first 18 months of operations. proposed revocation of new entrant Carriers
FMCSA would implement the minimum operating authority resulting from a new B. Proposed New Form—OP–1(NNA) for
requirements provision of sec. 210(b) for entrant safety audit), FMCSA believes Non-North America-Domiciled Motor
these carriers through Form OP– conducting a compliance review is an Carriers Requesting New Entrant
1(NNA). Because sec. 210(a) of MCSIA equivalent level of oversight due to its Registration
requires the Secretary to issue comprehensive nature, the resultant C. Proposed Safety Monitoring System
regulations mandating safety reviews of safety rating for the carrier, and the for Non-North America-Domiciled
all new entrant carriers, today’s action possibility of civil penalties. In Motor Carriers.
proposes such regulations for non-North addition, non-North America-domiciled A. Proposed Application Process for
America-domiciled motor carriers. Due motor carriers would be subject to the Non-North America-Domiciled Motor
to FMCSA’s lack of knowledge same cross-border inspections as Carriers
regarding the safety regimes of their Mexico-domiciled carriers. Vehicles
home countries (as opposed to Canada FMCSA proposes to add a new
operated by non-North America-
and Mexico), FMCSA will use subpart H to part 385 to address the
domiciled motor carriers will be subject
experience gained through the alternate specific requirements of the application
to the same inspection standards as
oversight safety monitoring system to process for all non-North America-
other CMVs entering or operating within
determine whether further regulatory domiciled motor carriers applying for a
the United States and will be inspected
changes may be appropriate in the USDOT Number. First, proposed
at the U.S.-Mexico international border
future. The agency requests information § 385.601 explains that subpart H would
unless displaying a valid safety decal.
on the safety systems of Central apply to any non-North America-
American and other non-North Through the agency’s process of domiciled motor carrier that wants to
American countries. gathering information on non-North operate within the United States to
America-domiciled motor carriers, provide transportation of property or
Monitoring the Safety of Existing Non- another group of carriers from Central passengers in interstate commerce.
North America-Domiciled Motor America has been identified. This group Proposed § 385.603 requires these
Carriers of carriers allegedly drives or flies applicants to file—
FMCSA will educate, review and drivers into interior States to purchase • Proposed Form OP–1(NNA)—
monitor the 64 registered non-North used tractor/trailers, school buses, farm Application for U.S. Department of
America-domiciled motor carriers and equipment, and other vehicles. These Transportation (USDOT) Registration by
any additional non-North American vehicles are transported to Central Non-North America-Domiciled Motor
carriers issued a USDOT Number prior America through the United States and Carriers,
to the effective date of any final rule Mexico without proper registration, • Form MCS–150—Motor Carrier
promulgated for today’s notice of insurance or licensing. This migration of Identification Report, and
proposed rulemaking. Compliance exports from the United States is • A notification of the means used to
reviews will be conducted within three funneled primarily through one designate process agents.
months on all existing non-North location—the Los Indios Port of Entry to The application would need to be
America-domiciled motor carriers to Mexico. filled out in English and be complete to
assess their compliance with U.S. be considered. Information on obtaining
To address this situation, FMCSA will applications is also provided.
regulations. With respect to additional
initially educate southbound non-North Proposed Form OP–1(NNA) would
non-North America-domiciled carriers
America-domiciled motor carriers by serve the dual purpose as being an
that register with FMCSA before the
providing warnings and informing them application for new entrant registration
effective date of any final rule
of the requirements for complying with (for all non-North America-domiciled
promulgated for today’s notice of
the Federal Motor Carrier Safety carriers) and operating authority (for for-
proposed rulemaking, FMCSA will (1)
Regulations. Following the educational hire carriers subject to the requirements
manually review each application for
period, FMCSA will perform periodic of 49 CFR part 365). Together with the
USDOT Number (Form MCS–150) filed
compliance strike force activities MCS–150, the OP–1(NNA) would
by non-North America-domiciled motor
carriers to ensure they are complete and targeting non-registered southbound provide a more complete picture of the
accurate; and (2) conduct a compliance traffic at the Los Indios Port of Entry to carrier’s operational characteristics as
review of these carriers within 6–12 Mexico. Non-compliant carriers will well as its safety compliance and other
months of issuing a USDOT Number receive enforcement action ranging from key information than could be obtained
registration and/or operating authority. roadside inspection citations to placing through either form alone.
FMCSA will monitor all non-North drivers and vehicles out of service, if FMCSA would not impose a
America-domiciled motor carriers for warranted. FMCSA requests comments registration fee for new entrant
violations of the 11 regulations that the on this alternate oversight system for registration unless the applicant also
agency considers as minimum standards non-North America-domiciled motor requires operating authority under part
for safe operations (the same violations carriers. 365, for which an application fee is
proposed as automatic failure factors in Proposed Registration and Safety charged. Under FMCSA’s current
this NPRM) and conduct an expedited Monitoring Process for Non-North regulations, a non-North America-
compliance review of any non-North America-Domiciled Motor Carriers domiciled for-hire carrier of non-exempt
America-domiciled motor carrier when Applying for a USDOT Number commodities must submit Form OP–1
a violation of these regulations is and pay a $300 application fee.
discovered. While the consequences of Today’s action proposes regulations Conforming amendments are proposed
undergoing a compliance review and governing the registration and safety to §§ 365.101 and 365.105 to clarify that
failing a new entrant safety audit may be monitoring of new entrant non-North a non-North America-domiciled motor
somewhat different (civil penalties, a America-domiciled motor carriers. The carrier would request operating
safety rating, and perhaps an operations proposals are discussed as follows: authority by using Form OP–1(NNA)
and consequently be subject to the applicant passes the audit.4 However, Canada-domiciled private motor carriers
application fee. the applicant will not be authorized to, in a separate rulemaking.5
Form MCS–150 would be used to and must not, begin operating within The new entrant registration would
obtain a USDOT Number. Conforming the United States unless it has filed not become permanent unless the
amendments have been made to evidence of financial responsibility carrier successfully completes the
proposed § 390.19 to require a non- pursuant to 49 CFR part 387 and proposed 18-month safety monitoring
North America-domiciled motor carrier designated a process agent. system proposed under new subpart I to
to file the MCS–150 before beginning The proposed Appendix to 49 CFR part 385. Successful completion of the
operations within the United States and part 385, subpart H, sets forth criteria safety monitoring system includes
to submit an updated form every 24 governing the pre-authorization safety having each CMV operated in the
months after issuance of a USDOT audit. During the pre-authorization United States pass a North American
Number. safety audit, FMCSA would validate the Standard commercial motor vehicle
Form BOC–3. The non-North accuracy of information provided in the inspection every 90 days (as indicated
America-domiciled motor carrier application and determine whether the by issuance of a valid safety decal for
additionally would be required to notify carrier has basic safety management each of these vehicles) and obtaining a
the agency regarding designation of Satisfactory safety rating as a result of
controls necessary to ensure safe
process agents by either: (1) Submission the required compliance review.
operations. FMCSA would gather
in the application package of Form Under proposed § 385.609, the
information by reviewing a motor
BOC–3—Designation of Agents-Motor applicant must notify FMCSA within 45
carrier’s compliance with ‘‘acute’’ and
Carriers, Brokers and Freight days of any changes or corrections to
‘‘critical’’ regulations in the FMCSRs
Forwarders, or (2) a letter stating that certain key information in the Form OP–
and HMRs. As stated under the
the applicant will use a process agent 1(NNA) or the Form BOC–3—the form
discussion of the New Entrant Safety
that will submit the Form BOC–3 used to designate a process agent.
Assurance Process for U.S. and Canada-
electronically. Failure to do so would be grounds for
domiciled carriers, FMCSA is studying
revocation or suspension of its new
Proposed § 385.605 would require a a new approach to assessing the severity
entrant registration.
non-North America-domiciled carrier to of violations as part of its announced
use only drivers who possess a valid CSA 2010 initiative. This initiative may B. Proposed New Form—OP–1(NNA) for
commercial driver’s license and to ultimately replace the ‘‘acute and Non-North America-Domiciled Motor
subject those drivers to drug and alcohol critical’’ methodology described in the Carriers Requesting New Entrant
testing as required under 49 CFR part Appendix to part 385, subpart H. Registration
382. Acceptable commercial driver’s Conforming amendments are Proposed Form OP–1(NNA) and its
licenses would include: (1) A CDL, (2) proposed for §§ 387.7 and 387.31 to instructions are based extensively on
Canadian commercial driver’s license or require all non-North America- the OP–1(MX) form with certain
(3) a Licencia de Federal de Conductor domiciled motor carriers—private and modifications applicable to non-North
issued by Mexico. FMCSA believes the for-hire—to maintain and file evidence America-domiciled applicants.
CDL and corresponding drug and of financial responsibility with the Proposed Section I of the form solicits
alcohol testing requirements are agency as a condition of registration. information about the applicant’s name,
justified because drivers’ licenses issued FMCSA believes conditioning address, official representative, and
by the various non-North American registration upon receipt of evidence of form of business. Proposed Section IA
countries may not meet FMCSA financial responsibility is appropriate would require the applicant to disclose
standards or State licensing standards for all non-North America-domiciled any existing operations in the United
regarding commercial motor vehicles motor carriers because the financial States, including whether it had
not requiring a CDL. responsibility standards within their previously applied for a USDOT
In proposed § 385.607, FMCSA countries of domicile may not meet U.S. Number. Proposed Section II solicits
explains how the agency would process Federal and State requirements. Section information about any relationships or
an application for new entrant 4120 of The Safe, Accountable, Flexible, affiliations with other entities registered
registration filed by a non-North Efficient Transportation Equity Act: A with FMCSA or its predecessor
America-domiciled motor carrier. To the Legacy for Users (SAFETEA–LU) [Pub. agencies. This information would help
extent practicable, the agency would L. 109–59, 119 Stat. 1762, August 10, FMCSA verify the applicant’s domicile
validate the accuracy of information and 2005] created new Sections 31138(c)(4) in a non-North American country and
certifications with data in its databases, and 31139(c) in title 49 of the U.S. Code, determine whether the applicant holds
and the databases of the governments of authorizing FMCSA to require filing of similar registration in its country of
the country where the carrier’s principal evidence of financial responsibility by domicile. Information regarding
place of business is located. FMCSA private property and passenger motor registration with the applicant’s country
would not grant new entrant registration carriers under its jurisdiction. However, of domicile would enable FMCSA to
unless the carrier passes a pre- only those private motor carriers confirm motor carrier safety issues with
authorization safety audit (discussed domiciled in non-North American its licensing authority.
later in this section). The criteria countries would be subject to financial Under proposed Section III of the
governing the pre-authorization safety responsibility filing requirements under form, the applicant would identify the
audit are fully explained in a new this proposal. FMCSA plans to address type(s) of registration requested. FMCSA
Appendix to part 385, subpart H, which the issue of extending financial would require a separate filing fee for
is modeled after the pre-authorization responsibility requirements to U.S. and each type of registration requested.
safety audit for certain Mexico- Section 4303(f) of SAFETEA-LU
domiciled carriers. 4 Applications by for-hire carriers subject to part
After completing the pre- 365 would also be subject to a 10-day protest 5 Mexico-domiciled private carriers are subject to
period. In such cases, a USDOT Number would not the same financial responsibility filing
authorization safety audit, FMCSA be issued until after the protest period has elapsed requirements as U.S. for-hire carriers pursuant to 49
would issue a USDOT Number if the and any protests filed have been denied. U.S.C. 13902(g).
imposed a January 1, 2007, deadline for amended 49 U.S.C. 13902(a) to require Proposed § 385.701 defines the
the agency to modify carrier such an applicant to: (1) Provide following terms used in new subpart I
registrations for non-exempt for-hire evidence of participation in an to part 385:
motor carriers under 49 U.S.C. chapter arbitration program and a copy of its (1) Compliance review has the same
139 to eliminate distinctions between notice to shippers about the availability meaning as in 49 CFR § 385.3.
common and contract carriers. of binding arbitration; (2) identify its (2) New entrant registration is the
Accordingly, FMCSA has removed the tariff and provide a copy of the notice provisional registration under 49 CFR
common and contract carrier of the availability of the tariff for part 385, subpart H that FMCSA grants
designations from the description of inspection; (3) certify it has read, and is to a non-North America-domiciled
types of registration under proposed willing to comply with all U.S. Federal motor carrier to provide interstate
Section III and modified the proposed laws regarding consumer protection, transportation within the United States.
instructions for Section III to explain estimating, consumers’ rights and It will be revoked if the registrant is not
which for-hire registrations require a responsibilities, and options for limiting assigned a Satisfactory safety rating
registration fee. liability for loss and damage; and (4) following a compliance review
Proposed Section IV notifies the disclose certain financial, operational conducted during the safety monitoring
applicant of financial responsibility and familial relationship with any other period established in subpart I.
requirements. Consistent with long-haul entity involved in the transportation of (3) Non-North America-domiciled
Mexico-domiciled new entrants, all household goods within 3 years of the motor carrier means a motor carrier of
non-North America-domiciled proposed date of registration. property or passengers whose principal
applicants (private and for-hire) would place of business is located in a country
be required to file evidence of financial Proposed Section VII would require
the applicant to specify the scope of other than the United States, Canada or
responsibility with the agency as a Mexico.
condition of registration. FMCSA also registration, indicating intended
principal border crossing points. Proposed § 385.703 describes
proposes making the cargo insurance elements of the safety monitoring
requirement for non-North America- Under proposed Section VIII, the
system for non-North America-
domiciled motor carriers consistent applicant would be required to make
domiciled new entrant motor carriers.
with what was proposed in the Unified specific certifications regarding
The safety monitoring system would
Registration System NPRM (70 FR compliance with laws of the United
include roadside monitoring and a
28990 published May 19, 2005). The States. The applicant would need to
compliance review within 18 months of
May 19, 2005, NPRM proposes that only affirm its willingness and ability to
receiving a USDOT Number.
household goods carriers must maintain provide the proposed service and to
Additionally, the non-North America-
and file evidence of cargo insurance comply with all pertinent statutory and
domiciled carrier would be required—
with the agency. FMCSA would modify regulatory requirements. Certifications
throughout the 18-month safety
proposed Form OP–1(NNA) if the under proposed Section VIII would
monitoring period and for three years
Unified Registration System final rule remind the applicant of statutory and
results in different cargo insurance after its new entrant registration
regulatory responsibilities which, if
requirements. becomes permanent—to display on each
neglected or violated, might subject the
Under proposed Section V, the CMV in its fleet that is operated within
applicant to disciplinary or corrective
applicant would certify and substantiate the United States, a valid safety
action by FMCSA. The applicant would
that it has a system in place to ensure inspection decal. The safety inspection
need to confirm its understanding that
compliance with applicable decal would only be valid for three
its process agent is deemed its official
requirements covering driver months.
representative within the United States
qualifications, hours of service, drug Under proposed § 385.705, a non-
for receipt of filings and notices relating
and alcohol testing, vehicle condition, North America-domiciled motor carrier
to the administrative and judicial
accident monitoring, and hazardous found in violation of the seven listed
process in connection with enforcement
material transportation. Substantiation serious violations or infractions would
of Federal statutes and regulations.
would be in the form of narrative be subject to expedited enforcement
Finally, the applicant would need to
responses describing how the applicant action. Such actions would include an
certify that it is not currently
will monitor hours of service, how it expedited compliance review or, in the
disqualified from operating a
will maintain an accident register and alternative, a demand that the carrier
commercial motor vehicle in the United
how it will monitor accidents. FMCSA demonstrate in writing that it has taken
States.
would also require that the applicant immediate corrective action. The
include the names of individuals in Proposed Section IX, the final section proposed infractions parallel those
charge of its safety program and drug of the form, includes the applicant’s proposed for U.S. and Canada-
and alcohol testing and identify specific oath attesting to the accuracy and domiciled motor carriers and those
locations where the applicant maintains truthfulness of application responses already applicable to Mexico-domiciled
current FMCSRs. Information obtained and certification of compliance with carriers. The section clarifies what
under Section V would enable FMCSA certain U.S. Federal and State laws constitutes a valid commercial driver’s
to evaluate, upon initial application, the regarding distribution or possession of license. The type of action taken by
safety compliance program of the controlled substances. FMCSA in response to any violations
applicant. FMCSA would reject an C. Proposed Safety Monitoring System would depend upon the specific
application that could not offer a for Non-North America-Domiciled circumstances of the violations.
specific, unambiguous plan to ensure Motor Carriers Proposed § 385.705(b) warns that
compliance. failure to respond to a request for a
Proposed Section VI of the form Today’s action proposes a new written response demonstrating
would include new registration subpart I to part 385 covering the corrective action within 30 days would
requirements for motor carriers of proposed safety monitoring system for result in suspension of new entrant
household goods created under Section non-North America-domiciled new registration until the required showing
4204 of SAFETEA–LU. Section 4204 entrants. of corrective action is made.
Proposed § 385.705(c) emphasizes this way, the agency could maintain a General Comments. In general, the
that a carrier that successfully responds complete safety record of the non-North comments were supportive of the new
to a demand for corrective action under America-domiciled motor carrier. entrant requirements in the IFR. The
this section still would need to undergo Proposed § 385.715 provides that the American Trucking Associations (ATA),
a compliance review during the 18- safety monitoring period for non-North American Society of Safety Engineers
month safety monitoring period if it had America-domiciled motor carriers (ASSE), Commercial Vehicle Safety
not already done so. would last for at least 18 months from Alliance (CVSA), Consolidated Safety
Under proposed § 385.707, FMCSA the date it was issued a USDOT Systems (CSS), Daecher Consulting
explains potential outcomes of the Number.6 If, at the conclusion of the Group, Inc. (Daecher), the Independent
compliance review—a Satisfactory, 18-month safety monitoring period, the Truckers and Drivers Association
Conditional, or Unsatisfactory rating— carrier has received a Satisfactory safety (ITDA), the National Private Truck
and FMCSA follow-up actions in rating and is not currently under a Council (NPTC), the Indiana State
response to each rating. The proposed notice from FMCSA to remedy Police, Schroeder & Associates, the
section would require the compliance deficiencies in its basic safety International Brotherhood of Teamsters
review to be conducted consistent with management practices, the carrier’s (IBT) and Tran Services generally
existing FMCSA safety fitness registration would become permanent. supported the IFR and offered
evaluation procedures under 49 CFR If the carrier is under a notice to comments to improve the rulemaking.
part 385, Appendix B. These are the remedy deficiencies in its basic safety The Canadian Trucking Alliance (CTA)
same criteria in use for U.S., Canada and management practices, the safety supported the IFR to the extent it
Mexico-domiciled carriers. monitoring period would be extended— applies equally to Canada- and U.S.-
FMCSA sets forth under proposed and its new entrant designation would domiciled carriers. CVSA stated the
§ 385.709 the specific time frames for continue—until FMCSA determines the SA—if properly implemented and
suspension and revocation of new carrier is complying with the Federal accompanied by CDL reforms,
entrant registration. We believe the safety regulations or revokes its technology and increased traffic
proposed procedures strike an registration under § 385.709. enforcement—will have a dramatic and
appropriate balance between the need to If FMCSA is unable to conduct a measurable impact on safety. CVSA
protect the public from potentially compliance review within the 18-month submitted a petition to delay the
unsafe carriers and preservation of the period, proposed § 385.715(c) would implementation of the New Entrant
carrier’s due process rights. extend the safety monitoring period Safety Assurance Process until States
Proposed § 385.711 sets forth
until such time as the agency completes receive adequate funding and after
procedures for requesting administrative
and evaluates a review. certain procedural issues relating to the
review of the agency’s safety rating or its
Proposed § 385.717 emphasizes that process are resolved.
decision to suspend or revoke new
the non-North America-domiciled motor Several commenters opposed the IFR
entrant registration. The request must
carrier also would be subject to the same for various reasons. Advocates for
explain the error it believes FMCSA
committed and a list of all factual and general safety fitness procedures in 49 Highway and Automobile Safety
procedural issues in dispute. In CFR part 385, subpart A, and to (AHAS) and Public Citizen opposed the
addition, the carrier must include any compliance and enforcement agency’s decision to publish an IFR
information or documents that support procedures applicable to all carriers instead of a notice of proposed
its argument. Following the regulated by the FMCSA. rulemaking. Both urged the agency to
administrative review, which would be Proposed § 390.19 explains filing permit full public involvement in the
conducted by the FMCSA Associate procedures for the MCS–150 in greater New Entrant Safety Assurance Process
Administrator for Enforcement and detail and would subject non-North rulemaking. AHAS indicated the quality
Program Delivery, the agency would America-domiciled motor carriers to the of FMCSA regulatory drafting and
notify the carrier of its decision. This biennial update requirement. publication would be improved by
decision would constitute the agency’s Additionally, § 390.19(h)(2) proposes a providing sufficient documentation of
final action. Administrative review technical correction documenting the agency reasoning and decisions in its
would be completed in no more than 10 existing requirement for a Mexico- final regulations. Public Citizen stated
days after the request is received. domiciled long-haul motor carrier to the New Entrant Safety Assurance
Under proposed § 385.713, a non- successfully complete a pre- Process is rooted in self-reporting and
North America-domiciled carrier whose authorization safety audit prior to being devoid of meaningful oversight.
registration has been revoked would be issued a USDOT Number. According to Public Citizen, only an
prohibited from re-applying for new extremely negligent new entrant would
Discussion of Comments
entrant registration for at least 30 days be denied operating authority under this
after the date of revocation. When FMCSA received 29 responses to the process. Public Citizen urged the agency
reapplying, the non-North America- IFR from 19 commenters. The to:
domiciled motor carrier again would be commenters were five trade • Permit full public involvement in
required to pass a pre-authorization associations, four safety consultants, the New Entrant rulemaking.
safety audit. The carrier would need to two public interest groups, three private • Eliminate from the process all
demonstrate to the FMCSA’s satisfaction citizens, a State police department, a requirements for uncorroborated self-
that it has corrected the deficiencies that safety enforcement organization, an reporting.
occupational health private practice, a • Make a proficiency examination,
resulted in revocation of its registration

and that it otherwise has effectively union, and a professional association. and third-party, in-person verification of
functioning basic safety management Five commenters made multiple regulatory compliance and knowledge,
systems in place. If the application is submissions. prerequisites for granting operating
approved, the carrier’s USDOT 6 If a carrier’s USDOT Number was revoked and
authority.
Number—linked to its previous safety reinstated under the provisions of proposed
• Develop a plan that assures the SA
record—would be reactivated; a new § 385.713, the 18-month period would run from the will be conducted within an 18-month
USDOT Number would not be issued. In date of reinstatement. time period.
• Establish stricter penalties for best time to conduct an audit is within action to the satisfaction of FMCSA. The
noncompliant motor carriers. 6 to 9 months of beginning operations. Indiana State Police urged FMCSA to
The Transportation Lawyers Only CSS agreed that an 18-month place both the vehicle and driver out-of-
Association (TLA) commented the IFR period may be necessary to effectively service until corrective action is taken if
fails to meet the statutory requirement evaluate a carrier from a regulatory a carrier is found to be operating
of ensuring a carrier is knowledgeable perspective because it affords the carrier without USDOT new entrant
about its safety responsibilities prior to an opportunity to execute certain registration.
commencing operations. ‘‘FMCSA requirements. The Indiana State Police FMCSA Response: The current
proposes nothing in this proceeding that recommended having a certified regulations under § 385.319 provide that
will reduce the ‘safety learning curve’ FMCSA representative conduct the SA FMCSA must notify a carrier of any
before a new carrier begins operating.’’ within 30 days of issuance of the inadequacies found during an SA and
TLA contended that safety certifications USDOT Number and CVSA advocated a advise the carrier what actions it must
and educational and technical face-to-face meeting with the new take to remedy the inadequacies to
assistance materials have been used by entrant at the time of the application. avoid having its registration revoked.
the agency for many years and have FMCSA Response: As noted above, 49 The carrier must submit written
already proven inadequate. U.S.C. 31144(g)(1) requires FMCSA to evidence of corrections taken, and
FMCSA Response: In a letter dated establish an 18-month period within FMCSA reserves the right to determine
April 11, 2003, the agency denied the which new entrant safety reviews must whether they are adequate. FMCSA is
CVSA petition to delay implementation be conducted. Furthermore, as a required to provide the carrier with
of the New Entrant Safety Assurance practical matter, FMCSA believes official notice of the deficiencies and
Process until January 2004 and carriers will not have sufficient records the opportunity to correct them. The
addressed CVSA concerns, including to allow the agency to review and carrier must respond with more than a
those related to adequate State funding evaluate the adequacy of a carrier’s self-certifying statement. For example,
for implementing the new entrant basic safety management controls until acceptable demonstration of corrective
process, adequate training for State and the carrier has been operating for action for a carrier found to not have a
Federal personnel charged with approximately 3 months. drug and alcohol testing program would
conducting safety audits, and Scope of the Audit. Some commenters be evidence documenting membership
recognition of Canadian and current took issue with the SA itself and in a consortium. Under § 385.325, if a
State new entrant programs. A copy of recommended broadening the scope of carrier does not demonstrate corrective
the letter is in the docket to this rule. the audit to address more than just action acceptable to FMCSA, the agency
In developing this proposal, FMCSA compliance issues. ATA recommended would revoke its new entrant
fully considered all comments to the including such topics as employee registration and issue an out-of-service
May 2002 IFR and has adopted some of hiring, bonus and incentive programs, order. If the carrier is found to be
the recommendations. In response to employee training, quality control and operating a CMV in violation of an out-
complaints about self-certifications, this safety meetings. CVSA recommended of-service order, under § 385.331, it
NPRM would eliminate the Form MCS– including a CVSA Level 1 or Level 5 might be fined up to $11,000 per
150A because safety audits have inspection on as many of the carrier’s violation in accordance with 49 U.S.C.
confirmed carrier certifications on the vehicles as possible. 521(b)(2)(A) and 49 CFR part 386,
MCS–150A and findings at the carrier’s FMCSA Response: FMCSA proposes Appendix B (a)(3).
place of business are not always broadening the scope of the audit to Form MCS–150A. Several commenters
consistent (See the ‘‘Form MCS–150A’’ include additional areas over which it encouraged FMCSA to eliminate the
subheading). Later in this section under has jurisdiction, such as operating MCS–150A. ATA contended that many
applicable subject headings, the agency authority, and household goods and of the certification statements on the
addresses specific concerns from AHAS, ADA regulatory compliance. However, form are already collected on the
TLA and Public Citizen regarding the as noted previously, only safety-related registration application and suggested
use of proficiency examinations (see the questions would count toward the pass/ we retain and incorporate certification
‘‘Proficiency Examinations’’ fail determination. The agency also statements 18 and 19 into the MCS–150.
subheading) and plans to improve the proposes to strengthen the audit by ITDA urged FMCSA to require each new
educational and technical assistance making specific violations, such as applicant to provide a written plan
(ETA) materials by including operating without a required CDL, result demonstrating the applicant’s
information on how to comply with the in automatic failure of the audit. knowledge of motor carrier safety
regulations (see the ‘‘ETA Materials’’ Currently, the SA involves a Level 1 or regulations and its ability to safely
subheading). The rule provides 5 inspection of a sample of the carrier’s operate a trucking business. Public
additional details about the scoring vehicles. If there are insufficient Citizen regarded the certifications on
methodology and how the agency vehicles on site at the time of the audit, the MCS–150A as uncorroborated
intends to strengthen the New Entrant the auditor completes the audit and declarations by the applicant.
Safety Assurance Process under the documents why he/she was unable to FMCSA Response: FMCSA agrees the
previous section titled ‘‘Discussion of conduct the inspections. MCS–150A is not producing the
the Proposed Rule’’ under the Safety Audit and Corrective Actions. intended results. FMCSA’s review of the
‘‘Strengthening the Safety Audit’’ Public Citizen opposed having a new New Entrant Safety Assurance Process
subheading. entrant self-certify regarding corrective has verified many new entrants are
Timing of the SA and 18-month action for deficiencies revealed during falsely certifying to having safety
monitoring period. Several commenters the SA and asserted FMCSA should management controls when they are not
took issue with the timing of the SA and require in-person verification of actually in place. The agency proposes
the 18-month monitoring period. ASSE corrective action. The Teamsters urged to eliminate Form MCS–150A.
stated that the 18-month period is too the agency to immediately suspend any Proficiency Examination. Several
long, Daecher contended that a 6-month new entrant found to be lacking basic commenters opposed FMCSA’s decision
period would be adequate, and safety management controls during the to not require a proficiency examination
Schroeder & Associates believed the SA until it has demonstrated corrective for new entrants. AHAS argued the IFR
does not adequately consider the use of one operates. ITDA urged FMCSA to inspections. Although the agency does
a proficiency examination to measure establish a process that encourages a not identify a new entrant that has not
new entrant safety. CSS supported the new entrant to seek information and yet passed an SA by assigning a unique
use of a proficiency examination as a guidance and makes that information USDOT Number, FMCSA is able to
component of the New Entrant Safety and guidance easily accessible. A target such new entrants for an SA or
Assurance Process and offered to private citizen recommended classroom roadside inspection using information
discuss its current program with the instruction for new entrants. systems such as SafeStat, the Inspection
Department of Defense (DOD) and FMCSA Response: FMCSA agrees the Selection System (ISS) and the Motor
associated procedures with FMCSA. ETA materials need to be updated to Carrier Management Information System
CVSA stated that in addition to using better inform new entrants about (MCMIS).
enhanced, comprehensive educational regulatory requirements and how to Safety Audit. Other commenters
and technical assistance materials, comply fully with the requirements. The stated FMCSA should disclose the SA
FMCSA should administer a proficiency ETA materials are an integral Evaluation Criteria, Forms, and
examination to measure a new entrant’s component of the entire New Entrant Monitoring Procedures. Both ATA and
knowledge of Federal motor carrier Safety Assurance Process. One of the AHAS requested the SA evaluation
safety standards. According to CVSA, a reasons stated in the March 2002 IFR for criteria be placed in the rulemaking
new entrant’s self-certification alone is not initiating a proficiency exam was docket for review and comment, and
insufficient proof of adequate systems to FMCSA’s belief that the educational and complained that FMCSA has not
assure compliance with the FMCSRs. technical assistance provided to new disclosed the criteria by which a new
Daecher asserted that giving ETA entrants would ensure they understood entrant will be evaluated.
materials to a carrier does not ensure the the applicable safety regulations. FMCSA Response: Appendix A to 49
carrier will read and understand the However, it is apparent many new CFR part 385 explains the SA evaluation
information. It encouraged FMCSA to entrants are not fully compliant and one criteria, including the source of the data
use a proficiency examination to ensure of the reasons is because the ETA and how FMCSA determines whether a
the carrier has knowledge of the materials are not as comprehensive as new entrant has basic safety
regulations and related safety they need to be. FMCSA plans to review management controls.
information. Public Citizen urged the all ETA materials provided to new
Reciprocity. CTA urged FMCSA to
agency to make a proficiency entrants and improve the quality,
exempt from the SA audit requirement
examination a prerequisite for receiving content, and format of the material.
The agency believes enhanced ETA Canada-domiciled new entrant carriers
operating authority. According to Public
materials, including a new entrant that have undergone a provincial facility
Citizen, the examination would be a far
safety assurance compact disc, would audit during the 18-month monitoring
more comprehensive evaluation of
substantially increase a new entrant’s period.
regulatory knowledge than certifications
made on the MCS–150A. awareness of carrier responsibilities FMCSA Response: Although FMCSA
FMCSA Response: The agency before beginning operations and would, is engaged in ongoing discussion with
believes the planned enhancements to to a great extent, make them proficient its Canadian partners concerning the
the ETA materials, as discussed in in those requirements. FMCSA further New Entrant Safety Assurance Process,
greater detail below, would provide believes the anticipated benefits of the today’s rulemaking is not proposing an
most carriers with sufficient enhanced ETA materials more than exemption for a Canada-domiciled new
understanding of applicable regulations justify associated agency costs. FMCSA entrant carrier that has passed a
and assistance on how to comply with has determined the contents of these provincial facility audit for several
the applicable FMCSRs and HMRs and materials are not subject to notice and reasons. First, 49 U.S.C. 31144(g)(1)
that a proficiency examination is not comment because they do not establish specifies the regulation must require
necessary. However, the agency standards or procedures, but will place each new entrant to undergo the safety
recognizes knowledge alone does not a copy of the updated ETA materials in review (audit) within the first 18
ensure a carrier is in satisfactory the docket to this rule for inspection months of beginning operations. The
compliance with the regulations. Only a upon completion. statutory language provides no authority
review of the carrier’s records and Safety Monitoring During the 18- to exempt new entrants, including
systems could demonstrate such month Period. ATA requested specific Canada-domiciled carriers that have
compliance. details about how the agency intends to successfully undergone a provincial
ETA Materials. Several commenters monitor new entrants during the 18- facility audit, from the SA. Furthermore,
addressed the subject of educational and month period. Section 385.307(a) states: the Canadian provincial facility audit
technical materials for new entrants. ‘‘[t]he new entrant’s roadside safety fails to address all of the elements of the
AHAS and ATA complained FMCSA performance will be closely monitored new entrant SA. For example, Canada
has not provided an opportunity for to ensure the new entrant has basic does not require a carrier to have a
public review and comment on those safety management controls that are controlled substance and alcohol testing
educational and technical assistance operating effectively.’’ ATA believed program for its drivers. FMCSA could
materials new entrant carriers will this is insufficient information verify a Canada-domiciled carrier is
receive. They suggested the agency concerning how the agency will monitor aware of, and in compliance with, the
place the ETA materials in the new entrants during the 18-month agency’s controlled substances and
rulemaking docket or direct readers to period. CSS and CVSA supported alcohol testing requirements only by
where on the agency web site they can development of a unique registration conducting a new entrant SA under part
be obtained. CTA recommended and USDOT Number to identify new 385. Moreover, § 31148(b) requires the
revising the ETA materials to generally entrants that have not yet passed the SA to be conducted by: (1) A motor
and clearly acknowledge distinctions SA. carrier safety auditor certified under
between U.S. and Canadian rules. FMCSA Response: FMCSA would FMCSA regulations or (2) a Federal or
According to CTA, this would warn new continue to monitor a new entrant’s on- State employee who on the date of the
entrants that rules can, and do, vary road performance using agency enactment of § 31148(b) was qualified to
depending on the jurisdiction in which information systems and roadside perform such an audit or review.
Canadian provincial officials may not FMCSA conducts group audits only in and software, and how the Government
meet these qualifications. those areas where practicable. will measure program effectiveness.
Alternate Locations for Audits. The Currently, an SA provides education CSS believed that its own experiences
IFR also requested comments on the and technical assistance to a motor in conducting inspections for DOD
advisability of conducting some SAs at carrier that has recently begun support its position that ‘‘there are
alternate locations. ATA agreed the use operations. In addition, the SA provides many well trained and qualified
of locations other than the carrier’s FMCSA with the opportunity to ensure transportation safety professionals in
place of business for the SA may be the carrier’s compliance with applicable the private sector.’’
beneficial, but recommended that Federal safety regulations. Normally, an Indiana State Police supported the use
alternate location scheduling remain SA would take from 2 to 4 hours to of FMCSA-certified private contractors
optional and used at the discretion of complete. Unlike the in-depth to conduct abbreviated SAs before the
the motor carrier scheduled for the compliance review for motor carriers carrier begins operations. Indiana
audit. CVSA commented that the that are not in the new entrant program, asserted these contractors could provide
primary value of the SA is the the SA focuses on education. By the basic educational and technical
personalized evaluation and education conducting these audits at the carrier’s guidance in a classroom setting when
provided by the safety professional and place of business rather than in a the USDOT Number would be granted.
did not believe an adequate audit could classroom setting, auditors gain a Indiana stated the private contractor
be conducted in a group setting. CVSA broader perspective of the company’s could bill the new entrant for these
supported conducting the SA on-site at structure and level of compliance with services, resulting in a cost savings to
the new entrant’s place of business. CSS Federal safety regulations. FMCSA.
Schroeder & Associates supported the
also opposed the use of alternate Use of Private Contractors to Conduct
use of private contractors and suggested
locations for the SA. Although Safety Audits. The IFR requested
adopting the expertise levels described
acknowledging there are obvious comments on whether private
in FMCSA’s March 19, 2002, IFR titled
economies associated with this contractors certified by FMCSA should Certification of Safety Auditors, Safety
approach, CSS contended that the conduct SAs. AHAS, ASSE, ATA, Investigators, and Safety Inspectors (67
effectiveness and desired results would CVSA, CSS, Daecher, The Indiana State FR 12775) as the standard for such
be significantly reduced, particularly if Police, Public Citizen, Schroeder & contractors. Schroeder suggested that
the primary focus of the SA is to assess Associates, and Tran Services supported FMCSA certify individuals, not
the new entrant’s safety management the use of qualified, private contractors companies, for conducting the SAs.
controls. Public Citizen acknowledged to conduct SAs. AHAS asserted that use They also suggested that the agency
that conducting multiple audits of private contractors would ‘‘provide could model the certification for private
simultaneously might expedite the an opportunity to boost the annual contractors after the former Interstate
number of audits conducted and ease numbers and percentages of motor Commerce Commission Practitioner
agency backlog. However, Public Citizen carriers that are inspected and audited certification process, including
contends a new entrant may be reluctant for safety adequacy.’’ AHAS minimum education and employment
to fully participate in the process for acknowledged that substantial standards and a comprehensive 8-hour
fear of exposing potential vulnerabilities safeguards must be built in order to essay examination. Schroeder further
to its competitors. Another commenter avoid the possibility of fraud and other recommended that the FMCSA SA
stated that effective group audits are not abuses. course be accessible to non-government
possible because carrier operational According to ASSE, a certified safety personnel with a waiver for those who
types are so varied. Tran Services professional (CSP) with appropriate successfully test out of the course.
applauded the use of alternate locations transportation experience would be well Lastly, they recommended FMCSA
to simultaneously provide educational qualified to perform the audits without require private contractors to conduct a
and technical assistance to multiple further designation. ASSE minimum of 12 inspections annually to
new entrant carriers, but opposed recommended the final rule allow the maintain certification.
conducting SAs in such a setting. The use of private auditors who must be Tran Services asserted Federal, State
new entrant would need to bring along accredited by either the Council on and private contractors should be
too many records, and FMCSA may be Engineering and Scientific Specialties identically certified to ensure
unable to provide an individual carrier Board or the National Commission on uniformity. Tran Services, and other
the individual attention necessary to Certifying Agency (NCCA), two private companies, already provide
determine if the carrier is in nationally recognized independent safety services, including ‘‘mock DOT
compliance. accrediting bodies overseeing audits’’ to help companies achieve and
FMCSA Response: FMCSA has professional safety designations for maintain compliance. ITDA opposed the
carefully considered the feasibility of safety, health and environmental use of private contractor inspectors, and
conducting group audits. The agency professionals who are qualified to stated that only Federal and State
believes group audits may present an perform audits such as the new entrant inspectors should conduct the SA at this
excellent opportunity to simultaneously SA. time. ITDA believes that only after the
provide many new entrants with ATA recommended that private New Entrant Safety Assurance Process
educational and technical assistance in contractors receive the same training as is fully implemented and there is
a classroom setting while auditing the Federal and State investigators and use sufficient experience with the process
systems and records of individual new identical audit and data collection should FMCSA consider the use of
entrants in a private, one-on-one setting. techniques. ATA asserted that industry private contractor inspectors.
However, experience has shown group support of the use of private contractors The IBT interpreted sec. 211 of
audits are only beneficial in select is contingent upon strict oversight of MCSIA as prohibiting the use of a
situations, depending on many factors their work. ATA urged FMCSA to private contractor to grant operating
including, but not limited to, the address the use of private contractors for authority to a carrier and that the SA
number of new entrants within the SAs in a notice outlining proposed falls within that prohibition. IBT stated
given geographical area. For this reason, contractor training, auditing procedures the SA is an integral part of the
procedure for obtaining permanent followed by Federal and State safety exceed the $100 million annual
operating authority, and is a auditors. In addition, FMCSA closely threshold as defined in Executive Order
precondition for such authority. IBT monitors the activities of private 12866, FMCSA believes the subject of
contended that SAs are so closely linked contractors by obtaining monthly new entrant motor carrier requirements
with the grant of permanent operating activity reports and reviewing their generates considerable public interest
authority that allowing private internal administrative procedures. and therefore is significant. FMCSA has
contractors to conduct SAs would be a FMCSA is requiring all individuals analyzed the costs and benefits, as
de facto impermissible delegation of performing a privately contracted safety discussed below, and has preliminarily
authority. audit to be certified following the same determined this proposed rule would
Due to the anticipated strain on guidelines applicable to Federal and not be economically significant. This
Federal and State enforcement State safety auditors. They must meet NPRM has been reviewed by the Office
resources, CVSA recommended the the same minimum qualifications as of Management and Budget (OMB).
agency use private contractors to Federal and State safety auditors, A number of studies, some of which
conduct SAs. CVSA argued, given their including certain education and were sponsored by FMCSA or its
limited resources, Federal and State experience requirements, as well as predecessor agency, have evaluated the
officials should not weaken efforts to testing through the FMCSA safety experience of new entrants. While
conduct compliance reviews, roadside International Training Division located the studies differ in emphasis and some
inspections, and traffic enforcement to in Arlington, VA. Private contractors particulars, they all demonstrate new
implement the New Entrant Safety must also pass the same proficiency entrants have higher crash rates than
Assurance Process. CVSA made the exams given to Federal and State safety more established carriers and are less
following specific recommendations auditors and renew their certification likely to comply with Federal
regarding the use of private contractors: annually. The maintenance of regulations.
• Use only properly trained and certification requirement currently As explained previously, this
certified individuals; includes performing a minimum of 24 rulemaking makes a number of revisions
• Exclude the results of private SAs each year. to how the agency monitors and
contractor audits when determining a Completed SAs performed by private evaluates new entrant motor carriers
carrier’s safety rating or for enforcement contractors receive the same scrutiny as operating in the United States, and how
purposes; and those performed by Federal and State these carriers apply for authority. The
• Prohibit private contractors from auditors. Although private contractors rulemaking also establishes procedures
conducting roadside inspections. perform SAs, the results of any audit are for the oversight of non-North American
CVSA also recommended FMCSA motor carriers. Only a very small
not final until reviewed by FMCSA,
conduct a multi-State, private contractor number of non-North American carriers
thus ensuring Federal oversight of the
pilot program modeled after Canada’s are currently operating in the United
program.
third-party auditor pilot program. Since the SA does not result in a States, and we do not expect this
Daecher believed FMCSA should number to grow appreciably in the
safety rating for the motor carrier being
exclusively use qualified private future.
audited, private contractor SAs are not
auditors to conduct the SAs because it OMB guidance states that the agency’s
used to determine a carrier’s safety
is a more easily managed and cost analyses should ‘‘focus on benefits and
rating. A safety rating is only issued
effective option. According to Daecher, costs that accrue to citizens and
upon completion of a compliance
current FMCSA resources are residents of the United States.’’ 7 The
review. Compliance reviews are only
insufficient to handle the anticipated analysis of costs is based on the total
conducted by Federal or State personnel
number of new entrants; opting not to number of new entrants registering with
and cannot be performed by a private
use private contractors would be FMCSA. This rule would impose costs
contractor.
detrimental to the New Entrant Safety on a small number of Canada-domiciled
FMCSA agrees that private industry
Assurance Process and prohibit review and non-North America-domiciled
offers many trained and qualified
of each new entrant within the 18- motor carriers operating in the United
individuals who can be utilized to
month monitoring period. Daecher States. The difference between
ensure public safety. The agency
recommended establishing a including and excluding non-North
acknowledges the strain brought to bear
certification program for private America-domiciled carriers is
upon Federal and State resources due to
contractors to conduct both safety audits imperceptible after rounding. To obtain
the large number of incoming new
and compliance reviews. cost estimates for the U.S.-domiciled
FMCSA Response: Annually, entrant motor carriers annually
registering with FMCSA and hopes to motor carriers, one should reduce the
approximately 48,000 motor carriers
mitigate the situation by continuing to estimates presented by 3.5 percent. Most
register with FMCSA to become new
use private contractors. of the foreign carriers involved are
entrants. Federal and State compliance
domiciled in Canada.
officers are able to conduct SAs on Rulemaking Analyses and Notices The costs associated with the
many of these carriers, but not all of FMCSRs, HMRs, or the New Entrant
them. To increase the number of new Executive Order 12866 (Regulatory
Planning and Review) and DOT Safety Assurance Process IFR should
entrants inspected and monitored for not be counted as a cost of this NPRM
safety compliance under the New Regulatory Policies and Procedures
because these costs were already
Entrant Safety Assurance Process, FMCSA has preliminarily determined
counted when the various measures
FMCSA has been using private this proposed rule is a significant

were first promulgated. Thus, there are
contractors to conduct safety audits regulatory action within the meaning of
no societal costs associated with the
since January 2004. Executive Order 12866 and the U.S.
proposed changes. We are not proposing
FMCSA has built into its contracts Department of Transportation’s
any substantive changes to the
with private contractors effective regulatory policies and procedures
safeguards against fraud and other (DOT Order 2100.5 dated May 22, 1980; 7 OMB, Circular A–4, September 2003, page 15.
abuses. The contractors are required to 44 FR 11034, February 26, 1979). While Available online at http://www.whitehouse.gov/
follow the same policies and procedures the costs of this NPRM would not omb/circulars/a004/a-4.pdf.
operational regulatory requirements; already are required to comply with the Alternative Costs Associated With
motor carriers, including new entrants, FMCSRs and applicable HMRs, Proposed Changes to Safety Audit
are already required to comply with including all the standards that would Scoring System
these regulations. Therefore, this be checked during the safety audit. As of October 2004, 33,787 new
proposal would not place any new Therefore, the costs and benefits of the entrant SAs had been completed. Only
substantive burdens upon new entrants audit should not be ascribed to this 253 of new entrants audited under the
or any other entity. Rather, as explained NPRM; these costs and benefits were program failed the SA under the
above, the proposed changes would included when these regulations were existing scoring criteria, which is only
make the enforcement of existing initially promulgated, so including them 0.75 percent of those receiving an SA.
requirements more rigorous. Any motor now would be double counting. Had the list of proposed automatic
carrier already complying with the
However, we did attempt to measure failure criteria been incorporated into
FMCSRs and HMRs would not face any
these costs and benefits. While they are our regulations at the time these audits
change in practices. This proposal
not properly part of this proposed rule, were conducted, 19,559 of the audited
would include modest administrative
the information may prove useful for carriers would have failed, almost 58
costs for carriers to become aware of the
decision makers. This section therefore percent of those audited. Therefore, the
new consequences for failing to comply
provides an alternate description of the proposed scoring change would have
with existing requirements.
Between 1995 and 2002, an average of impact of this proposal. resulted in an additional 19,306 new
47,535 8 new entrants began operations entrant carriers failing the audit (19,559
We calculated the number of crashes
annually. We assumed this number ¥ 253 = 19,306). On an annual basis,
that must be avoided to make this
would remain constant. As noted above, this translates to 27,162 carriers failing
proposed rule cost beneficial, meaning the audit under the new criteria if there
this NPRM would not impose any new the benefits would exceed the costs. We
operational requirements on new is no change in carrier behavior.13
first converted crashes into dollar values However, it is unlikely the number of
entrants. The only truly new cost to allow for comparison with the cost
involved would be the cost to motor carriers that would fail the audit or
figures, based on work by Zaloshnja et whose new entrant authority would be
carriers of becoming aware of new al. They estimated the cost of an average
requirements when this NPRM is revoked would be this large. The cost of
police-reported crash involving trucks not correcting violations of the 11
promulgated as a final rule. We assumed with a gross vehicle weight rating of
it would take an extra hour for the automatic failure provisions is currently
more than 10,000 pounds was $59,153 low. New entrants cited for one of these
appropriate motor carrier official of each in 2000 dollars.10 FMCSA adjusted this
new entrant to study the new violations are not placed out of service.
figure to 2004 dollars based on the Gross In fact, it is possible for new entrants to
requirements and discern how to best Domestic Product Deflator, which yields
comply with them. Using Bureau of continue operating for some time before
a value of $65,183. remedying their violations. This
Labor Statistics 9 (BLS) estimates for
hourly wages for Transportation New entrant carriers are involved in proposal would dramatically raise the
Managers of $33.50 and 31.5 percent more crashes than more experienced cost of failing to comply with these
employment benefits, we obtain an carriers. According to a 2000 Volpe provisions, with violators possibly
hourly compensation of $44.05. study, new entrants (defined as motor losing their authority and being placed
Assuming learning the new audit carriers registered for less than 2 years) out of business. Raising the cost of not
consequences takes an hour per firm, we were more frequently assessed to have correcting a violation, therefore, would
estimate a cost of $2.1 million annually. Safety Evaluation Area scores in the encourage new entrants to comply with
As noted above, this NPRM proposes worst quartile.11 In fact, new entrants the regulatory requirements, either
eliminating the Form MCS–150A were about twice as likely to have an before they are audited or after they fail
because of its ineffectiveness in Accident SEA score of 75 or above. the audit.
ensuring an understanding of required Therefore, Volpe concludes, SafeStat We believe new entrants would be
basic safety management controls. We results show new entrants to have sensitive to the increased cost of
assume the elimination of this form significantly lower levels of safety violations and would respond
would save new entrants 10 minutes compliance and performance. The accordingly. We assume half of the new
each. Using a clerical wage of $14 per overall motor carrier crash rate from entrants that would otherwise be put
hour, this provision would save new MCMIS is 0.75 crashes per million out of service instead would adjust their
entrants $111,000 annually. The net vehicle miles of travel (MVMT), while practices and behavior to comply with
administrative cost of this proposed rule the new entrant crash rate is 25 percent the regulations. We assume of the
to new entrants is thus $2.0 million per higher, 0.94 per MVMT. 27,162 new entrants failing one or more
year. of the automatic failure criteria, 13,581
The net cost of this proposed rule is
would be placed out of service, and
Alternative Analysis $2.0 million per year. For this proposed 13,581 would make whatever changes
We do not believe this proposed rule rule to be cost beneficial, it would have are necessary to continue operations.
would impose significant costs or to deter 31 crashes ($2.0 million/ These costs are now discussed in turn.
benefits other than those intended and $65,183), or one fatal crash.12
counted in the IFR. As explained Alternative Cost of Replacing New
previously, this proposed rule would 10 Based on Revised Costs of Large Truck- and Entrants 14
Bus-Involved Crashes, by Eduard Zaloshnja, Ted
not introduce any new requirements. Miller, and Rebecca Spicer (National Technical
As discussed in footnote 14, we
All carriers, including new entrants, Information Service, Springfield, VA), 2002. assume that non-compliant carriers will
11 Volpe Center, Analysis of New Entrant Motor
8 These estimates were derived from data Carriers Safety Performance and Compliance Using 13 (19,559 ¥ 253) * (47,535/33,787) = 27,162.
contained in the Motor Carrier Management SafeStat, March 2000, pp. 3–2, 3–7, and 5–4. 14 Not all non-compliant carriers will be replaced
Information System (MCMIS). 12 For economic evaluations in the Department of by other new entrants. It is possible that carriers
9 See the Bureau of Labor Statistics Web site Transportation, the value of a statistical life is to be already in operation will absorb freight or
http://www.bls.gov/oes/2003/may/oes_11Ma.htm $3.0 million. However, since there cannot be passengers previously transported by firms placed
dated May 2003. fractional fatal crashes, we round up to one. out of service. Although it is possible existing
be replaced by other new entrants. continue operations would be $1,000. by the 5 percent business failure rate
These replacement new entrants could Therefore, the total cost for these 13,581 would be more than offset by the
purchase equipment from out-of-service new entrants would be approximately additional carriers closed each year.
carriers, so the cost of equipment and $13.6 million. Over 10 years, more than 48,000 crashes
facilities is a transfer between entities. The maximum cost of this proposed would be deterred by placing unsafe
The absolute costs of starting these new rule is estimated at approximately $67.9 carriers out of service.
firms would include fees for million per year ($54.3 million + $13.6 The SAs also would reduce crashes
application, licensing, registration, million). The ten-year undiscounted among those new entrants allowed to
surveying potential markets, cost would be almost $679 million, continue operations after coming into
advertisements, training, and while the discounted cost would be compliance. Over 10 years, almost 5,700
transactions costs for transferring assets. $477 million. crashes would be deterred from carriers
Our all-inclusive estimate for these costs Alternative Benefits that take action to remedy violations.
is $4,000 per carrier replaced in this For both classes of carriers, the SAs
fashion. Therefore, replacing the 13,581 The theoretical benefits accrue from
would result in 54,000 fewer crashes
carriers that would be placed out of removing the least safe carriers from the
over 10 years.
service would yield a total cost of $54.3 road and replacing them with safer
carriers. This change would result in a As noted above, the average cost of a
million annually. motor-carrier-involved crash is $65,183.
difference in expected crashes. Using
Alternative Cost for New Entrants That the Compliance Review Impact By deterring 54,000 crashes, this
Adjust Assessment Model, we assumed each proposed rule thus would yield a 10-
failing new entrant removed and year savings of $3.5 billion
As discussed above, the costs and undiscounted. At a 7 percent discount
benefits of complying with the FMCSRs replaced would have had a crash rate of
1.13 crashes per million vehicle miles rate, this would translate into a benefit
and HMRs (if applicable) are not of $2.3 billion. Most of these benefits
attributable to this proposal since we are traveled (MVMT), which is 50 percent
higher than the crash rate for would come from the crash reduction of
not proposing to change existing closed carriers. This benefit would
operational requirements. However, this established motor carriers. According to
MCMIS, new entrants average 400,000 greatly exceed the costs described
evaluation also includes an estimate of previously. The discounted ten-year net
costs and benefits assuming these were VMT per year. We assume freight that
had been carried by closed carriers benefit of this NPRM would be $1.8
new requirements. These estimates are billion, and the benefit cost ratio would
presented to assist decision makers in would be carried by replacement new
entrants. According to MCMIS, new be 4.8 to 1.
considering the impacts of this
proposal. While these estimates do not entrants have an overall crash rate of Paperwork Reduction Act
represent the real costs of this proposal, 0.94 crashes per MVMT. Therefore,
closing unsafe carriers results in a 17 Under the Paperwork Reduction Act
they illustrate possible impacts of this of 1995 (PRA) (44 U.S.C. § 3501, et seq.),
proposal. percent reduction in the per million
mile crash rate ((1.13–0.94)/1.13). Federal agencies must obtain approval
New entrants that change their from OMB for each collection of
practices and remain in service would We estimate new entrants eventually
placed out of service or required to information they conduct, sponsor, or
also face some costs. The cost of coming require through regulations. FMCSA has
into compliance would vary, depending modify their operations are currently
involved in approximately 11,200 determined there are three currently
on a number of factors, including the approved information collections that
size of the new entrant and the specific baseline crashes annually. This is the
sum of two calculations. For carriers would be affected by this NPRM: (1)
regulation (or regulations) violated. We OMB Control No. 2126–0013 titled
conservatively assume the average cost that would be placed out of service, the
calculation is the sum of 13,581 new ‘‘Motor Carrier Identification Report’’
for carriers failing one of the 11 (FMCSA Forms MCS–150, MCS–150A,
automatic failure criteria but desiring to entrants times 400,000 miles per new
entrant times 1.13 crashes per MVMT. and MCS–150B), approved at 74,896
The calculation is similar for new burden hours through July 31, 2007; (2)
carriers may be able to operate more efficiently by
increasing existing load factors, they may also have entrants that continue operations, OMB Control No. 2126–0015 titled
to divert vehicles and drivers from other loads or except their crash rate is 0.94 crashes ‘‘Designation of Agents, Motor Carriers,
buy/hire new ones to provide the service. To per MVMT. Brokers and Freight Forwarders
provide a conservative estimate, we assume the cost (FMCSA Form BOC–3) approved at
of these resources will be mostly the same whether
Closing 13,581 carriers would result
the loads are carried by existing carriers expanding in almost 1,020 fewer crashes in the first 5,000 burden hours through April 30,
or transferring capacity or by new entrants coming year, 967 in the second year (since 5 2008; and (3) OMB Control No 2126–
into the market to meet this demand. The only percent of the closed carriers would 0016 titled ‘‘Licensing Applications for
differences would be registration and licensing Motor Carrier Operating Authority’’
costs. We assume that there is no possibility that
have gone out of business in any case),
the replacing firm is the non-compliant firm and fewer each succeeding year. (FMCSA Forms OP–1, OP–1 (FF), OP–
repackaged as a new firm. Without this illegal However, an additional 13,581 carriers 1 (MX) and OP–1 (P), approved at
practice, the replacing firm would either be a would be closed in each succeeding 55,738 burden hours through August 31,
completely new motor carrier or an existing motor 2008. Table 1 depicts the current and
carrier expanding its operation. Since there is not
year, so the total crashes deterred by
a big difference, we choose to report the larger of closing carriers increases over the proposed burden hours associated with
the two cost possibilities. analysis period as the reduction caused the information collections.
TABLE 1.—CURRENT AND PROPOSED INFORMATION COLLECTION BURDENS

Burden hours Burden hours
OMB approval No. currently Change
proposed
approved
2126–0013 ................................................................................................................................... 74,896 66,977 –7,919

2126–0015 ................................................................................................................................... 5,000 5,002 2
2126–0016 ................................................................................................................................... 55,738 55,786 48
Net Change .......................................................................................................................... ........................ ........................ ¥7,869
The following is an explanation of entrant registration as a private or and must undergo an 18-month
how each of the information collections exempt for-hire carrier or operating monitoring period, including an SA.
shown above would be affected by this authority as a non-exempt for-hire During the audit, FMCSA verifies the
proposal. carrier. The estimated annual carrier has in place basic safety
OMB Control No. 2126–0013. This paperwork burden for this information management controls and identifies any
NPRM would eliminate the requirement collection would be 55,786 hours areas needing correction. A new entrant
for new entrants to complete the Form [55,738 currently approved annual is granted permanent registration only
MCS–150A (Safety Certification for burden hours + 48 hours (12 new after successfully completing the SA
Applications for USDOT Number) entrant non-North America-domiciled and the 18-month monitoring period.
because it does not provide the motor carriers × 4 hours to complete The agency received numerous
certification intended. Proposed Form OP–1(NNA)) = 55,786 hours]. comments to the May 2002 IFR
amendments to 49 CFR part 385, The proposals in this NPRM, affecting announcing the New Entrant Safety
subpart E—Hazardous Materials Safety three currently-approved information Assurance Process, including
Permits would remove references to the collections, would result in a net recommendations for improvement and
MCS–150A and would not impact the decrease of 7,869 burden hours in the alternatives to the program. By late
MCS–150B in any way. The estimated agency’s information collection budget. summer 2003, the agency and its State
annual paperwork burden for this FMCSA requests comments on: (1) partners had collected sufficient data
information collection would be 66,977 whether the collection of information is and had sufficient experience
hours [74,896 currently approved necessary or useful for the agency to administering the program to assess its
annual burden hours ¥ 7,923 (47,535 meet its goal of reducing truck crashes, effectiveness. The Administrator formed
new entrants × 10 minutes/60 minutes (2) the accuracy of the estimated a working group comprised of field and
to complete the MCS–150A form) + 4 information collection burden; (3) ways Headquarters staff to conduct a program
(12 non-America-domiciled motor to enhance the quality, utility, and review. This group identified several
carriers × 20 minutes/60 minutes to clarity of the information collected; and key improvements to clarify, strengthen
complete the Form MCS–150) = 66,977]. (4) ways to minimize the information and correct the new entrant regulations.
OMB Control No. 2126–0015. The collection burden on respondents, Today’s action proposes measures to
non-North America-domiciled motor including the use of automated make the New Entrant Safety Assurance
carriers would also be required to notify collection techniques or other forms of Process better. It also proposes a
the agency regarding designation of information technology. separate new entrant application
process agents by either: (1) submission procedure and safety oversight program
Regulatory Flexibility Act for non-North America-domiciled motor
in the application package of Form
BOC–3 (Designation of Agents, Motor The Regulatory Flexibility Act (RFA), carriers.
Carriers, Brokers and Freight as amended by the Small Business (2) A succinct statement of the
Forwarders), or (2) a letter stating that Regulatory Enforcement and Fairness objectives of, and legal basis for, the
the applicant will use a process agent Act (SBREFA), requires Federal agencies proposed rule. Section 210 of MCSIA
that will submit the Form BOC–3 to analyze the impact of rulemakings on required the Secretary of Transportation
electronically. The estimated annual small entities, unless the agency to establish regulations specifying
paperwork burden for this information certifies the proposed rule will not have minimum requirements for motor
collections would be 5,002 hours [5,000 a significant economic impact on a carriers seeking to operate in interstate
currently approved annual burden substantial number of small entities. commerce for the first time to ensure
hours + 2 hours (12 new entrant non- FMCSA believes these proposals do not such carriers are knowledgeable about
North America-domiciled motor carriers meet the threshold values for requiring applicable Federal motor carrier safety
× 10 minutes/60 minutes to complete a full-blown regulatory flexibility standards. MCSIA also directed the
Form BOC–3) = 5,002 hours]. analysis. Nonetheless, because of the Secretary to require, by regulation, that
OMB Control No. 2126–0016. The public interest in these proposals, we each motor carrier granted new
proposed rule would create a new Form have prepared a regulatory analysis and operating authority undergo an SA
OP–1(NNA) titled ‘‘Application for U.S. placed a copy in the docket to this within the first 18 months of operations.
Department of Transportation (USDOT) NPRM. The initial regulatory flexibility MCSIA also required the Secretary to
Registration by Non-North America- analysis (IRFA) for the proposed rule is establish the elements of the safety
Domiciled Motor Carriers.’’ A non-North set forth below. review, including basic safety
America-domiciled motor carrier is one (1) A description of the reasons why management controls, to consider the
whose principal place of business is action by the agency is being effect the regulations would have on
located in a country other than the considered. FMCSA implemented the small businesses and to consider
United States, Canada or Mexico. These New Entrant Safety Assurance Process establishing alternate locations where
entities would use the OP–1(NNA) in January 2003. Under the program, a the review may be conducted for the
when requesting either a USDOT new carrier receives new entrant registration convenience of the small businesses.
An IFR, with request for comments, number of small trucking entities three of its information systems for
was published May 13, 2002, and potentially affected by our proposed motor carriers into a single, on-line
became effective January 1, 2003. The rules. There are 100,048 for-hire replacement system. The ‘‘replacement
IFR established new minimum trucking firms within NAICS Code 484. system’’ NPRM proposes a more
requirements for all applicant motor Of these, 75,491, or roughly 75 percent, streamlined registration process. The
carriers domiciled in the United States had annual receipts of less than $21.5 USDOT Number registration process for
and Canada seeking to operate in million. While SBA has changed its size new entrants would be included in the
interstate commerce. Under the IFR, all definitions, updated data is not yet replacement system NPRM.
new entrants, regardless of whether they available. Therefore, this analysis uses The replacement system rulemaking
need to register with FMCSA under 49 the old definition. The actual percent of is a very complex undertaking and
U.S.C. 13901, are required to complete small businesses is probably somewhat would address the USDOT Number,
a Form MCS–150A—Safety Certification greater than our estimate, but the financial responsibility and commercial
for Applications for USDOT Number. difference is not likely to be significant. aspects of registration; it only touches
Additionally, during the initial 18- Because FMCSA does not have annual on ministerial aspects of the New
month period of operations, FMCSA sales data on private carriers, the agency Entrant Safety Assurance Process.
would evaluate the new entrant’s safety assumed the revenue and operations Today’s proposed rule covers the
management practices through an SA characteristics of the private new complete New Entrant Safety Assurance
and monitor its on-road performance entrant firms would be similar to those Process, not just registration. It is for
prior to granting the new entrant of new entrant for-hire carriers. Using these reasons the agency is pursuing
permanent registration. The objective of these assumptions, the agency estimates these efforts in separate rulemakings.
this NPRM is to enhance the safety of almost 35,651 of the total 47,535 new The agency would address any impacts
new entrants and thereby reduce the entrants (or 75 percent) are considered to administrative elements of the New
number of crashes which involve these small entities. This assumption is Entrant Safety Assurance Process when
carriers. generally consistent with an alternative, the proposed rule announcing the
(3) A description of and, where industry-based approach used to replacement system is promulgated as a
feasible, an estimate of the number of estimate the number of small trucking final rule.
small entities to which the proposed firms, where size is defined by the Accordingly, FMCSA preliminarily
rule would apply. The trucking number of power units (i.e., tractors or determines the proposed action
industry, and to a lesser extent the bus single-unit trucks) owned or leased by discussed in this document would not
industry, is populated by several very motor carriers. Also, MCMIS data have a significant economic impact on
large firms and many small firms. We indicate 80 percent of new entrant a substantial number of small entities.
believe most motor carriers start small. motor carriers within the industry
The proposed rule would cover all U.S. owned or leased six or fewer power Privacy Impact Analysis
and Canada-domiciled carriers and a units. FMCSA conducted a privacy impact
very small number of motor carriers (4) A description of the proposed assessment of this proposed rule as
domiciled outside of North America. reporting, recordkeeping and other required by Section 522(a)(5) of the FY
FMCSA estimated in the regulatory compliance requirements of the 2005 Omnibus Appropriations Act, Pub.
evaluation accompanying this proposal proposed rule, including an estimate of L. 108–447, 118 Stat. 3268 (Dec. 8, 2004)
that an average of 47,535 motor carriers the classes of small entities which [set out as a note to 5 U.S.C. § 552a]. The
entered the industry each year from would be subject to the requirements assessment considers any impacts of the
1995–2002 seeking interstate authority. and the type of professional skills proposed rule on the privacy of
Roughly 23,400 of these new entrants necessary for preparation of the report information in an identifiable form and
are estimated to be non-exempt for-hire or record. Except for a small number of related matters. The entire privacy
carriers that must register under 49 non-North America-domiciled motor impact assessment is available in the
U.S.C. 13901, 20,300 are estimated to be carriers, this proposed rule would docket for this proposal.
exempt for-hire and private carriers not impose no additional reporting,
subject to § 13901, and the roughly recordkeeping, or other compliance Unfunded Mandates Reform Act
3,800 remaining new registrants are of requirement beyond those currently This proposed rule would not impose
other types (including 1,922 brokers/ required of all motor carriers. This a Federal mandate resulting in the net
freight forwarders, 1,200 Mexico- proposed rule would change the expenditures by State, local, or tribal
domiciled commercial zone carriers, consequences for violating certain governments, in the aggregate, or by the
and 664 other carriers). These estimates existing safety rules. Indeed, this private sector, of $120.7 million or more
were derived from data contained in the proposed rule eliminates one form, the in any one year. 2 U.S.C. 1531, et seq.
Motor Carrier Management Information MC–150A, integrating a few of the data
System (MCMIS). National Environmental Policy Act
elements from the MC–150A into Form
The Regulatory Flexibility Act MC–150. Therefore, there will be one FMCSA has analyzed this proposed
requires Federal agencies to analyze the less form for motor carriers to complete. rule for the purpose of the National
impact of proposed and final rules on (5) An identification, to the extent Environmental Policy Act of 1969
small entities. Small Business practicable, of all Federal rules, which (NEPA) (42 U.S.C. 4321, et seq.) and has
Administration (SBA) regulations (13 may duplicate, overlap, or conflict with determined under the agency’s National
CFR part 121) define a ‘‘small entity’’ in the proposed rule. FMCSA is not aware Environmental Policy Act Implementing
the motor carrier industry by average of any areas where this proposed rule Procedures, FMCSA Order 5610.1C
annual receipts, which are currently set would duplicate, overlap, or conflict (published at 69 FR 9680, March 1,
at $23.5 million per firm. FMCSA with any other Federal rules. However, 2004, with an effective date of
estimated based upon the 1997 under a separate rulemaking (a notice of March 30, 2004) this proposed action is
Economic Census (U.S. Census Bureau), proposed rulemaking titled Unified categorically excluded under Appendix
North American Industrial Registration System published in the 2, paragraph 6.f of the Order from
Classification System (NAICS) Code 484 May 19, 2005, Federal Register at 70 FR further environmental documentation.
‘‘Truck Transportation’’ segments, the 28989), the agency is proposing to unify That categorical exclusion relates to
establishing regulations implementing Executive Order 12630 (Taking of List of Subjects

the following activities, whether Private Property)
49 CFR Part 365
performed by FMCSA or by States
pursuant to the Motor Carrier Safety This proposed rule would not effect a Administrative practice and
Assistance Program (MCSAP), which taking of private property or otherwise procedure, Brokers, Buses, Freight
provides financial assistance to States to have taking implications under forwarders, Motor carriers, Moving of
reduce the number and severity of Executive Order 12630, Governmental household goods, Reporting and
crashes and hazardous materials Actions and Interference with recordkeeping requirements.
incidents involving commercial motor Constitutionally Protected Property 49 CFR Part 385
vehicles: (1) Driver/vehicle inspections; Rights.
(2) traffic enforcement; (3) safety audits; Administrative practice and
Executive Order 13132 (Federalism) procedure, Highway safety, Motor
(4) compliance reviews; (5) public
carriers, Motor vehicle safety, Reporting
education and awareness; and (6) data This proposed action has been and recordkeeping requirements.
collection; and provides reimbursement analyzed in accordance with the
for the expenses listed under paragraphs principles and criteria contained in 49 CFR Part 387
6.d(i) through 6.d(v). This action Executive Order 13132 dated August 4, Buses, Freight, Freight forwarders,
proposes amendments to the New 1999, and it has been preliminarily Hazardous materials transportation,
Entrant Safety Assurance Process for determined this proposed action would Highway safety, Insurance,
carriers newly registering to operate in not have a substantial direct effect or Intergovernmental relations, Motor
interstate commerce. The agency sufficient federalism implications on carriers, Motor vehicle safety, Moving of
believes the proposed action would States, limiting the policymaking household goods, Penalties, Reporting
include no extraordinary circumstances and recordkeeping requirements, Surety
discretion of the States. Nothing in this
having any effect on the quality of the bonds.
document would directly preempt any
environment.
State law or regulation. It would not 49 CFR Part 390
FMCSA has also analyzed this impose additional costs or burdens on
proposal under section 176(c) of the Highway safety, Intermodal
the States. This proposed action would
Clean Air Act (CAA), as amended (42 transportation, Motor carriers, Motor
not have a significant effect on the
U.S.C. 7401 et seq.), and implementing vehicle safety, reporting and
States’ ability to execute traditional recordkeeping requirements.
regulations promulgated by the State governmental functions. To the
Environmental Protection Agency. We For the reasons stated in the
extent that States incur costs for preamble, the Federal Motor Carrier
performed a conformity analysis of the conducting these SAs, they would be
CAA according to the procedures Safety Administration proposes to
reimbursed 100 percent with Federal amend title 49, Code of Federal
outlined in appendix 14 of FMCSA
funds under MCSAP. Regulations, chapter III, subchapter B as
Order 5610.1C. This proposed rule
would not result in any emissions Executive Order 12372 set forth below:
increase, nor would it have any (Intergovernmental Review) PART 365—RULES GOVERNING
potential to result in emissions above
The regulations implementing APPLICATIONS FOR OPERATING
the general conformity rule’s de minimis
Executive Order 12372 regarding AUTHORITY
emission threshold levels. Moreover, it
is reasonably foreseeable the proposed intergovernmental consultation on 1. The authority citation for part 365
rule change would not increase total Federal programs and activities do not continues to read as follows:
CMV mileage, change the routing of apply to this program. Authority: 5 U.S.C. 553 and 559; 16 U.S.C.
CMVs, change how CMVs operate, or 1456; 49 U.S.C. 13101, 13301, 13901–13906,
change the CMV fleet-mix of motor Executive Order 13211 (Energy Supply,
14708, 31138, and 31144; 49 CFR 1.73.
carriers. This proposed action would Distribution, or Use)
2. Amend § 365.101 by adding a new
revise the program for assuring the This proposed action is not a paragraph (i) to read as follows:
safety of new entrant motor carriers. significant energy action within the
§ 365.101 Applications governed by these
Executive Order 12988 (Civil Justice meaning of section 4(b) of the Executive
rules.
Reform) Order because it is not economically
significant and is not likely to have a * * * * *
This proposed action meets (i) Applications for non-North
significant adverse effect on the supply,
applicable standards in sections 3(a) America-domiciled motor carriers to
distribution, or use of energy.
and 3(b)(2) of Executive Order 12988, operate in foreign commerce as for-hire
Civil Justice Reform, to minimize Privacy Act motor carriers of property and
litigation, eliminate ambiguity, and passengers within the United States.
reduce burden. Anyone is able to search the 3. Amend § 365.105 by revising
electronic form of all comments paragraph (a) to read as follows:
Executive Order 13045 (Protection of received into any of our dockets by the
Children) § 365.105 Starting the application process:
name of the individual submitting the
Form OP–1.
comment (or signing the comment, if
We have analyzed this proposed rule (a) All applicants must file the
submitted on behalf of an association,
under Executive Order 13045, appropriate form in the OP–1 series,
business, labor union, etc.). You may
‘‘Protection of Children from effective [effective date of final rule].
Environmental Health Risks and Safety review DOT’s complete Privacy Act Form OP–1 for motor property carriers
Risks.’’ This proposed rule does not Statement in the Federal Register and brokers of general freight and
concern a risk to environmental health published on April 11, 2000 (Volume household goods; Form OP–1(P) for
or safety that would disproportionately 65, Number 70; Pages 19477–78) or you motor passenger carriers; Form OP–
affect children. may visit http://dms.dot.gov. 1(FF) for freight forwarders of
household goods; Form OP–1(MX) for under § 383.5 without a valid revocation of the new entrant’s
Mexico-domiciled motor property commercial driver’s license. An invalid registration.
carriers, including household goods and commercial driver’s license includes 9. Revise § 385.319 to read as follows:
motor passenger carriers; and Form OP– one that is falsified, revoked, expired, or
1(NNA) for non-North America- missing a required endorsement. § 385.319 What happens after completion
domiciled motor property and motor (2) Operating vehicles that have been of the safety audit?
passenger carriers. A separate filing fee placed out of service for violations of
(a) Upon completion of the safety
in the amount set forth at 49 CFR the Federal Motor Carrier Safety
audit, the auditor will review the
360.3(f)(1) is required for each type of Regulations or compatible State laws
authority sought in each transportation and regulations without taking findings with the new entrant.
mode. necessary corrective action. (b) Pass. If FMCSA determines the
* * * * * (3) Involvement in a hazardous safety audit discloses the new entrant
materials incident, due to carrier act or has adequate basic safety management
PART 385—SAFETY FITNESS omission, involving any of the controls, the agency will provide the
PROCEDURES following: new entrant written notice as soon as
(i) A highway route controlled practicable, but not later than 45 days
4. The authority citation continues to
quantity of a Class 7 (radioactive) after completion of the safety audit, that
read as follows:
material as defined in § 173.403 of this it has adequate basic safety management
Authority: 49 U.S.C. 113, 504, 521(b), title. controls. The new entrant’s safety
5105(e), 5109, 5113, 13901–13905, 31136, (ii) Any quantity of a Class 1, Division
31144, 31148, and 31502; sec. 350 of Pub. L.
performance will continue to be closely
1.1, 1.2, or 1.3 explosive as defined in monitored for the remainder of the 18-
107–87; and 49 CFR 1.73.
§ 173.50 of this title. month period of new entrant
§ 385.305 [Amended] (iii) Any quantity of a poison registration.
5. Amend § 385.305 to remove inhalation hazard Zone A or B material
as defined in §§ 173.115, 173.132, or (c) Fail. If FMCSA determines the
paragraph (b)(3) and to redesignate safety audit discloses the new entrant’s
paragraph (b)(4) as (b)(3). 173.133 of this title.
(4) Involvement in two or more basic safety management controls are
6. Add § 385.306 to subpart D to read
hazardous materials incidents, due to inadequate, the agency will provide the
as follows:
carrier act or omission, involving any new entrant written notice, as soon as
§ 385.306 What are the consequences of hazardous material not identified in practicable, but not later than 45 days
furnishing misleading information or paragraph (a)(3) of this section and after the completion of the safety audit,
making a false statement in connection with that its USDOT new entrant registration
defined in chapter I of this title.
the registration process?
(5) Using a driver who tests positive will be revoked and its operations
A carrier that furnishes false or for controlled substances or alcohol or placed out-of-service unless it takes the
misleading information, or conceals who refuses to submit to required actions specified in the notice to remedy
material information in connection with controlled substances or alcohol tests. its safety management practices.
the registration process, is subject to the (6) Operating a motor vehicle that is
following actions: (1) 60-day corrective action
not insured as required by part 387 of requirement. All new entrants, except
(a) Revocation of registration. this chapter.
(b) Assessment of the civil and/or those specified in paragraph (c)(2) of
(7) Having a driver or vehicle out-of- this section, must take the specified
criminal penalties prescribed in 49 service rate of 50 percent or more based
U.S.C. 521 and 49 U.S.C. chapter 149. actions to remedy inadequate safety
upon at least three inspections
7. Amend § 385.307 to revise management practices within 60 days of
occurring within a consecutive 90-day
paragraph (a) to read as follows: the date of the notice.
period.
§ 385.307 What happens after a motor (b) If a new entrant that commits any (2) 45-day corrective action
carrier begins operations as a new entrant? of the actions listed in paragraph (a) of requirement. The new entrants listed
* * * * * this section: below must take the specified actions to
(a) The new entrant’s roadside safety (1) Has not had a safety audit or remedy inadequate safety management
performance will be closely monitored compliance review, FMCSA will practices within 45 days of the date of
to ensure the new entrant has basic schedule the new entrant for a safety the notice:
safety management controls that are audit as soon as practicable. (i) A new entrant that transports
operating effectively. (2) Has had a safety audit or passengers in a CMV designed or used
* * * * * compliance review, FMCSA will send to transport between 9 and 15
8. Add § 385.308 to subpart D to read the new entrant a notice advising it to
passengers (including the driver) for
as follows: submit evidence of corrective action
direct compensation.
within 30 days of the service date of the
§ 385.308 What will cause an expedited notice. (ii) A new entrant that transports
action? (c) FMCSA may schedule a passengers in a CMV designed or used
(a) A new entrant that commits any of compliance review of a new entrant that to transport more than 15 passengers
the following actions, identified through commits any of the actions listed in (including the driver).
roadside inspections or by any other paragraph (a) of this section at any time (iii) A new entrant that transports
means, may be subjected to an if it determines the violation warrants a hazardous materials in a CMV as
expedited safety audit or a compliance thorough review of the new entrant’s defined in paragraph (4) of the
review or may be required to submit a operation. definition of a ‘‘Commercial Motor
written response demonstrating (d) Failure to respond within 30 days Vehicle’’ in § 390.5 of this subchapter.
corrective action: of the notice to an agency demand for
(1) Using drivers to operate a a written response demonstrating 10. Revise § 385.321 to read as
commercial motor vehicle as defined corrective action will result in the follows:
§ 385.321 What failures of safety (b) FMCSA may extend the 45-day (c) A new entrant must submit a
management practices disclosed by the period in § 385.319(c)(2) for up to 10 request for an administrative review
safety audit will result in a notice to a new days if the new entrant has submitted within one of the following time
entrant that its DOT new entrant registration evidence that corrective actions have periods:
will be revoked? (1) If it does not submit evidence of
been taken pursuant to § 385.319(c) and
(a) General. The failures of safety the agency needs additional time to corrective action under § 385.319(c),
management practices consist of a lack determine the adequacy of the within 90 days after the date it is
of basic safety management controls as corrective action. notified that its basic safety
described in Appendix A of this part or 12. Amend § 385.325 to revise management controls are inadequate.
failure to comply with one or more of paragraph (b) to read as follows: (2) If it submits evidence of corrective
the regulations set forth in paragraph (b) action under § 385.319(c), within 90
of this section and will result in a notice § 385.325 What happens after a new days after the date it is notified that its
to a new entrant that its DOT new entrant has been notified under § 385.319(c) corrective action is insufficient and its
entrant registration will be revoked. to take corrective action to remedy its basic safety management controls
(b) Automatic failure of the audit. A safety management practices?
remain inadequate.
new entrant will automatically fail the (a) * * * (d) If a new entrant wants to assure
safety audit if found in violation of any (b) If a new entrant, after being that FMCSA will be able to issue a final
one of the following 11 regulations: notified that it is required to take written decision before the prohibitions
(1) § 382.115(a) or (b)—Failing to corrective action to improve its safety outlined in § 385.325(c) take effect, the
implement an alcohol and/or controlled management practices, fails to submit a new entrant must submit its request no
substances testing program (domestic written response demonstrating later than 15 days from the date of the
and foreign motor carriers, respectively). corrective action acceptable to FMCSA notice that its basic safety management
(2) § 382.211—Using a driver who has within the time specified in § 385.319, controls are inadequate. Failure to
refused to submit to an alcohol or including any extension of that period submit the request within this 15-day
controlled substances test required authorized under § 385.323, FMCSA period may result in revocation of new
under part 382. will revoke its new entrant registration entrant authority and issuance of an out-
(3) § 382.215—Using a driver known and issue an out-of-service order of-service order before completion of
to have tested positive for a controlled effective on: administrative review.
substance. (1) Day 61 from the notice date for (e) FMCSA will complete its review
(4) § 383.37(a)—Knowingly allowing, new entrants subject to § 385.319(c)(1). and notify the new entrant in writing of
requiring, permitting, or authorizing an (2) Day 46 from the notice date for its decision within:
employee with a commercial driver’s new entrants subject to § 385.319(c)(2). (1) 45 days after receiving a request
license which is suspended, revoked, or (3) If an extension has been granted for review from a new entrant that is
canceled by a State or who is under § 385.323, the day following the subject to § 385.319(c)(1).
disqualified to operate a commercial expiration of the extension date. (2) 30 days after receiving a request
motor vehicle. * * * * * for review from a new entrant that is
(5) § 383.51(a)—Knowingly allowing, 13. Revise § 385.327 to read as subject to § 385.319(c)(2).
requiring, permitting, or authorizing a follows: (f) The Field Administrator’s decision
driver who is disqualified to drive a constitutes the final agency action.
commercial motor vehicle. § 385.327 May a new entrant request an (g) Notwithstanding this subpart, a
(6) § 387.7(a)—Operating a motor administrative review of a determination of new entrant is subject to the suspension
vehicle without having in effect the a failed safety audit? and revocation provisions of 49 U.S.C.
required minimum levels of financial (a) If a new entrant receives a notice 13905 for violations of DOT regulations
responsibility coverage. under § 385.319(c) that its new entrant governing motor carrier operations.
(7) § 391.15(a)—Using a disqualified registration will be revoked, it may 14. Revise § 385.329 to read as
driver. request FMCSA to conduct an follows:
(8) § 391.11(b)(4)—Using a physically administrative review if it believes
unqualified driver. § 385.329 May a new entrant that has had
FMCSA has committed an error in its DOT new entrant registration revoked
(9) § 395.8(a)—Failing to require a determining that its basic safety and its operations placed out of service
driver to make a record of duty status. management controls are inadequate. reapply?
(10) § 396.9(c)(2)—Requiring or The request must:
permitting the operation of a motor (a) A new entrant whose DOT new
(1) Be made to the Field entrant registration has been revoked,
vehicle declared ‘‘out-of-service’’ before Administrator of the appropriate
repairs are made. and whose operations have been placed
FMCSA Service Center. out of service by FMCSA, may reapply
(11) § 396.17(a)—Using a commercial (2) Explain the error the new entrant
motor vehicle not periodically for new entrant authority no sooner than
believes FMCSA committed in its 30 days after the date of revocation.
inspected. determination.
11. Revise § 385.323 to read as (b) If the DOT new entrant registration
(3) Include a list of all factual and was revoked because of a failed safety
follows: procedural issues in dispute and any audit, the new entrant must do all of the
§ 385.323 May FMCSA extend the period information or documents that support following:
under § 385.319(c) for a new entrant to take the new entrant’s argument. (1) Submit an updated MCS–150.
corrective action to remedy its safety (b) FMCSA may request that the new (2) Submit evidence that it has
management practices? entrant submit additional data and corrected the deficiencies that resulted
(a) FMCSA may extend the 60-day attend a conference to discuss the in revocation of its registration and will
period in § 385.319(c)(1) for up to an issue(s) in dispute. If the new entrant otherwise ensure that it will have basic
additional 60 days provided FMCSA does not attend the conference or does safety management controls in effect.
determines the new entrant is making a not submit the requested data, FMCSA (3) Begin the 18-month new entrant
good faith effort to remedy its safety may dismiss the new entrant’s request monitoring cycle again as of the date the
management practices. for review. re-filed application is approved.
(c) If the DOT new entrant registration 18. Amend § 385.421 by revising (2) The information supplied must be
was revoked because FMCSA found that paragraph (a)(2) to read as follows: accurate, complete, and include all
the new entrant had failed to submit to required supporting documents and
a safety audit, it must do all of the § 385.421 Under what circumstances will a applicable certifications in accordance
safety permit be subject to revocation or
following: suspension by FMCSA?
with the instructions to Form
(1) Submit an updated MCS–150. OP–1(NNA), Form MCS–150 and Form
(2) Begin the 18-month new entrant (a) * * * BOC–3; and
monitoring cycle again as of the date the (2) A motor carrier provides any false (3) The application must be signed by
re-filed application is approved. or misleading information on its the applicant.
(3) Submit to a safety audit upon application (Form MCS–150B) or as part (c) An applicant must submit the
request. of updated information it is providing application to the address provided in
(d) If the new entrant is a for-hire on Form MCS–150B (see § 385.405(d)). Form OP–1(NNA).
carrier subject to the registration * * * * * (d) An applicant may obtain the
provisions under 49 U.S.C. 13901 and 19. Amend part 385 by adding a new application forms from any FMCSA
also has had its operating authority subpart H consisting of new §§ 385.601 Division Office or download them from
revoked, it must re-apply for operating through 385.609 and an Appendix to the FMCSA Web site at: http://
authority as set forth in part 365 of this subpart H to read as follows: www.fmcsa.dot.gov/forms/forms.htm.
title.
Subpart H—Special Rules for New Entrant § 385.605 New entrant registration driver’s
15. Revise § 385.331 to read as Non-North America-Domiciled Carriers license and drug and alcohol testing
follows: requirements.
Sec.
§ 385.331 What happens if a new entrant 385.601 Scope of rules. (a) A non-North America-domiciled
operates a CMV after having been issued an 385.603 Application. motor carrier must use only drivers who
order placing its interstate operations out of 385.605 New entrant registration driver’s possess a valid commercial driver’s
service? license and drug and alcohol testing license—a CDL, Canadian Commercial
A new entrant that operates a CMV in requirements. Driver’s License, or Mexican Licencia de
violation of an out-of-service order is 385.607 FMCSA action on the application.
385.609 Requirement to notify FMCSA of
Federal de Conductor—to operate its
subject to the penalty provisions in change in applicant information. vehicles in the United States.
U.S.C. 521(b)(2)(A) for each offense as Appendix to Subpart H of Part 385— (b) A non-North America-domiciled
adjusted for inflation by 49 CFR part Explanation of Pre-Authorization Safety motor carrier must subject each of the
386, Appendix B. Audit Evaluation Criteria for Non-North drivers described in paragraph (a) of this
16. Amend § 385.337 to revise America-Domiciled Motor Carriers section to drug and alcohol testing as
paragraph (a) to read as follows: prescribed under part 382 of this
Subpart H—Special Rules for New subchapter.
§ 385.337 What happens if a new entrant Entrant Non-North America-Domiciled
refuses to permit a safety audit to be § 385.607 FMCSA action on the
Carriers
performed on its operations? application.
(a) If a new entrant refuses to permit § 385.601 Scope of rules. (a) FMCSA will review and act on
a safety audit to be performed on its The rules in this subpart govern the each application submitted under this
operations, FMCSA will provide the application by a non-North America- subpart in accordance with the
carrier with written notice that its domiciled motor carrier to provide procedures set out in this part.
registration will be revoked and its transportation of property and (b) FMCSA will validate the accuracy
operations placed out of service unless passengers in interstate commerce in the of information and certifications
the new entrant agrees in writing, United States. provided in the application by checking,
within 10 days from the service date of to the extent available, data maintained
the notice, to permit the safety audit to § 385.603 Application. in databases of the governments of the
be performed. The refusal to permit a (a) Each applicant applying under this country where the carrier’s principal
safety audit to be performed may subject subpart must submit an application that place of business is located and the
the new entrant to the penalty consists of: United States.
provisions of 49 U.S.C. 521(b)(2)(A), as (1) Form OP–1(NNA)—Application (c) Pre-authorization safety audit.
adjusted for inflation by 49 CFR part for U.S. Department of Transportation Every non-North America-domiciled
386 Appendix B. (USDOT) Registration by Non-North motor carrier that applies under this
* * * * * America-Domiciled Motor Carriers; part must satisfactorily complete an
17. Amend § 385.405 to revise (2) Form MCS–150—Motor Carrier FMCSA-administered safety audit
paragraph (a) to read as follows: Identification Report; and before FMCSA will grant new entrant
(3) A notification of the means used registration to operate in the United
§ 385.405 How does a motor carrier apply to designate process agents, either by States. The safety audit is a review by
for a safety permit? submission in the application package FMCSA of the carrier’s written
(a) Application form(s). (1) To apply of Form BOC–3—Designation of Agents- procedures and records to validate the
for a new safety permit or renewal of the Motor Carriers, Brokers and Freight accuracy of information and
safety permit, a motor carrier must Forwarders or a letter stating that the certifications provided in the
complete and submit Form MCS–150B, applicant will use a process agent application and determine whether the
Combined Motor Carrier Identification
service that will submit the Form carrier has established or exercises the
Report and HM Permit Application. BOC–3 electronically. basic safety management controls
(2) The Form MCS–150B will also (b) The Federal Motor Carrier Safety necessary to ensure safe operations.
satisfy the requirements for obtaining Administration (FMCSA) will only FMCSA will evaluate the results of the
and renewing a USDOT Number; there process an application if it meets the safety audit using the criteria in the
is no need to complete Form MCS–150, following conditions: Appendix to this subpart.
Motor Carrier Identification Report. (1) The application must be (d) Applications of non-North
* * * * * completed in English; America-domiciled motor carriers
requesting for-hire operating authority occur during the application process or (8) Verification of drivers’ qualifications,
under part 365 of this chapter may be after having been granted new entrant including confirmation of the validity of the
protested under § 365.109(b). Such registration. CDL, Canadian Commercial Driver’s License,
(2) A motor carrier subject to this or Mexican Licencia de Federal de
carriers will be granted new entrant Conductor, as applicable, of each driver the
registration after successful completion subpart must notify FMCSA of any carrier intends to assign to operate under its
of the pre-authorization safety audit and changes or corrections to the new entrant registration; and
the expiration of the protest period, information in Sections I, IA or II of (9) An interview of carrier officials to
provided the application is not Form OP–1(NNA)—Application for U.S. review safety management controls and
protested. If a protest to the application Department of Transportation (USDOT) evaluate any written safety oversight policies
is filed with FMCSA, new entrant Registration by Non-North America- and practices.
Domiciled Motor Carriers that occurs (d) To successfully complete the safety
registration will be granted only if
audit, a non-North America-domiciled motor
FMCSA denies or rejects the protest. during the application process or after carrier must demonstrate to FMCSA that it
(e) If FMCSA grants new entrant having been granted new entrant has the required elements in paragraphs
registration to the applicant, it will registration. (c)(2), (3), (4), (7), and (8) above and other
assign a distinctive USDOT Number that (3) A motor carrier must notify basic safety management controls in place
identifies the motor carrier as FMCSA in writing within 45 days of the which function adequately to ensure
authorized to operate in the United change or correction to information minimum acceptable compliance with the
States. In order to initiate operations in under subparagraphs (a)(1) or (a)(2) of applicable safety requirements. FMCSA
the United States, a non-North America- this section. developed ‘‘safety audit evaluation criteria,’’
(b) If a motor carrier fails to comply which uses data from the safety audit and
domiciled motor carrier with new roadside inspections to determine that each
entrant registration must: with paragraph (a) of this section, applicant for new entrant registration has
(1) Have its surety or insurance FMCSA may suspend or revoke its new basic safety management controls in place.
provider file proof of financial entrant registration until it meets those (e) The safety audit evaluation process
responsibility in the form of certificates requirements. developed by FMCSA is used to:
of insurance, surety bonds, and (1) Evaluate basic safety management
Appendix to Subpart H of Part 385— controls and determine if each non-North
endorsements, as required by Explanation of Pre-Authorization
§ 387.7(e)(2), § 387.31(e)(2) and America-domiciled carrier and each driver is
Safety Audit Evaluation Criteria for able to operate safely in the United States;
§ 387.301 of this subchapter, as Non-North America-Domiciled Motor and
applicable; and Carriers (2) Identify motor carriers and drivers who
(2) File a hard copy of, or have its are having safety problems and need
process agent(s) electronically submit, I. General improvement in their compliance with the
Form BOC–3—Designation of Agents— (a) FMCSA will perform a safety audit of FMCSRs and the HMRs, before FMCSA
Motor Carriers, Brokers and Freight each non-North America-domiciled motor issues new entrant registration to operate
Forwarders, as required by part 366 of carrier before granting the carrier new entrant within the United States.
this subchapter. registration to operate within the United
States. II. Source of the Data for the Safety Audit
(f) A non-North America-domiciled Evaluation Criteria
(b) FMCSA will conduct the safety audit at
motor carrier must comply with all a location specified by the FMCSA. All (a) The FMCSA’s evaluation criteria are
provisions of the safety monitoring records and documents must be made built upon the operational tool known as the
system in part 385, subpart I of this available for examination within 48 hours safety audit. FMCSA developed this tool to
subchapter, including successfully after a request is made. Saturdays, Sundays, assist auditors and investigators in assessing
passing North American Standard and Federal holidays are excluded from the the adequacy of a non-North America-
commercial motor vehicle inspections at computation of the 48-hour period. domiciled carrier’s basic safety management
least every 90 days and having safety (c) The safety audit will include: controls.
decals affixed to each commercial motor (1) Verification of available performance (b) The safety audit is a review of a non-
data and safety management programs; North America-domiciled motor carrier’s
vehicle operated in the United States as (2) Verification of a controlled substances operation and is used to:
required by § 385.703(c) of this and alcohol testing program consistent with (1) Determine if a carrier has the basic
subchapter. part 40 of this title; safety management controls required by 49
(g) FMCSA may remove a non-North (3) Verification of the carrier’s system of U.S.C. 31144; and
America-domiciled carrier’s new entrant compliance with hours-of-service rules in (2) In the event that a carrier is found not
designation no earlier than 18 months part 395 of this subchapter, including to be in compliance with applicable FMCSRs
after the date its USDOT Number is recordkeeping and retention; and HMRs, the safety audit can be used to
issued and only after successful (4) Verification of proof of financial educate the carrier on how to comply with
responsibility; U.S. safety rules.
completion to the satisfaction of FMCSA
(5) Review of available data concerning the (c) Documents such as those contained in
of the safety monitoring system for non- carrier’s safety history, and other information driver qualification files, records of duty
North America-domiciled carriers set necessary to determine the carrier’s status, vehicle maintenance records, and
out in part 385, subpart I of this preparedness to comply with the Federal other records are reviewed for compliance
subchapter. Successful completion Motor Carrier Safety Regulations, parts 382 with the FMCSRs and HMRs. Violations are
includes obtaining a Satisfactory safety through 399 of this subchapter, and the cited on the safety audit. Performance-based
rating as the result of a compliance Federal Hazardous Material Regulations, information, when available, is utilized to
review. parts 171 through 180 of this title; evaluate the carrier’s compliance with the
(6) Inspection of available commercial vehicle regulations. Recordable accident
§ 385.609 Requirement to notify FMCSA of motor vehicles to be used under new entrant information is also collected.
change in applicant information. registration, if any of these vehicles have not
received a decal required by § 385.703(c) of III. Overall Determination of the Carrier’s
(a)(1) A motor carrier subject to this Basic Safety Management Controls
this subchapter;
subpart must notify FMCSA of any (7) Evaluation of the carrier’s safety (a) The carrier will not receive new entrant
changes or corrections to the inspection, maintenance, and repair facilities registration if FMCSA cannot:
information the Form BOC–3— or management systems, including (1) Verify a controlled substances and
Designation of Agents—Motor Carriers, verification of records of periodic vehicle alcohol testing program consistent with part
Brokers and Freight Forwarders that inspections; 40 of this title;
(2) Verify a system of compliance with the (MCMIS) during the twelve months before deemed to have inadequate basic safety
hours-of-service rules of this subchapter, the safety audit or performed at the time of management controls for the accident factor.
including recordkeeping and retention; the review, the Vehicle Factor (part 396) will The rates are the result of roughly doubling
(3) Verify proof of financial responsibility; be evaluated on the basis of the Out-of- the United States national average accident
(4) Verify records of periodic vehicle Service (OOS) rates and noncompliance with rate in Fiscal Years 1994, 1995, and 1996.
inspections; and acute and critical regulations. The results of (4) FMCSA will continue to consider
(5) Verify the qualifications of each driver the review of the OOS rate will affect the preventability when a new entrant contests
the carrier intends to assign to operate Vehicle Factor as follows: the evaluation of the accident factor by
commercial motor vehicles in the United (i) If the motor carrier has had at least three presenting compelling evidence that the
States, as required by parts 383 and 391 of roadside inspections in the twelve months recordable rate is not a fair means of
this subchapter, including confirming the before the safety audit, and the vehicle OOS evaluating its accident factor. Preventability
validity of each driver’s CDL, Canadian rate is 34 percent or higher, one point will will be determined according to the
Commercial Driver’s License, or Mexican be assessed against the carrier. That point following standard: ‘‘If a driver, who
Licencia de Federal de Conductor, as will be added to any other points assessed for exercises normal judgment and foresight,
appropriate. discovered noncompliance with acute and could have foreseen the possibility of the
(b) If FMCSA confirms each item under critical regulations of part 396 to determine accident that in fact occurred, and avoided it
III(a)(1) through (5) above, the carrier will the carrier’s level of safety management by taking steps within his/her control which
receive new entrant registration, unless control for that factor. would not have risked causing another kind
FMCSA finds the carrier has inadequate basic (ii) If the motor carrier’s vehicle OOS rate of mishap, the accident was preventable.’’
safety management controls in at least three is less than 34 percent, or if there are less (k) Factor Ratings
separate factors described in part IV below. than three inspections, the determination of (1) The following table shows the five
If FMCSA makes such a determination, the the carrier’s level of safety management regulatory factors, parts of the FMCSRs and
carrier’s application for new entrant controls will only be based on discovered HMRs associated with each factor, and the
registration will be denied. noncompliance with the acute and critical accident factor. Each carrier’s level of basic
regulations of part 396. safety management controls with each factor
IV. Evaluation of Regulatory Compliance (2) Over two million inspections occur on is determined as follows:
(a) During the safety audit, FMCSA gathers the roadside each year in the United States. (i) Factor 1—General: Parts 390 and 387;
information by reviewing a motor carrier’s This vehicle inspection information is (ii) Factor 2—Driver: Parts 382, 383, and
compliance with ‘‘acute’’ and ‘‘critical’’ retained in the MCMIS and is integral to 391;
regulations of the FMCSRs and HMRs. evaluating motor carriers’ ability to (iii) Factor 3—Operational: Parts 392 and
(b) Acute regulations are those where successfully maintain their vehicles, thus 395;
noncompliance is so severe as to require preventing them from being placed OOS (iv) Factor 4—Vehicle: Parts 393, 396 and
immediate corrective actions by a motor during roadside inspections. Each safety the Out of Service Rate;
carrier regardless of the overall basic safety audit will continue to have the requirements (v) Factor 5—Hazardous Materials: Part
management controls of the motor carrier. of part 396, Inspection, Repair, and 171, 177, 180 and 397; and
(c) Critical regulations are those where Maintenance, reviewed as indicated by the (vi) Factor 6—Accident: Recordable
noncompliance relates to management and/or above explanation. Accident Rate per Million Miles;
operational controls. These are indicative of (j) Accident Factor. (1) In addition to the (2) For paragraphs IV (k)(1)(i) through (v)
breakdowns in a carrier’s management five regulatory factors, a sixth factor is (Factors 1 through 5), if the combined
controls. included in the process to address the violations of acute and or critical regulations
(d) The list of the acute and critical accident history of the motor carrier. This for each factor is equal to three or more
regulations, which are used in determining if factor is the recordable accident rate, which points, the carrier is determined not to have
a carrier has basic safety management the carrier has experienced during the past basic safety management controls for that
controls in place, is included in Appendix B, 12 months. Recordable accident, as defined individual factor.
VII, List of Acute and Critical Regulations to in 49 CFR 390.5, means an accident (3) For paragraphs IV (k)(1)(vi), if the
part 385 of this subchapter. involving a commercial motor vehicle recordable accident rate is greater than 1.7
(e) Noncompliance with acute and critical operating on a public road in interstate or recordable accidents per million miles for an
regulations are indicators of inadequate intrastate commerce which results in a urban carrier (1.5 for all other carriers), the
safety management controls and usually fatality; a bodily injury to a person who, as carrier is determined to have inadequate
higher than average accident rates. a result of the injury, immediately receives basic safety management controls.
(f) Parts of the FMCSRs and the HMRs medical treatment away from the scene of the (l) Notwithstanding FMCSA verification of
having similar characteristics are combined accident; or one or more motor vehicles the items listed in part III (a)(1) through (5)
together into six regulatory areas called incurring disabling damage as a result of the above, if the safety audit determines the
‘‘factors.’’ The regulatory factors, evaluated accident requiring the motor vehicle to be carrier has inadequate basic safety
on the adequacy of the carrier’s safety transported away from the scene by a tow management controls in at least three
management controls, are: truck or other motor vehicle. separate factors described in part III, the
(1) Factor 1—General: Parts 387 and 390; (2) Experience has shown that urban carrier’s application for new entrant
(2) Factor 2—Driver: Parts 382, 383 and carriers, those motor carriers operating registration will be denied. For example,
391; entirely within a radius of less than 100 air FMCSA evaluates a carrier finding:
(3) Factor 3—Operational: Parts 392 and miles (normally urban areas), have a higher (1) One instance of noncompliance with a
395; exposure to accident situations because of critical regulation in part 387 scoring one
(4) Factor 4—Vehicle: Parts 393, 396 and their environment and normally have higher point for Factor 1;
inspection data for the last 12 months; accident rates. (2) Two instances of noncompliance with
(5) Factor 5—Hazardous Materials: Parts (3) The recordable accident rate will be acute regulations in part 382 scoring three
171, 177, 180 and 397; and used in determining the carrier’s basic safety points for Factor 2;
(6) Factor 6—Accident: Recordable management controls in Factor 6, Accident. (3) Three instances of noncompliance with
Accident Rate per Million Miles. It will be used only when a carrier incurs two critical regulations in part 396 scoring three
(g) For each instance of noncompliance or more recordable accidents within the 12 points for Factor 4; and
with an acute regulation, 1.5 points will be months before the safety audit. An urban (4) Three instances of noncompliance with
assessed. carrier (a carrier operating entirely within a acute regulations in parts 171 and 397
(h) For each instance of noncompliance radius of 100 air miles) with a recordable rate scoring four and one-half (4.5) points for
with a critical regulation, 1 point will be per million miles greater than 1.7 will be Factor 5.
assessed. deemed to have inadequate basic safety Under this example, the carrier will not
(i) Vehicle Factor. (1) When at least three management controls for the accident factor. receive new entrant registration because it
vehicle inspections are recorded in the Motor All other carriers with a recordable accident scored three or more points for Factors 2, 4,
Carrier Management Information System rate per million miles greater than 1.5 will be and 5 and FMCSA determined the carrier had
inadequate basic safety management controls inspection by a certified FMCSA or occurring within a consecutive 90-day
in at least three separate factors. State inspector pursuant to 49 CFR period.
20. Amend part 385 by adding a new § 350.201(k). This requirement applies (b) Failure to respond to an agency
Subpart I consisting of new §§ 385.701 during the new entrant operating period demand for a written response
through 385.717 to read as follows: and for three years after the carrier’s demonstrating corrective action within
Subpart I—Safety Monitoring System for registration becomes permanent 30 days will result in the suspension of
Non-North America-Domiciled Carriers following removal of its new entrant the carrier’s new entrant registration
Sec. designation. until the required showing of corrective
385.701 Definitions. (d) Compliance review. FMCSA will action is submitted to the FMCSA.
385.703 Safety monitoring system. conduct a compliance review on a non- (c) A satisfactory response to a written
385.705 Expedited action. North America-domiciled carrier within demand for corrective action does not
385.707 The compliance review. 18 months after FMCSA issues the excuse a carrier from the requirement
385.709 Suspension and revocation of non- carrier a USDOT Number. that it undergo a compliance review
North America-domiciled carrier during the new entrant registration
registration. § 385.705 Expedited action. period.
385.711 Administrative review. (a) A non-North America-domiciled
385.713 Reapplying for new entrant § 385.707 The compliance review.
registration.
motor carrier committing any of the
following actions identified through (a) The criteria used in a compliance
385.715 Duration of safety monitoring
system. roadside inspections, or by any other review to determine whether a non-
385.717 Applicability of safety fitness and means, may be subjected to an North America-domiciled new entrant
enforcement procedures. expedited compliance review, or may be exercises the necessary basic safety
required to submit a written response management controls are specified in
Subpart I—Safety Monitoring System demonstrating corrective action: Appendix B to this part.
for Non-North American Carriers (1) Using drivers not possessing, or (b) Satisfactory Rating. If FMCSA
operating without, a valid CDL, assigns a non-North America-domiciled
§ 385.701 Definitions. carrier a Satisfactory rating following a
Canadian Commercial Driver’s License,
Compliance review means a compliance review conducted under
or Mexican Licencia Federal de
compliance review as defined in § 385.3 this subpart, FMCSA will provide the
Conductor. An invalid commercial
of this part. carrier written notice as soon as
driver’s license includes one that is
New entrant registration means the practicable, but not later than 45 days
falsified, revoked, expired, or missing a
provisional registration under part 385, after the completion of the compliance
required endorsement.
subpart H of this subchapter that review. The carrier’s registration will
(2) Operating vehicles that have been
FMCSA grants to a non-North America- remain in provisional status and its on-
placed out of service for violations of
domiciled motor carrier to provide highway performance will continue to
the Federal Motor Carrier safety
interstate transportation within the be closely monitored for the remainder
regulations without taking the necessary
United States. It will be revoked if the of the 18-month new entrant registration
corrective action.
registrant is not assigned a Satisfactory period.
(3) Involvement in, due to carrier act
safety rating following a compliance (c) Conditional Rating. If FMCSA
or omission, a hazardous materials
review conducted during the safety assigns a non-North America-domiciled
incident within the United States
monitoring period established in this carrier a Conditional rating following a
involving:
subpart. compliance review conducted under
Non-North America-domiciled motor (i) A highway route controlled
quantity of a Class 7 (radioactive) this subpart, it will initiate a revocation
carrier means a motor carrier of proceeding in accordance with
property or passengers whose principal material as defined in § 173.403 of this
title; § 385.709 of this subpart. The carrier’s
place of business is located in a country new entrant registration will not be
other than the United States, Canada or (ii) Any quantity of a Class 1, Division
1.1, 1.2, or 1.3 explosive as defined in suspended prior to the conclusion of the
Mexico. revocation proceeding.
§ 173.50 of this title; or
(d) Unsatisfactory Rating. If FMCSA
§ 385.703 Safety monitoring system. (iii) Any quantity of a poison
assigns a non-North America-domiciled
(a) General. Each non-North America- inhalation hazard Zone A or B material
carrier an Unsatisfactory rating
domiciled carrier new entrant will be as defined in §§ 173.115, 173.132, or
following a compliance review
subject to an oversight program to 173.133 of this title.
conducted under this subpart, it will
monitor its compliance with applicable (4) Involvement in, due to carrier act
initiate a suspension and revocation
Federal Motor Carrier Safety or omission, two or more hazardous
proceeding in accordance with
Regulations (FMCSRs), Federal Motor material incidents occurring within the
§ 385.709 of this subpart.
Vehicle Safety Standards (FMVSSs), and United States and involving any
Hazardous Materials Regulations hazardous material not listed in § 385.709 Suspension and revocation of
(HMRs). paragraph (a)(3) of this section and non-North America-domiciled carrier
(b) Roadside monitoring. Each non- defined in chapter I of this title. registration.
North America-domiciled carrier new (5) Using a driver who tests positive (a) If a carrier is assigned an
entrant will be subject to intensified for controlled substances or alcohol or ‘‘Unsatisfactory’’ safety rating following
who refuses to submit to required
monitoring through frequent roadside a compliance review conducted under

inspections. controlled substances or alcohol tests. this subpart, FMCSA will provide the
(c) Safety decal. Each non-North (6) Operating within the United States carrier written notice, as soon as
America-domiciled carrier must have on a motor vehicle that is not insured as practicable, that its registration will be
every commercial motor vehicle it required by part 387 of this chapter. suspended effective 15 days from the
operates in the United States a current (7) Having a driver or vehicle out-of- service date of the notice unless the
decal attesting to a satisfactory North service rate of 50 percent or more based carrier demonstrates, within 10 days of
American Standard Commercial Vehicle upon at least three inspections the service date of the notice, that the
compliance review contains material violation of a suspension order issued that it will have adequate basic safety
error. under this section, it will issue an Order management controls. It will also have
(b) For purposes of this section, requiring the carrier to show cause, to undergo a pre-authorization safety
material error is a mistake or series of within 10 days of the service date of the audit.
mistakes that resulted in an erroneous Order, why its new entrant registration
safety rating. should not be revoked. If the carrier fails § 385.715 Duration of safety monitoring
(c) If the carrier demonstrates that the system.
to make the necessary showing, FMCSA
compliance review contained material will revoke its registration. (a) Each non-North America-
error, its new entrant registration will (h) If a non-North America-domiciled domiciled carrier subject to this subpart
not be suspended. If the carrier fails to motor carrier operates a commercial will remain in the safety monitoring
show a material error in the compliance motor vehicle in violation of a system for at least 18 months from the
review, FMCSA will issue an Order: suspension or out-of-service order, it is date FMCSA issues its new entrant
(1) Suspending the carrier’s new subject to the penalty provisions in 49 registration, except as provided in
entrant registration and requiring it to U.S.C. 521(b)(2)(A), as adjusted by paragraphs (c) and (d) of this section.
immediately cease all further operations inflation, not to exceed amounts for (b) If, at the end of this 18-month
in the United States; and each offense under part 386, Appendix period, the carrier’s most recent safety
(2) Notifying the carrier that its new B of this subchapter. rating was Satisfactory and no
entrant registration will be revoked (i) Notwithstanding any provision of additional enforcement or safety
unless it presents evidence of necessary this subpart, a carrier subject to this improvement actions are pending under
corrective action within 30 days from subpart is also subject to the suspension this subpart, the non-North America-
the service date of the Order. and revocation provisions of 49 U.S.C. domiciled carrier’s new entrant
(d) If a carrier is assigned a 13905 for repeated violations of DOT registration will become permanent.
‘‘Conditional’’ rating following a regulations governing its motor carrier (c) If, at the end of this 18-month
compliance review conducted under operations. period, FMCSA has not been able to
this subpart, the provisions of conduct a compliance review, the
paragraphs (a) through (c) of this section § 385.711 Administrative review. carrier will remain in the safety
will apply, except that its new entrant (a) A non-North America-domiciled monitoring system until a compliance
registration will not be suspended under motor carrier may request FMCSA to review is conducted. If the results of the
paragraph (c)(1) of this section. conduct an administrative review if it compliance review are satisfactory, the
(e) If a carrier subject to this subpart believes FMCSA has committed an error carrier’s new entrant registration will
fails to provide the necessary in assigning a safety rating or become permanent.
documents for a compliance review suspending or revoking the carrier’s (d) If, at the end of this 18-month
upon reasonable request, or fails to new entrant registration under this period, the carrier’s new entrant
submit evidence of the necessary subpart. registration is suspended under
corrective action as required by (b) The carrier must submit its request § 385.709(a) of this subpart, the carrier
§ 385.705 of this subpart, FMCSA will in writing, in English, to the Associate will remain in the safety monitoring
provide the carrier with written notice, Administrator for Enforcement and system until FMCSA either:
as soon as practicable, that its new Program Delivery, Federal Motor Carrier (1) Determines that the carrier has
entrant registration will be suspended Safety Administration, 400 Seventh taken corrective action; or
15 days from the service date of the Street, SW., Washington DC 20590. (2) Completes measures to revoke the
notice unless it provides all necessary (c) The carrier’s request must explain carrier’s new entrant registration under
documents or information. This the error it believes FMCSA committed § 385.709(c) of this subpart.
suspension will remain in effect until in assigning the safety rating or
the necessary documents or information suspending or revoking the carrier’s § 385.717 Applicability of safety fitness
are produced and: and enforcement procedures.
new entrant registration and include
(1) The carrier is rated Satisfactory any information or documents that At all times during which a non-North
after a compliance review; or support its argument. America-domiciled motor carrier is
(2) FMCSA determines, following (d) FMCSA will complete its subject to the safety monitoring system
review of the carrier’s response to a administrative review no later than 10 in this subpart, it is also subject to the
demand for corrective action under days after the carrier submits its request general safety fitness procedures
§ 385.705, that the carrier has taken the for review. The Associate established in subpart A of this part and
necessary corrective action. Administrator’s decision will constitute to compliance and enforcement
(f) If a carrier commits any of the the final agency action. procedures applicable to all carriers
actions specified in § 385.705(a) of this regulated by the FMCSA.
subpart after the removal of a § 385.713 Reapplying for new entrant 21. Amend Appendix A to part 385,
suspension issued under this section, registration. section III to add new paragraph (i) to
the suspension will be automatically (a) A non-North America-domiciled read as follows:
reinstated. FMCSA will issue an Order motor carrier whose provisional new
entrant registration has been revoked Appendix A to Part 385—Explanation
requiring the carrier to cease further
may reapply for new entrant registration of Safety Audit Evaluation Criteria
operations in the United States and
demonstrate, within 15 days from the no sooner than 30 days after the date of * * * * *
service date of the Order, that it did not revocation. III. Determining if the Carrier Has Basic
commit the alleged action(s). If the (b) The non-North America-domiciled Safety Management Controls
carrier fails to demonstrate that it did motor carrier will be required to initiate
* * * * *
not commit the action(s), FMCSA will the application process from the (i) FMCSA also gathers information on
issue an Order revoking its new entrant beginning. The carrier will be required compliance with applicable household goods
registration. to demonstrate how it has corrected the and Americans with Disabilities Act of 1990
(g) If FMCSA receives credible deficiencies that resulted in revocation requirements, but failure to comply with
evidence that a carrier has operated in of its registration and how it will ensure these requirements does not affect the
determination of the adequacy of basic safety § 390.19 Motor carrier identification report. (Form OP–1, OP–1(MX), OP–1(NNA) or
management controls. (a) Applicability. Each motor carrier OP–2), to the appropriate address
* * * * * must file the Form MCS–150 or Form referenced on that form, or may submit
MCS–150B with FMCSA as follows: it electronically or by mail separately to
PART 387—MINIMUM LEVELS OF (1) A U.S., Canada-, Mexico-, or non- the address mentioned in paragraph (d)
FINANCIAL RESPONSIBILITY FOR North America-domiciled motor carrier of this section.
MOTOR CARRIERS conducting operations in interstate (f) Only the legal name or a single
commerce must file a Motor Carrier trade name of the motor carrier may be
22. The authority citation for part 387 Identification Report, Form MCS–150. used on the forms under paragraph (a)
continues to read as follows: (2) A motor carrier conducting of this section (Form MCS–150 or MCS–
Authority: 49 U.S.C. 13101, 13301, 13906, operations in intrastate commerce and 150B).
14701, 31138, and 31139; and 49 CFR 1.73. requiring a Safety Permit under 49 CFR (g) A motor carrier that fails to file the
part 385, subpart E of this chapter must form required under paragraph (a) of
23. Amend § 387.7 by revising this section, or furnishes misleading
paragraph (e) to read as follows: file the Combined Motor Carrier
Identification Report and HM Permit information or makes false statements
§ 387.7 Financial responsibility required. Application, Form MCS–150B. upon the form, is subject to the
* * * * * (b) Filing schedule. Each motor carrier penalties prescribed in 49 U.S.C.
must file the appropriate form under 521(b)(2)(B).
(e)(1) The proof of minimum levels of (h)(1) Upon receipt and processing of
paragraph (a) of this section at the
financial responsibility required by this the form described in paragraph (a) of
following times:
section shall be considered public (1) Before it begins operations; and this section, FMCSA will issue the
information and be produced for review (2) Every 24 months, according to the motor carrier an identification number
upon reasonable request by a member of following schedule: (USDOT Number).
the public. (2) The following applicants must
(2) In addition to maintaining proof of USDOT Number additionally pass a pre-authorization
Must file by last day of safety audit as described below before
financial responsibility as required by ending in
subparagraph (d) of this section, non- being issued a USDOT Number:
1 ......................... January. (i) A Mexico-domiciled motor carrier
North America-domiciled private and 2 ......................... February.
for-hire motor carriers shall file seeking to provide transportation of
3 ......................... March. property or passengers in interstate
evidence of financial responsibility with 4 ......................... April.
FMCSA in accordance with the 5 ......................... May.
commerce between Mexico and points
requirements of subpart C of this part. 6 ......................... June. in the United States beyond the
7 ......................... July. municipalities and commercial zones
* * * * *
8 ......................... August. along the United States-Mexico
24. Amend § 387.31 by revising 9 ......................... September. international border must pass the pre-
paragraph (e) to read as follows: 0 ......................... October. authorization safety audit under
§ 365.507 of this subchapter. The agency
§ 387.31 Financial responsibility required. (3) If the next-to-last digit of its will not issue a USDOT Number until
* * * * * USDOT Number is odd, the motor expiration of the protest period
(e)(1) The proof of minimum levels of carrier shall file its update in every odd- provided in § 365.115 of this subchapter
financial responsibility required by this numbered calendar year. If the next-to- or—if a protest is received—after
section shall be considered public last digit of the USDOT Number is even, FMCSA denies or rejects the protest.
information and be produced for review the motor carrier shall file its update in (ii) A non-North America-domiciled
upon reasonable request by a member of every even-numbered calendar year. motor carrier seeking to provide
the public. (c) Availability of forms. The forms transportation of property or passengers
described under paragraph (a) of this in interstate commerce within the
(2) In addition to maintaining proof of
section and complete instructions are United States must pass the pre-
financial responsibility as required by
available from the FMCSA Web site at authorization safety audit under
subparagraph (d) of this section, non-
http://www.fmcsa.dot.gov for (Keyword § 385.607(c) of this subchapter. If the
North America-domiciled private and
‘‘MCS–150,’’ or ‘‘MCS–150B’’) from all carrier also requests operating authority
for-hire motor carriers shall file
FMCSA Service Centers and Division under part 365 of this chapter, the
evidence of financial responsibility with
offices nationwide; or by calling 1–800– agency will not issue a USDOT Number
FMCSA in accordance with the
832–5660. until expiration of the protest period
requirements of subpart C of this part.
(d) Where to file. The required form or—if a protest is received—after
* * * * * under paragraph (a) of this section must FMCSA denies or rejects the protest.
be filed with FMCSA Office of (3) The motor carrier must display the
PART 390—FEDERAL MOTOR Information Management. The form may number on each self-propelled CMV, as
CARRIER SAFETY REGULATIONS; be filed electronically according to the defined in § 390.5, along with the
GENERAL instructions at the agency’s web site, or additional information required by
it may be sent to Federal Motor Carrier § 390.21.
25. The authority citation for part 390
Safety Administration, Office of (i) A motor carrier that registers its
continues to read as follows:
Information Technology, MC–RIO, 400 vehicles in a State that participates in

Authority: 49 U.S.C. 508, 13301, 13902, Seventh Street, SW, Washington, DC the Performance and Registration
31133, 31136, 31502, 31504, and sec. 204, 20590. Information Systems Management
Pub. L. 104–88, 109 Stat. 803, 941 (49 U.S.C. (e) Special instructions for for-hire (PRISM) program (authorized under
701 note); sec. 114, Pub. L. 103–311, 108 Stat.
1673, 1677; sec. 217, Pub. L. 106–159, 113
motor carriers. A for-hire motor carrier section 4004 of the Transportation
Stat. 1748, 1767; and 49 CFR 1.73. should submit the Form MCS–150, or Equity Act for the 21st Century [(Pub. L.
Form MCS–150B, along with its 105–178, 112 Stat. 107]) is exempt from
26. Revise § 390.19 to read as follows: application for operating authority the requirements of this section,
provided it files all the required Issued on: December 11, 2006.
information with the appropriate State John H. Hill,
office. Administrator.
Note: The following form will not appear
in the Code of Federal Regulations.
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BILLING CODE 4910–EX–C

Proposed Rule: Motor Carrier Safety Standards: New Entrant Safety Assurance Process

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Proposed Rule: Motor Carrier Safety Standards: New Entrant Safety Assurance Process

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Thursday,

December 21, 2006

49 CFR Parts 365, 385, 387, and 390

provisions for Mexico-domiciled

when the carrier is not directly compensated. See

will be amended to achieve consistency with this

resulted in revocation of its registration

FMCSA has been using private this proposed rule is a significant

TABLE 1.—CURRENT AND PROPOSED INFORMATION COLLECTION BURDENS

2126–0013 ................................................................................................................................... 74,896 66,977 –7,919

Net Change .......................................................................................................................... ........................ ........................ ¥7,869

establishing regulations implementing Executive Order 12630 (Taking of List of Subjects

monitoring through frequent roadside a compliance review conducted under

Information Technology, MC–RIO, 400 vehicles in a State that participates in

[FR Doc. 06–9759 Filed 12–20–06; 8:45 am]

BILLING CODE 4910–EX–C

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