Glostone Newsletter – March 2014
posted in Newsletter by Brian Gray
Glostone Newsletter – March 2014
FMCSA Proposes ELD Mandate for Nearly All Trucks
The Federal Motor Carrier Safety Administration on March 13 issued a revised proposal to mandate that electronic logging devices be installed in interstate commercial trucks and buses. The requirement would help enforce hours-of-service rules, reduce paperwork burdens on carriers and ensure that drivers are not harassed, FMCSA said. The new proposal supplements the agency’s February 2011 proposal. FMCSA stopped work on that requirement in 2012 after a federal court ruled that a previous regulation mandating the devices for some carriers did not properly prevent the ELDs from being used to harass drivers. The proposal addresses new technical specifications for ELDs, mandates ELDs for drivers currently using record of duty status, clarifies hours-of-service supporting document requirements and outlines procedural and technical provisions aimed at ensuring that ELDs are not used to harass vehicle operators. In an effort to allay drivers’ and motor carriers’ fears, FMCSA said in its statement that the rule protects privacy because electronic logs would only be available to law enforcement or FMCSA during roadside inspections, compliance reviews and post-crash investigations. The rule would come with a new prohibition on carriers harassing drivers, which could carry an $11,000 fine. Carriers must allow drivers access to their logs, and the devices must be able to be muted when drivers sleep.
FMCSA estimated the mandate would save 20 lives and prevent 434 injuries each year, with a net benefit to the country of $394.8 million annually. “Impaired driving, including fatigue, was listed as a factor in more than 12% of the 129,120 total crashes that involved large trucks or buses in 2012,” the agency said. FMCSA will soon publish the proposal in the Federal Register, starting a 60-day period during which the public can comment on it. The agency will then consider the comments before making the rule final. As proposed, the mandate would take effect two years after FMCSA makes it final. Carriers and drivers using compliance electronic logs will be allowed to continue using them for two more years after the rule takes effect.
What Are IRP & IFTA Auditors Looking For?
The International Registration Plan (IRP) and the International Fuel Tax Agreement (IFTA) both apply to carriers with trucks over 26,000lbs and traveling interstate. The IRP deals with how states register vehicles and distribute the registration fees to the states traveled. IFTA is the system states use to collect and distribute fuel tax monies based upon where the fuel was used. Each state is required to audit 3% or more of their carriers registered in these programs. Both IRP and IFTA have similar record keeping requirements when it comes to tracking distance traveled. IFTA goes beyond IRP record keeping requirements by also requiring fuel purchase records. The records are used by auditors to verify that each carrier has an adequate record keeping system in place and uses those records accurately to calculate distance and pay the proper registration and fuel tax fees. Auditors can request records going back 4 years. Here is a list of required records common to both IRP and IFTA:
- Distance recaps for each vehicle for each jurisdiction in which the vehicle operated.
- An acceptable distance accounting system is necessary to substantiate the information reported on the tax return filed quarterly or annually. At a minimum, must include distance data on each individual vehicle for each trip and be recapitulated in monthly fleet summaries. Supporting information should include:
- Date of trip (starting and ending);
- Trip origin and destination;
- Route of travel;
- Beginning and ending odometer
- Total trip miles/kilometers;
- Miles/kilometers by jurisdiction;
- Unit number or vehicle identification number;
- Vehicle fleet number;
- Registrant’s name; and
- May include additional information at the discretion of the base jurisdiction.
- The date of each receipt of fuel;
- The name and address of the person from whom purchased or received;
- The number of gallons or liters received;
- The type of fuel;
- The vehicle or equipment number into which the fuel was placed, and
- If applicable, details of taxable and non-taxable usage of fuel;
These are the minimum records needed for an IFTA and/or IRP audit. Just having the document does not mean it will be acceptable. Auditors will verify the accuracy of the records plus ensure the correct numbers were actually reported.
Common mistakes carriers make with IFTA and IRP record keeping:
- Recording miles from dispatch records and not balancing them with odometer readings
- Recording miles using mapping software and zip code references
- Not recording odometer readings
- Not recording routes of travel
- Not recording empty or bob-tail miles
- Not recording personal miles
- Not keeping fuel receipts or accepting fuel receipts without all of the required information included.
When an auditor finds an error, percentages are applied to the entire three year audit period and to all vehicles which can result in substantial fee, penalty and interest assessments. When it comes to compliance and audits, being proactive is the key. Have systems in place that will guarantee records compliance and promote safety. If you need help with a proactive plan, give us a call!
The “Classic Blunder” Of New Commercial Insurance Filings
Buying insurance is a critical piece of the process for a new company to obtain his Motor Carrier (MC) operating authority. At Glostone, we help dozens of clients get set up with new MC authorities every year. When we ask about how they are going to handle their insurance requirement, we often hear statements like “I’m going to my insurance guy” or worse yet, “my car insurance agent said he could give me a quote.” What typically happens is our clients will call up the same person who provides all of their other various insurances (personal car, life, property) and say something like “I just bought a truck, I need insurance”. That agent is, of course, going to say, “Yes, I can insure a truck”! The uninformed agent has no idea that we are talking about a commercial truck, with totally different insurance needs and a filing requirement that is attached directly to an FMCSA Motor Carrier authority number. This approach always leads to delays in obtaining the authority and usually wastes a lot of time and money. The best rule of thumb is if an insurance provider does not already insure 100’s of other commercial motor vehicles, they probably have a limited knowledge of what the carrier actually needs. Even companies that insure motor carriers, trucks and drivers are not all the same. Some sell through independent agents, others through their own sales staffs. Some specialize in commercial truck insurance, while others sell it as one of a secondary line of coverage they offer. Some companies specialize in specific niches within trucking, such as large fleets, temperature-controlled equipment or owner-operators. Some cover thousands of small customers, while others only handle a few big companies. This intense specialization suggests the first insurance-buying decision: Buy from a company that specializes in truck insurance for your type of operation. Specialists know what to ask and will recommend a policy that will not only meet the FMCSA requirements, but will also match the needs of your operation and at a price you can afford. If you are looking a quote from a truck insurance specialist, we can to refer you to the best in the business! Give us a call at 503-607-1088
