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- Nov. 30 , 2010 -

Supply Chain News: With CSA Looming, Trucking Groups Move to Halt Implementation; Should Shippers Care?


Suit Filed One Week before Implementation of Revised Carrier Safety Reporting; Rates Hikes Ultimately in Double Digits, One Freight Broker Says


 
 


SCDigest Editorial Staff

SCDigest Says:
A worsening driver shortage will lead to increase wages for drivers and less capacity in the industry, both driving up rates. Carrier costs for driver research and insurance might also be pressured higher.

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Just a week before the government's Compliance, Safety and Accountability 2010  (CSA 2010) program is set to be operational, a coalition of transportation groups largely representing smaller carriers has petitioned a federal appeals court in Washington DC to block implementation of the program, or at minimum prohibit the public release of certain CSA data until the Federal Motor Carrier Safety Administration (FMCSA) reviews some aspects of the new regulations.

The National Association of Small Trucking Companies, The Expedite Alliance of North America and the Air & Expedited Motor Carriers Association together filed the motion for an emergency stay with court. CSA data is currently scheduled to be published starting Dec. 5.

CSA 2010 assigns safety scores to carriers through use of additional metrics than in the past, including all safety-based roadside inspection violations and assessments and violation/citation histories of individual drivers and will update carrier scores more often. The fear from some quarters is that this will knock many existing drivers off the roads, while others worry that the impact will fall disproportionately on smaller carriers, who may tend to hire drivers with less clean driving histories.

Afraid of low scores that could lead shippers to drop poorly-ranked carriers or that could be cited as evidence in lawsuits related to future accidents, many smaller carriers see CSA as a major business threat.

In the court filing, the three groups said that FMCSA should disclose fully to the industry and public all aspects of its proposed rule, including:

  • The algorithms and other formulas the agency plans to use in developing carriers’ Behavior Analysis and Safety Improvement Categories (BASICs) grades and classifications
  • The sample populations used in developing the percentiles and other criteria the agency will utilize in grading carriers as to safety
  • The procedures the agency will use, if any, to determine that alleged violations are reported accurately.

However, the industry's largest group, the American Trucking Associations (ATA), said that while it continues to have some concerns with the CSA 2010 methodology, it has decided not to join the other groups in challenging the program in court.

Bob Digges, ATA’s vice president and chief counsel, said the ATA has evaluated the merits of the legal arguments and believes they have a very limited chance of being successful.

“Further, ATA believes greater gains can and have been made by working with the agency to make needed improvements to ensure that scores are both fair and accurate,” the ATA said this week in a member email alert. “In those categories where the accuracy of scores is questionable (the Crash Indicator and Cargo-Related BASIC) scores should appropriately be kept from public view.”

On August 16, 2010, FMCSA began providing carriers with information about where they stand in each of the new CSA SMS’s Behavior Analysis and Safety Improvement Categories (BASICs) based on roadside inspection data and investigation findings. 

Just this week, the agency also announced a couple of modifications to the program, based on community feedback. Those included changing the term “Deficient” to “Alert” when a motor carrier’s score in one or more BASICs is above the FMCSA threshold for intervention, changing the highlight color from red to orange, and making some changes in the algorithms used to compute the scores.

 

 

(Transportation Management Article - Continued Below)

 
     
 
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However, the trucking groups filing the motion charge that FMCSA has not adequately responded to substantial concerns over CSA methodology, including:

  • Due Process Concerns: CSA 2010 will assign safety ratings based on citations and warnings that motor carriers have no effective way to challenge, the organizations said.
  • Peer Grouping: Carriers required to maintain paper logs of drivers’ on-duty and driving time are peer grouped with carriers that do not need to do so, resulting in unfair comparisons that prejudice carriers using paper logs, the groups said. A large proportion of logging violations typically involve recordkeeping errors rather than excessive driving hours.
  • Data Inequity: Enforcement officials in some states need “probable cause” for charging a moving violation in order to stop a truck for a safety inspection, escalating the number of warnings received by carriers in those states. Although this is the case under SafeStat as well, the inequity will be compounded when they can influence an actual safety rating under CSA, the associations said. In addition to geographical inequity, under-reporting of satisfactory inspections skews several of the BASIC scores, resulting in faulty statistical data.
  • Unexplained Methodology Changes: In August of 2010, after two years of test trials, the agency announced it made 800 technical changes in its methodology, none of which have been released or reviewed by the public, the groups said. “Because neither the science nor the math behind the methodology appears to have been subject to Data Quality Act review by the agency, the data has no proven reliability and is not fit to be published given the substantial adverse consequences.”

Should Shippers be Worried?

Assessments on the impact or SCA 2010 to shippers range from modest to dire.

Clearly, the reporting could exacerbate the resurgent worries about drivers shortages.

The FMSCA says under CSA 2010 that it cannot use individual ratings to remove a driver from his or her job or to revoke a trucker's commercial drivers license (CDL).  However, that does not mean drivers - perhaps tens or even hundreds of thousands - will be driven from the ranks even as trucking safety overall continues to improve.

John Smith, chairman of carrier CRST, noted at the Council of Logistics Management (CSCMP) conference this September that his company's new CSA-based standards were knocking out huge numbers of potential driver candidate, and that its most recent owner-operator of the year wouldn't make the cut based on a few traffic violations in the past.

A worsening driver shortage will lead to increase wages for drivers and less capacity in the industry, both driving up rates. Carrier costs for driver research and insurance might also be pressured higher.

Kenny Lund, vice president of support operations for transportation broker Allen Lund Co., said this week that the ultimate impact of CSA 2010 is likely to be quite substantial.

“I’d be surprised if freight rates rise less than 10%, but I would not be that surprised if it’s over 20%, he said.

While other don't think the cost increase will be that high, it's clear CSA will have a larger impact on shippers than many realize, especially those using a lot of smaller carriers whose survival could be in jeopardy from the new rules if they are implemented.

Do you have any perspective on CSA 2010? Do you think its implementation should be delayed?  Will the impact on rates be modest or worse? Let us know your thoughts at the Feedback button below.


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