highway bill a mixed blessing for shippers

Shippers dodged some bullets but took others when Congress passed the new highway bill earlier this year. Though widely criticized for funding billions of dollars' worth of pork projects that will do little to improve the nation's creaky infrastructure, the bill could have been much worse, John Cutler told NASSTRAC members at the group's fall meeting in Baltimore.

In his legislative update, Cutler, who is NASSTRAC's legal counsel, told shippers they should consider themselves lucky not to be paying federally mandated fuel surcharges right now. He reported that a proposal to impose across-the-board fuel surcharges survived until late in the legislative process. Cutler said that he had no objection to fuel surcharges negotiated between shippers and carriers, but opposed the idea of the government's mandating them. "That's inconsistent with the idea of deregulation and the free market," he said.

Another proposal that failed to make it through the process would have added tolls to existing roads. Although Congress did grant states some limited authority to impose tolls, Cutler said, the final bill was not as far-reaching as many had feared.

Still, Cutler did express concerns about the newly passed bill, known as the Safe, Accountable, Flexible, Efficient Transportation Equity Act (SAFETEA-LU). Reflecting a widespread sentiment, he described the funds allocated by the $286 billion, six-year spending bill as insufficient for maintaining the nation's current infrastructure, not to mention improving the transportation system. "Civil engineers say we need to spend $94 billion a year just on highways," said Cutler.

Cutler also warned shippers that although they may have dodged some bullets, they shouldn't be lulled into complacency. The new highway bill includes provisions that could have a major impact on their operations. For example, the bill increased penalties for violations of hazardous materials transportation regulations. Penalties can now reach $50,000 per violation, or $100,000 per violation in the event it causes death, severe injury, serious illness or major property destruction. Cutler reminded the audience that a single shipment can be cited for multiple violations.

Of particular significance to DC and warehouse managers, the law expanded hazmat regulations to cover those who prepare hazardous materials for transportation, those responsible for safe transportation, those who certify compliance with the rules, and anyone who misrepresents the identity of the responsible parties.

In his legislative recap, Cutler also lamented Congress's failure to address the truck driver hours-of-service issue, though he praised the Federal Motor Carrier Safety Administration (FMCSA) for adopting a rule similar to the one it proposed in 2003, which had been challenged by safety advocates. "We had hoped that Congress would bless the rule," he said. "But it did not. That makes a court fight more likely." He added that any legal challenge would probably be delayed for several months while the FMCSA reviewed several petitions for reconsideration of the rule.