FMCSA to Set Procedures for Barring 'Reincarnated' Violators

Comments on the notice of proposed rulemaking are due by Jan. 12. There would be an administrative review before an out-of-service order in such a case could take effect.

The Federal Motor Carrier Safety Administration has proposed changes in its Rules of Practice for Motor Carrier, Intermodal Equipment Provider, Broker, Freight Forwarder, and Hazardous Materials Proceedings that would allow it to issue out-of-service orders to companies that it determines are reincarnations of other entities with a history of failing to comply with requirements.

The lengthy NPRM published Dec. 13 says FMCSA determined several motor carriers "have submitted new applications for registration, often under a new name, in order to continue operating after having been placed out of service for safety-related reasons; to avoid paying civil penalties; to circumvent denial of operating authority based on a determination that they are not fit, willing, or able to comply with the applicable statutes or regulations; or to otherwise avoid a negative compliance history." It continues, "Other motor carriers attempt to avoid enforcement or negative compliance history by creating or using an affiliated company under common operational control. They then shift customers, vehicles, drivers, and other operational activities to that affiliated company when FMCSA places one of the commonly controlled companies out-of-service. The practice of 'reincarnating' as a new carrier or operating affiliated companies to circumvent Agency enforcement actions and avoid a negative compliance history or enforcement action creates an unacceptable risk of harm to the public because it results in the continued operation of at-risk carriers and thwarts FMCSA's ability to carry out its safety mission."

The example cited in the NPRM is a 2008 bus crash in Sherman, Texas. The carrier in that crash did not have operating authority from FMCSA but had an application pending with it; FMCSA determined the carrier was a reincarnation of another bus company that had recently been placed out of service. That bus crash caused FMCSA to begin reviewing applications for passenger-carrier operating authority in a hunt for reincarnations or affiliates of other motor carriers with negative compliance histories.

"Although the vetting program is a significant improvement to the operating authority review process, it is not a complete solution to the reincarnation problem. Accordingly, FMCSA proposes new procedures to prohibit reincarnated or affiliated carriers from successfully evading accountability for their compliance history," the rule states.

The NPRM would clarify that paying the full civil penalty in an enforcement proceeding doesn't allow respondents to unilaterally avoid an admission of liability for the violations charged. And it would set procedures for consolidating FMCSA records of reincarnated companies with their predecessor entities.

To file a comment, visit www.regulations.gov and search for Docket Number FMCSA-2011-0259.

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