FMCSA expects to issue broker final rule in March

Although the broker transparency issue was placed on the back-burner, the Federal Motor Carrier Safety Administration is poised to issue a final rule regarding broker and freight forwarder financial responsibility in the coming months.

According to the U.S. Department of Transportation’s September 2023 Significant Rulemaking Report, FMCSA is targeting March 29 to release the final rule.

In January, the Federal Motor Carrier Safety Administration published a notice of proposed rulemaking about modifications to broker and freight forwarder financial responsibility requirements. Prompted by 2012’s Moving Ahead for Progress in the 21st Century Act, FMCSA previously implemented a requirement to increase the financial security amount for brokers to $75,000.

FMCSA proposed regulations involving assets readily available, immediate suspension of broker/freight forwarder operating authority, surety or trust responsibility in cases of insolvency, enforcement authority and entities eligible to provide trust funds.

OOIDA asks for more

In comments filed in March, the Owner-Operator Independent Drivers Association suggested that FMCSA take the proposal even further.

“The final rule must be strengthened to ensure that FMCSA, along with industry stakeholders, can readily identify when available financial security falls below $75,000,” OOIDA wrote in formal comments signed by President Todd Spencer. “The notice of proposed rulemaking falls short of providing the necessary transparency and accountability from brokers and freight forwarders to absolutely know if and when there has been a drawdown on the bond below $75,000.”

OOIDA added that without these changes, the current issues that allow a bond to be in effect until a claim is actually paid on the bond will persist.

“Under this unofficial policy, even if legitimate claims aggregating in excess of the bond amount have been presented to the surety and as long as the surety has not yet paid a single claim, the bond is still good and the broker can stay in business,” OOIDA wrote. “Any final rule must finally end this practice.”

Trucker Frank Seltzer told FMCSA that owner-operators often are working from a disadvantage when it comes to brokers.

“I follow the same sentiment as probably most of the (owner-operators) you have heard from,” Seltzer wrote. “We don’t have a lot of tools to measure the market. And as of late the tools that I have to measure the market with don’t line up with broker rates … Some of these rates cannot possibly allow a carrier to make any profit. Basically, some carriers are moving freight for free. Carriers are held to all kinds of standards, and it’s about time brokers are held to some standards as well. We deserve to be treated better than this.”

It is unclear whether FMCSA’s forthcoming final rule will integrate OOIDA’s suggestions.

Broker transparency

While we should see action regarding financial responsibility early in 2024, FMCSA’s proposal on broker transparency isn’t expected until the latter part of the year.

After previously targeting this past June as the date for a notice of proposed rulemaking to address the issue, the DOT report says FMCSA’s proposal now isn’t expected until Oct. 31, 2024.

OOIDA criticized FMCSA’s lack of urgency.

“The continued delay is BS – transparency has been required since 1980,” OOIDA President Todd Spencer said. “FMCSA stated in March 2023 the timeframe would be announced in the upcoming unified regulatory agenda. The agenda indicated June, and now they’ve inexplicably delayed more than a year. The public docket from our petition as well as the listening sessions they’ve held provided an abundance of material to produce a meaningful proposal by now.”

In 2020, OOIDA petitioned FMCSA to do something about the lack of broker transparency. That petition was granted earlier this year, but now it looks like it could be close to 2025 before a proposal is unveiled.

Other rulemakings

The Significant Rulemakings report also noted that FMCSA plans to issue a supplemental notice of proposed rulemaking on speed limiters in December and a final rule on automatic emergency braking systems in April. LL