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Federal Register / Vol. 45,No.169 / Thursday, August 28, 1980 / Proposed Rules

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Also appearing in-today's Federal

On July 1, 1980, the President signed
Register are the-delegations otauthority
the Motor Carrier Act of 1980, Pub. L.
necessary for the issuance of this
Federal Highway Administration
96-296. Section 30 of the Act establishes
advance notice of proposed rulemaking
minimum levels of financial
(ANPRM, The Motor CarrierAct of-1900'
49 CFR Ch. III
responsibility to be set for all for-hire
vests the Secretary with the authority to
motor carriers of property involved in
prescribe minimum financial
[BMCS Docket No. MC-94; Notice No. 80-8] interstate or foreign transportation and
responsibility levels. This authority is
for all motor carriers transporting
Citation:
45Financial
Fed. Reg. 57676hazardous
1980 materials in intrastate or
delegated. to theFHWA. and. in-turn,, the
Minimum
Levels of
FHWA is delegating the authority to,the
Responsibility for Motor Carriers
interstate commerce. The Motor Carrier
DirectorBureau of Motor Carrier
Act of 1980 limits the applicability of
Safety.
AGENCY: Federal Highway
these requirements to motor vehicles
The minimum, levels of financial
Administration (FHWA), DOT.
having a gross vehicle weight rating of
responsibility
set forth in the Act, levels
10,000 pounds or more.
ACTION: Advance Notice of Proposed
that will take effect 1 year after
The law establishes minimum levels
Rulemaking.
enactment unless the Secretary.
of financial responsibility that ihust be
exercises the statutory authority to.
SUMMARY: Comments and information
carried by affected persons I year from
establish differentlevels, are:.
are solicited regarding implementation
the date ofenactment of the Act unless
1. $750,000for the transportation of
of Section 30 of the Motor Carrier Act of the Secretary exercises the statute's
property by for-hire motor vehiclein
1980. The Act establishes certain
authority to adjust those limits. The
interstate or foreign commerce;
requirements for levels of insurance, or
Secretary may promulgate those
2. $5 million for the transportation by
other evidence of financial
regulations to require higher levels. The
motor vehicle in interstate or intrastate
responsibility; which must be
Secretary also has limited authority to
commerce ofmaintained by motor carriers, and
,reduce those levels. The statute
(a) Hazardous substances (as defined
empowers
the
Secretary
of"
Content downloaded/printedprecludes
from the Secretary from reducing
by the Administrator of the
Transportation to make certain
Environmental Protection Agency) in
the minimum levels below specified
HeinOnline
(http://heinonline.org)
adjustments
in the statutory
levels and provides that the authority to cargo tanks, portable tanks, or hopper
requirements.
This
document
sets
forth
a
Mon Oct 20 17:00:22 2014 impose reduced levels applies only to a type vehicles,,with capacities in excess
number of questions for the purpose of
of 3,500 water gallons;
period of up 2 years beginning (1) on the
gathering information which should
(b) Class,A explosives, polson'gas.
effective date of the rule provided that a
assist the FHWA in both promulgating
liquefied gas, or compressedgasin
rulePDF
is made
effective within
one
year
-Your
use
of
this
HeinOnline
indicates
your
acceptance
reasonable and comprehensive
bulRor
after enactment, or (2) on the 366th day
regulations
the area of motor
carrier andafter
of in
HeinOnline's
Terms
Conditions
of the license
(61 Large quantities of radioactive
enactment provided
a rule is made
financial responsibility and in
materials;
and
effective
one
year
after
enactment
or
agreement
available
developing
a report for the
Secretary at
of http://heinonline.org/HOL/License
3. $1 million for the transportation by
later.
Transportation to submit to the
motor vehicle in interstate or intrastate
The purpose of the financial
Congress.
commerce of any hazardous material (as
responsibility
provision
of the Motor
The search
of this
is generated
from
DATE: -Comments
must betext
received
on orPDF
defined by the Secretary), oil, or
Carrier Act of1980 is to create
hazardous substance or waste (both as
before October
27, 1980. OCR text.
uncorrected
incentives for the motor carrier industry
definedby the Administrator of the
ADDRESS: All comments should refer to
to-focus on the safety aspects of
Environmental Protection Agencyl other
'the docket number that appears at the
highway transportation and to assure
than these materials. described in2 (a),
top of this document and should be
the general public that a motor carrier
submitted in an origingal and two copies maintains an adequate level of financial (b), or (c).
The Secretary's authority to establish
to Room 3402, Bureau of Motor Carrier
responsibility requirements sufficient to
reduced.
requirements allows reductions:
Safety (BMCS], 400 Seventh Street, SW., satisfy claims covering public liability,
as follows:
Washington, D.C. 20590.
property damage, and environmental
1. $750,00fYto no less than $500,000;
FOR FURTHER INFORMATION CONTACl
restoration. The legislative history
2. $5Imillion to no less, than $1 millionr
Mr. Gerald J. Davis, Bureau of Motor
regarding Section 30 indicates a
and
Carrier Safety, (202) 426-9767; or Mr.
Congressional belief that increased
3. $1 million to no less than $500,000.
Gerald M. Tierney, Office of the Chief
financial responsibility will lead to
Generally, the Secretary maymake
Counsel, (202) 426-0346; Federal
improved safety performance as unsafe
these reductions provided such
Highway Administration, 400 Seventh
motor carriers will incur higher
reductions (1) will not adversely affect
Street, SW., Washington D.C. 20590.
premiums than safe carriers, or will be
public safety; and (2) will prevent a
Office hours are from 7:45 a.m. to 4:15
unable to obtain coverage. Motor
serious disruption In transportation
p.m. ET, Monday through Friday.
carriers who maintain high levels of
service. However, as to the
safety may be evaluated in a favorable
SUPPLEMENTARY INFORMATION: The
transporation of hazardous materials,
light by insurance companies, since
FHWA has determined that this
oil, substance, or waste In interstate
generally the premiums that insurance
document contains a significant
'Commerce, other than bulk, the
proposal according to the criteria
companies actually charge are directly
Secretary may reduce the amounts if the
related to their insured's recqrd of loss
established by the Department of
Secretary finds that such a reduction
experience. The new minimum levels of
Transportation pursuant to Executive
will not adversely affect safety.
firiancial responsibility for public
Order 12044. A draft regulatory
It should be noted that the term "forliability, property damage, and
evaluation is available for inspection in
hire transportation" applicable to the
the public docket and maybe obtained
environmental restoration as required in $75,000 minimum levels include all
the Motor Carrier Act of 1980 should
by contacting Mr. Gerald J.Davis of the
motor carriers operating under contract
program office at the address specified
initiate a new and major focus on motor
or common carrier authority issued by
above.
carrier safety.
the Interstate Commerce Commission
DEPARTMENT OF TRANSPORTATION

+(,121/,1(

Federal Register / Vol. 45, No. 169 / Thursday, August 28, 1980
(ICC) and interstate for-hire carriers that
are exempt from the ICC's economic
regulations. Examples of interstate
motor carrier activities that are exempt
from the ICC's economic regulation but
subject to regulation under Section 30
include, but are not limited to1. The for-hire transportation of
exempt commodities, such as
unprocessed agricultural commodities,
including fresh fruits and vegetables;
liverstock and poultry feed and certain
seeds and plants being transported to a
site of agricultural production; fish or
shellfish by-products not intended for
human consumption; used pallets, and
used empty "shipping" containers;
pumice stone and other natural crushed
volcanic rock to be used for decorative
purposes; wood chips; newspapers;
livestock; agricultural or horticultural
commodities; commodities listed as
exempt in the commodity list
incorporated in ICC ruling, number 107,
published on March 19, 1958; certain
cooked or uncooked fish; and
2. Exempt interstate operations, such
as: the for-hire transfer, pickup and
delivery of property in a terminal area of
a rail carrier, water carrier, or freight
forwarder, operations conducted under
a one-State exemption certificate;
operations incidental to air
transportation and in lieu of air
transportation due to weather
conditions or mechanical failure;
interstate operations of a cooperative
association for compensation;
commercial zone operations; casual,
occasional, or reciprocal transportation;
and emergency towing of disabled
vehicles. Intrastate carriage of
nonhazardous materials, however, is not
covered by Section 30.
The BMCS is considering the impact
of the levels of financial responsibility
prescribed in Section 30 of the Act, as
well as any other levels that might be
prescribed by the Secretary, on the
affected motor carrier population,
insurance companies, and the general
public.
The principal reason for issuing this
ANPRM is to obtain comments and data
to assist the BMCS in determining1. What minimum levels of financial
responsibility should be established;
2. If there should be a phase-in of the
requirements over a period of time and,
if so, what that phase-in period should
be; and
3. If the levels prescribed in any
phase-in period should remain constant
throughout that period.
Comments and data are also solicited
to obtain information that will assist the
BMCS in developing a report to
Congress, as required by the statute,

addressing the impact of the minimum

levels of financial responsibility on1. The safety of motor vehicle
transportation;
2. The economic condition of the
motor carrier industry including, but not
limited to, small and minority motor
carriers and independent owneroperators; and
3. The ability of insurance companies
to provide designated coverage.
Information on these three factors would
contribute to the rulemaking process as
well as to the development of this
report.
The BMCS invites comments from
interested persons on the need for
regulations that would change the
minimum levels of financial
responsibility for up to a 2-year phase-in
period as authorized by the Motor
Carrier Act of 1980. Comments are
especially invited on the questions
below. Responses to these questions,
other relevant comments, and factual
data in support thereof are solicited so
that minimum level requirements can be
promulgated in light of hdw readily
motor carriers and insurance companies
could meet the requirements, and as to
the extent to which various levels could
be expected to affect the safety of the
public and the ability of motor carrier
service.
A number of the specific questions
concern insurance industry practices.
However, the content of this ANPRM is
in no way intended to imply an effort to
regulate the insurance industry. These
questions have been included in the
belief that data about insurance
practices will help the BMCS better
understand the relationship between
insurance requirements and safety
performance which is critical to the
development of the most appropriate
rule. Also, it should be noted that the
scope of the rulemaking concerns only
liability insurance, not cargo insurance.
Lastly, all relevant data and
comments are welcome, even if not
specfically requested by any of the
following questions:
1. What dollar figure of financial
responsibility is sufficient to "protect"
the general public from the operation of
motor carriers of nonhazardous
materials? Why?
2. What dollar figure of financial
responsibility is sufficient to "protect"
the general public from the operation of
motor carriers of hazardous materials?
Why?
3. By establishing a $5 million
financial responsibility requirement for
some hazardous materials movements
but only a $1 million requirement for
other hazardous materials, the Act

Proposed Rules

57677

indicates that different kinds of

hazardous material movements deserve
different levels of financial
responsibility. Should the Secretary
establish levels for the transportation of
certain hazardous materials higher than
is required by the statute? If so, for
which hazardous materials? What
should the limits be? Why?
4. By what percentage would a motor
carrier's insurance premiums be
increased if the minimum limits were set
for carriers of nonhazardous materials
at $500,000? $750,000? $1 million? If set
at $i million for carriers of hazardous
materials? $5 million? Assume that most
carriers meet the current limits of
$100,000 (per person/$300,000 (for all
persons) as set by the ICC.
5. What will the economic impact of
increased insurance premiums be on
carriers of hazardous materials? Would
small and minority controlled carriers
be affected differently than other such
carriers?
6. What will the economic impact of
increased insurance premiums be on
carriers of nonhazardous materials?
Would small and minority controlled
carriers be affected differently than
other such carriers?
7. Should there be lower financial
responsibility limits established for all
or any part of the 2-year phase-in
period? For which classes of carriers?
Why? Would the establishment of lower
limits either adversely affect public
safety or seriously disrupt
transportation service?
8. Will the insurance industry be able
to provide motor carriers with the
expanded coverage required by the Act
I year after the Act takes effect? 2
years? 3 years?
9. Will the insurance industry be able
to issue self-insurance surety bonds to
motor carriers in amounts up to $5
million and greater? If "yes." what
criteria are now used by insurance
companies in making a determination
whether to issue such a surety bond?
What criteria would be used in making
such a determination once new levels of
financial responsibility are established?
What evidence of compliance should be
required?
%
10. What criteria should the Secretary
use in determining and approving
financial responsibility of those carriers
who choose to be self-insured?
11. Should a motor carrier be allowed
to aggregate the required insurance
coverage with more than one insurance
company?
12. Should motor carriers be required
to obtain insurance or other security
equal to minimal levels of financial
responsibility that cannot be cancelled
or withdrawn for a finite period? If

57678-

Federal Register / Vol. 45, 'No. 169

Thursday, August 28, 1980 / Proposed Rules

"yes," what time period should be

23. Thie Act provides that the
Secretary may establish levels of
established for cancellation notices? 30
financial responsibility for the
days? 60 days? 1 year?
transportation of Class A explosives,
13. What evidence should be required
poison gas, liquefied gas, or compressed
of motor carriers to ensure compliance
-gas in bulk. How should the term "in
with the minimum levels of financial
responsibility?
bulk" be applied to each of these
14. Should motor carriers obtain
materials?
insurance only from companies that
(Sec. 30, Pub. L. 9G-296,94 Stat 793; 23 U.S.C.
belong to State Insurance Guaranty
315.49 CFR 1.48 and 301.60]
Funds?
(Catalog of Federal Domestic Assistance
.15. Should motor carriers be required
Program Number 20.217, Motor Carrier
to purchase insurance only from
Safety)
insurance companies that provide loss
Issued on: August 25,1980.
prevention services to their insureds?
Robert A. Kaye,
16. Should motor carriers obtain
Director,BureauofMotor CarrierSafety.
insurance only from those companies
[FR Doc. 80-26353 Filed 8-27-f0 8:45 aml
legally authorized to issue policies in
BILLING dODE 4910-22-M
each State in which the motor carriers
operate?
17. Should the coverage of fiduciaries
be included in insurance policies,
guarantees, surety bonds, qualifications
as self-insurers, or notices of
cancellation issued by or in behalf of
motor carriers?
18. What likelihood exists that motor
carriers with good safety records will
end up subsidizing less safe motor
carriers? If so, why, and to what extent?
Do rating plans and premium
requirements-proyide the necessary
incentives for motor carriers to
administer effective loss prevention
programs?
19. Can insurers establish a rating
plan for newly established motor
carriers? If so, what would the
requirements be?
20. What new factors would the
insurance industry use in establishing
rates for individual motor carriers?
21. The Act provides for mandatory
insurance limits for for-hire interstate
transportation but no limits are
prescribed for private transportation of
nonhazardous materials in interstate
operations. Will this distinction result in
a diversion of traffic from for-hire motor
carriers to private motor carriers?
22. The Act provides for higher limits
for the transportation of large quantities
of radioactive materials. "Large quantity radioactive materials" are currently
defined, pursuant to the Department's-'
Hazardous Materials Regulations, as.'a',
quantity, the aggregate radioactivity of
which in one package exceeds that
specified as follows:
(a) Group I or I radionuclides: 20.,
curies;
(b) Group III or IV radionuclides: 200
curies;
(c) Group V radionuclides: 5,000
curies; and
(d) Group VI or VII radionuclides:
50,000 curies (49 CFR 173.389(b)). Should
this definition be incorporated in.the
new rules?