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Another ministerial exercise in the name of safety

By James Aaron Cooke, Executive Editor -- Logistics Management, 9/1/2004

Come January, truckers hauling hazardous materials will be hit with more red tape in the name of public safety and security. That's when the Federal Motor Carrier Safety Administration (FMCSA) will implement a rule requiring carriers to apply for federal permits to haul toxic inhalants, liquefied natural gas, explosives, and radioactive materials. Despite the regulators' good intentions, one question lingers like a bad odor: What's the overall gain?

The U.S. Department of Transportation (DOT) dragged its feet on this matter for close to 15 years. In 1990, Congress passed the Hazardous Materials Transportation Uniform Safety Act (HMTUSA), which directed DOT to develop permits for hazmat carriers. DOT overlooked that obligation until a lawsuit filed by safety, labor, and consumer advocacy groups last summer forced its hand.

Starting next year, a motor carrier must have a "satisfactory" safety rating and a "satisfactory" security program in place to receive a hazmat-hauling permit. Each carrier must also sign up with DOT's Research and Specials Program Administration (RSPA), which oversees hazardous materials transportation regulations. RSPA will handle carriers' registrations but FMCSA will issue the permits.

Each carrier will also be required to establish a communications plan for maintaining driver contact during hazmat trips, and drivers must check in with their employers at least twice during each such trip. Carriers that haul only radioactive materials must have a written route plan, and each truck must pass a pre-trip inspection by a government-approved inspector.

FMCSA's analysts estimate that the new requirements will cost industry and government $4.8 million a year. The agency also says those requirements will save some $3.6 million annually by reducing the number of accidental releases of hazardous materials.

To bolster its case, FMCSA put forward the following argument: "Although we cannot predict the actual security benefits or the number and size of future terrorist acts, the security benefits clearly would be immense if the rule prevented a terrorist act even a fraction of the size of the Twin Towers calamity."

Has fear of another terrorist attack emerged as the trump card in any debate over the value of new regulations? If it has, then it shouldn't. Fact and reason should take precedence over emotional arguments.

Although it's difficult to accurately estimate the likelihood of a terrorist attack, it's a reasonable economic assumption that as carriers' administrative burdens increase, so do their costs. At a certain point the added costs undercut the profit to be gained by providing service.

One shipper raised that very point in its comments on the proposed rulemaking. Fisher Scientific International, a manufacturer of laboratory chemicals, stated that some motor carriers had indicated that they would not be securing permits for transporting hazardous materials. In its response, FMCSA noted that as a shipper of many types of hazardous materials, Fisher Scientific tries to manage its transportation costs by having one carrier satisfy all its transportation needs. If carriers refuse to transport hazardous materials, Fisher Scientific's costs will increase because it will need to hire multiple carriers.

Exactly. This rule will do little except increase freight costs at a time when shippers are struggling to contain them. It will offer little safety benefit, as the government already has hazmat transportation rules in place. Yet despite all the rational arguments against the need for more rules, it appears that many in the trucking industry are resigned to carrying out the new directives, whether they like it or not. Or as National Tank Truck Carriers President Cliff Harvison so aptly put it: "It's a ministerial exercise."

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