The Surface Transportation Board could rule soon on whether it will demand reform of the National Classification Committee (NCC) and the antitrust immunity enjoyed by motor carrier rate bureaus.

The decisions will be important to shippers, even those that have contracted with carriers for their rates, because NCC freight classifications are often used as a foundation for rate setting. The rate bureaus also establish benchmark rates from which carriers negotiate discounts.

John Cutler, general counsel of NASSTRAC, an organization of less-than-truckload and package shippers, told the group's spring meeting that shippers were concerned that the NCC's class rates have long been well above market rates. "Over the years, class rates increased as competition kept [market] rates flat," he said. "They are just too high."

Another key issue is the lack of access for shippers to the raw data that underlie the NCC's classification decisions. The NCC's rates are based on a number of criteria, including handling characteristics, density, and value. "It's dismaying to shippers that class rating increases come before the NCC that could result in the doubling of freight rates ...," Cutler said. "The raw data [are] still concealed. There are still disputes over the right to see documentary support for decisions."

Cutler, who said he expected the STB to issue its rate-bureau decision at the same time that it ruled on the NCC's rate-making procedures, also urged members to watch several other potentially important regulatory efforts in the next several months. They include:

• Motor carrier hours-of-service changes. The initial proposal from the Federal Motor Carrier Safety Administration (FMCSA) met with criticism from carriers, shippers, and safety advocates. That agency may issue a revised proposal soon. Truckers believe any plan could add billions of dollars to their cost of doing business. But there's a larger issue at stake, Cutler said. "As economic regulation recedes, it seems the greatest [regulatory] threats are from the health, safety, and environmental areas. We have to make some noise so that the people who focus only on health, only on safety, or only on the environment realize that there is an economic impact."
• Ergonomics regulations imposed by states. Cutler said that Washington state had adopted regulations that were similar to federal rules rejected by Congress earlier this year as being too costly. Cutler said he agreed with the rules'advocates that the rate of injuries was too high but he believed that more work on the proposed rules was needed.
• Environmental Protection Agency emissions rules. "The Bush administration is in, but it's not as if health, safety, and environmental regulators have shut down," Cutler said. Proposed rules affecting new lower-emission formulations of diesel, he said, could result in shortages and higher prices.
• Fuel surcharges. Owner-operators last year persuaded the House of Representatives to adopt a bill that would have imposed fuel surcharges on all shippers when diesel prices surged. (The bill never became law.) Cutler said he expected a renewed call for the federally mandated surcharges this year, a bill NASSTRAC would oppose. One major problem with the bill that passed the House, Cutler said, was that the legislation did not clearly exempt shippers that already included fuel surcharges in their contracts.

Timothy Lynch, president and CEO of the Motor Freight Carriers Association, which represents unionized motor carriers, also briefed NASSTRAC members on Capitol Hill issues. Lynch applauded the Congress for its quick action in overturning the ergonomics rules proposed by the Occupational Safety and Health Administration. He was critical, though, of the legislature's failure to move on important nominations. Lynch said that about 25 key appointments at the Department of Transportation had yet to receive Senate approval. "I hope that in the coming weeks we'll see a rapid push to get these names up," he said. Most important for the trucking industry will be to install an FMCSA administrator," he said. "There are a lot of things in the pipeline that need leadership in that position."