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Transportation News Bulletins - LTL and TL

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Pension Bill Would Provide Firms More Time to Restore Funds to Underfunded Plans
Monday, 09 November 2009 00:00

Carriers with multi-employer pension obligations would get as much as 30 years to restore full funding of currently underfunded plans, under legislation introduced by two members of Congress.

The bill would stretch out the current seven-year requirement for boosting assets in underfunded plans through more extended employer contributions.

The Preserve Benefits and Jobs Act of 2009, introduced by Reps. Earl Pomeroy (D-N.D.) and Patrick Tiberi (R-Ohio), affects YRC Worldwide Inc., UPS Inc. and Arkansas Best Corp., which employ Teamsters union workers, as do some smaller fleets. Fleet officials and union leaders praised the move, saying it addresses the long-standing issue of pensions paid from multi-employer funds.

“Exceedingly large pension costs will hamper both job growth and capital investment that are needed to grow the economy,” Pomeroy said in a statement. “The cornerstone of this bill is temporary pension funding relief that eases an employer’s obligation to make up for the investment losses.”

The sponsors said the bill also would ease pressure on funds in the worst financial shape, offering options such as mergers or alliances to conserve assets. The bill also would give the Pension Benefit Guaranty Corp., a government agency, the ability to step in and pay benefits when possible.

Tiberi and Pomeroy blamed the stock market’s nose dive last year for funds’ difficulties, which sharply increased employer contributions, by 13% in 2009 alone, to rebuild assets.

“This massive increase could cause many employers to have to lay off workers to meet the governmentmandated contribution increase,” the congressmen said.

The measure also would protect employees, its sponsors said, by guaranteeing that pensions would continue to become available.

Randy DeFrehn, executive director of a trade group that includes multi-employer plans, said at an Oct. 29 hearing that trucking has the second-largest number of multi-employer plan participants, exceeded only by construction. In total, he said, 10.1 million Americans are covered by multi-employer plans.

YRC said the bill “seeks to repair and resolve some unintended consequences” of past legislation that forced operating less-than-truckload carriers such as YRC to pay benefits for workers at competitors that failed.

The company, in its most recent quarterly regulatory filing, said it could face withdrawal liability of more than $4 billion in connection with underfunded pensions.

Arkansas Best’s withdrawal liability to those underfunded plans would be about $800 million.

“We obviously want to pay retirement benefits for our own employees, but the hundreds of thousands of employees of bankrupt companies should not be our responsibility,” Arkansas Best said in an e-mailed statement criticizing the “fundamental inequity” that exists now.

“The current situation is like being the last one to leave a restaurant and receiving the bill for a room full of strangers,” the company said in the statement.

Pension costs prompted Arkansas Best to seek an exit from those plans for its ABF Freight System unit during the last round of contract talks with the Teamsters union. In 2007, UPS agreed to pay $6 billion to the Central States pension fund to exit from the fund. UPS still pays into other funds with Teamster members.

Up to 50% of YRC’s pension contributions go to funds that pay benefits to retired workers who never had a job at YRC or its predecessors, the company said. YRC currently isn’t making pension payments to those funds, after a deal with the union to conserve the carrier’s cash.

“These costs represent a huge, hidden tax on large and small businesses,” said Bill Zollars, chairman and CEO of YRC. “We are hopeful that Congress will take swift action to resolve this inequity.”

No hearings on the House bill have been scheduled, and there is no companion bill in the Senate, said Sandra Salstrom, a spokeswoman for Pomeroy. She said his seat on the Ways and Means Committee, which has jurisdiction over tax and pension issues, would help the bill’s prospects.

The measure also would offer a choice of new approaches to firms with defined benefit pensions.

One approach would give them nine years to make payments into the fund to restore them to fully funded levels, with two years of interest-only payments or a 15-year period to reach that level.

The Teamsters said the largest pension funds had less than 80 cents in assets per $1 in obligations to pay benefits at the end of 2008, before the stock market recovery.

“This legislation would simply give our pension plans some breathing room to recover from the catastrophe that the big banks and Wall Street operators created,” said Teamsters General Secretary- Treasurer Thomas Keegel.

“The funding pressure on the remaining employers is unsustainable and, if not dealt with soon, will lead to a new wave of bankruptcies,” the union said in the statement.

Transport Topics, 11/9/2009

Ferro’s Final Confirmation Draws Quick Response
Friday, 06 November 2009 00:00

WASHINGTON—Anne Ferro’s confirmation by the Senate late Thursday to become the next administrator of the Federal Motor Carrier Safety Administration drew quick response from trucking industry stakeholders today.

All that remains for Ferro before she takes office is an as yet unscheduled swearing-in ceremony.

Ferro will come to FMCA from the Maryland Motor Transport Association, where she is president and CEO.

“Ferro is highly qualified for this position, having served as a state regulator leading the Maryland Motor Vehicle Administration,” Dave Osiecki, vice president of safety, security and operations at the American Trucking Associations, said. “We look forward to working with her to advance ATA's comprehensive highway safety agenda to further improve the trucking industry's on-road safety performance."

“We are encouraged by the remarks she made about uncompensated time in her testimony before the Senate and look forward to her striking a balance between safety and the realities of how truck transportation is provided,” Norita Taylor, media spokesperson for the Owner-Operator Independent Drivers Association, said.

In her testimony at her confirmation hearing before the Senate Commerce, Science and Transportation Committee Sept. 23, Ferro talked about commercial transportation safety.

“Every other hour someone in our country is killed in a crash with a truck or motor coach and hundreds are injured. If it happens to someone close to you it’s intolerable—we shouldn’t have to wait for that possibility,” Ferro testified. “Whoever leads this agency must foster frank discussions about the fundamentals in the freight supply chain and motor coach industries that encourage participants to push the limits and put the driving public and other commercial drivers at risk. Uncompensated time, compensation by the mile or load, professional drivers classified as laborers—these are all aspects of a supply-chain model that rewards squeezing transportation costs out of the equation; factors that shift the cost onto the driving public and professional driver.”

The head of the Commercial Vehicle Safety Alliance said his organization was pleased with Ferro’s confirmation.

“I have personal experience in working with Ferro in both positions she has held in the State of Maryland,” said Buzzy France, CVSA president. “She has an excellent understanding of how government, law enforcement and industry need to work together to solve problems, and will be a great advocate for safety.”

“The Federal Motor Carrier Safety Administration’s mandate requires a strong leader who can meet the challenges that come from a diverse industry and that person is rightly Ms. Ferro,” said Stephen Keppler, CVSA’s interim executive director. “Ferro has proven that she is committed to working with a wide range of stakeholders including CVSA and understands the important role that states and roadside inspectors play in ensuring highways safety, including our friends to the north and south in Canada and Mexico.”

A spokesman for the International Brotherhood of Teamsters, which opposed Ferro’s nomination, said the organization would not issue a statement about the confirmation.

A spokesman for Public Citizen, a safety advocacy group that was also opposed to her nomination, said it was not determined yet whether the organization would comment today., 11/6/2009

DOT, FCC target distracted driving
Wednesday, 04 November 2009 00:00

The U.S. Department of Transportation and Federal Communications Commission announced Wednesday, Nov. 4, they are launching a joint effort to evaluate technologies that may help curb distracted driving.

The DOT-FCC partnership will also include outreach efforts to educate the public about the dangers of texting while driving, talking on cell phones while driving and other distracting behavior that can lead to accidents.

“We must put an end to distracted driving, which is costing lives and inflicting injuries across the nation's roads and railways," DOT Secretary Ray LaHood told the House Energy and Commerce Subcommittee on Commerce, Trade and Consumer Protection.

FCC Chairman Julius Genachowski said, “I welcome this collaborative effort to eliminate the increasingly deadly practice of distracted driving. Changing this ingrained behavior will require us to develop creative solutions using both technology and education.”

Officials from the DOT and FCC will establish a working group to evaluate technology-based solutions to the problem of distracted driving and will coordinate consumer outreach and education., 11/4/2009

Bill to Offer Incentives to States That Ban Texting While Driving
Wednesday, 04 November 2009 00:00

WASHINGTON—Several senators introduced legislation last week that would offer incentives to states that ban texting while driving, an issue Transportation Secretary Ray LaHood said has become his cause.

LaHood told the Senate Commerce, Science and Transportation Committee Oct. 28 that the Department of Transportation was working aggressively on regulations that would, among other things, ban messaging by commercial drivers.

The Senate bill was introduced by committee Chairman Sen. Jay Rockefeller (D-W.Va.) and five other members.

“The centerpiece of this legislation is a grant program for states who prohibit texting while driving,” Rockefeller said at the hearing on distracted driving, adding that the dangerous activity was very pervasive, making it difficult to root out.

The House highways subcommittee held its own hearing on driving distraction on Oct. 29, during which Randy Mullett, vice president for government relations for Con-way Inc., said “legislation alone will not solve the problem.”

Rockefeller said that driving while distracted by cell phones or texting was “the grossest kind of negligence and, yet, it’s a part of our lives,” and conceded that even with the law, drivers may continue to text behind the wheel.

“I don’t know how you change cultural habits,” Rockefeller said. “And I am skeptical about being able to change people’s behavior simply by passing a law. Irrespective of that, we’re going to do it.” His bill would provide grants to states that ban all cell-phone use by teenagers and require the use of hands-free phones by all drivers.

LaHood told members of the Senate committee that DOT was working “aggressively and quickly to evaluate regulatory options” and would initiate rules to limit texting while driving commercial vehicles.

One such rule would “consider banning text messaging and restricting the use of cell phones by truck and interstate bus operators while operating the vehicle,” he said.

After the hearing, LaHood told Transport Topics that such a ban also could include limits on the use of incab communications units by the drivers because “they’re distracting.”

LaHood said that DOT officials “have so many rules we are doing, but I [have said] this one is important and they are the most important to me, so we’re trying to put together a timetable.”

Besides laws and regulations, both Rockefeller and Federal Communications Commission Chairman Julius Genachowski said that technology could be used to limit the devices’ ability to send or receive messages.

However, Sen. Byron Dorgan (D-N.D.) said, “Frankly, I don’t know that there’s going to be a technology that addresses this.”

Genachowski said that technology alone probably couldn’t stop people from texting; it would require a comprehensive effort including education and enforcement.

Mullett, testifying at the House panel, said, “Public attitudes and perceptions will need to change, and any legislation will have to apply to all drivers on the highway.”

Mullett testified on behalf of American Trucking Associations, which last month endorsed a bill introduced by Sen. Charles Schumer (D-N.Y.) that would strip federal highway funds from states that do not ban texting.

Schumer, also a co-sponsor of the incentives bill, said his bill was “slightly different” from Rockefeller’s measure, which he said “focuses on carrots . . . while our bill utilizes sticks.”

“The best way to go is both carrots and sticks,” Schumer said. “My hope and belief [is to] . . . have a bill that combines the best of both worlds.”

At the House hearing, LaHood said he believes in “the carrot and the stick approach.”

However, support for a federal action approach was not universal.

Sen. Roger Wicker (R-Miss.) said that “if forced to choose, I would choose the carrot . . . but I would also suggest that we might want to let the states continue to work on this for a while longer.”

Wicker said he had confidence in the states’ abilities, “so I would choose the third approach and that is to continue letting them make their own decisions.”

Sen. Kay Bailey Hutchison (R-Texas), the top Republican on the commerce committee, said the incentives bill, of which she was a co-sponsor, was the right approach because it “respects states’ rights.”

Rockefeller said he didn’t want to get into the philosophical issues of what the federal or state role is, telling the panel, “I don’t really give a hoot about states’ rights or federal rights. I give a hoot about results.”

Transport Topics, 11/4/2009

Diesel Gains 0.7¢ to $2.808 a Gallon as Increases Slow
Tuesday, 03 November 2009 00:00
Gas Rises 2¢ to $2.694 in Fourth Straight Gain.

Diesel fuel’s national average retail price rose for a fourth straight week, though its increase slowed from recent weeks in a 0.7 cent gain to $2.808 a gallon, the Department of Energy said Monday.

The uptick—which followed last week’s 9.6-cent jump and a 10.5-cent spike two weeks ago—left trucking’s primary fuel just 28 cents below the same week last year, DOE said.

Regular gasoline, meanwhile, rose 2 cents $2.694 a gallon, DOE said following its weekly survey of filling stations.

The increase marked the fourth straight gain following eight declines in the price of gasoline, according to DOE records.

Diesel has now risen 22 cents in the past month, while gas is up 22.6 cents over that time.

Oil prices rose in mid-to-late October to a peak $81.37 per-barrel closing price on Oct. 21 on the New York Mercantile Exchange before declining about $3 last week to close at $77 a barrel on the Nymex Friday.

Each week, DOE surveys about 350 diesel filling stations to compile a national snapshot average price.

Transport Topics, 11/3/2009

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