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FROM THE HILL


SAMSON SAID IT’S NOT AS SIMPLE AS JUST PAYING FOR A BOND. UNDER THE


LAW, CARRIERS MUST HAVE SOMEONE ON STAFF WITH THREE YEARS OF BROKERAGE


EXPERIENCE OR EXPERIENCE THAT HAS BEEN DEEMED ALLOWABLE, WITH “ALLOWABLE” STILL BEING DEFINED BY THE FMCSA’S


RULEMAKING PROCESS. FOR SOME OF HIS CLIENTS WITH 10 TRUCKS AND THREE OR


FOUR EMPLOYEES, THOSE ARE PROHIBITIVE REQUIREMENTS. THE COST OF THE BOND ITSELF CAN BE A PROBLEM.


about it are “a little late to the game,” she said. The purpose of the bond increase was


to reduce fraud, which she said occurs not just between brokers and carriers but also between carriers and carriers. In fact, the TIA publishes a 58-page document that instructs its members how to select a carrier properly. O’Liddy said that the brokerage industry


is far more than salespeople with telephones. Sixty percent of TIA’s membership is asset- based, and was so before the passage of the MAP-21 provision. Many major carriers have logistics companies that operate with carrier authority. Brokers operate on tight margins and have costs like other businesses, such as paying for insurance. “We feel without the brokerage industry, most of the owner- operators would have no freight to move,” O’Liddy said. “That’s 100 percent our market, which is why we care that they get paid, and which is why we agreed to the language.” Sean McNally, ATA spokesman, confirmed


that the ATA had supported the compromise and is staying out of the current controversy. “OOIDA and TIA had been in talks for some


time to enact legislation that increased the bond amount,” McNally said. “ATA supported an increase in the bond amount and negotiated some changes to the legislative


ROADWISE |


language to continue to allow interlining. The legislative language was a compromise that ATA supported.However, there are a number of state trucking associations and two ATA conferences that object to the prohibition on motor carriers subcontracting to other motor carriers without having broker authority. Those entities are pursuing a fix, and ATA is neither opposing nor supporting their efforts.” Saylor, the partner with the Scopelitis legal


firm, said the change hasn’t seemed to have had too big of an effect on his clients. Many of them already have broker authority, and most of those that don’t have not sought it. He said there’s a lot of bad information being spread about the rule, such as the incorrect assertion by some that a carrier must form two companies: one to carry freight and another to broker it, though such a move might be advantageous. FMCSA has not been enforcing the rule,


but Saylor hasn’t heard of any widespread disobedience.Naturally, he’s advising his clients to purchase the bond rather than break the law. The penalty for performing brokerage services without the proper authority is $10,000 per violation, and if the company doesn’t pay, the officers and principals are liable. RW


ISSUE 5, 2014 | www.mttrucking.org 17


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