DEREGULATION COULD LOWER TRUCKING COSTS BY $8B A YEAR

Byline: Joanna Ramey

WASHINGTON--A measure approved Monday by the House would drastically lower the cost of trucking goods within the same state by deregulating intrastate trucking.
This is the first time lawmakers have considered the issue since Congress took the giant step in 1980 to deregulate interstate trucking. The provision is contained in a massive airport-improvement bill, which the Senate is expected to vote on soon.
The measure, whose passage has been heavily lobbied by the retail industry, has received bipartisan support and mustered endorsements from a former opponent, the American Trucking Association. The contingent fighting intrastate deregulation the hardest has been the Teamsters.
If the bill is approved by the Senate and signed by the President, deregulation could lower the cost of trucking by some $8 billion annually, according to Eric White, a lobbyist for Americans for Safe and Competitive Trucking, which has been pushing for full intrastate deregulation on behalf of the National Retail Federation; International Mass Retail Association; Kmart Corp., Troy, Mich.; Sears Roebuck & Co., Chicago, and other members.
The measure doesn't appear to be facing any major roadblocks, White said, particularly since the trucking industry dropped its opposition.
"From the looks of it politically, the truck is leaving the loading dock and we don't want to be left standing there," said Ken Siegel, ATA deputy general counsel. He said the association would be better served supporting deregulation for rates and carrier routes, while concentrating its efforts on preserving regulations governing financial fitness requirements for trucking companies and uniform operating practices.
Forty-two states have some type of regulations dictating which carriers can operate within their boundaries and how rates are determined. The bill would restrict state regulations to issues concerning safety, beginning Jan. 1. Hawaii, too, would be exempt from deregulation for three years.
Complying with individual state regulations is a massive and costly undertaking for retailers and vendors alike, according to intrastate trucking deregulation advocates.
"The intrastate rates within regulated states are higher than interstate rates," said Tom D'Ambrosio, divisional vice president for transportation at Kmart, whose department oversees several thousand truck deliveries daily to the company's 19 distribution centers and 2,400 stores.
D'Ambrosio estimated that intrastate rates average 10-20 percent higher for equivalent distances between states. In addition to the cost, regulations governing when carriers can operate in a state create obstacles for shippers that add new trucking companies to their fleets, he said.
Intrastate trucking deregulation landed on the congressional agenda in June as an amendment tacked on a Senate airport funding bill. But the amendment was tailored to deregulate only delivery companies like Federal Express that are affiliated with an air carrier and trucking services that carry partial loads and are hooked into a freight-forwarding network.
While many retailers and manufacturers could become affiliated with air carriers or freight forwarders to qualify under the amendment, the bill didn't target their businesses, White said.
A companion House bill didn't address intrastate trucking at all. When a conference committee met last week to reconcile the two measures, it decided to keep a deregulation feature and expand it to include all intrastate carriers.
--Fairchild New Service

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