News

Commerce – Regulatory & Compliance

Making the Case for a National Infrastructure Bank

Robert J. Bowman, SupplyChainBrain | August 12, 2013

The nation’s transportation infrastructure is in dire shape.

The latest report card from the American Society of Civil Engineers assigns the system a grade of D+. It estimates that $3.6tr is needed by 2020 in order to repair, improve or replace the crumbling bridges, highways and railroads that are essential to moving people and freight. Current funding mechanisms are woefully inadequate to achieve the task. Fortunately, there are serious adults with ideas on how to address the crisis. One is the creation of a National Infrastructure Bank, which would combine federal funds and private-sector capital to pay for critical transportation, energy and water infrastructure projects.

In the plan’s current form, Congress would seed the bank with $10bn in start-up money. The new institution would then select projects that provide “a clear benefit” to taxpayers, costing at least $100m for urban construction, or $25m for rural projects. Loans by the bank would cover 50 percent or less of total project costs, the remainder of which would come from private-sector investment or local governments. Upon completion, projects would be required to generate revenues to help pay back the original loan. A report issued late last year by the Brookings Institution makes the case for a National Infrastructure Bank. Authors William Galston and Korin Davis say the benefits would be “considerable.” They note that U.S. infrastructure ranked 16th in the 2011-2012 Global Competitiveness Report of the World Economic Forum, down from seventh place four years earlier.

DOT Proposes Paperwork-Eliminating Reports for Trucking Industry

U.S. Transportation Secretary Anthony Foxx announced a proposal to eliminate a burdensome daily paperwork requirement for professional truck drivers that will reduce costs to the industry by an estimated $1.7 billion annually while still maintaining high safety standards.

Current federal regulations require commercial truck drivers to conduct pre- and post-trip equipment inspections and file Driver Vehicle Inspection Reports (DVIRs) after each inspection, regardless of whether or not an issue requiring repairs is identified. DVIRs are the 19th-highest paperwork burden, based on the number of hours needed to comply, imposed across all federal agencies and only 5 percent of reports filed include defects. This announcement represents the largest paperwork reduction achieved since President Obama’s May 2012 Executive Order to reduce regulatory burdens on the private sector.

Under the proposed change, commercial truck drivers would continue conducting pre- and post-trip inspections. However, DVIRs would be required only if defects or

For Truckers, It’s a Long and Winding Road

Robert J. Bowman, SupplyChainBrain | July 29, 2013

Hours of Service. New regulations on the number of hours that drivers can work without a break went into effect on July 1. The more restrictive rules are intended to reduce driver fatigue and increase highway safety, according to the Federal Motor Carrier Safety Administration. They’re also likely to have a major impact on driver productivity, trucking company profits and freight rates.

The previous daily limits of 11 hours of driving and 14 hours of work remain in effect. However, drivers must take a 30-minute break within the first eight hours of work. And the maximum average work week is now 70 hours, down from the prior limit of 84 hours. Drivers must rest for 34 consecutive hours, including two nights, before they can “reset” their work week.

FMCSA estimates that the stricter hours of service will save 19 lives and prevent 1,400 crashes and 560 injuries per year. Those figures have been hotly disputed by the trucking industry. American Trucking Associations president and chief executive officer Bill Graves has charged that the agency “is using unjustified causal estimates to justify unnecessary changes.”

Meanwhile, carriers and shippers will pay a heavy price. Overall truck capacity will shrink by 3 to 5 percent, and carrier productivity will decline by more than 10 percent with the removal of a full workday, according to Ken Kellaway, CEO of RoadOne Intermodal Logistics. “Carrier rates will increase and costs will have to be passed on to the customers,” he said.