Final Rule "Transportation of Household Goods; Consumer Protection Regulations

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
that no segment of the population,
regardless of race, color, national origin,
or income, bears disproportionately
high and adverse human health and
environmental effects as a result of
EPA’s policies, programs, and activities.
EPA has considered the impacts of
this rule on low-income populations
and minority populations and
concluded that it will not cause any
adverse effects to these populations. As
stated above, the Agency has
determined that the risk of significant
data loss is very low. The data elements
being removed or streamlined either
have a low incidence of reporting, have
other data source readily available or do
not appear to be used to any significant
degree by the public.
K. Congressional Review Act
The Congressional Review Act, 5
U.S.C. 801 et seq., as added by the Small
Business Regulatory Enforcement
Fairness Act of 1996, generally provides
that before a rule may take effect, the
agency promulgating the rule must
submit a rule report, which includes a
copy of the rule, to each House of the
Congress and to the Comptroller General
of the United States. EPA will submit a
report containing this rule and other
required information to the U.S. Senate,
the U.S. House of Representatives, and
the Comptroller General of the United
States prior to publication of the rule in
the Federal Register. A Major rule
cannot take effect until 60 days after it
is published in the Federal Register.
This action is not a ‘‘major rule’’ as
defined by 5 U.S.C. 804(2). This rule
will be effective September 12, 2005.
List of Subjects in 40 CFR Part 372
Environmental protection,
Community right-to-know, Reporting
and recordkeeping requirements, Toxic
chemicals.
Dated: June 30, 2005.
Stephen L. Johnson,
Administrator.

iii. Redesignate paragraphs (b)(7)
through (b)(18) as paragraphs (b)(6)
through (b)(17).
■ iv. Revise the newly-designated
paragraph (b)(6).
■ v. Remove the newly-designated
paragraph (b)(16)(iii).
■ vi. Redesignate the newly-designated
paragraphs (b)(16)(iv) and (b)(16)(v) as
paragraphs (b)(16)(iii) and (b)(16)(iv).
■ vii. Revise the newly-designated
paragraph (b)(16)(iii).
■ viii. Remove the newly-designated
paragraph (b)(17).
■

372.85 Toxic chemical release reporting
form and instructions.

(a) Availability of reporting form and
instructions. The most current version
of Form R may be found on the
following EPA Program Web site,
http://www.epa.gov/tri. Any subsequent
changes to the Form R will be posted on
this Web site. Submitters may also
contact the TRI Program at (202) 564–
9554 to obtain this information.
(b) * * *
(6) Dun and Bradstreet identification
number.
*
*
*
*
*
(16) * * *
(iii) An estimate of the efficiency of
the treatment, which shall be indicated
by a range.
*
*
*
*
*
§ 372.95

[Amended]

3. Section 372.95 is amended as
follows:
■ i. Remove paragraphs (b)(11), (b)(13),
(b)(14) and (b)(15).
■ ii. Redesignate paragraph (b)(12) as
paragraph (b)(11) and redesignate
paragraphs (b)(16) through (b)(17) as
paragraphs (b)(12) through (b)(13).
■

[FR Doc. 05–13486 Filed 7–11–05; 8:45 am]
BILLING CODE 6560–50–P

DEPARTMENT OF TRANSPORTATION

For the reasons discussed in the
preamble, the Environmental Protection
Agency 40 CFR part 372 is amended as
follows:

■

PART 372—[AMENDED]

Federal Motor Carrier Safety
Administration
49 CFR Part 375
[Docket No. FMCSA–97–2979]
RIN 2126–AA32

1. The authority citation for part 372
continues to read as follows:

■

Authority: 42 U.S.C. 11023 and 11048.

Transportation of Household Goods;
Consumer Protection Regulations;
Final Rule

Subpart E—[Amended]

AGENCY:

2. Section 372.85 is amended as
follows:
■ i. Revise paragraph (a).
■ ii. Remove paragraph (b)(6).

SUMMARY: The Federal Motor Carrier
Safety Administration (FMCSA) adopts

■

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

Federal Motor Carrier Safety
Administration (FMCSA), DOT.
ACTION: Final rule.

PO 00000

Frm 00045

Fmt 4700

Sfmt 4700

39949

as final its interim regulations at 49 CFR
part 375 published in the Federal
Register on June 11, 2003 (68 FR 35064)
and subsequent technical amendments
published on March 5, 2004 (69 FR
10570), April 2, 2004 (69 FR 17313), and
August 5, 2004 (69 FR 47386). The final
rule specifies how motor carriers
transporting household goods by
commercial motor vehicle in interstate
commerce must assist their individual
customers who ship household goods.
As no further amendments are
necessary, the interim regulations at
part 375 are adopted without change.
DATES: Effective August 11, 2005.
Petitions for Reconsideration must be
received by the agency not later than
August 11, 2005.
FOR FURTHER INFORMATION CONTACT: Ms.
Joy Dunlap, Acting Chief, Commercial
Enforcement Division (MC–ECC), (202)
385–2428, Federal Motor Carrier Safety
Administration, Suite 600, 400 Virginia
Avenue, SW., Washington, DC 20024.
Docket: For access to the docket to
read background documents or
comments received on the interim final
regulations and subsequent
amendments, including a Record of
Meeting and all correspondence
referenced in this document, go to
http://dms.dot.gov at any time or to
Room PL–401 on the Plaza level of the
Nassif Building, 400 Seventh Street,
SW., Washington, DC, between 9 a.m.
and 5 p.m., Monday through Friday,
except Federal Holidays.
Privacy Act: Anyone is able to search
the electronic form of all comments
received into any of DOT’s dockets by
the name of the individual submitting
the comment (or signing the comment,
if submitted on behalf of an association,
business, labor union, etc.). You may
review DOT’s complete Privacy Act
Statement in the Federal Register
published on April 11, 2000 (65 FR
19477). This statement is also available
at http://dms.dot.gov.
SUPPLEMENTARY INFORMATION:
Legal Basis for the Rulemaking
The Interstate Commerce Commission
Termination Act of 1995 (ICCTA) (Pub.
L. 104–88, 109 Stat. 803) provides that
‘‘[t]he Secretary may issue regulations,
including regulations protecting
individual shippers, in order to carry
out this part with respect to the
transportation of household goods by
motor carriers subject to jurisdiction
under subchapter 1 of chapter 135. The
regulations and paperwork required of
motor carriers providing transportation
of household goods shall be minimized
to the maximum extent feasible
consistent with the protection of

E:\FR\FM\12JYR1.SGM

12JYR1

39950

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations

individual shippers’’ (49 U.S.C.
14104(a)(1)). This final rule establishes
regulations governing the transportation
of household goods in interstate and
foreign commerce and, as such, is
within the authority conferred by the
ICCTA.
In the Motor Carrier Safety
Improvement Act of 1999 (Public Law
106–159, December 9, 1999, 113 Stat.
1749), which established FMCSA as a
separate agency within the U.S.
Department of Transportation (DOT),
Congress authorized the agency to
regulate motor carriers transporting
household goods for individual
shippers. Our regulations setting forth
Federal requirements for movers that
provide interstate transportation of
household goods are found in 49 CFR
part 375.
Background
In May 1998, the Federal Highway
Administration published a notice of
proposed rulemaking (NPRM)
requesting comments on its proposal to
update the household goods regulations
(63 FR 27126, May 15, 1998). The
Federal Highway Administration is the
predecessor agency to FMCSA within
DOT.
The public submitted more than 50
comments to the NPRM. FMCSA
subsequently modified the substance of
the proposal in light of concerns raised
by some of the commenters, and
published an interim final rule in June
2003 (68 FR 35064, June 11, 2003). We
published an interim final rule rather
than a final rule to complete procedures
for complying with information
collection requirements.
In order to publish the rule text in the
October 1, 2003, edition of the Code of
Federal Regulations (CFR), we
established the interim final rule’s
effective date as September 9, 2003.
However, compliance was not required
until March 1, 2004. On August 25,
2003, we received two petitions for
reconsideration of the interim final rule.
The petitioners were (1) the American
Moving and Storage Association
(AMSA) and (2) United Van Lines, LLC
and Mayflower Transit, LLC
(UniGroup). On the same date, AMSA
submitted a separate Petition for Stay of
Effective Date.
On September 30, 2003, FMCSA
delayed the compliance date for the rule
indefinitely in order to consider fully
the petitioners’ concerns (68 FR 56208).
In separate letters to the petitioners
dated December 23, 2003, we conveyed
our decision to make some of the
requested changes through technical
amendments to the interim final rule
and to further consider others that are

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

which movers must comply, and (2)
help individual shippers and the
moving industry understand the roles
and responsibilities of movers, brokers,
and shippers, to prevent moving
disputes. Individual shippers—many of
whom are either relocating for business
reasons or have retired—may use forhire truck transportation services
infrequently. These consumers may be
poorly informed about the regulations
movers must comply with and thus
have little understanding of how
moving companies operate. The
consumer pamphlet Your Rights and
Responsibilities When You Move—
Appendix A to part 375—is intended to
help individual shippers understand the
regulations so that they can make
informed decisions in selecting a mover
and planning a satisfactory move.
Section 375.213 requires movers to
furnish the information in the consumer
pamphlet to prospective customers. The
consumer information is posted on
FMCSA’s Web site at http://
www.fmcsa.dot.gov/, where it can be
downloaded and printed.

substantive in nature in a future
rulemaking proceeding.
On March 5, 2004, FMCSA published
technical amendments to the interim
final rule (69 FR 10570). Some of the
amendments provided uniformity
between the rule text and the
appendix—the consumer pamphlet
Your Rights and Responsibilities When
You Move—while others clarified
certain provisions, reflected current
industry practice, or corrected
typographical errors. In addition, certain
technical amendments revised language
that was contrary to the statutory intent
of the ICCTA, as codified at 49 U.S.C.
14104 and 14708.
The March 5, 2004, notice of technical
amendments stated our intent to
consider certain substantive
amendments requested by the
petitioners in a future rulemaking. As
these substantive amendments involve
changes to prescribed operational
practices of movers, and in some cases
have a direct impact on consumers, the
public should be given an opportunity
to comment.
On March 16, 2004, we received from
AMSA a Petition for Reconsideration
and Stay of the Interim Final Rule and
Technical Amendments Compliance
Date. In response to the petitioner’s
concerns, on April 2, 2004, we
published clarifying technical
amendments to the interim final rule,
chiefly to its appendix, and established
a new compliance date of May 5, 2004
(69 FR 17313, Apr. 2, 2004). However,
we believe that certain amendments
sought in the petition are not necessary,
while others are substantive in nature
and will be considered along with other
potential substantive amendments in a
future rulemaking proceeding.
Therefore, the petition was granted in
part and denied in part.
In May 2004, attorneys for both Atlas
World Group, Inc. (Ms. Marian Weilert
Sauvey) and Wheaton Van Lines, Inc.
(Mr. James P. Reichert) contacted us
concerning an incorrect statutory
citation in four sections of Appendix A
to part 375. Mr. Reichert also brought to
our attention certain language in subpart
E of Appendix A that is not fully
consistent with 49 CFR 375.501(h) and
375.505(e), as amended on March 5,
2004. To correct these problems and
make a few minor editorial revisions to
the rule appendix, we published
correcting amendments on August 5,
2004 (69 FR 47386).

Discussion of Public Comments
In addition to the petitions described
above, FMCSA received public
comments to the interim final rule and
subsequent amendments from 19
commenters. Commenting were 12
moving companies—Mayflower Transit,
LLC (Mayflower), United Van Lines,
LLC, and Mayflower Transit, LLC
(UniGroup), Paul Arpin Van Lines
(Arpin), Affiliated Movers of Oklahoma
City, Inc. (Affiliated Movers), Capitol
North American (Capitol), Hawkeye
North American Moving and Storage
(Hawkeye), Republic Van Lines of San
Diego (Republic), Andy’s Transfer and
Storage (Andy’s), Cor-O-Van Moving
and Storage (Cor-O-Van), Mother Lode
Van and Storage, Inc. (Mother Lode),
and Atlas World Group, Inc. and
Wheaton Van Lines, Inc. (through
attorneys Marian Weilert Sauvey and
James P. Reichert, respectively); the
Georgia Department of Motor Vehicle
Safety; five individuals—Staci Haag,
Angie A. Chen, Kay F. Edge, Tyrone
Kelly, and Tim Walker for
MovingScam.com; and the American
Moving and Storage Association
(AMSA), which submitted one of three
comments through counsel (Venable
LLP). The comments are discussed
below, together with FMCSA’s
responses on the issues addressed.

Purpose of the Household Goods
Regulations
The amended interim final rule is
intended to (1) increase the public’s
understanding of the regulations with

Enforcement of the Household Goods
Regulations
The Georgia Department of Motor
Vehicle Safety, while expressing
support for the interim final rule,

PO 00000

Frm 00046

Fmt 4700

Sfmt 4700

E:\FR\FM\12JYR1.SGM

12JYR1

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
emphasized that FMCSA should devote
resources to enforcing the household
goods regulations. This commenter
observed: ‘‘No amount of regulatory
change will make any difference unless
the FMCSA will have the personnel
available to deal with consumer
complaints.’’
FMCSA Response: Recognizing the
limited resources available for FMCSA’s
household goods program, coupled with
the increasing volume of consumer
complaints against moving companies,
Congress increased our program funding
for fiscal year 2004 and authorized
seven new staff positions for household
goods complaint investigation and
enforcement activities. We are using
these resources to expand our
household goods enforcement program
initiatives and activities. Our focus is on
more accurately defining and analyzing
the various problems related to
household goods transportation,
implementing improved
countermeasures, and carrying out a
more aggressive enforcement and
compliance policy.
Extension of Compliance Date
Ten commenters—AMSA, UniGroup,
Mother Lode, Car-O-Van, Andy’s,
Republic, Hawkeye, Affiliated Movers,
Arpin, and North American—requested
a further delay of the compliance date
beyond the extension to May 5, 2004,
granted in FMCSA’s April 2, 2004,
decision (69 FR 17313). These
commenters emphasized the difficulties
of implementing the new requirements
at the onset of the peak moving season
(May 15 through September 15). They
argued that moving companies would
not have time, while coping with peakseason demands, to train their
employees in the proper application of
the amended regulations. Several
commenters added that the summer
2004 moving season was expected to be
one of the busiest in many years.
Of this group, six (Mother Lode, CorO-Van, Andy’s, Republic, Hawkeye, and
Affiliated Movers) noted that as small
businesses they would be particularly
hard-pressed to meet the May 5, 2004,
compliance date. Three others—AMSA,
UniGroup, and Arpin—cited the change
to the regulation governing payment for
additional services (discussed below) as
especially likely to cause problems if
compliance with the new rules were not
postponed.
In a letter of April 29, 2004, to
FMCSA Administrator Annette M.
Sandberg, AMSA predicted that,
without a further extension of the
compliance date, moving companies’
inability to adequately train employees
during the busy summer moving season

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

would create service disruptions. AMSA
representatives had discussed these
concerns during an April 26, 2004,
meeting with FMCSA staff, explaining
that they expected confusion about the
new rules to lead to disputes with
customers (individual shippers). A
record of the April 26, 2004, meeting is
in the docket, along with a copy of
AMSA’s April 29, 2004, letter and
copies of all other correspondence
referenced in this document.
Two individuals (Movingscam.com
and Tyrone Kelley) stated there was no
need for a further extension of the
compliance date. Mr. Kelley asserted
that ‘‘willful, arrogant defiance of DOT/
FMCSA authority does not constitute
grounds for an extension, especially
since the sole beneficiaries of the
extension would be the defiant ones.’’
FMCSA Response: In her May 3, 2004,
response to AMSA’s April 29, 2004,
correspondence, FMCSA Administrator
Sandberg stated the agency would not
further extend the May 5, 2004,
compliance date. Ms. Sandberg noted,
however, that we were not
unsympathetic to the potential for
service interruptions resulting from
requiring full compliance with the
revised regulations on May 5, 2004, and
that FMCSA had worked to avoid this
situation since receiving the first
industry petitions in August 2003. In
her letter, Ms. Sandberg indicated that
to address AMSA’s concerns and assist
the moving industry in complying with
the new rule, she was establishing the
following FMCSA enforcement policy:
1. For all household goods shipments
contracted before May 5, 2004, the new
regulations would not be enforced. All
shipments for which contracts were
signed on or after May 5, 2004, would
be subject to the new requirements.
2. FMCSA would delay enforcement
of regulatory provisions requiring
changes to forms (such as bills of lading)
until July 1, 2004. This provided the
industry an opportunity to produce new
forms and train employees in their use.
3. The industry was required to
distribute the revised consumer
pamphlet Your Rights and
Responsibilities When You Move
beginning on May 5, 2004.
4. Compliance with the shipper
notification requirement for an
arbitration program was required by
May 5, 2004.
5. Compliance with all other
provisions, including the collection of
transportation charges and charges for
additional services, was required
beginning on May 5, 2004.
This household goods enforcement
policy is posted under the ‘‘What
Happens When You Move?’’ link on the

PO 00000

Frm 00047

Fmt 4700

Sfmt 4700

39951

FMCSA Web site. To view the policy, go
to http://www.fmcsa.dot.gov/factsfigs/
hhg/enforcement_policy.htm.
In a letter to FMCSA Administrator
Sandberg dated May 26, 2004, AMSA
expressed disappointment that we had
not delayed the May 5, 2004,
compliance date. The Association
added, however, that its members
would ‘‘do their best to comply with the
new regulations’’ during the summer
2004 moving season and ‘‘work with
FMCSA to ensure that relocating
consumers experience quality moves
pursuant to the requirements of
FMCSA.’’
Incorrect Statutory Citation
As noted in the Background section
above, attorneys for both Atlas World
Group, Inc. and Wheaton Van Lines,
Inc. called to our attention an incorrect
statutory citation in four sections of
Appendix A to part 375, the consumer
pamphlet Your Rights and
Responsibilities When You Move. The
attorneys noted that the provision under
which a person may seek judicial
redress for alleged loss of or damage to
household goods by a carrier is at 49
U.S.C. 14706, not 49 U.S.C. 14704 as
cited in the pamphlet.
FMCSA Response: We corrected this
error in ‘‘Transportation of Household
Goods; Consumer Protection
Regulations; Corrections’’ (69 FR 47386,
Aug. 5, 2004).
Additional Services Requested by the
Shipper
Several commenters—Arpin,
UniGroup, and AMSA (through Venable
LLP)—took issue with the requirement
under 49 CFR 375.403(a)(8) that the
mover defer billing for additional
services requested by the consumer after
the shipment is in transit. These
commenters believe this provision is
unfair to the mover.
AMSA stated, ‘‘As discussed in the
AMSA petition, the IFR [interim final
rule] will require that carrier charges for
any additional service requested by a
shipper or necessary to service properly
a shipment cannot be collected at
delivery.’’ The Association observed:
‘‘The consensus of the moving industry
is that this departure from the current
requirement will have at least two
unfavorable consequences. It will force
movers to decline to perform additional
services and it will require shippers to
attempt to make other arrangements to
meet all of their moving requirements.
Neither consequence is acceptable and
the FMCSA regulations should not be
the catalyst for disruptive situations of
this nature.’’ In its previously
mentioned letter of May 26, 2004,

E:\FR\FM\12JYR1.SGM

12JYR1

39952

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations

AMSA noted that FMCSA had stated its
intention to address this issue in noticeand-comment rulemaking. It urged the
agency to publish this rulemaking as
soon as possible.
UniGroup asserted the ‘‘IFR strips
from carriers their most effective
collection tool, i.e., a possessory lien.’’
It added, ‘‘If movers cannot collect at
delivery for requested or needed
additional services, it would be to the
shipper’s advantage, when an estimate
is being presented, not to request a
service, but request it later or not inform
a mover of possible problems that could
arise.’’
Ms. Angie Chen commended FMCSA
for closing the additional services
‘‘loophole.’’ Ms. Chen wrote, ‘‘I am
pleased that the interim final rules make
it clear that a moving company must
relinquish the goods upon payment of
no more than 100% for binding
estimates and 110% for non-binding
estimates, with no exceptions, and that
the moving company must defer
collection of any legitimate additional
charges over that threshold for a period
of 30 days.’’ (Emphasis in original) This
commenter included extensive materials
related to the legislative and regulatory
history on this issue. She asserted these
materials support her position that the
additional services loophole should not
be reopened.
Mayflower Transit specifically
addressed Ms. Chen’s letter, arguing that
in light of its timing with respect to a
lawsuit Ms. Chen had filed against
Mayflower, her submission ‘‘should not
be considered in this matter.’’
Ms. Kay F. Edge commented that
some movers make a practice of holding
in hostage a shipper’s goods (known
colloquially as ‘‘hostage freight’’) while
demanding payment for additional
services allegedly requested by the
shipper. Regarding AMSA’s request for
reconsideration and stay of enforcement
of the ‘‘additional services’’ provision at
§ 375.403(a)(8), Ms. Edge contended:
‘‘The problem with AMSA’s view is that
it considers ‘services requested by the
shipper’ to include those services the
mover has unilaterally decided are
necessary to get the goods off the truck
and into the destination residence (such
as shuttles, long carries, and the catchall ‘extra labor’). * * * Thus, according
to AMSA’s view of ‘services requested
by the shipper,’ a shipper is not free to
decline these additional services—even
if the extra amount makes the final
charges exceed 100–110% of the
original estimate.’’
FMCSA Response: We believe the
issue of ‘‘additional services’’ charges
deserves further consideration through
additional public notice and comment.

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

Accordingly, we plan to consider this
issue fully in a more focused
rulemaking proceeding in the future.
Released Rates Valuation Statement
As noted in the Background section,
Mr. James P. Reichert, General Counsel
for Wheaton Van Lines, Inc., brought to
our attention certain language in subpart
E of Appendix A that was not fully
consistent with 49 CFR 375.501(h) and
375.505(e), as amended on March 5,
2004. The amended regulations make
clear that household goods carriers have
the option of placing the Surface
Transportation Board’s required
released rates valuation statement, and
any charges for optional valuation
coverage, on either the order for service
or the bill of lading. In the appendix
(consumer pamphlet) of the interim
final rule, however, subparagraph (10)
of the section Must My Mover Write Up
an Order for Service? and subparagraph
(12) of Must My Mover Write Up a Bill
of Lading? implied that the carrier must
include the released rates valuation
statement and any charges for valuation
coverage on the order for service as well
as on the bill of lading.
FMCSA Response: In the corrections
notice published on August 5, 2004 (69
FR 47386), we revised subparagraph
(10) of Must My Mover Write Up an
Order for Service? by adding to the first
sentence an introductory clause
clarifying that the order for service must
include the released rates valuation
statement and any valuation coverage
charges only if the mover has not
provided them on the bill of lading.
Conversely, a new introductory clause
in subparagraph (12) of Must My Mover
Write Up a Bill of Lading? makes it clear
that the bill of lading must include the
released rates valuation statement and
any valuation coverage charges only if
these were not provided in the order for
service. These corrections ensure that
the information provided to consumers
is consistent with amended
§§ 375.501(h) and 375.505(e).
Rulemaking Analyses and Notices
Executive Order 12866 (Regulatory
Planning and Review) and DOT
Regulatory Policies and Procedures
FMCSA has determined that this
action is a significant regulatory action
within the meaning of Executive Order
12866 and the U.S. Department of
Transportation regulatory policies and
procedures (44 FR 11034, Feb. 26, 1979)
because there is substantial public
interest in the interstate transportation
of household goods and related
consumer protection regulations.
FMCSA estimates that the first-year

PO 00000

Frm 00048

Fmt 4700

Sfmt 4700

discounted costs to the industry of this
rulemaking equal $14.6 million, while
total discounted costs are estimated at
$42.8 million over the 10-year analysis
period. As such, the costs of this final
rule do not exceed the $100 million
annual threshold as defined in
Executive Order 12866.
FMCSA’s full Regulatory Impact
Analysis explaining in detail how we
estimated cost impacts of the final rule
is in the docket. The Regulatory Impact
Analysis is summarized below.
This final rule adopts the interim final
regulations published in the Federal
Register on June 11, 2003, governing the
interstate transportation of household
goods (68 FR 35064) and subsequent
technical amendments published on
March 5, 2004 (69 FR 10570), April 2,
2004 (69 FR 17313), and August 5, 2004
(69 FR 47386). These new regulations
specify how motor carriers transporting
household goods by commercial motor
vehicle in interstate commerce must
assist their individual customers who
ship household goods. They revise,
clarify, and augment the existing
regulations governing matters such as
when a mover is required to have an
arbitration program, how notification of
additional services proposed by the
mover must be made, presentation of
freight bills, collection of charges, and
liability disclosure requirements. In
addition, Appendix A to part 375—the
consumer pamphlet Your Rights and
Responsibilities When You Move—has
been extensively revised. These changes
to the appendix ensure uniformity with
the rule text and increase the accuracy
and clarity of the information provided
to individual shippers.
FMCSA estimates these regulatory
changes will produce five primary cost
impacts on household goods carriers, as
follows: (1) Costs of training certain
employees on the proper application of
the regulatory changes; (2) costs to
revise carrier marketing materials,
forms, and bills of lading, including
technical writing and printing costs
associated with incorporating in
marketing materials the consumer
information in the Your Rights and
Responsibilities When You Move
pamphlet (Appendix A to part 375); (3)
costs to update online documentation
and/or redesign carrier Web pages to
incorporate new or revised information
about the regulatory requirements; (4)
additional paperwork costs associated
with the new regulations; and (5) costs
associated with deferred collection of
‘‘additional services’’ payments, which
the new regulations prohibit carriers
from collecting at delivery. FMCSA’s
estimates of the costs in these five
impact areas are summarized below.

E:\FR\FM\12JYR1.SGM

12JYR1

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
1. Training Costs
The 1997 Economic Census 1
indicates there are currently 8,279
motor carriers of ‘‘Used Household and
Office Goods Moving’’ (NAICS Code
484210). These motor carriers employ a
total of 121,550 workers (or almost 15
employees per firm). Since the
Economic Census makes no distinction
between intrastate and interstate
household goods movers, we adjusted
these totals to include only those
household goods carriers operating in
interstate commerce. According to our
Licensing and Insurance (L&I) database
of active interstate, for-hire carriers,
there are currently 4,000 active motor
carriers engaged in the movement of
household goods in interstate
commerce. The ratio of carriers
identified in the L&I database to the
number identified in the Economic

Census (8,279) is 48.3 percent (or 4,000
divided by 8,279). Multiplying 48.3
percent by the 121,550 employees of
household goods firms identified in the
Economic Census, we estimated the
4,000 household goods carriers
currently operating in interstate
commerce employ 58,700 workers.
For purposes of this analysis, we
assumed that, on average,
approximately 50 percent of each
employer’s workforce will be trained in
the new regulations (backroom
employees would not require training).
Therefore, of the estimated 58,700
workers employed by interstate
household goods carriers,
approximately 29,350 (or 50 percent)
will receive new training as a result of
these regulations. Based on information
from FMCSA Household Goods Program
staff, we estimated each of the 29,350
household goods employees will

39953

require, on average, four hours of new
training.
At an April 26, 2004, meeting with
FMCSA staff, AMSA representatives
noted the need to ‘‘train agents, sales
personnel and drivers.’’ (See FMCSA’s
Record of Meeting in the docket.) In a
May 26, 2004, letter to FMCSA
Administrator Annette M. Sandberg,
AMSA reiterated that ‘‘thousands of
sales personnel, drivers and
management personnel’’ would need
training in the new regulations. This
information helped us to estimate the
per-hour cost of training, using hourly
wage information from the publication
Occupational and Employment Wages
(May 2003) produced by the U.S.
Department of Labor, Bureau of Labor
Statistics (BLS). The median hourly
wage estimates used in our analysis are
shown in Table 1.

TABLE 1.—OCCUPATION AND MEDIAN HOURLY WAGE DATA FOR EMPLOYEES REQUIRING TRAINING AS A RESULT OF THIS
FINAL RULE
Median hourly
wage

Occupation
Sales Representatives, Wholesale and Manufacturing, Except Technical and Scientific Products ...................................................
First-line Managers of Non-retail Sales Workers ................................................................................................................................
Truck Drivers, Heavy & Tractor-Trailer ...............................................................................................................................................
Average (Simple) of Above-Median Hourly Wages ............................................................................................................................

$21.09
26.78
16.01
21.29

Source: Occupational Employment and Wages, May 2003, U.S. Department of Labor, Bureau of Labor Statistics (BLS).

On the assumption that sales, driver,
and management personnel will be
trained in equal numbers, we calculated
a simple average of the hourly wage
rates shown in the table. This yielded an
average hourly direct wage rate of
$21.29. The addition of an estimated 31
percent to cover the cost of fringe
benefits (a weighted average of the
fringe benefits for private and for-hire
carriers, based on data from the
American Trucking Associations and
BLS) brings total compensation to
$27.89 per hour. This average hourly
wage rate represents the ‘‘opportunity
cost’’ to household goods movers. The
opportunity cost constitutes the overall
losses business sustain by pulling
workers away from economically
productive tasks to train them in the
application of the new rules.
To the opportunity cost we added an
estimate of the direct costs of training.
Based on data from truck driver training
schools, we estimated a direct cost of
$25 per hour. This yielded an hourly
training cost of $52.89. We multiplied
the 29,350 employees requiring training

by the $52.89 hourly cost to derive an
estimated $1.55 million in costs for each
hour of training for all affected
employees. Multiplying this result by
four (or the average number of training
hours required per employee) yields a
total first-year cost of training equal to
$6.2 million (undiscounted). Using a 1⁄2year discounting method and a sevenpercent discount rate as recommended
by the Office of Management and
Budget (OMB) in its guidelines for
regulatory analyses (OMB Circular A–
4) 2, first-year discounted costs of
training equal $6.0 million.
Based on information AMSA
provided both during its April 26, 2004,
meeting with FMCSA and in its April
29, 2004, letter to Administrator
Sandberg, we assumed this training cost
will be a one-time cost to employers.
Any future training would be at the
discretion of the employer and not a
direct result of this regulation.

2. Costs To Revise and Reprint Forms,
Bills of Lading, and Marketing Materials

1 The Economic Census is published by the U.S.
Bureau of the Census. Copies may be found at
http://www.census.gov/epcd/www/econ97.html.

2 OMB Circular A–4 (September 17, 2003)
provides guidance to Federal agencies on the
development of regulatory analyses as required
under Section 6(a)(3)(C) of Executive Order 12866,

‘‘Regulatory Planning and Review.’’ For a copy, see
http://www.whitehouse.gov/omb/inforeg/
circular_a4.pdf.

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

PO 00000

Frm 00049

Fmt 4700

Sfmt 4700

It is our understanding that many
household goods carriers, particularly
the larger moving companies, develop
their own marketing materials, forms,
and/or bills of lading. Forms and bills
of lading must be consistent with the
new regulatory requirements, while
FMCSA also requires that carrier
marketing materials incorporate the
information in the Your Rights and
Responsibilities When You Move
consumer pamphlet. Therefore, carriers
will incur costs in updating and
reprinting these forms and materials.
(Carriers without proprietary marketing
materials may download and print the
consumer pamphlet from FMCSA’s Web
site at http://www.fmcsa.dot.gov/. These
carriers will incur minimal costs in
providing customers with the revised
pamphlet.) We estimated an average
cost of $5.00 to revise and reprint each
packet of materials (containing the
marketing pamphlet(s), forms, and/or
bill of lading); this includes costs for

E:\FR\FM\12JYR1.SGM

12JYR1

39954

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations

design, layout, and review, plus
additional charges for printing the cover
and for specifications such as high
gloss. Using estimates from the FMCSA
information collection approved by
OMB for the interim final rule (see the
Paperwork Reduction Act section
below), we assumed the population of
4,000 interstate household goods
carriers conducts 600,000 interstate
moves annually. Multiplying the
estimated $5.00 printing cost per
marketing item by 600,000 yields firstyear printing costs of $3.0 million
(undiscounted). Using a 1⁄2-year
discounting method and a 7 percent
discount rate, we calculated first-year
discounted costs of reprinted marketing
materials as $2.9 million.
Many household goods carriers may
use in-house technical writers to
convert FMCSA regulations to
layperson’s language. Using wage
information in the BLS May 2003
Occupational and Employment Wages
report, we estimated the fully loaded
median wage for technical writers
(including fringe benefits) at $32.49 per
hour. Assuming each technical writer
requires 8 hours to rewrite the new
rules, we derived a total technical
writing cost of $260 per carrier.
Multiplied by the population of 4,000
interstate household goods carriers, this
yields total first-year costs of $1.04
million (undiscounted). Using a 1⁄2-year
discounting method and a 7 percent
discount rate, we calculated first-year
discounted costs of rewriting marketing
materials as $1.0 million.
In the aggregate, first-year discounted
costs to motor carriers to rewrite and
print marketing materials equal $3.9
million (after rounding). Again, we
assumed this to be a one-time cost.
3. Online Documentation and Web Page
Redesign Costs
An unpublished research study by the
Volpe Center for FMCSA in calendar
year 2000 indicated that 70 percent of
existing motor carriers had direct access
to the Internet and used that access for
business purposes.3 On the assumption
that Web site usage for commercial
purposes is likely approaching 100
percent, we believe the 4,000 interstate
household goods carriers probably
maintain Web sites for commercial
purposes that contain information of
interest to individual shippers.
To estimate the costs of updating
household goods carriers’ Web site
content to reflect the new rules, we used
3 ‘‘Internet Accessibility to Commercial Motor
Vehicle Operators and Carriers,’’ an unpublished
report by the Volpe National Transportation
Systems Center for the Federal Motor Carrier Safety
Administration, 2000.

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

the median wage for a computer support
specialist (a category including Web site
designer) of $18.96 per hour (from the
BLS May 2003 Occupational and
Employment Wages report). Applying a
fringe benefits factor of 31 percent, we
derived a fully loaded rate for a Web site
designer of $24.84 per hour. On the
assumption that Web site design work is
performed by third-party contractors,
we applied a factor of 100 percent to the
fully loaded direct wage rate to account
for third-party profit, overhead, and
other administrative expenses
associated with standard contractor fees.
This yielded an hourly wage rate of
$49.68.
We assumed that in-house technical
writing costs (already incorporated in
section 2 of this summary, Costs To
Revise and Reprint Forms, Bills of
Lading, and Marketing Materials)
include costs for rewriting any
documents and forms the carrier
publishes online. Consequently, in
estimating the present costs we focused
strictly on information upload and Web
site redesign. Based on discussions with
FMCSA information systems staff, we
estimated each site designer requires
about 2 hours to update a carrier’s Web
site with the new information.
Therefore, the total cost per carrier to
update Web site information is
estimated at $99.36 (or $49.68 per hour
times 2 hours). Multiplying this per-firm
cost by the 4,000 interstate household
goods carriers yields a total first-year
cost of $397,440 (undiscounted). Using
a 1⁄2-year discounting method and a 7
percent discount rate, we calculated
first-year discounted costs for Web
updating and redesign as equal to
$384,000. As with technical writing and
printing costs, we assumed this is a onetime cost.
4. Paperwork Costs
The paperwork burden associated
with this rule entails a permanent
change in recordkeeping practices of
household goods carrier personnel for
the foreseeable future. Thus, unlike the
costs for training personnel, revising
and reprinting marketing materials, and
redesigning carrier Web sites, this
paperwork burden imposes recurring
costs on the industry. The paperwork
burden estimates provided by FMCSA
to OMB in 2003 as part of the
Supporting Statement to the June 11,
2003, interim final rule (see the
Paperwork Reduction Act section
below) estimated the new burden hours
at 1,232,000 hours annually, with an
accompanying annual cost of $2.61
million (undiscounted) to the 4,000
motor carriers engaged in interstate
household goods movement. This total

PO 00000

Frm 00050

Fmt 4700

Sfmt 4700

cost is primarily from the new
paperwork burden associated with
motor carriers’ management of
arbitration programs and non-binding
estimates. Additionally, paperwork
costs under each category are broken out
by capital costs and operational/
maintenance costs. The source material
for estimating the paperwork burden
hours and cost estimates was obtained
from national averages developed by the
Association of Records Managers and
Administrators (ARMA).4 Given the
detail with which the paperwork-related
costs were developed, FMCSA analysts
adopted these cost figures for its
Regulatory Impact Analysis.
First-year costs associated with this
requirement equal $2.5 million (using a
1⁄2-year discounting method and a 7
percent discount rate). Recurring costs
associated with paperwork burden in
years 2 through 10 of the analysis period
total $16.4 million (discounted using a
7 percent discount rate). When lateryear, recurring paperwork-related costs
($16.4 million) are added to first-year
costs ($2.5 million), the result is 10-year
discounted costs of $19.0 million (after
rounding).
5. Costs To Collect Payment for
Additional Services
Under 49 CFR 375.403(a)(7) and (a)(8)
and 375.405(a)(9) and (a)(10), a mover
must wait 30 days after delivery to
collect fees for additional services
required to complete the move or
provided at the shipper’s request, and
not included in the estimate (whether
binding or non-binding). These are
termed ‘‘additional services’’ charges.
FMCSA believes that additional services
charges would seldom exceed 20
percent of the estimated value of the
move, as the shipper and carrier
typically discuss such services before
the carrier provides the estimate.
Multiplying the average cost of a
household goods move in 2003 ($3,900,
based on a range of $3,800 to $4,000 as
reported by AMSA), we estimated
average ‘‘additional services’’ fees of
$780 per binding estimate. If the carrier
provided a non-binding estimate,
however, the additional services charges
would equal only 10 percent of the
shipment value (or $390 for the average
shipment) since the current regulations
permit carriers to collect 110 percent of
a non-binding estimate at delivery.
Based on figures FMCSA used to
estimate paperwork burden costs for the
interim final rule, we assumed
4 ‘‘Cost Indicators for Selected Records
Management Activities (A Guide to Unit Costing for
the Records Manager—Volume 1)’’ (1993) by
Griffiths, Jose-Marie, Ph.D. and King, Donald W.

E:\FR\FM\12JYR1.SGM

12JYR1

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
household goods carriers provide
binding estimates 60 percent of the
time, with the remaining 40 percent of
shipments moving under non-binding
estimates. Therefore, the average value
of additional services for which carriers
must defer billing is estimated at $624,
or ($780 × 60%) + ($390 × 40%).
For this analysis, we assumed that the
shipper contests additional services
charges 5 percent of the time, or in
30,000 of the 600,000 annual interstate
household goods moves. We believe this
assumption is reasonable, given that the
amended ‘‘additional services’’
provision is aimed at the relatively
small segment (20 percent) of annual
interstate household goods moves that
are transacted directly between the
mover and shipper, rather than at the
remaining 80 percent contracted
through an employer (governmental or
private sector) or other commercial
entity. Therefore, the total estimated
value of the portion of ‘‘additional
services’’ charges contested by the
shipper is equal to $18.7 million (30,000
shipments × $624). An AMSA marketing
survey reported that, for large
household goods carriers, a contested
charge eventually had to be written off
as bad debt in 10 percent of cases. This
means the average annual amount of
unrecovered charges for large carriers is
equal to $1.87 million ($18.7 million ×
10 percent). Using a 1⁄2-year discounting
method and a 7 percent discount rate,
we calculated first-year costs of this
provision as equal to $1.81 million.
These costs are assumed to recur
throughout the 10-year analysis period,
resulting in a total discounted cost of
$13.6 million.
Total Costs
Total first-year, discounted costs
associated with this final rule equal
$14.6 million (the sum of all cost figures
for each compliance cost item). Total
discounted costs associated with this
final rule over the 10-year analysis
period equal $42.8 million.
Benefits
The agency was unable to quantify the
benefits of this rule. While we identified
categories of benefits, none of these
categories is amenable to quantification.
For example, we expect individual
shippers with loss or damage claims to
expend less time and effort in
paperwork associated with recovering
their losses, because the clear
instructions in household goods
carriers’ revised forms and
informational materials will direct them
to the appropriate venue and forms.
However, FMCSA does not have access
to information regarding how much

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

time consumers currently waste in
searching for the correct venue and
forms. What can be said with certainty
is that putting more information in the
hands of consumers cannot increase
their out-of-pocket costs. Clearly, all
household goods shippers will benefit
from knowing the rules and remedies
governing household goods
transportation and from knowing what
levels of service to expect.
In addition to increasing the
transparency of the household goods
regulations, this final rule ensures
consumers are better protected against
unfair practices and financial harm.
This brings individual shippers
increased peace of mind. Although
important, ‘‘peace of mind’’ benefits are
difficult to quantify in a meaningful and
objective manner. Nevertheless, we
expect these benefits to be substantial.
This rule is not intended to address
motor carrier safety issues, and would
not impact the number of truck-related
crashes.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA)
(5 U.S.C. 601–612), as amended by the
Small Business Regulatory Enforcement
Fairness Act of 1996 (Pub. L. 104–121,
110 Stat. 857), requires Federal
agencies, as a part of each rulemaking,
to consider regulatory alternatives that
minimize the impact on small entities
while achieving the objectives of the
rulemaking. FMCSA has evaluated the
effects of this rule on small entities as
required by the RFA. We have
determined this regulatory action will
have a significant economic impact on
a substantial number of small entities.
Therefore, we have prepared the
following Regulatory Flexibility
Analysis.
The Regulatory Flexibility Analysis
covers the following topics: (1) A
description of the reasons why the
agency is taking this regulatory action;
(2) a succinct statement of the objectives
of, and legal basis for, the rule; (3) a
description of and, where feasible, an
estimate of the number of small entities
to which the rule will apply; (4) a
description of the reporting,
recordkeeping, and other compliance
requirements of the rule, including an
estimate of the classes of small entities
that will be subject to the requirement
and the type of professional skills
necessary for preparation of the report
or record; (5) significant alternatives
considered that accomplish the stated
objectives and minimize the impact on
small entities; and (6) an identification,
to the extent practicable, of all relevant
Federal rules that may duplicate,
overlap, or conflict with the rule.

PO 00000

Frm 00051

Fmt 4700

Sfmt 4700

39955

1. A description of the reasons why
the agency is taking this regulatory
action.
FMCSA is amending its regulations
governing the interstate transportation
of household goods so that individuals
who ship their personal effects may
better understand their rights.
Additionally, several regulatory changes
were made to improve the balance
between the rights of household goods
movers and those of individual shippers
(consumers). Such amendments will
allow the shipper to make more
informed decisions in selecting a mover
and ensuring the mover conducts the
delivery of goods in a satisfactory
fashion.
2. A succinct statement of the
objectives of, and legal basis for, the
rule.
In the Motor Carrier Safety
Improvement Act of 1999 (MCSIA)
(Public Law 106–159, December 9, 1999,
113 Stat. 1749), Congress authorized
FMCSA to regulate household goods
carriers engaged in interstate operations
for individual shippers. The objectives
of today’s final rule are to clarify the
existing regulations and balance more
equitably the rights of the individual
shipper with those of the mover. This
will enable consumers to make more
informed decisions in selecting a mover
and ensuring the delivery of goods is
conducted in a satisfactory fashion.
3. A description of and, where
feasible, an estimate of the number of
small entities to which the rule will
apply.
This regulation will apply to all motor
carriers transporting household goods in
interstate commerce. According to
FMCSA’s Licensing and Information
(L&I) database, approximately 4,000
such carriers are currently in operation.
Total discounted costs of the final rule
are estimated at $42.8 million.
Spreading the total discounted costs
evenly over the 10-year analysis period
yields average annual discounted costs
of $5.9 million. Dividing this figure by
the 4,000 affected firms yields an
average compliance cost of $1,475 per
firm. We anticipate the compliance
costs of large firms will be higher than
this average, while those incurred by
small firms will be lower. This is
because many of these costs (such as for
training and printing) increase with the
number of workers the firm employs
and/or the number of household goods
shipments it handles. Since this cost
differential is not expected to be
substantial, however, we will use the
average compliance cost of $1,475 per
firm for the purposes of this Regulatory
Flexibility Analysis.

E:\FR\FM\12JYR1.SGM

12JYR1

39956

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations

The 1997 Economic Census indicated
a total of 8,279 firms operating in the
‘‘Used Household and Office Goods
Moving’’ segment, or North American
Industrial Classification System
(NAICS) Code 484210. Of these, 6,764
firms (or 81 percent) had average annual
receipts or revenues of less than $21.5
million. However, the Economic Census
makes no distinction between firms
operating in interstate and intrastate
commerce. The agency’s L&I database
indicates that approximately 4,000 of
these firms currently operate in
interstate commerce. Therefore, for the
purposes of this analysis, 81 percent of
the 4,000 interstate household goods
carriers, or 3,246 carriers, are
considered small entities affected by
this regulation.
According to the 1997 Economic
Census, NAICS Code 484210, there are
1,177 firms with average annual
revenues of less than $100,000, where
average annual pre-tax profits are equal
to $3,042 per firm. Average annual
compliance costs of $1,475 per firm
comprise 48.5 percent of these firms’
average annual pre-tax profits, which
we consider a significant impact.
Additionally, there are 1,764 firms with
$100,000 to $249,999 in average annual
revenues, where average annual pre-tax
profits are equal to $9,018. Average
annual compliance costs of $1,475 per
firm comprise 16.4 percent of these
firms’ average annual pre-tax profits,
which we consider a significant impact.
Firms with average annual revenues
above $250,000 per year will not be
significantly impacted by this rule,
given that the compliance costs are less
than 7 percent of these firms’ average
annual pre-tax profits. Therefore,
according to the Economic Census data,
a total of 2,941 small firms (or 1,177 +
1,764) will be significantly impacted by
implementation of this rule. As noted
earlier, the Economic Census makes no
distinction between carriers operating in
interstate and intrastate commerce.
Thus, we adjusted downward the
number of small firms calculated above
to include only those entities operating
in interstate commerce. Since the 4,000
household goods carriers currently
operating in interstate commerce
constitute 48.3 percent of the total
population of 8,279 household goods
carriers, we derived this lower figure by
calculating 48.3 percent of 2,941 (the
number of small firms significantly
impacted according to the Economic
Census), or 1,421 small interstate
household goods carriers that will be
significantly impacted by this
regulation.
These 1,421 small entities represent a
substantial segment of motor carriers

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

currently hauling household goods in
interstate commerce: 36 percent of all
such carriers (4,000 firms), and 44
percent of small interstate household
goods carriers (3,246 firms).
4. A description of the projected
reporting, recordkeeping, and other
compliance requirements of the
proposed rule, including an estimate of
the classes of small entities that will be
subject to the requirement and the types
of professional skills necessary for
preparation of the report or record.
This rule will result in additional
information collection, retention, and
dissemination by household goods
carriers. For instance, the regulations
will require motor carriers to: (1) Have
written agreements with their prime
agents stipulating that each
advertisement by a motor carrier or its
agent include the name or trade name of
the originating-service motor carrier and
its USDOT number; (2) establish and
maintain a procedure for responding to
complaints from shippers; (3) develop a
concise summary of the carrier’s
arbitration procedures; and (4) update
the consumer pamphlet Your Rights and
Responsibilities When You Move to
incorporate the new requirements. All
these changes (and several others not
listed above) will assist consumers in
their commercial dealings with
interstate household goods carriers, by
enabling them to make better informed
decisions about contracts with, and
services to be ordered, executed, and
settled with, the carriers. Approximately
3,246 small entities (interstate
household goods carriers) will be
subject to this regulation. While
knowledge of household goods industry
operations is required to explain the
new information to consumers, no
special skills or training are required to
prepare or report on this information.
5. Significant alternatives considered
that accomplish the stated objectives
and minimize the impact on small
entities.
This rulemaking effort is a direct
result of the conclusions reached by the
Government Accountability Office
(GAO) in its 2001 report entitled
‘‘Consumer Protection: Federal Actions
Are Needed to Improve Oversight of the
Household Goods Moving Industry,’’
No. GAO–01–318. Section 209 of the
MCSIA directed that GAO study the
effectiveness of DOT’s consumer
protection activities regarding the
interstate household goods moving
industry and identify alternative
approaches for providing consumer
protection. The GAO report
recommended FMCSA: (1) Study
alternative dispute mechanisms
required by the ICCTA; (2) evaluate the

PO 00000

Frm 00052

Fmt 4700

Sfmt 4700

adequacy of agency enforcement efforts;
(3) determine whether legislative
changes are needed to supplement
Departmental efforts, including
authorizing the States to enforce Federal
statutes and regulations and amending
the Federal statute limiting carrier
liability with respect to interstate
shipments of household goods; and (4)
conduct public education efforts to
promote consumer awareness of selfhelp measures.
FMCSA has acted on each of the GAO
report recommendations. Our
assessment of the agency’s enforcement
sufficiency and effectiveness led, as
noted above under Discussion of Public
Comments, to the hiring of seven
additional enforcement staff in fiscal
year 2004. We also implemented revised
operating procedures for conducting
investigations of household goods
movers, and developed a
comprehensive Household Goods
Compliance and Enforcement Training
course for safety investigators.
We have proposed and supported
enforcement enhancements through
legislative provisions under
consideration in both the House and
Senate. These include providing State
agencies with expanded authority to
enforce Federal regulations, increasing
enforcement sanctions against rogue
moving companies, and other
provisions to bolster consumer
protection against unscrupulous
household goods transportation
practices.
We are expanding our public
education efforts. These include
developing and implementing a
comprehensive household goods
education and outreach initiative, aimed
primarily at individual shippers but also
targeting carriers and brokers, consumer
advocacy groups, and law enforcement
agencies. We also recently completed a
major revision and improvement of the
FMCSA household goods Web site and
the National Consumers Complaint
database.
Finally, we are conducting an
Alternative Dispute Mechanism
Assessment focused on arbitration
procedures and programs.
We believe these efforts are
reinforcing the consumer protections
provided in the regulations adopted as
final in today’s action. This final rule
remains the centerpiece of FMCSA’s
household goods enforcement program,
as it is the most effective way to provide
consumers with enhanced protections
without unduly impeding market
competition within the moving
industry.
6. An identification, to the extent
practicable, of all relevant Federal rules

E:\FR\FM\12JYR1.SGM

12JYR1

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
that may duplicate, overlap, or conflict
with the rule.
In the agency’s view, no Federal rules
would duplicate, overlap, or conflict
with this final rule.
Executive Order 13132 (Federalism)
This action has been analyzed in
accordance with the principles and
criteria contained in Executive Order
13132, dated August 4, 1999 (64 FR
43255, Aug. 10, 1999). State Attorneys
General submitted comments to the May
2, 1998, NPRM, which were considered
and addressed in developing the interim
final regulation. FMCSA certifies that
this rule has federalism implications
because it directly impacts the
distribution of power and
responsibilities among the various
levels of government. The rule will not,
however, impose significant additional
costs or burdens on the States.
Federalism Summary Impact Statement
The FMCSA Position Supporting the
Need To Issue This Regulation
The State Attorneys General generally
believe they hold authority to enforce
laws and regulations governing the
interstate transportation of household
goods and want FMCSA to acknowledge
their role. However, the interstate
transportation of household goods
involves issues that are national in
scope and that have been regulated
exclusively by the Federal Government
for many years. Regulations
implementing the Household Goods
Transportation Act of 1980 were
promulgated by the ICC in 1981 and
subsequently transferred to DOT by the
ICC Termination Act of 1995 wherein
Congress, in 49 U.S.C. 14104, conferred
authority on the Secretary of
Transportation to ‘‘issue regulations
* * * protecting individual shippers.’’
The Secretary subsequently delegated
this authority to FMCSA under 49 CFR
1.73(a)(6). The Carmack Amendment,
now codified at 49 U.S.C. 14706,
imposes a uniform regime of mover
liability for interstate shipments of
property designed to eliminate the
uncertainty resulting from potentially
conflicting State laws. Federal and State
courts consistently have held that
Carmack preempts a broad range of
State consumer protection laws
potentially applicable to interstate
household goods carriers. As with the
former ICC regulation amended by the
interim final rule, under current case
law this rule preempts all State
regulations that purport to regulate
interstate household goods
transportation subject to Federal
jurisdiction.

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

As AMSA commented, the NPRM’s
conclusion that this rule is not intended
to preempt any State law or regulation
was incorrect and likely to promote
uncertainty and potential conflicts with
States. AMSA stated, ‘‘In promulgating
these regulations FHWA has expressly
preempted application of any State law
that would impact the services required
to perform interstate transportation of
household goods. States, for example,
may not regulate the manner in which
household goods carriers are required
by FHWA to execute orders for service
nor may they enforce any State
regulation that would affect any other
aspect of the interstate moving service
performed by household goods carriers
regulated by FHWA. See, e.g., Fidelity
Federal S. & L. Assn. v. de la Cuesta,
458 U.S. 141, 73 L.Ed.2d 664 (1982)
(Even where Congress has not
completely displaced State regulation in
a specific area, State law is nullified to
the extent that it actually conflicts with
Federal law. Federal regulations have no
less pre-emptive effect than Federal
statutes.)
‘‘FHWA authority to issue the
proposed regulations is without
question. As the NPRM notes, in
enacting section 14104 of the
Termination Act, the enabling statute in
this proceeding, Congress conferred
authority on the Secretary to ‘issue
regulations protecting individual
shippers.’ That is precisely what the
Secretary proposes and his action in
doing so preempts all State regulations
that would purport to regulate the same
activities. For these reasons, the cited
sentence should be removed or clarified
in the final decision in this proceeding.
In a similar vein, it is appropriate at this
point to address certain comments of
NACAA [National Association of
Consumer Agency Administrators].
NACAA urges that the proposed
regulations should announce that they
are supplementary law only and that
violations will also subject movers to
remedies provided by other Federal,
State and local laws, such as State
deceptive trade practices laws.
(Comments, p. 7). This suggestion
reflects a fundamental misconception of
the Supremacy Clause, U.S.
Constitution, Art. VI, clause 2, and
Federal preemption. There is not the
slightest suggestion in the law or its
precedent that Congress ever intended
this explicit and comprehensive
regulatory scheme to be supplemental to
or superseded by any State law or
regulation. Congress could not have
been clearer in expressing its intent to
occupy the field of interstate household
goods transportation regulation. AMSA

PO 00000

Frm 00053

Fmt 4700

Sfmt 4700

39957

asserts the NACAA’s contention is flatly
wrong.’’
FMCSA agrees that AMSA has
correctly stated current case law on the
preemption issue. AMSA is likewise
correct that NACAA’s suggestion to
consider the Federal rules solely as
supplementary law reflects a basic
misconception of the Supremacy
Clause.
Prior Consultations With State and
Local Officials
As AMSA pointed out, the NPRM’s
conclusion that this rule is not intended
to preempt any State law or regulation
was incorrect. Thus, the requirement in
section 6(c) to consult ‘‘with State and
local officials early in the process of
developing the proposed regulation,’’ in
accordance with OMB guidance to send
letters to State and local officials or their
regional or national representative
organizations such as the National
Association of Governors, did not occur.
The agency did, however, receive
comments to the docket from State and
local officials.
Summary of the Nature of State and
Local Officials’ Concerns
State officials recommended that the
rules incorporate additional consumer
protection provisions, including: (1)
More comprehensive disclosure
requirements, particularly with respect
to insurance and mover liability; (2)
stronger arbitration requirements; (3)
uniform rules governing cash-ondelivery service, including requiring
movers to relinquish possession of a
shipment upon payment of an amount
substantially less than the amount of the
estimate; (4) requiring movers to offer
guaranteed delivery prices if requested
by the shipper; (5) restricting billing for
additional services not contained in the
estimate; (6) establishing a 3-day grace
period allowing a shipper to rescind an
order for service without penalty; (7)
permitting the shipper to deduct
penalties for late deliveries from the
transportation charges; (8) relaxing
limitations on a shipper’s right to file
loss and damage claims, including
claims for loss and damage occurring
during storage-in-transit; and (9)
prohibiting demands for payment until
the entire shipment is delivered.
Statement of the Extent to Which
FMCSA Has Addressed the Concerns of
State and Local Officials
In response to these comments to the
NPRM, the agency amended the
proposed regulations in five respects.
The interim final rule (and today’s final
rule): (1) Revises the consumer
information pamphlet that movers must

E:\FR\FM\12JYR1.SGM

12JYR1

39958

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations

give shippers to include guidance
regarding the shipper’s right to decline
arbitration; (2) clarifies mover liability
disclosure requirements; (3) requires
movers to disclose the names and
addresses, when known, of any other
motor carriers that will participate in
transportation of the shipment; (4)
requires movers to make delivery
(relinquish the shipment) and defer
demanding payment for charges not in
the estimate, if the mover could
reasonably have determined such
charges at the time of pickup; and (5)
mandates a 3-day grace period for
shippers to cancel orders for service
without penalty.
Conclusion
FMCSA submitted State and local
officials’ comments to the docket and
the federalism summary impact
statement for the June 11, 2003, interim
final rule to the Director of the Office of
Management and Budget.
Unfunded Mandates Reform Act of
1995
The Unfunded Mandates Reform Act
of 1995 (Public Law 104–4; 2 U.S.C.
1532) requires each agency to assess the
effects of its regulatory actions on State,
local, and tribal governments and the
private sector. Any agency promulgating
a final rule likely to result in a Federal
mandate that may result in the
expenditure by State, local, and tribal
governments, in the aggregate, or by the
private sector, of $120 million or more
(adjusted annually for inflation) in any
one year must prepare a written
statement incorporating various
assessments, estimates, and descriptions
that are delineated in the Act. FMCSA
determined that the changes in the June

11, 2003, interim final rule will not have
an impact of $120 million or more (as
adjusted for inflation) in any one year.
No significant additional impact is
associated with today’s adoption of the
interim final regulations as a final rule.
Paperwork Reduction Act
Under the Paperwork Reduction Act
of 1995 (PRA) (44 U.S.C. 3501–3520), a
Federal agency must obtain approval
from OMB for each collection of
information it conducts, sponsors, or
requires through regulations. FMCSA
sought approval of the information
collection requirements in the
‘‘Transportation of Household Goods;
Consumer Protection Regulations’’
interim final rule published on June 11,
2003. On June 19, 2003, OMB assigned
control number 2126–0025 to this
information collection, and the approval
expires on June 30, 2006.
OMB approved 600,000 annual
responses, 4,370,037 annual burden
hours, and an annual information
collection burden of $37,247,000. It also
approved FMCSA form number MCSA–
2P to be used as part of the information
collection process.
The collected information
encompasses that which is generated,
maintained, retained, disclosed, and
provided to, or for, the agency under 49
CFR part 375. It will assist individual
household goods shippers in their
commercial dealings with interstate
household goods carriers, thereby
providing a desirable consumer
protection service. The collection of
information will be used by prospective
household goods shippers to make
informed decisions about contracts and
services to be ordered, executed, and
settled within the interstate household

goods carrier industry. These
information collection items were
required by regulations issued by the
former ICC. When these items
transferred from the ICC to FMCSA,
however, no OMB control number was
assigned to cover this information
collection transfer. It was therefore
necessary to calculate the old
information collection burden hours for
these items approved under the ICC
rules versus the new burden generated
by the interim final rule and subsequent
amendments and adopted in today’s
final rule.
Assumptions used for calculation of
the information collection burden
include the following: (1) There are
currently approximately 4,000 active
household goods carriers, up from the
2,000 estimated in the 1998 NPRM; (2)
an estimated 75 new household goods
carriers will start up business each year;
(3) over the next 3 years, two large van
lines will start up business; and (4) the
requirement for an arbitration report
proposed in the NPRM was not retained
in the interim final rule.
The following table summarizes the
information collection burden hours by
correlating the information collection
activities with the sections of part 375
in which they appear. (The total annual
burden hours of 4,370,037 represent a
441,090-hour decrease from the
4,811,127 burden hours estimated in the
NPRM.) The table shows whether each
information collection activity was
required under ICC regulations. A
detailed analysis of the burden hours
can be found in the OMB Supporting
Statement for this rule. The Supporting
Statement and its attachments are in the
docket.
Proposed
section

Type of burden

Hourly burden

Agency Agreements .............................................................................................................................
Minimum Advertising Information Soliciting Prospective Individual Shippers .....................................
Complaint and Inquiry Handling ..........................................................................................................
Arbitration Program Summary .............................................................................................................
Your Rights and Responsibilities When You Move Booklet ................................................................
Selling Insurance Policies ....................................................................................................................
Estimates—Binding ..............................................................................................................................
Estimates—Non-binding ......................................................................................................................
Orders for Service ................................................................................................................................
Inventory ..............................................................................................................................................
Bills of Lading ......................................................................................................................................
Volume to Weight Conversions ...........................................................................................................
Weight Tickets .....................................................................................................................................
Notifications of Reasonable Dispatch Service Delays .........................................................................
Delivery More Than 24 Hrs. Ahead of Time ........................................................................................
Notification of Storage-in-Transit Liability Assignments ......................................................................

375.205
375.207
375.209
375.211
375.213
375.303
375.401
375.401
375.501
375.503
375.505
375.507
375.519
375.605
375.607
375.609

19
684
500,000
8,000
8,334
100,000
1,836,000
1,224,000
300,000
*0
300,000
4,000
42,000
16,000
1,000
30,000

‘‘Old’’ Burden Hours ......................................................................................................................

........................

3,138,037

‘‘New’’ Burden Hours ....................................................................................................................

........................

1,232,000

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

PO 00000

Frm 00054

Fmt 4700

Sfmt 4700

E:\FR\FM\12JYR1.SGM

12JYR1

New
burden?
No.
No.
No.
Yes.
No.
No.
No.
Yes.
No.
Yes.
No.
No.
No.
No.
No.
No.

Federal Register / Vol. 70, No. 132 / Tuesday, July 12, 2005 / Rules and Regulations
Proposed
section

Type of burden
Total Burden Hours for Information Collection ......................................................................

Hourly burden

........................

39959
New
burden?

4,370,037

*Making inventories is a usual and customary moving industry practice that FMCSA adopted on June 11, 2003, at the suggestion of the National Association of Consumer Agency Administrators (NACAA) and the American Moving and Storage Association (AMSA). The PRA regulations at 5 CFR 1320.3(b)(2) allow FMCSA to calculate no burden when the agency demonstrates to OMB that the activity needed to comply with
the specific regulation is usual and customary. The supporting statement in the docket demonstrates that moving industry drivers usually and
customarily write inventories before loading shipments, although drivers have not been required by law to do so before the May 5, 2004, compliance date for the interim final regulations.

National Environmental Policy Act
The agency has analyzed this final
rule for the purpose of the National
Environmental Policy Act of 1969
(NEPA) (42 U.S.C. 4321 et seq.). We
have determined under our
environmental procedures Order 5610.1,
published March 1, 2004, that this
action is categorically excluded (CE)
under Appendix 2, paragraph 6.m. of
the Order from further environmental
documentation. This CE relates to
regulations implementing procedures
applicable to the ‘‘operations,’’
including specified business practices,
of motor carriers engaged in the
transportation of household goods. In
addition, the agency believes that the
action includes no extraordinary
circumstances that would have any
effect on the quality of the environment.
Thus, we believe the action does not
require an environmental assessment or
an environmental impact statement.
We have also analyzed this action
under section 176(c) of the Clean Air
Act (CAA), as amended (42 U.S.C. 7401
et seq.), and implementing regulations
promulgated by the Environmental
Protection Agency. We have
preliminarily determined that approval
of this action would be exempt from the
CAA’s General Conformity requirement
since it is merely an adoption of an
existing interim final rule as a final rule.
See 40 CFR 93.153(c)(2). We believe that
it will not result in any emissions
increase, nor will it have any potential
to result in emissions that are above the
general conformity rule’s de minimis
emission threshold levels. Moreover, we
believe it is reasonably foreseeable that
the rule will not increase total
commercial motor vehicle mileage,
change the routing of commercial motor
vehicles, change how commercial motor
vehicles operate, or change the
commercial motor vehicle fleet-mix of
motor carriers. This rule merely revises
and clarifies certain requirements for
interstate household goods carriers to
ensure individual shippers of household
goods are better protected against unfair
practices and financial harm. It also
ensures these individual shippers are
better informed about the new
regulations.

VerDate jul<14>2003

14:34 Jul 11, 2005

Jkt 205001

Executive Order 12630 (Taking of
Private Property)
This rule will not effect a taking of
private property or otherwise have
takings implications under Executive
Order 12630, Governmental Actions and
Interference with Constitutionally
Protected Property Rights.
Executive Order 12372
(Intergovernmental Review)
Catalog of Federal Domestic
Assistance Program Number 20.217,
Motor Carrier Safety. The regulations
implementing Executive Order 12372
regarding intergovernmental
consultation on Federal programs and
activities do not apply to this program.
Executive Order 13211 (Energy Supply,
Distribution, or Use)
We have analyzed this action under
Executive Order 13211, Actions
Concerning Regulations That
Significantly Affect Energy Supply,
Distribution, or Use. This action is not
a significant energy action within the
meaning of section 4(b) of the Executive
Order because as a procedural action it
is not economically significant and will
not have a significant adverse effect on
the supply, distribution, or use of
energy.
Executive Order 12988 (Civil Justice
Reform)
This action meets applicable
standards in sections 3(a) and 3(b)(2) of
Executive Order 12988, Civil Justice
Reform, to minimize litigation,
eliminate ambiguity, and reduce
burden.
List of Subjects in 49 CFR Part 375
Advertising, Arbitration, Consumer
protection, Freight, Highways and
roads, Insurance, Motor carriers, Moving
of household goods, Reporting and
recordkeeping requirements.
Final Rule
The interim regulations published
June 11, 2003, at 68 FR 35064, part 375
of Title 49 of the Code of Federal
Regulations, are adopted as amended
without further revision. For the current
version of part 375, you may refer to the
electronic Code of Federal Regulations

PO 00000

Frm 00055

Fmt 4700

Sfmt 4700

on the Internet at http://
ecfr.gpoaccess.gov/cgi/t/text/textidx?c=ecfr&sid=6480bc2da610cfedac
650114c5e44fef&rgn=div5&view=
text&node=49:4.1.2.2.17&idno=49. The
technical amendments published on
March 5, 2004 (69 FR 10570) clarified
certain provisions, sought to provide
full uniformity between the rule text
and the appendix, and ensured the rule
reflects current industry practice. The
clarifying technical amendments
published on April 2, 2004 (69 FR
17313) chiefly affected the rule
appendix. The appendix was further
corrected on August 5, 2004 (69 FR
47386).
Issued on: July 6, 2005.
Annette M. Sandberg,
Administrator.
[FR Doc. 05–13608 Filed 7–11–05; 8:45 am]
BILLING CODE 4910–EX–P

DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety
Administration
49 CFR Part 571
[Docket No. NHTSA–2003–15712]
RIN 2127–AJ43

Federal Motor Vehicle Safety
Standards; Glazing Materials
National Highway Traffic
Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Final rule; response to petitions
for reconsideration; correction.
AGENCY:

SUMMARY: NHTSA published a final rule
in July 2003 that updated the Federal
motor vehicle safety standard on glazing
materials. The agency received several
petitions for reconsideration of the rule,
and has published documents that have
delayed the rule’s effective date.
Today’s document completes the
response to the petitions by amending
provisions on shade band requirements;
by providing a compliance option to
certain aftermarket glazing materials; by
delaying the compliance date of the rule
for motor vehicle manufacturers by two
months so that they can deplete glazing

E:\FR\FM\12JYR1.SGM

12JYR1