Eliminate Fraud, Comply with MAP-21 Training Requirements, and Issuance of Safety Ratings to ALL Regulated Entities Within 3 Years - It Can Be Done!

Comprehensive Framework Detailing Proposed Requirements to obtain and maintain FMCSA Operating Authority:

• Transportation Workers Identification Credential (TWIC) Card (Positive ID PRIOR to Obtaining Operating Authority
• MAP-21 Required Training (Completed PRIOR to Obtaining Operating Authority)
• New Entrant Audit (Safety Rating Issued PRIOR to Obtaining Operating Authority)

I. Introduction

The freight industry is crucial to the U.S. economy, but it faces challenges related to fraud, identity theft, and non-compliance during the FMCSA application and registration process for motor carriers, freight brokers, and freight forwarders.

These challenges not only threaten the integrity of the freight sector but also increase safety risks. To combat these issues, this framework introduces a comprehensive compliance process that will strengthen the vetting and registration procedures for all FMCSA-regulated entities.

This framework focuses on three core components:

1. TWIC Card Issuance and Biometric Verification
2. Public Law 112-141 – Moving Ahead for Progress the 21st Century Act (MAP-21) Required Training and Examination
3. New Entrant Safety Audit and Safety Rating Issuance

The legal owner or designated representative of each company will be required to undergo these processes as part of their FMCSA application or renewal. In cases where ownership or representation changes, the new individual must complete the entire process.

Until the new representative is verified, the previously listed owner or representative will remain legally responsible for the company's compliance. This ensures continuity, accountability, and protection against fraud.

II. Key Components of the Framework

1. TWIC Card Issuance and Biometric Verification for Legal Owners or Representatives

• Objective: To require the legal owner or designated representative of every motor carrier, broker, or forwarder to obtain a Transportation Worker Identification Credential (TWIC) card as part of the FMCSA registration process to apply for a DOT Number. The TWIC card will ensure that the individual responsible for the company undergoes biometric verification and a comprehensive background check, reducing the risk of fraud, identity theft, and misrepresentation. The TWIC Card will be tied to the DOT Number. This alone can eliminate chameleon carriers
• Verification of Legal Ownership or Representation: The identity of the legal owner or designated representative must be verified in person and through authoritative documents such as: Tax filings with the Internal Revenue Service (IRS) Corporate filings with the Secretary of State Operating agreements or partnership agreements Official business licenses issued by state or local authorities Bank account verification and proof of business ownership from recognized financial institutions If additional confirmation is necessary, notarized affidavits or certified statements from company officers or legal counsel may be required. This ensures a robust verification process that reduces the risk of fraudulent actors gaining control of a company.
• Ownership or Representation Changes: In the event of a change in ownership or designated representation, the new individual must complete the TWIC card process within 60 days. Until this process is completed, the previously listed owner or representative will remain legally responsible for all compliance matters.
• Fraud Prevention and Security: Biometric verification using fingerprints and facial recognition directly ties the responsible individual to the company's FMCSA operating authority. Comprehensive background checks conducted by TSA will help prevent high-risk individuals from gaining access to the freight industry.
• TWIC Card Processing Locations: The TWIC card issuance and biometric verification process must take place at one of the 300+ IDEMIA enrollment centers or any other facility where TWIC cards are issued. These centers are equipped to manage identity verification for other transportation sectors and will be integrated into the FMCSA registration system.
• TWIC Card Capacity and Efficiency: The Transportation Security Administration (TSA) issues over 600,000 TWIC cards annually, and there are more than 2.4 million active cards in circulation. The addition of approximately 60,000 new motor carriers and brokers each year represents only a 10% increase in TSA’s workload, which is manageable without adding any significant burden to taxpayers. Additionally, those individuals with a valid TWIC card will have already passed the first requirement in the application or recertification process. Costs for the TWIC card, including biometric verification and background checks, will be covered by the registrant, ensuring that there is no additional cost to taxpayers.
• Process and Timeline: New Applicants: Must complete the TWIC card application process as part of their FMCSA registration, typically taking 2-6 weeks. Existing Registrants: Must obtain a TWIC card within 6 months of the rule’s implementation to maintain their FMCSA operating authority.
• Statutory Reference: TWIC card issuance is governed by the Maritime Transportation Security Act (MTSA) of 2002, under 49 U.S.C. § 114 and 49 CFR Part 1572.

2. MAP-21 Training and Examination for Legal Owners or Representatives

• Objective: To require legal owners or designated representatives to complete mandatory MAP-21 training to ensure they have comprehensive knowledge of FMCSA regulations, safety standards, and fraud prevention strategies. This ensures that the individual responsible for the company understands and complies with all applicable rules.
• Statutory Reference: MAP-21 training is required under 49 U.S.C. § 13904 (broker registration) and 49 U.S.C. § 31144 (safety fitness of motor carriers).
• Training Content: FMCSA Regulatory Compliance: Training will cover essential regulations, including 49 CFR Part 365 (registration rules), 49 CFR Part 391 (driver qualifications), 49 CFR Part 395 (hours of service), and 49 CFR Part 396 (vehicle maintenance). Fraud Prevention: Focused training on preventing double brokering, identity theft, and other fraudulent activities. New Entrant Audit and Safety Rating Preparation: Instruction on how to prepare for audits and how to maintain compliance with FMCSA regulations.
• Examination: After completing the training, participants must pass an in-person exam to demonstrate their understanding of FMCSA regulations, compliance responsibilities, and fraud prevention strategies.
• Training and Examination Locations: The training and exam may be conducted at IDEMIA enrollment centers or other designated locations to ensure efficient and consistent delivery of the program. At the Examiner’s Discretion: The MAP-21 training and exam may also be conducted at the registrant’s principal place of business, as listed with the FMCSA, to ensure the responsible party is deeply familiar with the specific operations of the company they represent.
• Process and Timeline: New Applicants: Must complete the MAP-21 training and exam within 30 days of receiving their TWIC card. Existing Registrants: Must complete the training within 6 months of the rule’s implementation. Any change in ownership or representation requires the new individual to complete the training within 30 days.

3. New Entrant Safety Audit and Safety Rating Issuance

• Objective: To ensure that all new applicants undergo a New Entrant Safety Audit BEFORE receiving DOT Number and FMCSA Operating Authority and that all registrants are issued a Safety Rating to obtain or maintain Operating Authority.
• Statutory Reference: The New Entrant Audit and Safety Rating are governed by 49 U.S.C. § 31144 and 49 CFR Part 385.
• Audit Content: Driver Qualification Files: Verifying compliance with 49 CFR Part 391 to ensure drivers meet FMCSA standards. Hours of Service: Ensuring compliance with 49 CFR Part 395 to reduce driver fatigue. Insurance Verification: Ensuring compliance with 49 CFR Part 387 for required insurance coverage. Vehicle Maintenance: Ensuring vehicles meet safety standards under 49 CFR Part 396. Drug and Alcohol Testing: Ensuring compliance with 49 CFR Part 40 for required drug and alcohol testing.
• Safety Ratings: Satisfactory: Full compliance with FMCSA regulations. Conditional: Minor violations requiring correction. Unsatisfactory: Significant violations that may result in suspension of operating authority.
• Audit Locations: Audits may be conducted at IDEMIA centers or FMCSA-designated locations. At the Examiner’s Discretion: The New Entrant Safety Audit and Safety Rating Issuance may be conducted at the registrant’s principal place of business, as listed with FMCSA, allowing for on-site verification of compliance processes.
• Process and Timeline: New Applicants: Must complete the New Entrant Audit within 45 days of the TWIC card issuance and training completion, with audits finalized within 60-120 days. Existing Registrants: Must complete the Safety Rating Issuance Audit within 12 months of the rule’s implementation. Any change in ownership or representation requires the new individual to complete the audit within 60 days.

III. Cost Breakdown and Financial Considerations

To ensure compliance with this framework, the following costs are associated with each component:

1. TWIC Card Issuance

• Cost per TWIC Card: $125.25 (includes biometric verification, background checks, and card issuance) For FIVE YEARS! The TWIC Card and DOT Number Must be Renewed Every 5 Years
• Frequency: One-time cost unless the card expires or ownership changes

2. MAP-21 Training and Examination

• Training and Exam Cost: Estimated at $500-$700 per applicant
• Frequency: One-time cost unless there is a change in ownership or representation

3. New Entrant Audit and Safety Rating

• Audit Cost: Estimated at $300-$500 per company
• Frequency: Required for all new entrants; existing companies must undergo initial audit if they do not have a safety ratine and then required periodic audits

4. Overall Registration Cost

• Current FMCSA Operating Authority Filing Fee: $300 This fee has remained unchanged for many years.? This will need to change. The TWIC card issuance, MAP-21 training, and New Entrant audit will be integrated into the existing FMCSA registration fee structure. This means no additional cost to taxpayers, as the costs will be fully covered by the applicants through the registration process.

IV. Rollout Plan for the Initiative

1. Pilot Program and Phased Implementation (Year 1)

• Pilot Phase: FMCSA will launch a pilot program in key transportation hubs to test the TWIC card issuance, MAP-21 training/examination, and New Entrant/Safety Rating audits.
• Feedback and Adjustments: Feedback from participants will be used to refine the process before full implementation.
• Milestone 1: Pilot launched within 6 months of rule finalization.

2. Nationwide Rollout (Year 2)

• Nationwide Expansion: The program will be expanded to all 300+ IDEMIA enrollment centers for nationwide compliance.
• Public Awareness Campaign: FMCSA will work with industry groups like the American Trucking Associations (ATA), Broker-Carrier Summit (BCS), Owner-Operator Independent Drivers Association (OOIDA) and Transportation Intermediaries Association (TIA) to inform stakeholders.
• Milestone 2: Full nationwide rollout completed within 12 months of the pilot phase.

3. Full Compliance for Existing Registrants (Year 3)

• Mandatory Compliance: By the end of Year 3, all FMCSA-regulated entities must complete the TWIC card process, MAP-21 training, and required audits.
• Ongoing Monitoring: FMCSA will continuously monitor compliance and adjust as needed.
• Milestone 3: Full compliance achieved by Year 3.

V. Rulemaking and Legislative Process

• Statutory Authority: FMCSA will issue regulations under 49 U.S.C. §§ 31136, 31144, and 13904 to govern the registration, safety, and compliance of motor carriers, brokers, and forwarders. TWIC card issuance will be governed by TSA under the Maritime Transportation Security Act (MTSA).

Detailed Rulemaking Process:

1. Administrative Procedures Act (APA) Requirements: FMCSA will follow the Administrative Procedures Act (APA), which requires that all new regulations go through a transparent rulemaking process. The APA mandates: Notice of Proposed Rulemaking (NPRM): The proposed rule will be published in the Federal Register, inviting public comments. Public Comment Period: A 60-day public comment period will be provided, during which stakeholders, industry professionals, and the general public can provide feedback on the proposed regulations. Final Rule: After reviewing and incorporating feedback from the public comments, FMCSA will finalize and publish the rule.
2. Paperwork Reduction Act (PRA) Compliance: FMCSA will conduct an analysis to ensure that the collection of data related to TWIC card issuance, training, and audits minimizes the burden on businesses and complies with the Paperwork Reduction Act (PRA). This will include an assessment of the administrative workload placed on companies and the government.
3. Cost-Benefit and Regulatory Flexibility Analysis: Under Executive Order 12866, FMCSA will be required to conduct a cost-benefit analysis to ensure that the economic impact of the rule is justified. This analysis will compare the cost of implementing TWIC cards, training, and audits against the benefits of fraud prevention, improved compliance, and enhanced safety. Additionally, FMCSA will conduct a Regulatory Flexibility Act analysis to evaluate how the rule impacts small businesses and explore options to mitigate potential burdens.
4. Final Rule Publication: The final rule will be published in the Federal Register with all supporting analyses, including the cost-benefit and paperwork reduction analysis.
5. Congressional and Legislative Support: FMCSA will seek congressional support for any statutory amendments needed to enforce the TWIC card requirement, MAP-21 training, and New Entrant Audits.

VI. Conclusion: A Robust Future for Compliance and Fraud Prevention

This comprehensive framework ensures that all new and existing FMCSA-regulated entities meet high standards for identity verification, training, and auditing. By integrating the TWIC card, MAP-21 training, and New Entrant Audits into the FMCSA registration process, the system will prevent fraud, ensure safety, and enhance accountability.

Through phased implementation, strong rulemaking, and ongoing oversight, this initiative will set a new standard for compliance and security in the freight industry, ensuring a future of trust, integrity, and operational safety for all stakeholders. By Year 3, the freight industry will have transformed, reducing fraud and increasing safety and compliance to an unprecedented level.