SPECIAL REPORT: Truckers and brokers on board with reform bill

By David Tanner, Land Line associate editor | 6/11/2010

Friday, June 11, 2010 – Two U.S. senators have filed legislation that raises the bar for brokers and increases the broker bond from $10,000 to $100,000.

On board with the reform proposal are two unlikely allies: OOIDA and the Transportation Intermediaries Association, the trade association that represents brokers. Both organizations worked closely with U.S. Sen. Olympia Snowe, R-ME, and her co-sponsor, Sen. Amy Klobuchar, D-MN.

Snowe filed the bill on Friday, June 11. A summary of major provisions appears below.

For years, OOIDA and TIA have stood on opposite sides of many issues. But middle ground has been reached on the need for reform through federal legislation.

OOIDA Director of Legislative Affairs Mike Joyce explains how the two organizations reached the agreement.

“OOIDA members, Land Line readers, and Land Line Now listeners for the past several years have had a front row seat to the intense debate between our respective organizations,” Joyce said.

“Often, when conflicting organizations are fighting over legislation, members of Congress feel as though they are getting pulled in different directions. Compromise moves out of reach.

“For every powerful member of Congress who supports our cause, the other side can convince another powerful member to join their cause. Lawmakers prefer to ask the competing organizations to work together to resolve the dispute.”

As a result, the organizations began a dialogue, laying out positions in a straightforward and candid manner, he said.

That allowed Sens. Snowe and Klobuchar to write specific provisions into their proposal that are agreeable between OOIDA and TIA.

If passed the legislation would:

  • Increase the broker bond from $10,000 to $100,000 and expand that bond requirement to freight forwarders.
  • Increase requirements and disclosures for any person or company seeking to obtain broker or freight forwarder authority.
  • Establish significant penalties for violations of broker regulations, including unlimited liability for freight charges for conducting brokerage activities without a license or bond.
  • Create a requirement for brokers and freight forwarders to renew their operating authority annually and require FMCSA to revoke operating authority that is not renewed annually. Revenue generated from the renewal fees will be dedicated to FMCSA’s oversight and enforcement of broker regulations.
  • Establish strict guidelines on companies who provide brokers with surety bonds and on how they administer bonds.
  • Clarify that trucking companies must have a broker’s or freight forwarder’s license and an appropriate bond in addition to their motor carrier operating authority to arrange freight for another carrier for compensation.

“If passed, this law would put a stop to a system that allows rogue brokers and scam artists to operate unchecked,” said OOIDA Executive Vice President Todd Spencer. “For too long, bad brokers have gotten away with ripping off truckers.”

Copyright © OOIDA