ISSUES PERTAINING TO THE PROPOSED 

NAFTA CROSS-BORDER TRUCKING 

DEMONSTRATION PROJECT 

Federal Motor Carrier Safety Administration 

Report Number: MH-2007-065 

Date Issued: September 6, 2007 
U.S. Department of 

Memorandum

Transportation 

Office of the Secretary 

of Transportation 

Office of Inspector General 

Subject: ACTION: Issues Pertaining to the Proposed 

NAFTA Cross-Border Trucking Demonstration 

Project 

Federal Motor Carrier Safety Administration 

Report Number MH-2007-065 

Date: September 6, 2007 

From: Rebecca Anne Batts 

Acting Assistant Inspector General 

 for Surface and Maritime Programs 

Reply to 

Attn. of: JA-40 

To: Federal Motor Carrier Safety Administrator 

Since 1998, we have audited Federal Motor Carrier Safety Administration 

(FMCSA) programs related to the Cross Border Trucking provisions under the 

North American Free Trade Agreement (NAFTA). During this period, the 

Department of Transportation (DOT) and FMCSA have continually improved the 

programs established to address congressional pre-conditions for allowing 

Mexico-domiciled motor carriers to operate beyond the commercial zones1

 along 

the United States-Mexico border. FMCSA actions include increasing inspection 

capacity at the southern border crossings, developing and implementing policies 

for taking enforcement actions against Mexican motor carriers, and establishing 

integrated and accessible data systems with state and Mexican officials. 

On February 23, 2007, the Secretary of Transportation announced a 1-year 

demonstration project (also referred to as a pilot program) that would permit up to 

100 Mexican motor carriers to begin operating beyond the commercial zones. 

According to the Department, the demonstration project will start when the first 

Mexican carrier is granted provisional operating authority by FMCSA to operate 

throughout the United States. The demonstration project will not include carriers 

that transport hazardous materials or passengers. In addition, for each time a 

demonstration project participant crosses the border into the United States, the 

Department has committed to checking the driver’s license and the inspection 

 

1

 Commercial zones at the southern border generally extend from 3 to 25 miles north of U.S. border municipalities (or 

75 miles within the State of Arizona). Our audit also refers to the operation of Mexico-domiciled motor carriers 

outside of these zones as “long-haul” operations. 

i
decal on the vehicle. In announcing the project, the Department referred to this 

process as checking “every truck every time.” 

Section 6901 of the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and 

Iraq Accountability Appropriations Act, 20072

 requires the Office of Inspector 

General (OIG) to review FMCSA’s preparations for monitoring and enforcing 

safety rules among the demonstration project participants. This report presents the 

results of our initial audit on the demonstration project. According to Section 

6901, prior to the start of the demonstration project, the Secretary is to take such 

actions as may be necessary to address the issues raised in our report and submit a 

report to Congress detailing such actions. 

Our audit objectives, based on Section 6901 provisions, were to determine 

whether FMCSA has: 

1. established sufficient monitoring and enforcement mechanisms to ensure that 

Mexican motor carriers that are granted provisional operating authority 

comply with U.S. Federal motor carrier laws and regulations and 

requirements associated with the demonstration project. 

2. complied with each of the requirements contained in Section 350(a) of the 

Department of Transportation and Related Agencies Appropriation Act, 2002 

(FY 2002 Act).3

3. established sufficient mechanisms to ensure that provisional operating 

authority is only granted to motor carriers domiciled in Mexico that can 

comply with U.S. Federal motor carrier laws and regulations and 

requirements associated with the demonstration project. 

In assessing FMCSA’s mechanisms for granting provisional operating authority to 

Mexican motor carriers and for monitoring and enforcing compliance with U.S. 

laws and regulations, we based our conclusions on a review of documentation, 

interviews with Federal and state officials, direct observation at selected border 

crossings, and our prior audit work. However, until FMCSA initiates the 

demonstration project, we will not be able to fully test whether the mechanisms 

are, in fact, operating effectively. 

We conducted this performance audit from June 2007 through August 2007 with 

the majority of fieldwork and interviews conducted in June and July. This audit 

was conducted in accordance with Generally Accepted Government Auditing 

Standards as prescribed by the Comptroller General of the United States. We 

 

2

 Pub. L. No. 110-28 (2007). 

3

 Pub. L. No. 107-87 (2001). 

ii
performed such tests as considered necessary to detect fraud, waste, and abuse. 

Exhibit A further details our audit scope and methodology and prior audits. 

RESULTS IN BRIEF 

Our review found that FMCSA has implemented significant initiatives to address 

Section 350 requirements and cross-border safety concerns. The established 

mechanisms for monitoring and enforcing U.S. safety rules and regulations, such 

as conducting truck inspections at the border and throughout the United States, 

continue to function. Additionally, FMCSA has established mechanisms for 

monitoring Mexican carriers and drivers within the United States. It has also 

taken actions to address our August 2007 report4

 recommendations regarding 

improving data consistency for Mexican driver convictions in the United States. 

The Agency is also now reviewing Mexican carriers on site in Mexico and 

performing these reviews in accordance with their regulations. Finally, although 

not required by Section 350, FMCSA has reviewed Mexican drug and alcohol test 

specimen collection facilities. 

Despite FMCSA’s significant accomplishments in implementing Section 350 

requirements and addressing cross-border safety concerns, we identified three 

issues pertaining to the proposed demonstration project. Specifically: 

• FMCSA has not developed and implemented complete, coordinated plans for 

checking trucks and drivers participating in the demonstration project as they 

cross the border. Without having site-specific plans in place and fully 

coordinated with U.S. Customs and Border Protection (CBP) and the states, the 

Department’s commitment to check every demonstration project truck every 

time it crosses the border into the United States is at risk. These checks are 

important because they are intended to ensure that drivers entering the country 

are properly licensed and that trucks entering from Mexico display a decal 

denoting a recent safety inspection. 

• FMCSA needs to take further action so that state enforcement officials 

understand how to implement recent demonstration project guidance for areas 

such as testing English language proficiency among drivers and ensure that 

training initiatives filter down to the roadside inspectors. 

• FMCSA has implemented policies, rules, and regulations that differ slightly 

from the language in 3 of 34 specific Section 350(a) requirements. The most 

significant of these variations limits inspections of vehicles during on-site 

 

4

 OIG Report Number MH-2007-062, “Follow-Up Audit on the Implementation of the North American Free Trade 

Agreement’s Cross-Border Trucking Provisions,” August 6, 2007. OIG reports can be found on our website: 

www.oig.dot.gov. 

iii
safety audits to those trucks that are available at the time of the review. 

However, we have not identified any safety impacts arising from these 

differences if the controls cited by FMCSA, particularly checking every truck 

every time for an inspection decal, are put in place. 

Further details on our review are provided in exhibit B. 

Although we are making no formal recommendations, in our view, the Secretary’s 

report to Congress prior to the initiation of the demonstration project should at a 

minimum include actions being taken to: 

• Ensure that sufficient plans are in place to carry out the Department’s 

commitment to check every demonstration project truck every time it crosses 

the border into the United States during the demonstration project. 

• Ensure that state enforcement officials understand how to implement recent 

demonstration project guidance for areas such as testing English language 

proficiency among drivers and that training initiatives filter down to the 

roadside inspectors. 

• Address our determination that FMCSA has implemented policies, rules, and 

regulations that differ slightly from the language in 3 of 34 specific Section 

350(a) requirements. 

Now that we have issued our report to the Secretary on the proposed 

demonstration project, if the Secretary elects to initiate the project following her 

report to Congress, we will be required under Section 6901 to monitor and review 

the demonstration project and submit an interim and final report to the Secretary 

and the Congress. 

SUMMARY OF AGENCY COMMENTS AND OFFICE OF 

INSPECTOR GENERAL RESPONSE 

We provided FMCSA with a draft of this report on August 27, 2007. On 

August 27, 2007, FMCSA provided us with its formal comments (see page 31). In 

its comments, FMCSA stated that it will submit a report to Congress detailing the 

actions the Agency is taking to address each of the three issues we raised in this 

report. 

#

iv
TABLE OF CONTENTS 

ISSUES .................................................................................................. 1

FMCSA Has Not Developed Sufficient Plans for 

Checking Every Truck Every Time.................................................... 1

FMCSA Needs To Take Further Action so That State 

Enforcement Officials Understand How To Implement 

Recent Demonstration Project Guidance.......................................... 2

FMCSA Has Implemented Policies and Rules That 

Differ Slightly From the Language in the Section 350(a) 

Requirements .................................................................................... 5

DATA NEEDED TO EVALUATE THE DEMONSTRATION 

PROJECT .............................................................................................. 7

EXHIBIT A. OBJECTIVES, SCOPE, AND 

METHODOLOGY AND PRIOR OIG AUDITS ....................................... 9

EXHIBIT B. FURTHER DETAILS ON OUR REVIEW ........................ 14

EXHIBIT C. OIG QUESTIONS FOR THE EVALUATION 

PANEL ................................................................................................. 23

EXHIBIT D. MAJOR CONTRIBUTORS TO THIS 

REPORT .............................................................................................. 30

APPENDIX A. FMCSA MANAGEMENT COMMENTS ...................... 31

APPENDIX B. PUBLIC LAW 107-87, SECTION 350(a).................... 32
1

ISSUES 

FMCSA Has Not Developed Sufficient Plans for Checking Every Truck 

Every Time 

FMCSA has not developed and implemented complete, coordinated plans for 

checking trucks and drivers participating in the demonstration project as they cross 

the border. Without having site-specific plans in place and fully coordinated with 

CBP and the states, the Department’s commitment to check every demonstration 

project truck every time it crosses the border into the United States is at risk. 

These checks are important because they will review the driver’s license to ensure 

that the vehicle is driven by a licensed driver and that the truck has an inspection 

decal issued by the Commercial Vehicle Safety Alliance (CVSA). These decals 

show that the vehicle received a safety inspection in the last 3 months. If the 

vehicle lacks the decal, a safety inspection is required before the truck enters the 

United States. 

On June 26 and June 28, 2007, we directly observed inspections at three highvolume United States-Mexico border crossings: Otay Mesa, California, and the 

Ysleta and Bridge of the Americas ports of entry in El Paso, Texas5

 (see figure 1 

on next page). We observed that FMCSA’s established monitoring and 

enforcement mechanisms were in place. However, neither FMCSA nor CBP had 

issued site-specific guidance on how they would ensure that every demonstration 

project truck would be checked every time. FMCSA officials on site in El Paso 

offered their plan to accomplish this task; this included positioning staff near 

compound exits to identify project trucks, which will have a DOT number ending 

in an “X.” This screening will need to be done visually at the border crossing 

because an automated screening system used by CBP cannot currently identify 

project participants. However, at the time of our visits, there was no indication 

that CBP or the states would allow placement of staff to conduct such visual 

screening, as planned by FMCSA. In addition, no automated system was in place 

to identify demonstration project participants at the crossings. 

 

5

 From January 2006 through July 2006, DOT reported 448,552 truck crossings at El Paso, Texas, and 427,994 truck 

crossings at Otay Mesa, California. 

Issues 
2

Figure 1. Long Lines of Trucks Waiting To Enter the United States 

From Mexico 

Trucks at the El Paso/Ysleta, Texas border crossing (June 2007, OIG) 

After our visits, FMCSA and CBP agreed to develop a plan to check every truck 

every time, but, as of July 2007, no coordinated, site-specific plans to carry out 

such checks were in place. FMCSA stated that it would have plans outlined by 

August 22, 2007, but we have not received any outlines or completed plans. In 

our opinion, not having site-specific plans developed and in place prior to 

initiating the demonstration project will increase the risk that project participants 

will be able to avoid the required checks. Site-specific plans should ensure 

coordination among FMCSA, CBP, and state officials. Additionally, these plans 

should include quality control measures to ensure that FMCSA’s system for 

checking each demonstration project truck is effective. 

FMCSA Needs To Take Further Action so That State Enforcement 

Officials Understand How To Implement Recent Demonstration 

Project Guidance 

Since state enforcement officials conducted approximately 3.1 million vehicle and 

driver inspections in FY 2006 to enforce motor carrier safety rules, it is essential 

that these officials understand how to implement demonstration project 

requirements. Our interviews of key state enforcement officials between 

June 22 and August 1, 2007, identified a general readiness to enforce safety rules 

during the demonstration project. However, a number of concerns related to 

specific elements of the project were expressed by state officials. The officials 

also noted areas where state procedures related to the demonstration project were 

not in place. FMCSA issued guidance for some of these areas after our interviews, 

Issues 
3

but it still needs to address all the concerns and guidance issues raised in order to 

provide assurance that demonstration project requirements will be met. 

Concerns Expressed by State Officials: We interviewed state officials 

responsible for coordinating motor carrier safety programs (state Motor Carrier 

Safety Assistance Program coordinators) in 49 states6

 and the District of 

Columbia. Officials from 44 of the 50 states said that state inspectors were ready 

to enforce safety rules during the demonstration project. Of the remaining states, 

five officials stated that they were not ready to enforce these requirements and one 

did not respond. Twenty-six of the 50 state officials expressed 1 or more concerns 

as shown in figure 2 below. 

Figure 2. State Motor Carrier Safety Assistance Program Coordinator 

Areas of Concern 

7

1

1

1

3

3

6

10

0 2 4 6 810

OTHER

DECALS

SECURITY

IMMIGRATION

ENFORCEMENT

DATABASE

OUT-OF-SERVICE

ENGLISH LANGUAGE

Number of State Officials

12

Source: OIG analysis of states’ responses to OIG interviews conducted from June 22 to August 1, 2007 

As figure 2 shows, the most common concern, cited by 10 of the 50 states, was 

whether Mexican drivers would be able to sufficiently communicate with 

enforcement officials in English. For example, one official was concerned that a 

Mexican driver would not be able to understand directions when an inspector is 

underneath his vehicle and another was concerned about being able to discuss 

carrier ownership questions with the driver. 

 

6

 Hawaii was excluded from our interviews, and, for the purposes of this report, the District of Columbia is treated as a 

state. 

Issues 
4

State Procedures Lacking To Implement the Demonstration Project: Officials 

in some states reported that state procedures specifically related to the 

demonstration project were not in place. For example, Mexican carriers involved 

in the demonstration project are prohibited from transporting goods from one point 

in the United States to another location within the United States. Despite this, 

officials in seven states said they did not have procedures in place for enforcing 

restrictions on point-to-point deliveries within the United States. 

FMCSA Guidance and Training: After we began our interviews with state 

enforcement officials, FMCSA issued guidance on English language proficiency, 

prepared educational materials on point-to-point restrictions, and planned further 

training related to a number of the states’ concerns. However, FMCSA needs to 

ensure that states’ concerns about English language proficiency and point-to-point 

transportation have been resolved and that training filters down to roadside 

officials who must enforce motor carrier safety regulations during the 

demonstration project. Specifically: 

•

•

 

With regard to English language proficiency, Federal rules7

 require drivers to 

read and speak the English language sufficiently to converse with the general 

public, understand highway traffic signs and signals in the English language, 

respond to official inquiries, and make entries on reports and records. To 

reinforce this regulation, FMCSA issued guidance on July 20, 2007, on English 

language proficiency, which states that the inspector must conduct the 

interview of the driver in English. The guidance also includes minimum 

inquiries for the interview. In addition, the guidance provides strategies for 

communication with non-native speakers of English, including examples of 

driver interview questions, and instructs the inspector to place a driver out of 

service for failing the test. FMCSA should monitor implementation of this 

guidance so that the states’ concerns are addressed and the guidance is 

consistently implemented by state officials. 

With regard to point-to-point restrictions, Federal rules8

 prohibit Mexicodomiciled motor carriers from providing point-to-point transportation services, 

including express delivery services, within the United States for goods other 

than international cargo. The transportation of domestic freight between points 

in the United States is known as “cabotage.” Therefore, a demonstration 

project carrier providing point-to-point transportation services in the United 

States is operating beyond the scope of its provisional operating authority and 

must be placed out of service. During June 2007, FMCSA, assisted by CVSA, 

authored a brochure detailing cabotage rules, regulations, and procedures that 

7

 49 C.F.R. § 391.11(b)(2) (2006). 

8

 49 C.F.R. § 365.501(b) (2006) and 67 FR 71795 (November 27, 2002). 

Issues 
5

enforcement officers can use to identify cabotage violations. As of 

August 16, 2007, this brochure had not been distributed to state officials. 

•

 

With regard to training, in August 2007, FMCSA plans to provide “train-thetrainer” instruction through the International Association of Chiefs of Police 

and CVSA for state commercial vehicle enforcement officers. According to 

CVSA, the training is designed to inform uniformed state patrol officers of the 

requirements for entry of commercial vehicles into the United States from 

Canada and Mexico. It also is designed to provide information on required 

driver and vehicle documentation as well as resources available from Federal 

and state commercial vehicle enforcement agencies. FMCSA should take 

appropriate follow-up action so that this training filters down to the roadside 

inspectors responsible for enforcing safety rules throughout the United States. 

In summary, FMCSA has provided or prepared guidance and has begun working 

toward training state enforcement officials. However, it should develop a 

mechanism to obtain feedback on the success of current training and guidance 

activities. Without such a mechanism, FMCSA cannot ensure that critical 

information reaches the roadside inspectors who must enforce Federal safety rules 

during the demonstration project and that the states’ concerns expressed to us are 

resolved. 

FMCSA Has Implemented Policies and Rules That Differ Slightly From 

the Language in the Section 350(a) Requirements 

We verified that FMCSA implemented 31 of the 34 specific provisions we 

identified9

 in Section 350(a) of the FY 2002 Act. These provisions established 

pre-conditions for processing applications from Mexican carriers to operate 

beyond the commercial zones. For the three remaining provisions, FMCSA 

implemented policies and interim final rules that differ slightly from the language 

in the Section 350(a) requirements. However, our present audit work does not 

identify any safety impacts arising from these differences if the controls cited by 

FMCSA, particularly checking every truck every time for an inspection decal, are 

put in place and operate effectively. The 34 requirements we identified are 

provided in appendix B. The three provisions where differences with Section 

350(a) were identified are discussed below. 

9

 We identified 34 distinct requirements from among the 10 sub-sections of Section 350(a). 

Issues 
6

Vehicle Inspections During Pre-Authorization Safety Audits (PASA): While 

Section 350(a)(1)(B)(vi) requires a PASA inspection10 of Mexican vehicles 

without an inspection decal, the FMCSA interim final rule11 limits such 

inspections to “available vehicles.” FMCSA officials provided three reasons for 

this difference: 

•

•

•

 

FMCSA officials stated that it is an essentially meaningless requirement to 

inspect all vehicles during the PASA because Section 350 does not require that 

the vehicles pass inspection and receive a decal at the time of the PASA in 

order for the carrier to obtain provisional operating authority. We confirmed 

that although vehicles were inspected during the PASA, Section 350 does not 

make the award of provisional operating authority contingent on all of the 

carriers’ vehicles passing inspection during the PASA. In addition, carriers are 

not restricted to using only those vehicles inspected during the PASA for the 

demonstration program. 

FMCSA officials stated that it is unrealistic to expect Mexican carriers to have 

every vehicle that they intend to use beyond the border zone available during 

the PASA and to have FMCSA inspectors spend prolonged periods at the 

facility. This FMCSA position was challenged by one commentator on the 

March 2002 interim final rule implementing the Section 350(a) requirement. 

The commentator questioned limiting inspections to available trucks simply to 

make the inspections more convenient for the FMCSA auditors or Mexican 

applicants. Because FMCSA has not yet finalized this rule and addressed the 

comments, it has not provided its rationale to the public for limiting 

inspections to available vehicles during the PASA. 

FMCSA officials emphasized that the key vehicle inspection occurs at the 

border. Our present audit work does not identify any safety impacts resulting 

from limiting inspections during the PASA to available trucks if the 

coordinated, site-specific plans to implement decal checks for every 

demonstration project truck every time it enters the United States are in place 

and working effectively and if states exercise adequate oversight of decals they 

receive from CVSA.12 The state agencies are responsible for ensuring that 

decals are safeguarded and used properly. 

10 The PASA is a FMCSA review conducted at the motor carrier’s principal place of business, in which the motor 

carrier must demonstrate that it has: (1) a controlled substance and alcohol testing program, (2) a system for 

complying with hours-of-service requirements, (3) proof of insurance, (4) records of periodic inspections of vehicles 

for use in the United States, and (5) qualified drivers for U.S. operations. After these are verified, FMCSA officials 

then perform vehicle inspections and verify whether the motor carrier can comply with Federal regulations. 11 67 FR 12702, 12715 (March 19, 2002). 

12 According to CVSA, in calendar year 2006, it provided states with approximately 1.8 million decals and Mexican 

authorities with 200 decals. CVSA told us that it distributes tamper-resistant serialized decals to state agencies for 

certified inspectors to place on vehicles that have passed inspection. 

Issues 
7

Border License Checks of Drivers Working for Mexican Carriers: FMCSA 

policy implementing the Section 350(a)(3) requirement to electronically verify the 

status and validity of each Mexican commercial vehicle driver’s license crossing 

the border specifies license checks for only those drivers domiciled in Mexico. 

Strictly interpreted, this policy would not include Mexican commercial vehicle 

drivers who are domiciled outside of Mexico. However, since the automated 

system FMCSA has in place for inspectors to check commercial driver licenses 

can access data for drivers domiciled in either the United States or Mexico, our 

present audit work does not identify any impact on the operation of the safety 

program resulting from this difference. 

Safety Rules for Longer Combination Vehicles: The FMCSA rule 

implementing Section 350(a)(1)(B)(v) has not been updated to include all safety 

rules that currently apply to Mexican carriers. In 2002, FMCSA defined the safety 

rules relevant to Mexican motor carriers as 49 C.F.R. Parts 382 through 399. In 

2004, FMCSA promulgated Part 380, which establishes minimum requirements 

for operators of longer combination vehicles and their instructors.13 While this 

rule is not specifically mentioned in FMCSA guidance for conducting the PASA, 

we confirmed that the application process emphasizes the applicant must comply 

with all safety rules. This includes a requirement for a certification by Mexican 

carriers that they understand and will comply with all current Federal Motor 

Carrier Safety Regulations, Hazardous Material Regulations, and Federal Motor 

Vehicle Safety Standards. Therefore, our present audit work does not identify any 

impact on the operation of the safety program resulting from this difference. 

DATA NEEDED TO EVALUATE THE DEMONSTRATION PROJECT 

This initial audit does not examine whether FMCSA has established sufficient 

mechanisms to determine if the demonstration project will adversely affect motor 

carrier safety or the issue of whether Mexican participants in the demonstration 

project are a representative sample of the Mexican motor carriers who would be 

expected to operate in the United States. These are issues we are required to 

address in future audits of the demonstration project, if it is initiated. We sent 

questions to FMCSA on May 4, 2007, which we thought might be relevant as the 

Department develops performance metrics and success criteria for the 

demonstration program. These questions are provided in exhibit C. 

Although we are making no formal recommendations, in our view, the Secretary’s 

report to Congress prior to the initiation of the demonstration project should at a 

minimum include actions being taken to: 

 

13 49 C.F.R. § 380 (2006). 

Data Needed To Evaluate the Demonstration Project 
8

• Ensure that sufficient plans are in place to carry out the Department’s 

commitment to check every demonstration project truck every time it crosses 

the border into the United States during the demonstration project. 

• Ensure that state enforcement officials understand how to implement recent 

demonstration project guidance related to areas such as testing English 

language proficiency among drivers and that training initiatives filter down to 

the roadside inspectors. 

• Address our determination that FMCSA has implemented policies, rules, and 

regulations that differ slightly from the language in 3 of 34 specific Section 

350(a) requirements. 

Data Needed To Evaluate the Demonstration Project 
9

EXHIBIT A. OBJECTIVES, SCOPE, AND METHODOLOGY AND 

PRIOR OIG AUDITS 

OBJECTIVES 

The objectives of this audit were to determine whether FMCSA has: (1) 

established sufficient monitoring and enforcement mechanisms to ensure that 

Mexican motor carriers that are granted provisional operating authority comply 

with U.S. Federal motor carrier laws and regulations as well as requirements 

associated with the demonstration project, (2) complied with each of the Section 

350(a) requirements contained in the FY 2002 Act, and (3) established sufficient 

mechanisms to ensure that provisional operating authority is only granted to motor 

carriers domiciled in Mexico that can comply with United States Federal motor 

carrier laws and regulations as well as requirements associated with the 

demonstration project. 

SCOPE AND METHODOLOGY 

This performance audit was conducted from June 2007 through August 200714 in 

accordance with Generally Accepted Government Auditing Standards as 

prescribed by the Comptroller General of the United States. We performed such 

tests as we considered necessary to detect fraud, waste, and abuse. 

Our work included a review of documentation, interviews with Federal, state, and 

Commercial Vehicle Safety Alliance personnel, and direct observations of vehicle 

inspections and safety reviews in the United States and Mexico. Further details on 

the scope and methodology are discussed below. 

Since Mexican carrier long-haul authority has not yet been granted, we could not 

fully test and analyze certain enforcement mechanisms focused on Mexican longhaul carriers that FMCSA has put in place to meet requirements. For example, in 

order to fully test how effectively roadside inspections conducted by state officials 

ensure that Mexican motor carrier vehicles meet U.S. Federal motor carrier laws 

and regulations after entering the United States, we would need actual data on the 

number of these inspections, the number and type of violations detected, and 

whether any corrective action was required. Since demonstration project trucks 

 

14 We conducted additional research between March 2007 and May 2007 in response to a March 7, 2007, request from 

the House Committee on Transportation and Infrastructure that addressed issues similar to those in Section 6901 of 

the U.S. Troop Readiness, Veterans’ Care, Katrina Recovery, and Iraq Accountability Appropriations Act, 2007. 

Exhibit A. Objectives, Scope, and Methodology and Prior OIG Audits 
10

have not yet been cleared to enter the United States, data on state roadside 

inspections involving these trucks does not exist.

Our audit of monitoring and enforcement mechanisms focused on mechanisms at 

the United States-Mexico border and on those in place throughout the United 

States. At the United States-Mexico border, we directly observed FMCSA and 

state operations at three major truck border crossings: Otay Mesa, California, and 

the Ysleta and Bridge of the Americas (BOTA) crossings in El Paso, Texas. At 

these locations, we observed the overall crossing operation and vehicle and driver 

inspections; observed inspection-related equipment; reviewed inspection reports 

and other available documentation; and interviewed officials from FMCSA, CBP, 

and the state to determine: (1) the current roles and procedures they used to permit 

the entry of Mexican motor carriers into the United States and their subsequent 

operations beyond the entry point, (2) the working relationships between border 

staff of the different agencies at each crossing, (3) inspection procedures and 

certifications, and (4) the degree to which specific demonstration project 

requirements have been put in place. In El Paso, we were accompanied by a 

safety expert with extensive law enforcement experience to provide technical 

assistance with our work. 

To determine the status of on-site protocols covering the screening of project 

trucks at each United States-Mexico border location, FMCSA use of CBP 

automated systems, and other issues related to coordination between FMCSA and 

CBP, we met with a CBP official in Washington, D.C. 

To understand the monitoring and enforcement mechanisms within the United 

States, we observed operations and inspections at a Virginia truck inspection 

station. Further, we interviewed lead motor carrier safety officials from 49 states 

(Hawaii was excluded from the interviews) and the District of Columbia to 

ascertain if they believed they were prepared to enforce demonstration project 

requirements and if they had any concerns with mechanisms for monitoring 

Mexican motor carriers with provisional operating authority and enforcement of 

safety rules. We also confirmed that systems and procedures have been 

established to monitor Mexican carrier operating authority violations and driver 

convictions. For Mexican carriers that are considered high risk, or required to go 

through an immediate review because they have committed certain violations, 

FMCSA plans to use a compliance review to determine whether provisional 

operating authority should continue. To gain a better understanding of these 

reviews, we observed the practices employed for a U.S. compliance review. 

We obtained and reviewed documentation to determine whether FMCSA 

complied with each of the Section 350(a) requirements included in the FY 2002 

Act (Public Law 107-87). We identified 34 distinct Section 350(a) requirements. 

Exhibit A. Objectives, Scope, and Methodology and Prior OIG Audits 
11

To determine whether FMCSA has established sufficient mechanisms to ensure 

that provisional operating authority is only granted to Mexico-domiciled motor 

carriers that can comply with Federal motor carrier safety laws and regulations and 

the project requirements, we reviewed the results from the 32 PASAs conducted 

by FMCSA between February 22 and May 8, 2007. Specifically, we compared the 

applications and safety audit reports to FMCSA rules and requirements established 

for the application process, including proper completion of the application, 

FMCSA review of the application, and the safety audit. We reviewed the 

applications these 32 carriers submitted for the project and the evidence of 

management oversight of the application review process. We also verified that 

FMCSA’s report of the safety audit had supporting documentation. We followed 

up with FMCSA on the 6 carriers, of the 32, that did not pass the safety audit to 

determine if the reasons for the failure were in accordance with FMCSA policy. 

As of August 13, 2007, FMCSA had completed a total of 50 PASAs. 

In July 2007, we observed two FMCSA pre-authorization safety audits performed 

in Ciudad Juarez and Tijuana, Mexico. We were accompanied by an independent 

expert with experience in United States and Mexico commercial trucking and 

safety enforcement. Additionally, we met with representatives from CVSA to 

obtain an understanding of their controls over CVSA truck inspection decals. We 

also assessed FMCSA controlled substance and alcohol testing mechanisms. We 

attended a FMCSA safety auditor training class covering how to assess Mexican 

motor carrier drug testing programs during the pre-authorization safety audit and 

observed a test facility in Nuevo Laredo, Mexico, and a mobile test facility 

operated by Mexico. 

After completing safety audits, and before provisional operating authority is 

granted, FMCSA is required to post for public comment the names of the accepted 

carriers in the FMCSA Register. We compared the carrier names in the 

applications and the completed safety audits for the 26 carriers who passed the 

PASA to the Mexican motor carrier names posted in FMCSA Register notices to 

ensure that this was done. We attempted to review public comments, but, 

according to FMCSA, none were provided for the carriers they posted. Finally, to 

determine whether FMCSA was performing a final insurance check of the carrier 

before issuing provisional operating authority in accordance with FMCSA policy, 

we assessed FMCSA’s process and use of the Licensing and Insurance System 

(L&I). However, we did not test the accuracy of the data insurance companies 

supplied to FMCSA through the L&I system. 

Results From Prior OIG Audits Used in This Audit 

We used the results from prior OIG audits, to the extent necessary, to gain an 

understanding of FMCSA mechanisms established in response to the FY 2002 Act 

Exhibit A. Objectives, Scope, and Methodology and Prior OIG Audits 
12

and to determine the status of any issues that could impact the announced project. 

Previous OIG reports issued in June 2002, May 2003, January 2005, and August 

2007 addressed eight criteria contained in Section 350(c) of the FY 2002 Act and 

issues found pertaining to Section 350(a) and (b) requirements and general border 

operation or truck safety. The eight criteria that we reviewed and that FMCSA 

must have in place are: 

• filling positions at the southern border with trained inspectors; 

• training inspectors to conduct on-site inspections; 

• filling positions by not transferring inspectors; 

• having an hours-of-service policy; 

• having sufficiently accurate, accessible, and integrated information 

infrastructure and adequate telecommunications links; 

• ensuring there is adequate capacity to conduct meaningful inspections at the 

southern border; 

• having sufficient databases to allow safety monitoring of Mexican carriers and 

drivers; and 

• having measures to ensure effective enforcement and monitoring of Mexican 

carrier licensing.

Our most recent report in August 2007 reported that despite FMCSA’s progress, 

additional improvements were needed in two of the Section 350(c) criteria. First, 

the system used to monitor Mexican commercial drivers’ license convictions, the 

52nd State System, still contained data inconsistencies. Second, at one highvolume Mexican bus crossing, physical space and capacity issues prevented 

inspections during high-volume holiday periods. Additionally, FMCSA had not 

issued additional guidance that would make it mandatory for inspectors to check 

the vehicle identification number to ensure that Mexican vehicles had complied 

with manufacturing safety standards and to record the vehicle identification 

number in inspection records. Finally, it was not clear whether the controls in 

place ensured that valid specimens for drug and alcohol testing were being 

collected before being sent to a certified laboratory. 

In its comments to the August 2007 report, FMCSA concurred with the report 

recommendations and proposed corrective actions, which we accepted. 

Specifically, FMCSA stated that it would ensure that all southern border states 

would complete action plans to improve data consistency. A monthly data report 

would be implemented to identify data inconsistencies and to notify the states of 

these inconsistencies. FMCSA also planned to modify its commercial bus 

inspection plan to ensure adequate coverage at the Lincoln-Juarez crossing in 

Laredo, Texas, during periods of peak bus traffic. In addition, it planned to 

conduct or contract for a review of the effectiveness of its commercial bus 

inspection plan. 

Exhibit A. Objectives, Scope, and Methodology and Prior OIG Audits 
13

FMCSA agreed to require its inspectors to look at the vehicle identification 

number for all long-haul, Mexico-domiciled carriers to check vehicle compliance 

with U.S. manufacturing standards and to record this information. FMCSA also 

stated it will revise its system software so that it will automatically remind its 

inspectors to enter the vehicle identification number. Finally, FMCSA agreed to 

establish an action plan, in coordination with DOT’s Office of Drug and Alcohol 

Policy and Compliance, to conduct audits of Mexico’s drug collection facilities 

and laboratories and to work with Mexico to meet U.S. requirements. 

Other OIG reports issued in this area include: 

• OIG Report Number MH-2005-032, “Follow-Up Audit of the Implementation 

of the North American Free Trade Agreement’s Cross-Border Trucking 

Provisions,” January 3, 2005. 

• OIG Report Number MH-2003-041, “Follow-Up Audit on the Implementation 

of Commercial Vehicle Safety Requirements at the U.S.-Mexico Border,” 

May 16, 2003. 

• OIG Report Number MH-2002-094, “Implementation of Commercial Vehicle 

Safety Requirements at the U.S.-Mexico Border,” June 25, 2002. 

• OIG Report Number MH-2001-096, “Motor Carrier Safety at the U.S.-Mexico 

Border,” September 21, 2001. 

• OIG Report Number MH-2001-059, “Status of Implementing the North 

American Free Trade Agreement’s Cross-Border Trucking Provisions,” 

May 8, 2001. 

• OIG Report Number TR-2000-013, “Mexico-Domiciled Motor Carriers,” 

November 4, 1999. 

• OIG Report Number TR-1999-034, “Motor Carrier Safety Program for 

Commercial Trucks at U.S. Borders,” December 28, 1998. 

Exhibit A. Objectives, Scope, and Methodology and Prior OIG Audits 
14

EXHIBIT B. FURTHER DETAILS ON OUR REVIEW 

This exhibit provides additional background on the Section 350 requirements and 

the OIG role. It also provides further details on our review of FMCSA’s 

monitoring and enforcement mechanisms for Mexican carriers and the 

demonstration project, FMCSA compliance with Section 350(a) of the FY 2002 

Act, and FMCSA’s mechanisms for granting operating authority to project 

participants. 

Background on Section 350 Requirements and the OIG Role 

With the signing of NAFTA in December 1992, the United States and Mexico 

consented to cross-border trucking throughout both countries by January 1, 2000. 

However, in December 1995, the U.S. Secretary of Transportation indefinitely 

delayed implementation of NAFTA cross-border provisions, citing safety reasons. 

Between FY 2002 and FY 2007, Section 350 of the FY 2002 Act and subsequent 

appropriation legislation prohibited FMCSA from using Federal funds to review or 

process Mexico-domiciled motor carrier applications to operate beyond the 

U.S. commercial zones until certain pre-conditions and safety requirements were 

met. Section 350 provisions, including the requirement for an annual review by 

our office and the Secretary’s certification of border operations, are summarized 

below. 

• Section 350 Pre-Conditions for Reviewing or Processing Mexican LongHaul Applications: FMCSA must meet a number of pre-conditions contained 

in Section 350(a) before it can review or process Mexican motor carrier 

applications to operate as a long-haul carrier beyond the municipal and 

commercial zones at the southern border. This includes requiring on-site 

safety reviews of motor carriers in Mexico in some instances. 

• Section 350 Pre-Condition for Vehicles To Haul Hazardous Materials: 

Section 350(b) restricts vehicles owned or leased by Mexican motor carriers 

from carrying hazardous materials beyond commercial zones until an 

agreement is reached between the United States and Mexico. This agreement 

must hold hazardous material drivers from both countries to substantially the 

same requirements. 

• S ction 350 OIG Review and Secretary Certification of Border 

Operations: Section 350(c) prohibits Mexican motor carriers from operating 

beyond the commercial zone under conditional or permanent authority granted 

by FMCSA until two events occur. First, the OIG must conduct a review 

e

Exhibit B. Further Details on Our Review 
15

within the first 180 days of the law’s enactment to verify whether or not eight 

criteria are met. These criteria relate to the hiring and training of inspectors, 

establishment of inspection facilities, and development of safety processes and 

procedures for Mexican long-haul motor carriers. Second, the Secretary of 

Transportation must certify, in a manner addressing the OIG’s findings, that 

opening of the border does not pose an unacceptable safety risk to the 

American public. 

at opening the border 

does not pose an unacceptable risk to the American public. 

ight criteria and other border operations issues covered under the 

FY 2002 Act. 

•

essed criteria relevant to the eight criteria that the 

OIG is required to review. 

•

ed an action plan in 

which it committed to make improvements in each area. 

Further information pertaining to our prior reports can be found in exhibit A. 

r Mexican 

The OIG issued the initial report under the Section 350(c) criteria in June 2002. In 

November 2002, the Secretary of Transportation certified th

Although Section 350(c) does not require the Secretary of Transportation to recertify the safety of opening the border after the initial certification, it does direct 

the OIG to perform annual reviews using the eight Section 350(c) criteria. The 

OIG issued follow-up reports in May 2003, January 2005, and August 2007 that 

addressed the e

Our January 2005 report concluded that FMCSA had sufficient staff, facilities, 

equipment, and procedures in place to substantially meet the eight 

Section 350(c) criteria. However, the report made nine recommendations to 

FMCSA, four of which addr

Our August 2007 report assessed the actions that FMCSA took in response to 

our January 2005 recommendations. We found that despite the progress 

FMCSA had made, further improvements were needed in four areas. These 

included improving the consistency of data used to monitor Mexican 

commercial driver convictions in the United States, ensuring adequate Mexican 

bus inspection coverage during busy periods, implementing a FMCSA policy 

to check and record vehicle identification numbers during an inspection, and 

coordinating with DOT offices to ensure that drug and alcohol testing issues 

are addressed. In response to our report, FMCSA provid

FMCSA’s Monitoring and Enforcement Mechanisms fo

Carriers and the Demonstration Project (Objective 1) 

As described by the Department in notices published in the Federal Register on 

May 1 and June 8, 2007, the demonstration project, if initiated, will include 

monitoring and enforcement mechanisms that FMCSA has already established, 

Exhibit B. Further Details on Our Review 
16

such as inspections at the border. We have addressed these mechanisms in our 

prior reports. However, the demonstration project plans have also highlighted a 

number of specific provisions for demonstration project participants, which 

include the following: 

• Each driver and vehicle entering the United States will be checked. 

• Each driver will be required to be proficient in the English language. 

• A carrier will not be permitted to transport hazardous materials. 

• A vehicle will not be permitted to transport passengers. 

• ot provide point-to-point transportation services within the 

ement officials understand 

demonstration project guidance. 

A carrier may n

United States. 

Given our prior audit work regarding the monitoring and enforcement mechanisms 

FMCSA already had in place before the announcement of the demonstration 

project, we focused our current work on determining whether FMCSA had 

implemented the specific provisions of the demonstration project. As discussed 

in the “Issues” section of this report (see page 1), we found that FMCSA has not 

developed sufficient plans for checking every demonstration project truck every 

time and has not done enough to ensure that state enforc

Figure 3. Inspection Facility in Otay Mesa, California 

that 

existing mechanisms, such as truck inspections at the border, remain in place. 

Source: OIG (June 2007)

Our work included direct observations and interviews with state officials (see 

figure 3) at judgmentally selected border crossings where we confirmed 

Exhibit B. Further Details on Our Review 
17

D

wh

• ocedures in place for inspectors to check for violations pertaining 

specifically to the demonstration project, including driver English proficiency, 

int (cabotage) 

violations; 

• rding the demonstration project; and 

tes reporting that they did not have procedures in place for 

enforcing restrictions on point-to-point deliveries within the United States 

included the District of Columbia, Florida, Georgia, Louisiana, New Mexico, 

ited States commercial zones until certain 

pre-conditions in Section 350(a) of the act were met. We identified 

34 requirements in Section 350(a) that FMCSA must follow. See appendix B for a 

list of the 34 requirements identified. 

uring our interviews with state officials throughout the country, we asked 

ether: 

• truck inspections will be conducted differently for Mexican-domiciled motor 

carriers participating in the demonstration project than for U.S. carriers; 

there are pr

transport of passengers or hazardous materials, and point-to-po

there are any concerns rega

• state truck safety inspectors are ready to enforce FMCSA regulations during 

the demonstration project. 

Our discussion in the “Issues” section of this report (see page 3) noted that 

officials from five states stated that they were not ready to enforce FMCSA safety 

rules for the demonstration project. These five states were Montana, Nebraska, 

Nevada, Rhode Island, and Utah. Maryland officials did not respond to this 

question. The seven sta

Utah, and Washington. 

FMCSA Compliance With Requirements in Section 350(a) 

(Objective 2) 

The FY 2002 Act and subsequent appropriation legislation prohibited FMCSA 

from using Federal funds to review or process Mexico-domiciled motor carrier 

applications to operate beyond the Un

Exhibit B. Further Details on Our Review 
18

Generally, Section 350(a) requires that FMCSA establish requirements for: 

• conducting pre-authorization safety audits of all Mexican motor carriers who 

apply for long-haul authority; 

• performing full safety compliance reviews of those carriers within 18 months 

of granting conditional operating authority; and 

• monitoring and enforcing activities such as inspecting Mexican vehicles, 

verifying operators’ licenses, and ensuring adequate capacity at border 

crossings. 

We examined FMCSA’s documentation and conducted additional research to 

determine if FMCSA had implemented all 34 requirements. As a result, we 

verified that FMCSA implemented 31 of these requirements. While FMCSA did 

address the three remaining requirements, which included definitions of safety 

regulations, vehicle inspections during on-site safety audits, and border license 

checks of drivers working for Mexican carriers, it did so in a manner that was 

slightly different from what Section 350(a) required. In the “Issues” section of the 

report (see pages 5 through 7), we discuss these differences. 

In determining that 31 of the 34 requirements were implemented, we based our 

determination for 1 provision, Section 350(a)(9), on information obtained from 

CBP, an agency not under our audit jurisdiction, and our prior audit coverage. 

Section 350(a)(9) calls for FMCSA to: 

require that commercial vehicles operated by a Mexican motor carrier 

[defined in Section 350 as carriers operating beyond the commercial zones] 

only enter the United States at commercial border crossings where and when 

a certified motor carrier safety inspector is on duty and where adequate 

capacity exists to conduct a sufficient number of meaningful vehicle safety 

inspections and place vehicles out-of-service. 

CBP has the authority to enforce the language in this provision regarding entry to 

the United States because it controls ports-of-entry for Mexican commercial 

vehicles. FMCSA provided us with a letter from CBP dated July 18, 2007, stating 

that “Mexican commercial vehicles with authority to operate beyond the 

commercial zones will be permitted to enter the United States only at commercial 

border crossings and only when a certified motor carrier safety inspector is on 

duty.” 

Our prior work has shown that buses, which are also commercial vehicles, are 

currently inspected at commercial truck crossings. Bus capacity issues identified 

in our previous work occurred at separate border crossings designated for buses. 

Exhibit B. Further Details on Our Review 
19

Given the July 2007 CBP commitment discussed above to limit Mexican 

commercial vehicles to manned commercial border crossings, we accepted the 

CBP action as complying with the requirement since it would restrict buses to the 

manned crossings. 

FMCSA’s Mechanisms for Granting Provisional Operating Authority 

to Mexican Carriers (Objective 3) 

FMCSA’s mechanisms for granting provisional authority to operate beyond the 

commercial zones at the United States-Mexico border are contained in its June 

2007 Federal register notice regarding the demonstration project and in earlier 

published rules and guidance. The primary mechanisms FMCSA established are 

the carrier application review process and the PASA. This includes a requirement 

for an on-site review at the applicant’s place of business in Mexico. Additionally, 

FMCSA relies on public comments regarding the Mexican carrier and a 

verification of carrier insurance coverage before provisional operating authority is 

granted. The following chart summarizes the process established by FMCSA. 

Figure 4. Process for Granting OP-1 (Long-Haul) Provisional 

Operating Authority 

FMCSA Reviews Application 

FMCSA Conducts Pre-Authorization Safety Audit (PASA) 

Provisional Operating Authority Is Granted 

Mexican Motor Carrier Submits Application 

Notice of Carrier’s Pending Authority Is 

Published in FMCSA Register

Opportunity Is Provided for Public Comment 

Insurance Coverage Is Verified 

Between February 22, 2007, and August 13, 2007, FMCSA conducted 50 preauthorization safety audits of Mexican carriers seeking provisional authority in the 

demonstration project. Our review covered 32 of the completed safety audit 

reports available at the start of our audit and the related application materials. 

Additionally, in July 2007, we observed two other pre-authorization safety audits 

Exhibit B. Further Details on Our Review 
20

conducted in Mexico. Based on our review, FMCSA has properly implemented 

the mechanisms it has established to grant provisional operating authority. 

Our review of 32 applications for provisional operating authority by Mexican 

motor carriers showed that each of the 32 applications met the basic guidelines 

established by FMCSA. The applications were complete, prepared in English, and 

included the necessary information on the number of trucks and drivers the 

company intended to operate in the United States during the project. 

The 32 pre-authorization safety audit reports we reviewed were supported with 

documentation and complied with the established procedures. Each safety audit 

addressed the five critical elements required by FMCSA for a carrier to pass the 

audit. These included: (1) a controlled substance and alcohol testing program, (2) 

a system for complying with hours-of-service requirements, (3) proof of insurance, 

(4) records of periodic inspections of vehicles for use in the United States, and (5) 

qualified drivers for U.S. operations. As a result of the FMCSA safety audit, 

FMCSA failed six carriers for not implementing one of the five critical elements, 

as follows (see table): 

Table. Carriers That Failed the Pre-Authorization Safety Audit 

Carrier Reason(s) Mexican Carrier Did Not Pass Safety Audit 

1 Drug and Alcohol Testing Program Not In Place 

2 Hours of Service Program Not In Place 

3 Drug and Alcohol Testing, Vehicle Inspection Programs Not In Place 

4 Drug and Alcohol Testing, Vehicle Inspection Programs Not In Place 

5 Vehicle Inspection Program Not In Place 

6 Hours of Service, Insurance, and Vehicle Inspections Programs Not In Place 

Source: OIG analysis of FMCSA data 

The 26 carriers that passed FMCSA’s PASA identified 140 commercial motorvehicles intended for U.S. operations. Of these, 78 vehicles (56 percent) were 

inspected by FMCSA during the PASA. Vehicles that passed the inspection 

received or retained a CVSA decal required to operate in the United States. 

Our July 2007 observations of two FMCSA pre-authorization safety audits in 

Mexico revealed that the pre-authorization safety audits were done in accordance 

with FMCSA procedures. Only one of the two safety audits we observed included 

inspections conducted under the North American Standard Level V (Vehicle Only) 

Inspection procedure since the other carrier we visited failed the verification phase 

and, consequently, FMCSA was not required to inspect its vehicles. 

Exhibit B. Further Details on Our Review 
21

Figure 5. Inspection of Mexican Applicant’s Vehicle During the PASA 

PASA at Carrier’s Facility in Ciudad Juarez, Mexico (July 2007, OIG) 

During the safety audit, we observed FMCSA efforts to verify data provided by 

the Mexican carriers using other available information. For example, FMCSA 

officials conducting the PASA: 

• used insurance company loss reports, vehicle repair records, driver 

qualification files and information from FMCSA’s database to identify 

accidents involving the motor carrier. 

• compared driver time sheets to U.S. vehicle inspections in order to uncover 

hours-of-service violations. 

• contacted the third-party consortium administering the drug and alcohol testing 

program and reviewed the contract and rate of testing for compliance with U.S. 

requirements.15 

• verified the licenses of the Mexican drivers identified for U.S. operations 

through a check of the FMCSA database that included status information on 

Mexican commercial driver’s license holders. 

While the FMCSA officials conducting the PASA took steps to verify the on-site 

data, we noted that certain information was not available to them. Specifically, 

information pertaining to vehicle inspections, accident reports, and driver 

violations maintained by Mexican authorities was not available to FMCSA unless 

such information was included in company records. A FMCSA official stated that 

either such information was not available from the Mexican authorities or the 

databases containing such information were still under development. 

While insurance information was verified during the safety audit, FMCSA 

guidance did not require, and the FMCSA officials conducting the PASA did not 

 

15 49 C.F.R. § 40 (2006). 

Exhibit B. Further Details on Our Review 
22

verify, that the Mexican carrier had insurance coverage for long-haul operations at 

the time of the safety audit. Instead, carriers were advised to obtain appropriate 

insurance coverage as a prerequisite for obtaining provisional authority. After the 

safety audit and prior to issuing provisional authority, FMCSA verifies the 

carrier’s insurance coverage through its L&I database. While our testing of the 

L&I database was limited, our observation of the system as it applies to U.S. 

carriers and an assessment of the most recent Certification and Accreditation for 

the L&I System done in conjunction with this audit, found no significant risks 

associated with the system. 

We also confirmed that mechanisms established to provide for public comments 

following a PASA through use of the FMCSA Register were in place. However, 

since no public protests had been filed against a Mexican carrier posted in the 

Register, and no long-haul authority has been granted under the demonstration 

project, we could not fully test FMCSA’s response to a protest and final 

procedures for issuing the authority. 

Although not required, FMCSA has also reviewed Mexican drug and alcohol test 

specimen collection facilities. We attended training for the FMCSA staff 

conducting such reviews and observed a review of a Mexican facility in Nuevo 

Laredo. Based on our observation at this single facility, the processes at this 

facility were generally consistent with U.S. requirements. We have not received 

final reports on the review conducted by FMCSA and DOT’s Office of Drug and 

Alcohol Policy. 

Exhibit B. Further Details on Our Review 
23

EXHIBIT C. OIG QUESTIONS FOR THE EVALUATION PANEL 

 U.S. Department of 

Memorandum

 Transportation 

 Office of the Secretary 

 of Transportation 

 Office of Inspector General 

Subject: INFORMATION: Questions for Evaluation Panel 

on Cross-Border Demonstration Program 

Date: 

May 4, 2007

From: Calvin L. Scovel III 

 Inspector General 

Reply to 

Attn. of: JA-40 

To: Jeff Shane 

 Under Secretary for Policy 

The Office of Inspector General has been requested by the House Transportation 

and Infrastructure Committee to review the one-year demonstration program to 

grant authority to up to 100 Mexican-domiciled motor carriers to operate beyond 

the commercial zones at the southern border. Specifically, the committee asks us 

to determine whether DOT has established sufficient controls to ensure that the 

demonstration program participants are in full compliance with all U.S. motor 

carrier safety laws and regulations. 

Considering the scope of this request and our responsibility to be independent and 

objective in our work, we informed the Secretary that we viewed our role as 

providing ongoing feedback to the Department on our methodologies and potential 

findings rather than participating as a formal or ex officio member in any advisory 

groups established by the Secretary. 

Consistent with this role, the attachment provides a list of questions we have 

developed based on our prior audit work and preliminary research on the current 

request which may be relevant to developing performance metrics and success 

criteria for the demonstration program. These also may be used by the Evaluation 

Panel responsible for evaluating the safety impacts of allowing Mexicandomiciled motor carriers to operate on U.S. roads beyond the commercial zones. 

Exhibit C. OIG Questions for the Evaluation Panel 
24

The list provides questions addressing the following areas: 

• Safety Data and the Timeframe. These questions address the sufficiency of 

the safety data and the length of time planned for the demonstration 

program given issues we have encountered previously. 

• Participant Screening Questions. These questions address the stated goal 

of checking “every truck, every time.” 

• Assessing the Overall Results of the Demonstration Program. These 

questions address factors influencing the overall assessment of the 

demonstration program. 

We would be glad to discuss these questions with your staff, Federal Motor 

Carrier Safety Administration (FMCSA) personnel, or the Evaluation Panel. 

We will also be sharing this list with the Congressional Committees of 

jurisdiction as we keep them informed on the progress of our work. 

If you have any questions or if we can be of further assistance, please contact 

me at x61959 or Kurt Hyde, Assistant Inspector General for Surface and 

Maritime Programs, at x65630. 

Attachment 

cc: John Hill, FMCSA Administrator 

Evaluation Panel Members (Messrs. Downey, Kolbe, and Mead) 

Exhibit C. OIG Questions for the Evaluation Panel 
25

Questions on Cross-Border Demonstration Program

Safety Data and Timeframe Questions: 

1. What information exists on safety records for long-haul Mexican carriers 

already operating in the U.S., which could serve as a baseline for assessing the 

safety records of participants in the demonstration program1

? We are aware of 

the following Mexican domiciled carriers that could be part of this baseline 

calculation: 

• 1,300 long-haul Mexican carriers discussed in our January 2005 report2

 that 

are 55 percent U.S. owned and previously received approval to operate 

outside the commercial zones. 

• Mexican carriers identified as being inspected or involved in crashes 

beyond the border states. Our January 2005 report identified 144 such 

carriers, based on FMCSA records, in the period from 2002-2004, and our 

current work has identified similar numbers in 2005, although reliable 

estimates are difficult to make in this area. 

• At least 5,000 Mexican carriers operating in the commercial zone in 

FY 2005, according to our latest analysis of MCMIS3

 inspection records. 

• Carriers granted “extended authority” to operate beyond the commercial 

zone prior to 2002. We do not know how many of these exist, but have 

been told it would include carriers operating to San Antonio. 

2. What measures will be taken to ensure that all crashes involving demonstration 

program participants are reported? Recent University of Michigan studies 

have shown that, for 2003, California and New Mexico reported about 53 

percent and 9 percent respectively of reportable commercial crashes to 

FMCSA. Could such problems lead to under-reporting of crashes for Mexican 

carriers? Conversely, given the increased attention on the Mexican carriers 

could the crash rates for Mexican carriers be artificially inflated in comparison 

to non-Mexican carriers? How will these factors be considered in the 

evaluation? 

 

1

 We have used the terms demonstration program and pilot program interchangeably in these questions although this is 

not meant to imply that we have determined if the program must meet the pilot program criteria set forth in the law. 2

 OIG Report Number MH-2005-032, Follow-up Audit of the Implementation of the North American Free Trade 

Agreement’s Cross-Border Trucking Provisions, January 3, 2005. OIG reports are available on our web site:

www.oig.dot.gov. 3

 Motor Carrier Management Information System. 

Exhibit C. OIG Questions for the Evaluation Panel 
26

3. Since state crash reporting to FMCSA does not indicate who was at fault, will 

further work be done to identify fault? Will the Evaluation Panel rely on 

police reports for determining the cause of any fatal crashes, or will they call 

on others to review any fatal crashes involving demonstration program 

participants? Will FMCSA require that all crashes involving demonstration 

program participants be reported even if they do not meet Federal reporting 

criteria (fatality, tow away, or injury)? 

4. Will the crash rate calculation use power units or vehicle miles traveled, or 

both, as the normalizing factor (common denominator), and what controls will 

ensure the validity of this data? 

5. Is one year a sufficient period of time to collect adequate safety data from 

demonstration program participants for accurate and reliable data analyses of 

any safety issues? Our past and ongoing work has identified a number of 

issues related to this question: 

a. Some crashes may be reported after the demonstration period is 

ended. Our work indicates that, on average, states took 64 days to 

report crashes to FMCSA in CY 2005 and 92 days in FY 2004. 

What steps are being taken to ensure that crash data used to evaluate 

the demonstration program are as complete as possible and to avoid 

receiving information on crashes after the decisions are made on the 

pilot program? 

b. One year is a shorter period than the one used by the system for 

assessing high-risk U.S carriers. Given that the system used by 

FMCSA to evaluate the safety risk posed by all motor carriers 

(SafeStat4

) uses 30 months of safety data (weighted towards most 

recent) to assess the safety risk of U.S. motor carriers, and their 

selection for compliance reviews, what steps are being taken to 

ensure that using safety data covering only one year (or less, given 

reporting delays) will provide sufficient information to assess the 

safety risk posed by long-haul Mexican carriers participating in the 

demonstration program? 

c. Compliance reviews that are used by FMCSA to evaluate whether a 

motor carrier is meeting safety regulations rely on data about crashes 

over an 18 month period, not 12 months. If compliance reviews are 

used to assess safety during the demonstration program, will these 

 

4

 Motor Carrier Safety Status Measurement System. 

Exhibit C. OIG Questions for the Evaluation Panel 
27

compliance reviews be considered valid if 18 months of crash data is 

not available? 

6. Our work has also identified problems in the past associated with incomplete 

reporting of traffic violations cited in conjunction with inspections. For 

example, a police officer may have stopped a truck for speeding and 

subsequently conducted an inspection, but the inspection form does not reflect 

the speeding violation, whether or not a citation was issued. Are there any 

plans to mitigate this issue as it relates to demonstration program participants? 

7. Our prior audit work from 20045

 showed that about 13.4 percent of crashes and 

7.5 percent of inspections are reported inaccurately into the database. What 

steps will be taken to mitigate this issue in the assessment of long-haul 

Mexican carriers and are there reasons to believe that the error rate will be 

greater or lesser with demonstration program participants? Will Mexican 

carriers be allowed to correct inaccurate data using the systems implemented 

by FMCSA following our 2004 report? And, if so, will the calculations of 

safety rates be held up pending resolution of any contested data? 

8. Is the available data on enforcement of operating authority sufficient to 

determine the exact nature of reported operating authority violations (for 

example, can cabotage violations be identified)? 

9. The FMCSA Administrator testified in March 2007 that trucks involved in the 

demonstration program would be tracked by Vehicle Identification Number 

(VIN) to ensure that only trucks that have passed inspection are allowed to 

operate in the U.S. Our review of MCMIS data for 2005 indicates that only 

about 37 percent of the records for Mexican trucks inspected in that year 

included valid information in the VIN data field. What actions will FMCSA 

take to ensure that the VIN data are recorded by both state and Federal 

inspectors during the demonstration program? Will the need for such training 

delay the demonstration program? 

10.Will FMCSA only track and inspect specific power units (identified by VIN) 

and allow any trailer to be towed by pilot program participants; or will they 

also track specific trailers (identified by VIN) used by pilot program 

participants? If so, have any necessary training and modifications to existing 

databases been accomplished to carry out this tracking? 

 

5

 OIG Report Number MH-2004-034, Improvements Needed in the Motor Carrier Safety Status Measurement System, 

February 13, 2004. 

Exhibit C. OIG Questions for the Evaluation Panel 
28

Participant Screening Questions 

11.According to FMCSA, each participant’s driver license will be checked at the 

border every time. What will be considered a successful rate for passing the 

required licensing checks? For example, our current work shows that 16 

percent of the license checks of Mexican domiciled drivers in a one month test 

period showed that the license was not found in the Mexican CDL system. 

What percent would be an acceptable “driver not found” rate for pilot 

participants? How will the failure rate, if any, during license checks of 

Mexican drivers be compared to U.S. drivers? 

12.How can you be assured that checks of “every truck, every time” are being 

conducted, unless agreements have been reached with the U.S. Customs and 

Border Protection (CBP) to permit state or FMCSA personnel access to the 

primary screening points or equivalent locations so they may ensure that 100 

percent of demonstration program participants are selected for license 

checks/inspections? Or, alternatively, are automated systems in place to ensure 

that all demonstration program participants are selected for license 

checks/inspections every time they enter the U.S.? Will the demonstration 

program be delayed until such agreements or systems are in place? If not, 

what alternatives have been established? 

Assessing the Overall Result of the Demonstration Program: 

13.Given that the participants in the demonstration program are volunteers, can 

the group be said to be a representative sample of potential future long-haul 

Mexican operators? If the sample is a judgmental sample, what steps will be 

taken to ensure that it represents a fair sample? If the participants are not 

representative, can the Department still get valid results? 

14.How will FMCSA measure the success of the demonstration program? For 

example, will the absence of adverse safety information be sufficient to deem it 

a success or will a specific level of safety performance be required (e.g. a crash 

rate no higher than a certain value). If the former, what will constitute adverse 

safety impact? If the latter, what specific safety level or levels will be 

required? 

15.Will any elements of the demonstration program evaluation be designed to test 

the validity of prior determinations made regarding the comparability of the 

Mexican and U.S. systems? The current system and the demonstration 

program operate on the assumption that the Mexican Licencia Federal is 

equivalent to the U.S. Commercial Driver’s License, a determination made by 

Exhibit C. OIG Questions for the Evaluation Panel 
29

the Department in 1991. If this determination will not be tested, will the Safety 

Evaluation Panel examine the basis for this prior determination? 

16.Information on the Mexican Government website provides detailed 

information on state officials Mexican carriers should contact in Arizona, New 

Mexico, Texas, and California regarding certain fees and taxes generally 

collected on U.S. carriers through the International Registration Plan and 

International Fuel Tax Agreement. These fee and tax plans rely on carriers to 

report fuel they purchase and miles traveled by state. Will the border states be 

handling Mexican carriers for the purposes of these programs? If so, will 

information provided by Mexican carriers to confirm miles traveled also be 

used for safety rates? Further, if such information shows little travel outside 

the border states, does this mean the demonstration program is limited to the 

border states? If so, will this bias the program’s overall result? 

17.While the demonstration program does not include passenger carriers, will 

passenger carriers be authorized to apply for long-haul authority if the 

demonstration program is deemed successful? Information published on the 

Internet by the Mexico Ministry of Economy states that while the 

demonstration program excludes passenger carriers, once the border is fully 

opened under NAFTA, cross-border passenger carriers will be allowed to 

operate long-haul in the U.S. If this is the case, would an additional 

demonstration program be required for passenger carriers? If this is not the 

case, should safety issues regarding passenger carriers be considered during the 

demonstration program? Would similar factors apply to hazardous materials 

carriers? 

Exhibit C. OIG Questions for the Evaluation Panel 
30

EXHIBIT D. MAJOR CONTRIBUTORS TO THIS REPORT 

THE FOLLOWING INDIVIDUALS CONTRIBUTED TO THIS REPORT.

Name Title 

Joe Comé Program Director 

Joan Becker Project Manager 

David Pouliott Project Manager 

Kimberley Bolding Senior Auditor 

Pat Conley Senior Auditor 

Tony Saraco Senior Auditor 

Gerry Sheeran Senior Auditor 

Maurice Toval Senior Auditor 

Marvin Tuxhorn Senior Auditor 

Kate Conway Analyst 

Charlie Denno Auditor 

Constance Hardy Analyst 

Michael Masoudian Analyst 

Regan Maund Analyst 

Calvin Moore Analyst 

Scott Williams Analyst 

Tom Lehrich Chief Counsel 

Seth Kaufman Associate Counsel 

Petra Swartzlander Statistician 

Andrea Nossaman Writer-Editor 

Exhibit D. Major Contributors to This Report 
Appendix A. FMCSA Management Comments 

31

APPENDIX A. FMCSA MANAGEMENT COMMENTS 

 Memorandum 

U.S. Department 

Of Transportation 

Federal Motor Carrier 

Safety Administration 

Subject: INFORMATION: Response to the Office of the Inspector Date:

General’s (OIG) Draft Report “FMCSA Compliance August 27, 2007

with Mexican Motor Carrier Cross-Border Safety 

Recommendations – Initial Report” 

 Project No. 07M3008M000 

 

From: John H. Hill Reply to MC-E 

Administrator Attn. of: William Quade

To: Rebecca Anne Batts 

 Acting Assistant Inspector General 

 for Surface and Maritime Programs 

The Federal Motor Carrier Safety Administration (FMCSA) appreciates the opportunity to 

review the draft report titled, “FMCSA Compliance with Mexican Motor Carrier CrossBorder Safety Requirements-Initial Report.” The FMCSA also appreciates OIG’s efforts 

which resulted in the timely completion of both the audit and report required under section 

6901(b)(l) of Public Law 1 10-28. 

On August 20, 2007, staff from FMCSA and OIG met to review the “Discussion Draft” of 

the report. The FMCSA will submit a report to Congress detailing the actions the Agency is 

taking to address each issue raised by the OIG in this report, as required by section 

6901(b)(2)(A) of Public Law 1 10-28. 

If you need additional information or clarification, please do not hesitate to contact me, or 

William Quade, Associate Administrator for Enforcement and Program Delivery at 

202-366-2172.
APPENDIX B. PUBLIC LAW 107-87, SECTION 350(a) 

No. Section 350 

Reference

Requirement Language

§350(a) (a) No funds limited or appropriated in this Act may be obligated or expended for the review 

a Mexican motor carrier for authority to operate beyond United States municipalities and States-Mexico border until the Federal Motor Carrier Safety Administration— 

1 §350(a)(1)(A) requires a safety examination of such motor carrier to be performed before the carrier is gran

to operate beyond United States municipalities and commercial zones on the United States-M

§350(a)(1)(B) requires the safety examination to include— 

2 §350(a)(1)(B)(i) verification of available performance data and safety management programs; 3 §350(a)(1)(B)(ii) verification of a drug and alcohol testing program consistent with part 40 of title 49, Code of 4 §350(a)(1)(B)(iii) verification of that motor carrier’s system of compliance with hours-of-service rules, includin5 §350(a)(1)(B)(iv) verification of proof of insurance; 6 §350(a)(1)(B)(v) a review of available data concerning that motor carrier’s safety history, and other inform

carrier’s preparedness to comply with Federal Motor Carrier Safety rules and regulations aregulations; 

7 §350(a)(1)(B)(vi) an inspection of that Mexican motor carrier’s commercial vehicles to be used under such 

commercial vehicles have not received a decal from the inspection required in subsection (a)(

8 §350(a)(1)(B)(vii) an evaluation of that motor carrier’s safety inspection, maintenance, and repair facilities o

verification of records of periodic vehicle inspections; 

9 §350(a)(1)(B)(viii) verification of drivers’ qualifications, including a confirmation of the validity of the Licencia 

driver of that motor carrier who will be operating under such authority; and 

10 §350(a)(1)(B)(ix) an interview with officials of that motor carrier to review safety management controls and ev

policies and practices. 

§350(a)(1)(C) requires that— 

11 §350(a)(1)(C)(i) Mexican motor carriers with three or fewer commercial vehicles need not undergo on-site 

percent of all safety examinations of all Mexican motor carriers shall be conducted onsite; an

12 §350(a)(1)(C)(ii) such on-site inspections shall cover at least 50 percent of estimated truck traffic in any year. 13 §350(a)(2) requires a full safety compliance review of the carrier consistent with the safety fitness eval

385 of title 49, Code of Federal Regulations, and gives the motor carrier a satisfactory rapermanent operating authority to operate beyond United States municipalities and commeMexico border, and requires that any such safety compliance review take place within 18 m

granted conditional operating authority, provided that— 

14 §350(a)(2)(A) Mexican motor carriers with three or fewer commercial vehicles need not undergo onsite 

percent of all compliance reviews of all Mexican motor carriers shall be conducted on-site; an

Appendix B. Public Law 107-87, Section 350(a) 
No. Section 350 Requirement Language

Reference

15 §350(a)(2)(B) any Mexican motor carrier with 4 or more commercial vehicles that did not undergo an on

shall undergo an on-site safety compliance review under this section. 

16 §350(a)(3) requires Federal and State inspectors to verify electronically the status and validity of the lic

motor carrier commercial vehicle crossing the border; 

17 §350(a)(3)(A) for every such vehicle carrying a placardable quantity of hazardous materials; 18 §350(a)(3)(B) whenever the inspection required in subsection (a)(5) is performed; and 19 §350(a)(3)(C) randomly for other Mexican motor carrier commercial vehicles, but in no case less th

commercial vehicles. 

20 §350(a)(4) gives a distinctive Department of Transportation number to each Mexican motor carrier oper

to assist inspectors in enforcing motor carrier safety regulations including hours-of-service Code of Federal Regulations; 

21 §350(a)(5) requires, with the exception of Mexican motor carriers that have been granted permanent ope

consecutive years— 

22 §350(a)(5)(A) inspections of all commercial vehicles of Mexican motor carriers authorized, or seeking autho

States municipalities and commercial zones on the United States-Mexico border that do not dVehicle Safety Alliance inspection decal, by certified inspectors in accordance with the requir

under the criteria of the North American Standard Inspection (as defined in section 350.105 oRegulations), including examination of the driver, vehicle exterior and vehicle under-carriage

23 §350(a)(5)(B) a Commercial Vehicle Safety Alliance decal to be affixed to each such commercial vehicle 

required by clause (A) or a re-inspection if the vehicle has met the criteria for the Level I insp

24 §350(a)(5)(C) that any such decal, when affixed, expire at the end of a period of not more than 90 days, but 

construed to preclude the Administration from requiring reinspection of a vehicle bearing requiring that such a decal be removed when a certified Federal or State inspector determinviolation subsequent to the inspection for which the decal was granted. 

25 §350(a)(6) requires State inspectors who detect violations of Federal motor carrier safety laws or regulati

Federal authorities of such violations; 

26 §350(a)(7)(A) equips all United States-Mexico commercial border crossings with scales suitable for enforce

such crossings that have the highest volume of commercial vehicle traffic with weigh-in-motithe remaining 5 such border crossings are equipped within 12 months; requires inspectors to vmotor carrier commercial vehicle entering the United States at said WIM equipped high volum

27 §350(a)(7)(B) initiates a study to determine which other crossings should also be equipped with weigh-in-m28 §350(a)(8) the Federal Motor Carrier Safety Administration has implemented a policy to ensure that no M

granted authority to operate beyond United States municipalities and commercial zones on thunless that carrier provides proof of valid insurance with an insurance company licensed in th

Appendix B. Public Law 107-87, Section 350(a) 
Appendix B. Public Law 107-87, Section 350(a) 

No. Section 350 

Reference

Requirement Language

29 §350(a)(9) requires commercial vehicles operated by a Mexican motor carrier to enter the United States o

crossings where and when a certified motor carrier safety inspector is on duty and where adeqsufficient number of meaningful vehicle safety inspections and to accommodate vehicles placsaid inspections. 

§350(a)(10) publishes— 

30 §350(a)(10)(A) interim final regulations under section 210(b) of the Motor Carrier Safety Improvement Act o

that establish minimum requirements for motor carriers, including foreign motor carriers, to eabout Federal safety standards, that may include the administration of a proficiency examinat

31 §350(a)(10)(B) interim final regulations under section 31148 of title 49, United States Code, that implement m

provide for the certification of motor carrier safety auditors; 

32 §350(a)(10)(C) a policy under sections 218(a) and (b) of that Act (49 U.S.C. 31133 note) establishing standar

appropriate number of Federal and State motor carrier inspectors for the United States-Mexic

33 §350(a)(10)(D) a policy under section 219(d) of that Act (49 U.S.C. 14901 note) that prohibits foreign motor 

another carrier to transport products to the United States while the lessor is subject to a suspenits right to operate in the United States; and 

34 §350(a)(10)(E) a policy under section 219(a) of that Act (49 U.S.C. 14901 note) that prohibits foreign motor 

United States that is found to have operated illegally in the United States. 
The following pages contain textual versions of the graphs and charts found in this 

document. These pages were not in the original document but have been added here to 

accommodate assistive technology. 
Issues Pertaining to the Proposed NAFTA Cross-Border 

Trucking Demonstration Project

Section 508 Compliant Presentation 

Figure 1. Long Lines of Trucks Waiting To Enter the United States From Mexico 

Figure 1 is a picture of long lines of Mexican trucks waiting to enter the Customs and 

Border Protection primary booths at the El Paso/Ysleta, Texas, border crossing. This 

picture was taken by the Office of Inspector General (OIG) during an on-site review in 

June 2007. 

Figure 2. State Motor Carrier Safety Assistance Program Coordinator Areas of 

Concern 

Figure 2 is a bar chart that depicts the OIG analysis of state’s responses to an OIG survey 

of Motor Carrier Safety Assistance Program Coordinators. The Coordinators’ response 

focus on areas of concern related to implementing the demonstration project. The OIG 

survey was conducted from June 22 through August 1, 2007, and resulted in the 

following categories of concerns and number of concerns per category:

English Language 10 concerns 

Out-Of-Service 6 concerns 

Database 3 concerns 

Enforcement 3 concerns 

Immigration 1 concern 

Security 1 concern 

Decals 1 concern 

Other 7 concerns 

Figure 3. Inspection Facility in Otay Mesa, California 

Figure 3 is a picture of the enclosed state inspection facility in Otay Mesa, California, 

taken by the OIG during an on-site review in June 2007. The picture shows two trucks, 

the first truck is already in an inspection bay. The second truck is entering an inspection 

bay where a FMCSA inspector is standing. The inspection bay this truck is entering 

includes an inspection pit in the floor that can be used to inspect the underside of a truck. 
Figure 4. Process for Granting OP-1 (Long-Haul) Provisional Operating Authority 

Figure 4 depicts the process FMCSA identified for granting provisional operating 

authority for Mexican long-haul carriers. 

• First, the Mexican motor carrier submits an application. 

• Second, FMCSA reviews the application. 

• Third, FMCSA conducts the pre-authorization safety audit (PASA). 

• Fourth, notice of carrier’s pending authority is published in the FMCSA Register. 

• Fifth, an opportunity is provided for public comment. 

• Sixth, the Mexican carrier’s insurance coverage is verified. 

• Seventh, provisional operating authority is granted to the Mexican carrier by 

FMCSA. 

Figure 5. Inspection of Mexican Applicant’s Vehicle During the PASA 

Figure 5 is a picture of FMCSA personnel conducting a pre-authorization safety audit at a 

Mexican carrier facility in Ciudad Juarez, Mexico, in July 2007. This picture was taken 

by the OIG while observing the PASA. The picture shows the front driver’s side of a 

truck. The truck’s front hood is opened and the engine compartment is exposed. 

Standing next to the truck are FMCSA personnel inspecting the vehicle and two OIG 

staff observing the inspection.

Appendix B. Public Law 107-87, Section 350 (a) 

Appendix B provides a table identifying the 34 requirements OIG identified under 

Section 350(a). Requirements are presented verbatim from the public law. 

Section 350(a) overall requirement: No funds limited or appropriated in this Act may be 

obligated or expended for the review or processing of an application by a Mexican motor 

carrier for authority to operate beyond United States municipalities and commercial 

zones on the United States-Mexico border until the Federal Motor Carrier Safety 

Administration— 

Section 350(a)(1)(A) has one requirement 

• OIG identified requirement number 1: requires a safety examination of such motor 

carrier to be performed before the carrier is granted conditional operating authority 

to operate beyond United States municipalities and commercial zones on the 

United States-Mexico border [Section 350(a)(1)(A)]; 
Section 350(a)(1)(B) has nine subsections, and requires the safety examination to 

include— 

• OIG identified requirement number 2 - verification of available performance data 

and safety management programs [Section 350(a)(1)(B)(i)]; 

• OIG identified requirement number 3 - verification of a drug and alcohol testing 

program consistent with part 40 of title 49, Code of Federal Regulations [Section 

350(a)(1)(B)(ii)]; 

• OIG identified requirement number 4 - verification of that motor carrier’s system 

of compliance with hours-of-service rules, including hours-of service records 

[Section 350(a)(1)(B)(iii)]; 

• OIG identified requirement number 5 - verification of proof of insurance [Section 

350(a)(1)(B)(iv)]; 

• OIG identified requirement number 6 - a review of available data concerning that 

motor carrier’s safety history, and other information necessary to determine the 

carrier’s preparedness to comply with Federal Motor Carrier Safety rules and 

regulations and Hazardous Materials rules and regulations [Section 

350(a)(1)(B)(v)]; 

• OIG identified requirement number 7 - an inspection of that Mexican motor 

carrier’s commercial vehicles to be used under such operating authority, if any 

such commercial vehicles have not received a decal from the inspection required 

in Section 350(a)(5) [Section 350(a)(1)(B)(vi)]; 

• OIG identified requirement number 8 - an evaluation of that motor carrier’s safety 

inspection, maintenance, and repair facilities or management systems, including 

verification of records of periodic vehicle inspections [Section 350(a)(1)(B)(vii)]; 

• OIG identified requirement number 9 - verification of drivers’ qualifications, 

including a confirmation of the validity of the Licencia de Federal de Conductor of 

each driver of that motor carrier who will be operating under such authority 

[Section 350(a)(1)(B)(viii)]; 

• OIG identified requirement number 10 - an interview with officials of that motor 

carrier to review safety management controls and evaluate any written safety 

oversight policies and practices [Section 350(a)(1)(B)(ix)]. 

Section 350(a)(1)(C) has two subsections and requires that: 

• OIG identified requirement number 11 - Mexican motor carriers with three or 

fewer commercial vehicles need not undergo on-site safety examination; however 

50 percent of all safety examinations of all Mexican motor carriers shall be 

conducted onsite [Section 350(a)(1)(C)(i)]; 
• OIG identified requirement number 12 - such on-site inspections shall cover at 

least 50 percent of estimated truck traffic in any year [Section 350(a)(1)(C)(ii)]. 

Section 350(a)(2) has two subsections and requires that: 

• OIG identified requirement number 13 - requires a full safety compliance review 

of the carrier consistent with the safety fitness evaluation procedures set forth in 

part 385 of title 49, Code of Federal Regulations, and gives the motor carrier a 

satisfactory rating, before the carrier is granted permanent operating authority to 

operate beyond United States municipalities and commercial zones on the United 

States-Mexico border, and requires that any such safety compliance review take 

place within 18 months of that motor carrier being granted conditional operating 

authority, provided that [Section 350(a)(2)]: 

• OIG identified requirement number 14 - Mexican motor carriers with three or 

fewer commercial vehicles need not undergo onsite compliance review; however 

50 percent of all compliance reviews of all Mexican motor carriers shall be 

conducted on-site [Section 350(a)(2)(A)]; 

• OIG identified requirement number 15 - any Mexican motor carrier with 4 or more 

commercial vehicles that did not undergo an on-site safety exam under Section 

350(a)(1)(C), shall undergo an on-site safety compliance review under this section 

[Section 350(a)(2)(B)]. 

Section 350(a)(3) has three subsections and requires that: 

• OIG identified requirement number 16 - Federal and State inspectors to verify 

electronically the status and validity of the license of each driver of a Mexican 

motor carrier commercial vehicle crossing the border; 

• OIG identified requirement number 17 - for every such vehicle carrying a 

placardable quantity of hazardous materials [Section 350(a)(3)(A)]; 

• OIG identified requirement number 18 - whenever the inspection required in 

Section 350(a)(5) is performed [Section 350(a)(3)(B)]; 

• OIG identified requirement number 19 - randomly for other Mexican motor carrier 

commercial vehicles, but in no case less than 50 percent of all other such 

commercial vehicles [Section 350(a)(3)(C)]. 

Section 350(a)(4) has one requirement. 

• OIG identified requirement number 20 - gives a distinctive Department of 

Transportation number to each Mexican motor carrier operating beyond the 

commercial zone to assist inspectors in enforcing motor carrier safety regulations 
including hours-of-service rules under part 395 of title 49, Code of Federal 

Regulations [Section 350(a)(4)]. 

Section 350(a)(5) has three subsections and requires that: 

• OIG identified requirement number 21 - requires, with the exception of Mexican 

motor carriers that have been granted permanent operating authority for three 

consecutive years [Section 350(a)(5)]— 

• OIG identified requirement number 22 - inspections of all commercial vehicles of 

Mexican motor carriers authorized, or seeking authority to operate beyond United 

States municipalities and commercial zones on the United States-Mexico border 

that do not display a valid Commercial Vehicle Safety Alliance inspection decal, 

by certified inspectors in accordance with the requirements for a Level I 

Inspection under the criteria of the North American Standard Inspection (as 

defined in section 350.105 of title 49, Code of Federal Regulations), including 

examination of the driver, vehicle exterior and vehicle under-carriage [Section 

350(a)(5)(A)]; 

• OIG identified requirement number 23 - a Commercial Vehicle Safety Alliance 

decal to be affixed to each such commercial vehicle upon completion of the 

inspection required by clause (A) or a re-inspection if the vehicle has met the 

criteria for the Level I inspection [Section 350(a)(5)(B)]; and 

• OIG identified requirement number 24 - that any such decal, when affixed, expire 

at the end of a period of not more than 90 days, but nothing in this paragraph shall 

be construed to preclude the Administration from requiring re-inspection of a 

vehicle bearing a valid inspection decal or from requiring that such a decal be 

removed when a certified Federal or State inspector determines that such a vehicle 

has a safety violation subsequent to the inspection for which the decal was granted 

[Section 350(a)(5)(C)]. 

Section 350(a)(6) has one requirement. 

• OIG identified requirement number 25 - requires State inspectors who detect 

violations of Federal motor carrier safety laws or regulations to enforce them or 

notify Federal authorities of such violations [Section 350(a)(6)]. 

Section 350(a)(7) has two subsections and requires that: 

• OIG identified requirement number 26 - equips all United States-Mexico 

commercial border crossings with scales suitable for enforcement action; equips 5 

of the 10 such crossings that have the highest volume of commercial vehicle 
traffic with weigh-in-motion (WIM) systems; ensures that the remaining 5 such 

border crossings are equipped within 12 months; requires inspectors to verify the 

weight of each Mexican motor carrier commercial vehicle entering the United 

States at said WIM equipped high volume border crossings [Section 

350(a)(7)(A)]; and 

• OIG identified requirement number 27 - initiates a study to determine which other 

crossings should also be equipped with weigh-in-motion systems [Section 

350(a)(7)(B)]. 

Section 350(a)(8) has one requirement. 

• OIG identified requirement number 28 - the Federal Motor Carrier Safety 

Administration has implemented a policy to ensure that no Mexican motor carrier 

will be granted authority to operate beyond United States municipalities and 

commercial zones on the United States-Mexico border unless that carrier provides 

proof of valid insurance with an insurance company licensed in the United States 

[Section 350(a)(8)]. 

Section 350(a)(9) has one requirement. 

• OIG identified requirement number 29 - requires commercial vehicles operated by 

a Mexican motor carrier to enter the United States only at commercial border 

crossings where and when a certified motor carrier safety inspector is on duty and 

where adequate capacity exists to conduct a sufficient number of meaningful 

vehicle safety inspections and to accommodate vehicles placed out-of-service as a 

result of said inspections [Section 350(a)(9)]. 

Section 350(a)(10) has five subsections and requires that FMCSA publish: 

• OIG identified requirement number 30 - interim final regulations under section 

210(b) of the Motor Carrier Safety Improvement Act of 1999 (49 U.S.C. 31144 

note) that establish minimum requirements for motor carriers, including foreign 

motor carriers, to ensure they are knowledgeable about Federal safety standards, 

that may include the administration of a proficiency examination [Section 

350(a)(10)(A)]; 

• OIG identified requirement number 31 - interim final regulations under section 

31148 of title 49, United States Code, that implement measures to improve 

training and provide for the certification of motor carrier safety auditors [Section 

350(a)(10)(B)]; 
• OIG identified requirement number 32 - a policy under sections 218(a) and (b) of 

that Act (49 U.S.C. 31133 note) establishing standards for the determination of the 

appropriate number of Federal and State motor carrier inspectors for the United 

States-Mexico border [Section 350(a)(10)(C)]; 

• OIG identified requirement number 33 - a policy under section 219(d) of that Act 

(49 U.S.C. 14901 note) that prohibits foreign motor carriers from leasing vehicles 

to another carrier to transport products to the United States while the lessor is 

subject to a suspension, restriction, or limitation on its right to operate in the 

United States [Section 350(a)(10)(D)]; and 

• OIG identified requirement number 34 - a policy under section 219(a) of that Act 

(49 U.S.C. 14901 note) that prohibits foreign motor carriers from operating in the 

United States that is found to have operated illegally in the United States [Section 

350(a)(10)(E)].