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77–993CC 2002

THE IMPLEMENTATION OF THE TREAD ACT: ONE

YEAR LATER

HEARING

BEFORE THE

SUBCOMMITTEE ON

COMMERCE, TRADE, AND CONSUMER PROTECTION

OF THE

COMMITTEE ON ENERGY AND

COMMERCE

HOUSE OF REPRESENTATIVES

ONE HUNDRED SEVENTH CONGRESS

SECOND SESSION

FEBRUARY 28, 2002

Serial No. 107–92

Printed for the use of the Committee on Energy and Commerce

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house

2

COMMITTEE ON ENERGY AND COMMERCE

W.J. ‘‘BILLY’’ TAUZIN, Louisiana, Chairman

MICHAEL BILIRAKIS, Florida

JOE BARTON, Texas

FRED UPTON, Michigan

CLIFF STEARNS, Florida

PAUL E. GILLMOR, Ohio

JAMES C. GREENWOOD, Pennsylvania

CHRISTOPHER COX, California

NATHAN DEAL, Georgia

RICHARD BURR, North Carolina

ED WHITFIELD, Kentucky

GREG GANSKE, Iowa

CHARLIE NORWOOD, Georgia

BARBARA CUBIN, Wyoming

JOHN SHIMKUS, Illinois

HEATHER WILSON, New Mexico

JOHN B. SHADEGG, Arizona

CHARLES ‘‘CHIP’’ PICKERING, Mississippi

VITO FOSSELLA, New York

ROY BLUNT, Missouri

TOM DAVIS, Virginia

ED BRYANT, Tennessee

ROBERT L. EHRLICH, Jr., Maryland

STEVE BUYER, Indiana

GEORGE RADANOVICH, California

CHARLES F. BASS, New Hampshire

JOSEPH R. PITTS, Pennsylvania

MARY BONO, California

GREG WALDEN, Oregon

LEE TERRY, Nebraska

— — (Vacancy)

JOHN D. DINGELL, Michigan

HENRY A. WAXMAN, California

EDWARD J. MARKEY, Massachusetts

RALPH M. HALL, Texas

RICK BOUCHER, Virginia

EDOLPHUS TOWNS, New York

FRANK PALLONE, Jr., New Jersey

SHERROD BROWN, Ohio

BART GORDON, Tennessee

PETER DEUTSCH, Florida

BOBBY L. RUSH, Illinois

ANNA G. ESHOO, California

BART STUPAK, Michigan

ELIOT L. ENGEL, New York

TOM SAWYER, Ohio

ALBERT R. WYNN, Maryland

GENE GREEN, Texas

KAREN MCCARTHY, Missouri

TED STRICKLAND, Ohio

DIANA DEGETTE, Colorado

THOMAS M. BARRETT, Wisconsin

BILL LUTHER, Minnesota

LOIS CAPPS, California

MICHAEL F. DOYLE, Pennsylvania

CHRISTOPHER JOHN, Louisiana

JANE HARMAN, California

DAVID V. MARVENTANO, Staff Director

JAMES D. BARNETTE, General Counsel

REID P.F. STUNTZ, Minority Staff Director and Chief Counsel

SUBCOMMITTEE ON COMMERCE, TRADE, AND CONSUMER PROTECTION

CLIFF STEARNS, Florida, Chairman

NATHAN DEAL, Georgia

Vice Chairman

ED WHITFIELD, Kentucky

BARBARA CUBIN, Wyoming

JOHN SHIMKUS, Illinois

JOHN B. SHADEGG, Arizona

ED BRYANT, Tennessee

STEVE BUYER, Indiana

GEORGE RADANOVICH, California

CHARLES F. BASS, New Hampshire

JOSEPH R. PITTS, Pennsylvania

GREG WALDEN, Oregon

LEE TERRY, Nebraska

W.J. ‘‘BILLY’’ TAUZIN, Louisiana

(Ex Officio)

EDOLPHUS TOWNS, New York

DIANA DEGETTE, Colorado

LOIS CAPPS, California

MICHAEL F. DOYLE, Pennsylvania

CHRISTOPHER JOHN, Louisiana

JANE HARMAN, California

HENRY A. WAXMAN, California

EDWARD J. MARKEY, Massachusetts

BART GORDON, Tennessee

PETER DEUTSCH, Florida

BOBBY L. RUSH, Illinois

ANNA G. ESHOO, California

JOHN D. DINGELL, Michigan,

(Ex Officio)

(II)

3

C O N T E N T S

Page

Testimony of:

Graham, Hon. John D., Administrator, Office of Information and Regulatory Affairs, Office of Management and Budget ..................................... 16

Mead, Hon. Kenneth M., Inspector General, Office of Inspector General,

U.S. Department of Transportation ............................................................ 20

Runge, Hon. Jeffrey W., Administrator, National Highway Traffic Safety

Administration, U.S. Department of Transportation ................................. 11

(III)

(1)

THE IMPLEMENTATION OF THE TREAD ACT:

ONE YEAR LATER

THURSDAY, FEBRUARY 28, 2002

HOUSE OF REPRESENTATIVES,

COMMITTEE ON ENERGY AND COMMERCE,

SUBCOMMITTEE ON COMMERCE, TRADE,

AND CONSUMER PROTECTION,

Washington, DC.

The subcommittee met, pursuant to notice, at 9:30 a.m., in room

2322, Rayburn House Office Building, Hon. Cliff Stearns (chairman) presiding.

Members present: Representatives Stearns, Upton, Shimkus,

Bryant, Pitts, Bass, Towns, DeGette, Markey, Gordon, and Dingell

(ex officio)

Also present: Representatives Sawyer and Barrett.

Staff present: Kelly Zerzan, majority counsel; Ramsen Betfarhad,

majority counsel; Brendan Williams, lecislative Clerk; Jonathan

Cerdone, majority counsel; and Bruce Gwinn, minority professional

staff member.

Mr. STEARNS. Good morning, everybody. I welcome all and call

to order this hearing of the Commerce, Trade, and Consumer Protection. I’m especially pleased to welcome Dr. Runge. As this is

your first appearance before the committee since your confirmation

as National Highway Safety Administration Administrator, I look

forward to a productive relationship between NHTSA and this subcommittee, which is entrusted with oversight responsibilities over

NHTSA.

I find the subcommittee’s oversight vis-a-vis NHTSA as one of

the most important responsibilities of this subcommittee. As

NHTSA’s motto, ‘‘people saving people’’ suggests NHTSA can and

does save lives.

It is in this light that we are holding this hearing today examining NHTSA’s implementation of the TREAD Act.

In October 2000, Congress enacted a Transportation Recall Enhancement, Accountability, and Documentation Act, in response to

the many deaths and injuries attributed to tread separation observed on Ford Explorers equipped with certain Firestone tires.

The TREAD Act was enacted in large measure due to the efforts

of our full committee chairman, Mr. Tauzin, who at the time

Chaired the Commerce Committee’s Telecommunications, Trade,

and Consumer Protection Subcommittee.

After establishing an extensive hearing record, Chairman Tauzin

and other subcommittee members, including myself, recognized

2

that Congress had to act in order to protect American lives because

in some respects NHTSA had failed.

I am even more convinced today than the day we enacted the

TREAD Act, that if implemented as Congress intended, the Act can

save hundreds, if not thousands of lives. I’m still taken back when

told that 40,000 Americans lose their lives and countless thousands

are injured in our roads every year. Most of these deaths and injuries can be prevented if people did not drive while intoxicated or

simply wore their seatbelts. Even today only 7 out of 10 Americans

wear their seatbelts, while in many parts of Europe over 90 percent

buckle up. That’s 20 percent differential in seatbelt usage between

us and some Europeans. It is estimated to cost some 4,000 to 6,000

American lives. That should not be.

Many of the fatalities and injuries on American roads arise from

vehicle defects. The Ford Firestone case exemplifies that fact. Just

one mandate of the TREAD Act, the early warning reporting that

requires the reporting of vehicle problems to NHTSA from a variety

of sources, including warranty claims and consumer complaints, I

believe, if implemented right, can save thousands of lives throughout the coming year.

In order for the TREAD Act far-reaching safety effects to take

hold, NHTSA must promulgate regulations that are both true to

the Congressional intent and timely.

We, the Congress, further empower NHTSA with the TREAD

Act. We increase NHTSA’s funding by $9.1 million so that it could

implement the Act. Yet, without NHTSA’s diligent and expeditious

efforts, we as American drivers will not fully reap the benefits of

this TREAD Act.

Therefore, I’m pleased that NHTSA has completed three final

rules in a timely manner to date. However, I am concerned that

NHTSA has yet to complete 12 final rulemakings, 6 of which are

subject to statutory deadlines, the latest being November 2002. I

recognize that to date, the Agency has issued nine Notice of Proposed Rulemakings. Still, I agree with the Department of Transportation Inspector General that the final rules may be delayed at

least with regard to some of the more complex and as such contentious issues arise. Therefore, unless there are compelling reasons

to the contrary, I request that NHTSA periodically inform this committee as to its progress on the various TREAD Act rulemaking.

Let me emphasize that I do appreciate that Congress has asked

NHTSA to undertake a large, and in part, complicated undertaking. So I do compliment the Agency for its efforts to this date

and in particular, I commend the Agency for its responsiveness to

concerns raised by the Department of Transportation Inspector

General’s Report and the OMB.

We have the opportunity at this hearing to explore, in detail,

both the IG’s Report and the OMB’s evaluation of NHTSA’s tire

pressure warning device NPRM.

Clearly, it is important that NHTSA complete its TREAD Act

rulemaking in a timely fashion, since at least with regard to two

rulemakings, one, early warning data reporting; and two, rollover

rating system, I would not want NHTSA to shortchange the quality

of those rules because of time limitations. I’m not suggesting that

NHTSA take its time with these two rulemakings, but rather I find

3

both the early warning data reporting and rollover rating system

rules extremely important as they address critical issues and enjoy

exceptional complexity.

It is imperative, for example, that NHTSA reach an optimal rule

for the early warning data reporting. NHTSA has to get it right the

first time because this rule is setting a framework. The extent and

quality of data collected and analyzed under this rule will color all

of NHTSA’s work for the near future. If this rule is done right, as

I said earlier, it will save countless lives in years to come. It’s that

simple.

The object of the rule is not simply to collect more data sets. We

all appreciate the raw data in itself means little. It is estimated

that if NHTSA were to collect all the nearly warning data as contemplated today, it will become the largest warehouse of data in

the world. Warehousing data doesn’t save lives. NHTSA must carefully consider the type, quality and relevance of the data collected,

the way the data is processed and catalogued and ultimately analyzed. Injecting the required intelligence into the processing of each

warning data is a considerable undertaking and as such, NHTSA

must be rigorous when promulgating the early warning rule. And

obviously, this probably will take time.

The fact is that we in Congress can enact many laws such as

TREAD Act, designed to save motorists’ lives, yet if such laws are

not implemented properly and enforced rigorously, our efforts

would have been in vain.

And finally, I request that NHTSA submit its study of the use

and effectiveness of booster seats to the subcommittee as soon as

possible as it was due last November.

That study is of particular interest as the committee finds the

booster seat issue of significant importance.

I thank all the witnesses who are appearing today and I look forward to hearing your testimony and with that, the distinguished

ranking member from New York, Mr. Towns.

Mr. TOWNS. Thank you very much, Mr. Chairman. More than 15

months ago in response to the Firestone ATX Wilderness tire recalls, as well as the thousands of people who were killed and injured annually in highway tragedies, we came together to address

and pass bipartisan legislation, the Transportation Recall Enhancement, Accountability, and Documentation.

This public law was enacted with the hope of saving lives by providing as much vehicle accident information as quickly as possible

to regulators, increasing access to information for consumers, requiring a tire pressure monitoring system in all new vehicles, updating standards for tires, mandating child improvement seats and

developing a dynamic rollover test. In addition, TREAD increased

the resources available to the National Highway Traffic Safety Administration, as my colleague from Florida and the chairman of

this committee indicated to highly result in flood of new information that will come in.

These requirements were mandated not to make onerous new demands on industry, but rather to save lives. Unfortunately, while

we pass this legislation with great hope, to date, 4 of the 9 statutory deadlines have not been met and the most difficult and complex rules await final action.

4

Mr. Chairman, I welcome you calling this hearing and I’m eager

to hear from the witnesses because what we’re talking about here

today is saving lives. And I can’t think of anything more important

than saving lives.

On that note, I yield back.

Mr. STEARNS. I thank my colleague. The gentleman, the chairman of the Telecommunications Subcommittee who is also active

with the TREAD Act, Mr. Upton from Michigan.

Mr. UPTON. Thank you, Mr. Chairman, and I applaud you for

having this hearing today to look at the implementation of the

TREAD Act. I have a full statement that I’ll put into the record,

but I’d like to say just a couple of things at the beginning. As many

of you know I was the principal author of the TREAD Act and as

then chairman of the Oversight Investigation Subcommittee, our

role was to identify problems and then to come back with legislation to make sure that they never happen again. In the case of the

Firestone tire mess, we saw more than a hundred deaths across the

country that were directly attributable to those tires. And as we

began to examine this situation we found, in fact, that we had not

seen tire standards updated since 1968 and as a young grade

schooler then I can remember changing tires with my dad when we

went to winter tires from the summer tires in Michigan, things like

radials and those types of tires were not there, steel-belted radials

weren’t known to exist at that point. And we knew that when we

found these enormous problems, in fact, we needed legislation to

correct it. And that was why we saw tremendous bipartisan support in terms of the TREAD Act. Then Chairman Tauzin of this

subcommittee worked with us. We worked very carefully with the

Senate, was able to pass this legislation, as I recall, without a single dissenting vote and it was done. And now this oversight hearing to look at the implementation of the TREAD Act and to make

sure that, in fact, we don’t run into the same problems that we saw

exist prior to the passage of the TREAD Act.

So I look forward to the testimony, to the work, to make sure

that all travelers on our highways, both drivers and passengers are

going to be ensured of the safer travel and I look forward to hearing the testimony and asking some questions and thank you very

much, Mr. Chairman, and others for going ahead with this hearing.

I yield back the balance of my time.

[The prepaed statement of Hon. Fred Upton follows:]

PREPARED STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN CONGRESS FROM

THE STATE OF MICHIGAN

During the fall of 2000, I authored the Transportation Recall Enhancement, Accountability, and Documentation (TREAD) Act in order to get to the bottom of what

is wrong with the faulty tires and what we need to do to fix them. Congress did

this to ensure that no family would have to endure the same pain as those who have

already lost family members due to these horrific accidents. Mr. Chairman I am

very pleased that we are holding this hearing today in order to address the implementation of the T.R.E.A.D. Act.

I am glad to see the good work of this committee and Congress and that the

T.R.E.A.D. Act was able to expose flaws, so that in fact we could take faulty tires

away from people who might have had used them. I believe it is important to note

that this law has been both effective and positive.

As the Administration continues the rule making process I would like to give

them my full support. I would certainly like to reiterate the prominent issue of the

law, to ensure the safety of American consumers. In addition, I would like to take

5

this opportunity to remind them that this law needs be implemented fully, effectively, and expediently. I look forward to further hearings and will personally continue to follow this process.

Mr. STEARNS. And I thank my colleague who again was the author of the TREAD Act and for all the work that he did in the last

session.

I believe the ranking member of the full committee, Mr. Dingell

is here and is recognized for an opening statement.

Mr. DINGELL. Mr. Chairman, first of all, I thank you for holding

this hearing and I commend you. The questions that lie before us

are very important. The tire safety issue that caused this committee and the Congress to enact the TREAD Act in November

2000 remains a real concern today. It is important that the provisions of the TREAD Act be carried out as intended by the Congress.

I am going to observe that I am extremely discouraged, however,

that nothing much appears to have changed in the National Highway Traffic Safety Administration, NHTSA, since the TREAD Act

became law. Prior to the TREAD Act, NHTSA was awash in information, including information about defective Firestone tires. The

information was filed away and not used. The NHTSA appears

today to be awash in information. We’re not sure whether the information has been filed away or what has been done with it. In any

event, not much does seem to have been done in a way which

would contribute to safety on the highways. This is, was and will

be a wholly unacceptable way for NHTSA to do its business and

the committee clearly said so before at the time the TREAD Act

was considered. I had hoped that that warning would be a measure

which would dictate to NHTSA that they should do things differently and should begin a new, vigorous and intelligent approach

to their responsibilities.

As a result, I would note the fundamental purpose of the TREAD

Act was to change the way NHTSA handled safety investigations.

It is not good enough that NHTSA has only access to information

about possible safety problems. What must happen is that NHTSA

must actually evaluate the information it receives and see that it

receives proper information. And it then must determine what action and whether action is needed. Nevertheless, the Department

of Transportation’s Inspector General says that NHTSA continuously fails to read and react to the information it receives. Information unused, is of course, quite without value, quite worthless and

either is a policy or is a law enforcement matter.

In its report issued on January 3, 2002, the Inspector General

had some interesting things to say and I quote, ‘‘the success of the

TREAD Act will ultimately rise or fall on the quality and the usefulness of new information system and the ODI’s’’—that’s the Office

of Defect Investigations—‘‘ability to identify potential defects.’’ And

according to the Inspector General, NHTSA’s plans for its new information system and I here will quote from the report again to be,

and I quote, ‘‘fully operational by fall of 2002 is at risk because of

the poor project planning and management.’’ The Inspector General

went on to say that NHTSA cannot identify safety defects in a

timely manner because it has, and I quote again, ‘‘an unstructured

6

approach for analyzing data and determining if a potential defect

exists and warrants further investigation.’’

So here we are, a year and a half after the TREAD Act was enacted and NHTSA still has no methodology for analyzing complaints. NHTSA is on the verge of requiring thousands of motor vehicle and equipment manufacturers, both foreign and domestic, to

provide it with all kinds of information, including every customer

complaint and handwritten field reports. According to some,

NHTSA will be sitting on top of the world’s largest data base outside the military, and yet, NHTSA still has not set up methods and

procedures for evaluating safety administration.

I think we can all be disappointed at this situation. I had hoped

that NHTSA would understand and appreciate the deep concerns

of the committee and the Congress. I thought NHTSA was committed to making changes that would allow it to identify and to respond to safety problems because they’re the agency that we have

set up to address those kinds of questions.

I look forward to hearing the Administrator explain why the

Agency decided against developing a methodology for analyzing

complaints. I fully appreciate that it takes money, sophisticated

talent, a high degree of cooperation with the manufacturers to establish a new and effective information system to evaluate the

massive quantity of new information NHTSA will receive. In the

TREAD Act hearings, I repeatedly asked the Agency to identify for

us the additional resources they would need to do this job properly.

The only response was that it could be done with minimal new

funds. I think that that may be a little bit like the story of Cinderella. In any event, an old adage is that you get what you pay

for. It seems appropriate here.

The Inspector General expresses concerns about NHTSA’s plans

for a new system which will use off-the-shelf software and which

is only going to cost $5 million over a 3-year period. I think that

we should all share the concern expressed by the Inspector General

and this may be another fairy tale for us and may lead us to more

risk for the American public and more trouble for the industry because NHTSA is not going to be able to respond to its responsibilities under the law.

We need a system that works. We don’t need one which is cheap.

It has to work. Without an effective data management system and

without plans to use that effective data management system well

and wisely, the TREAD Act simply cannot be fully implemented

and most importantly, injuries and fatalities will continue to occur.

And these are injuries and fatalities that NHTSA should be able

to prevent.

I urge NHTSA to give its new data system the attention and to

seek the resources necessary to make it the accident prevention

tool that Congress intended it to be.

I look forward to what the hearings develop, but I do so, Mr.

Chairman, without great comfort. Thank you.

Mr. STEARNS. I thank the gentleman. The gentleman from Illinois, Mr. Shimkus.

Mr. SHIMKUS. Thank you, Mr. Chairman. I want to thank you for

bringing up the child safety seat issue, Rule 14H and 14I that were

7

due in November. That was a provision that we had worked on and

I hope we see some rapid movement on that.

The second thing is I’ve always been somewhat concerned about

some bias within DOT or NHTSA with respect to motorcycle riders

and there is a feeling out there that this new—the tire act will be

used to promulgate rules and standards on motorcycle equipment,

helmets and outerwear which when Congress has an intent to do

that we will pass legislation to direct that. This is not a time to

use the regulatory power or authority in which to manipulate Congressional intent. I was the author of the child safety seat legislation. We specifically put it in the legislation. There was no intent

in this legislation to address motorcycle outerwear and we will be

following that closely.

Third thing is there is a concern by the industry on the tire identification number being required on both sides of the tire. There is

some safety implications to workers in the facilities. I’m going to

tour a facility in my District within the next week because of removing the plates, the hot and cold aspects of tires. There’s got to

be a better way and I hope that you all look diligently to find that.

And with that, Mr. Chairman, I yield back my time.

Mr. STEARNS. I thank the gentleman. The gentleman from Tennessee, Mr. Gordon.

Mr. GORDON. Thank you, Mr. Chairman. Many of my concerns

have been addressed in earlier remarks, so I will make my remarks

part of the record and then would like to have some questions to

this panel at a later date.

Mr. STEARNS. Okay. The gentleman also from Tennessee, Mr.

Bryant.

Mr. BRYANT. Thank you, Mr. Chairman, and I too appreciate you

having these hearings. Certainly the last time we had hearings

along these lines in the TREAD Act it was certainly a period in

which we were experiencing some defects across the country with

our tires.

Both Mr. Gordon and I represent, or actually he represents one

of the Firestone plants and the headquarters is up in Tennessee

also and I recall vividly their role in this and certainly their contribution in terms of the legislation itself and their support, there

are some amendments of this bill, particularly with the collection

and destruction processes involved in some of their tires that were

affected by the recall. But I look forward to hearing from the witnesses today about this bill and how it’s worked so far.

In enacting legislation there’s always kinks to be worked out and

changes that need to be made during the process. I think once fully

enacted NHTSA is going to be receiving a great deal of data and

it’s important that a uniform and organized system be utilized to

organize this data.

There’s also controversy over what the standard for tire pressure

monitoring systems should be. I look forward to hearing from our

witnesses regarding their thoughts on the standard of alerting a

driver of a tire pressure and possible deflation. I also understand

that NHTSA is in the process of possibly changing the rollover resistance ratings. There are significant differences between the static stability factor method and the dynamic reliever test and I’d like

8

to hear about the benefits that these witnesses believe one method

has over the other.

I look forward to hearing from our witnesses on all of these

issues today.

All that said, I like many others on this committee have other

hearings also going on at the same time, so we are forced to go in

and out and will be in between these hearings so there may be

times that I will be out and won’t be able to hear all of this testimony that I’m looking forward to hearing. So I will try to follow

your written transcript of this hearing as well and I thank you,

gentlemen, for being here today and again, I thank our Chairman

for this very distinguished panel of witnesses today.

Thank you.

Mr. STEARNS. I thank my colleague and we’re welcoming also Mr.

Sawyer from Ohio who is a member of the full committee, but not

a member of the subcommittee and he’s welcome to have an opening statement.

Mr. SAWYER. Mr. Chairman, thank you very much for the opportunity to participate in this way. You’re very generous with the

time of this subcommittee. I also want to echo what we’ve heard

from others commending you for your diligence in making sure that

we don’t just enact bills requiring regulatory action, but that we

continue to monitor and evaluate the law’s implementation.

Let me also suggest that I share the concern that others have expressed that NHTSA may be underestimating the time and cost to

develop the data base that will be required to handle this enormous

amount of information. It strikes me that a $5 million off-the-shelf

system just does not seem adequate and that we run the risk of

what we talked about in the earlier hearings of a data dump that

undermines the value of whatever information we have.

With regard to specific rulemakings, I have some reservations

that we may not actually be protecting consumers. It seems to me

that it has been lost in NHTSA’s internal debate about whether to

use direct or indirect monitoring systems, the question of whether

allowing motorists to ride on tires that are 25 percent under inflated is itself safe. The rule, it seems to me would allow perhaps

up to half the motorists on the rode to operate their vehicles below

safe inflation rate. The problem is not one of immediate failure, but

rather of cumulative damage. It’s a problem that over time would

allow a tire to fail catastrophically. What’s more important even

that that, however, is the fact that an accurate early warning system is critical because it may actually encourage drivers to drive

for longer periods of time on under inflated tires and thereby risk

their safety due to that cumulative damage.

I’m not so concerned about which system is chosen, but rather

that we recognize that the tolerances are not very great.

Finally, just let me say that I share with others the concern that

they’ve expressed about the tire labeling rule. The question of

whether we are actually increasing safety in any substantial way

by requiring the tire identification number on both sides of the

mold is questionable. We do know, however, that that requirement

will pose substantial safety risk to workers and/or very substantial

cost and loss of productive time to manufacturers for a minimal

gain in consumer awareness. The descriptions that Mr. Bryant ofVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00012 Fmt 6633 Sfmt 6602 W:\DISC\77993 pfrm01 PsN: 77993
9

fered about workers climbing into 300 degree molds in order to

change the numbers once a week seems to me is very problematic.

With that, Mr. Chairman, I appreciate the change to be here. I

will submit my full statement for the record and thank you for the

opportunity to make these comments today.

Mr. STEARNS. And I thank my colleague and we also welcome the

gentle lady from Colorado, Ms. DeGette, for her opening statement.

Ms. DEGETTE. Thank you, Mr. Chairman. Mr. Towns apologizes

for having to leave, but I’m always happy to pinch hit for him and

I want to thank you, Mr. Chairman, for holding this hearing. I

know a lot of the issues that I cover in my opening statement have

been covered by the panel here this morning, so let me just say

that I’m really pleased we’re having this hearing today to talk

about what has happened with implementation of TREAD Act.

I’m also concerned about child restraints and I realize that we

haven’t had a full recommendation on this, but I look forward to

that recommendation in November. As the mother of two young

children who are now getting older, I know how important child restraints are and I look forward to hearing these recommendations.

With that, Mr. Chairman, I’ll submit the rest of my opening

statement for the record and I’m eager to hear the witnesses today.

[The prepared statement of Hon. Diana DeGette follows:]

PREPARED STATEMENT OF HON. DIANA DEGETTE, A REPRESENTATIVE IN CONGRESS

FROM THE STATE OF COLORADO

I want to thank you Mr. Chairman for holding this hearing, and I want to thank

our witnesses for being here today. I recognize that the National Highway Traffic

Safety Administration (NHTSA) has worked under considerable time pressure and

appreciate their expedited review of these critical issues.

This is an excellent opportunity to determine what has been achieved since Congress passed the TREAD, or Transportation Recall Enhancement, Accountability

and Documentation, Act. The most important duty of this subcommittee is to ensure

consumer protection. I am therefore glad to hear of NHTSA’s progress in addressing

the automobile safety concerns that were first raised following the Firestone ATX

and Wilderness tire recalls. This is also the time to determine what challenges remain in the implementation of the TREAD Act.

Early detection of dangerous patterns of tire and automobile defects can save

lives. With this in mind, the TREAD Act has introduced provisions that will require

vehicle and equipment manufacturers to report information regarding warranty adjustments, injuries and fatalities to NHTSA. By any account, these new reporting

requirements will result in an enormous amount of information. It is believed that

NHTSA’s database will be the largest database in the world. In the world. How will

NHTSA manage this information? What plans are in place to ensure that the data

is thoroughly analyzed? This early warning provision is at the heart of the TREAD

Act, so it is vitally important that NHTSA have in place information systems to

handle this gigantic influx of information.

We will also discuss the recommendations for tire pressure monitoring systems.

Underinflated tires present a significant hazard. NHTSA was charged with examining the two types of systems for monitoring tire pressure currently available: indirect and direct. Which system is ultimately chosen will significantly impact the auto

industry, as well as consumers.

Obviously an issue that is of great concern to all of us here is child restraints.

I realize that you have not issued your full recommendations on this, but I look forward to your report, which is due this November.

And finally, there is the question of how to best test and predict vehicle rollover

resistance. NHTSA was instructed to develop a dynamic test of vehicle rollover,

again by this November. The National Academy of Sciences’ recent recommendations support this development to supplement the current testing NHTSA performs.

I know that there are substantial hurdles to actualizing this test and I anticipate

hearing about the challenges and suggestions for overcoming them.

Again, I look forward to hearing from all of our witnesses and I welcome the

healthy debate that will ensue.

10

Mr. STEARNS. By unanimous consent, so ordered.

[Additional statement submitted for the record follows:]

PREPARED STATEMENT OF HON. W.J. ‘‘BILLY’’ TAUZIN, CHAIRMAN, COMMITTEE ON

COMMERCE

Thank you, Mr. Chairman for calling this important hearing today. I would like

to begin by welcoming the NHTSA Administrator, Dr. Jeffrey Runge, to our Committee. This is your first time testifying before us, and I find it quite fitting that

your testimony here today is on the implementation of such a significant piece of

safety legislation—the TREAD Act.

The Transportation Recall Enhancement, Accountability, and Documentation Act, or ‘‘TREAD’’ Act, was one of the most important pieces of legislation this Committee

produced in the 106th Congress. The Act revolutionized how NHTSA will collect,

analyze and assimilate data and established new safety standards that will improve

protection of the driving public.

As we evaluate the agency’s compliance with TREAD, we cannot forget why we

are here, and what spawned this legislation. Our hearings in the 106th Congress

confirmed that Firestone tires were de-treading at unusually high rates, causing

rollovers that injured, and in many cases killed, the vehicle’s occupants. Because of

this safety defect, more than 13 million Firestone tires were recalled at a cost of

nearly $3 billion—and more than 200 people needlessly lost their lives.

During our Firestone hearings, we learned a couple of things. First, it was clear

that the data available to NHTSA regarding Firestone’s tread-separation problems

were woefully insufficient. Although testimony showed that the agency had received

complaints about the tires, both from consumers and from an insurance company,

it did not receive data about Ford’s foreign recall actions or the internal company

claims data related to these accidents.

Second, it was clear that NHTSA did not effectively use the data it did have to

spot tire-failure trends. Indeed, NHTSA admitted that it needed to review and revise its own policies for evaluating its data. In response to these problems, we

passed the TREAD Act to prevent this kind of disaster from happening again.

So, how is NHTSA doing? As can be expected, it is doing well in some areas, and

could improve in others. One rulemaking that has received significant attention is

the tire-pressure monitoring rule. As part of the TREAD Act, we required that

NHTSA draft a regulation that would require manufacturers to install tire pressure

monitoring systems, which that tell a driver when a tire is significantly under inflated.

As NHTSA will tell us today, there are two different systems on the market that

can do this: direct and indirect. NHTSA’s draft final rule required the use of a direct

monitoring system, after a four-year phase-in period. While more expensive than an

indirect monitoring system, the direct system offers significant benefits. Namely, it

will alert a driver when all four tires have become under inflated at the same rate,

or when two tires on the same axel have become under inflated at the same rate.

The indirect system, at this point, does not, and cannot, detect these kind of underinflation situations.

According to NHTSA, there may be reason for concern about this: 2.8% of cars,

and nearly 4% of light trucks had all four tires under-inflated by at least 25% of

the recommended tire pressure. Now that doesn’t sound like a lot of vehicles, but

it totals approximately seven million vehicles. That’s more than the number of people

who live in entire state of Louisiana!

Allowing the use of an indirect tire pressure monitoring system would leave these

7 million vehicles without any tire pressure warning, which is simply unacceptable

and not consistent with the TREAD Act.

The TREAD Act required this rule to be completed on November 1, 2001. NHTSA

sent a draft final rule to OMB in December, but in February, OMB sent the draft

rule back to NHTSA with some concerns indicating that perhaps OMB preferred the

indirect to the direct monitoring system. But safety has to be the number one concern at NHTSA, and certainly when we passed the TREAD Act, the safety of the

driving public was our primary goal. Protecting some cars, but not others, was not

what we intended when we drafted the tire pressure monitoring rule.

I understand that OMB and NHTSA may be on the verge of reaching an agreement on the language of this rule. And I am glad this rule is close to seeing the

light of day. I do continue to have concerns, however: OMB is not an agency with

vehicle safety expertise. So I hope that it will be cautious when it decides to wade

into vehicle safety debates.

Again, I welcome our witnesses and I look forward to hearing about the implementation of this very important Act. Thank you, Mr. Chairman.

11

Mr. STEARNS. Now we look forward to hearing from the testimony of our witness list. Dr. Jeffrey Runge, Administrator of National Highway Traffic Safety Administration, Department of

Transportation. Welcome. The Honorable John D. Graham, Administrator, Office of Information and Regulatory Affairs, Office of

Management and Budget. I welcome you. And the Honorable Kenneth Mead, Inspector General, Department of Transportation, Office of Inspector General. Mr. Mead, we will welcome you.

Mr. Runge, we’ll start with you for your opening statement.

STATEMENTS OF HON. JEFFREY W. RUNGE, ADMINISTRATOR,

NATIONAL HIGHWAY TRAFFIC SAFETY ADMINISTRATION,

U.S. DEPARTMENT OF TRANSPORTATION; HON. JOHN D.

GRAHAM, ADMINISTRATOR, OFFICE OF INFORMATION AND

REGULATORY AFFAIRS, OFFICE OF MANAGEMENT AND

BUDGET; AND HON. KENNETH M. MEAD, INSPECTOR GENERAL, U.S. DEPARTMENT OF TRANSPORTATION, OFFICE OF

INSPECTOR GENERAL

Mr. RUNGE. Thank you, Mr. Chairman and members of the subcommittee. I am Jeff Runge, the new Administrator of National

Highway Traffic Safety Administration. I welcome the opportunity

to report on where we are with implementation of the TREAD Act.

The TREAD Act, as you know, challenged NHTSA to do a lot of

work. It required us to complete 15 separate rulemaking actions,

3 reports, 2 studies and 1 strategic plan. Many of those actions had

tight deadlines, some as short as 30 days, but even so we are well

on our way to accomplishing all the TREAD Act requirements.

First I want to report on the actions we have taken under the

TREAD Act to improve our defects program and then I’ll report on

actions taken to improve our safety standards and regulations.

Within the defects program, the key TREAD Act provision gives

us the authority to establish an Early Warning Reporting System.

When the rule is final, motor vehicle and equipment manufacturers

will be required to report a wide variety of information and relevant documents to us periodically.

In January 2001, we began gathering information about early

warning with an advance notice of proposed rulemaking. We received numerous comments from many constituencies that needed

to be considered and many were integrated into a notice of proposed rulemaking in December 2001. The NPRM proposed requiring all manufacturers of motor vehicles and equipment to submit

information on the claims and notices they receive about deaths

and injuries allegedly caused by defects in their products. Manufacturers of 500 or more vehicles annually and all child restraint and

tire manufacturers would have to submit information about injuries and statistical data about consumer complaints, warranty

claims, property damage claims and field reports. The NPRM’s

comment period closed just 3 weeks ago on February 4. We were

complimented on our responsiveness to the early comments and expect to issue the final rule by the June 30, 2002 deadline.

The TREAD Act also requires manufacturers to notify us about

safety recalls and similar campaigns in foreign countries. In October 2001, we issued the NPRM and the comment period ended in

December. The TREAD Act set no deadline for this rule, but for

12

simplicity we plan to issue it at the same time as the early warning

rule in June.

We’re also working hard to restructure the process we use for defects investigation. The TREAD Act has enabled us to hire additional investigators, to double the number of screeners and to establish a single point of contact for much outside reporting.

One of Congress’ primary concerns has been the Office of Defects

Investigation’s information, storage and management system.

Through provisions of the TREAD Act, we are developing a new

state-of-the-art data warehouse to process early warning information and to better manage ODI’s data.

We have worked intensively thus far with the Volpe National

Transportation Systems Center to ensure that this system will address our needs and we expect to have it online, on schedule and

under budget by the end of this year. Throughout the past year,

we have been in frequent contact with the DOT’s Office of Inspector General, Ken Mead, regarding these issues.

Senator McCain asked the IG to analyze our investigation processes and to evaluate their effectiveness in identifying vehicle safety problems. We also looked to the IG to provide a review of the

defects investigation process called for by the TREAD Act. After

the IG’s report was released in January, we reported on these matters to this committee and to the Senate committee on January 31.

In brief, we concur with all of the recommendations in the IG’s report. We have already implemented many of the recommendations,

including the creation of a panel to formalize the review of the

issues our screeners have identified as possible safety defects.

We’ve also hired a contractor in response to the IG’s recommendation for independent review of the development of the new data

management system to augment our internal control processes.

On the tire issue, the TREAD Act directs us to conduct several

actions to improve the safety of tires. Our NPRM to require a

warning system to indicate when a tire is significantly under inflated was published on July 26, 2001. The NPRM drew extensive

comments and we’ve sought to resolve the issues raised by the comments. We sent the final rule to OMB on December 18, 2001, and

on February 12, OMB returned the rule for reconsideration, based

on some concerns it had identified. We’ve been working together on

agreement with OMB and expect to have that completed within a

few days.

On the issue of tire endurance and resistance, we submitted an

NPRM on performance improvements to OMB on December 17.

OMB cleared the NPRM yesterday and it is up and available on

the NHTSA website this morning.

On tire labeling, we issued the NPRM in December 2001 and the

comment period closed on February 19. There were comments that

noted worker safety hazards and we are evaluating those comments. In fact, I have plans to visit a tire plant myself, actually

three tire plants in April. We expect to meet the June 1, 2002

deadline as well for this rulemaking.

The TREAD Act also requires us to take two other important

regulatory actions concerning vehicle rollover and child restraints

and Mr. Chairman, I see my light is red, so I have them in my

written comments or I can continue, if you like.

13

Mr. STEARNS. Well, is it possible you can just summarize a little

bit? I’ll give you 30 to 40 seconds.

Mr. RUNGE. Thanks. On rollover, the TREAD Act directs us to

develop a dynamic test by November 1 of this year and to conduct

rulemaking to determine the best way to inform the public about

our test results. Our request for comments, issued last July 3, described a number of driving maneuver tests from which we expect

to select a test to compare the rollover resistance of motor vehicles.

We expect to issue a second notice this spring describing our tentative choice of a test procedure. After considering the comments

on this notice, we will issue a final notice in October 2002. That

notice will describe the final test procedure along with an initial

set of ratings on rollover resistance.

With respect to child restraints, TREAD Act directs us to consider many performance elements and testing requirements. We

sent an NPRM on child safety performance to OMB for review and

we will be reporting to Congress about some elements for which insufficient data exists. We expect to issue a final rule by November

1 of this year.

On the matter of labeling, our NPRM for labeling improvements

was issued on October 29 and we expect to issue the final rule

again by TREAD’s November 1, 2002 deadline.

On the rating system to help purchasers compare restraint systems, we examined the rating systems developed by other countries

and some organizations and we conducted our own performance

testing. The request for comments was issued on October 29 and

we expect to have this implemented by the November 2002 deadline.

Mr. Chairman, that concludes my oral testimony. You have my

written testimony for the record.

[The prepared statement of Hon. Jeffrey W. Runge follows:]

PREPARED STATEMENT OF HON. JEFFREY W. RUNGE, ADMINISTRATOR, NATIONAL

HIGHWAY TRAFFIC SAFETY ADMINISTRATION

Mr. Chairman, Members of the Subcommittee, thank you for the opportunity to

speak about the National Highway Traffic Safety Administration’s (NHTSA) implementation of the Transportation Recall Enhancement, Accountability, and Documentation (TREAD) Act.

The TREAD Act was enacted on November 1, 2000, as a direct consequence of

hearings before the Committee on Energy and Commerce on the safety of Firestone

tires and related matters. In the course of the hearings, the Committee determined

that NHTSA could have detected the problems with the tires sooner if it had obtained reports about the tires’ problems in a timelier manner.

The TREAD Act therefore contains provisions requiring vehicle and equipment

manufacturers to report periodically to NHTSA on a wide variety of information

that could indicate the existence of a potential safety defect and to advise NHTSA

of foreign safety recalls and other safety campaigns. The Act increases civil penalties for violations of the vehicle safety law and provides criminal penalties for misleading the Secretary about safety defects that have caused death or injury. It authorizes the Secretary to require a manufacturer to accelerate its program for remedying a defect or noncompliance if there is a risk of serious injury or death, and

requires that manufacturers must have a plan for reimbursing owners who incur

the cost of a remedy before being notified by the manufacturer. It also prohibits the

sale of motor vehicle equipment, including a tire, for installation on a motor vehicle

if the equipment is the subject of a defect or noncompliance recall. In a remedy program involving tires, the manufacturer must include a plan that prevents replaced

tires from being resold for use on motor vehicles. The Act also directs the Secretary

to undertake a comprehensive review of the way in which NHTSA determines

whether to open a defect or noncompliance investigation.

14

In addition, the TREAD Act directs the Secretary to conduct rulemaking actions

to revise and update the Federal motor vehicle safety standards for tires, to improve

labeling on tires, and to require a system in new motor vehicles that warns the operator when a tire is significantly underinflated. The Act also directs the Secretary

to develop a dynamic rollover test for motor vehicles, to carry out a program of dynamic rollover tests, and to disseminate the results to the public.

An extensive provision on child restraints requires that the Secretary undertake

a comprehensive review of the safety of child restraints, upgrade the safety standard for child restraints where appropriate, establish a rating system for child restraints, study the effectiveness of automobile booster seats for children, and establish a plan for saving lives and reducing injuries through the use of booster seats.

As this brief summary makes clear, the TREAD Act challenged us to do a lot of

work. It requires us to complete 15 separate rulemaking actions, three reports, two

studies, and one strategic plan. Many of the required actions had tight deadlines,

some as short as 30 days. Some of these actions had not been on our agenda before

the TREAD Act, so we had to accomplish the TREAD actions without compromising

our work on other priority actions.

Thanks to the additional resources the TREAD Act gave us, we are well on our

way to accomplishing all of the goals of the Act’s requirements. First, I will report

on the actions we are taking that relate to the defects investigation program, and

then on our actions to amend and adopt safety standards and regulations.

Defects Investigation

On our actions to improve safety defect investigations, we have met all the rulemaking deadlines in the TREAD Act and are in the final stages of implementing

other provisions that do not contain such deadlines.

Within the defects program, the key TREAD Act provision gives us the authority

to issue a final rule that establishes an Early Warning Reporting System. When this

rule is final, motor vehicle and motor vehicle equipment manufacturers would be required to report a wide variety of information and to submit relevant documents to

us periodically. In the past, our decisions on whether to open defect investigations

have primarily been based on complaints we receive from consumers. Our efforts to

identify potential defects in a timely manner have been hampered by an inability

to obtain relevant information in the possession of the manufacturers. Experience

has shown that manufacturers often obtain information suggesting the existence of

a safety-related problem months, and sometimes years, before consumer complaints

to NHTSA indicate a potential problem.

In January 2001, we issued an advance notice of proposed rulemaking to begin

implementing the early warning requirement. We followed this with a notice of proposed rulemaking (NPRM) in December 2001. The comment period for the NPRM

closed on February 4, 2002. We are currently reviewing the over 50 comments received on the NPRM. We fully expect to issue our final rule by the June 30, 2002

deadline.

We have proposed to require all manufacturers of motor vehicles and motor vehicle equipment to submit information about claims and notices they receive about

deaths and injuries that are allegedly due to defects in their products. Manufacturers of 500 or more vehicles annually and all child restraint and tire manufacturers

would also have to submit, with minor exceptions, statistical data about consumer

complaints, warranty claims, property damage claims, and field reports. We believe

that these submissions will help us identify potential safety defects in a timely manner, without unduly burdening the manufacturers.

The TREAD Act requires manufacturers to notify the Secretary of safety recalls

and similar campaigns in foreign countries. In October 2001, we issued a NPRM

prescribing the contents of the notifications. The comment period on the NPRM

ended in December 2001, and we are currently reviewing the 20 comments received

on the NPRM. We have also issued final rules to implement the civil and criminal

penalty provisions and NPRMs to implement the other defect-related provisions

noted earlier. On all these matters, we expect to issue final rules within the next

few months.

As we develop the early warning reporting requirements, we also are working

hard to restructure the process we use for defects investigation. The TREAD Act has

enabled us to hire additional investigators, doubled the numbers of screeners, and

established a single point of contact for outside reporting. All of this information will

be entered into the Office of Defects Investigation (ODI) database, where all screeners and investigators will have access to it.

To improve ODI’s outdated information storage and management system and to

handle the large volume of information that will be submitted under the early warning rule, we have contracted with the Volpe National Transportation Systems CenVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00018 Fmt 6633 Sfmt 6621 W:\DISC\77993 pfrm01 PsN: 77993
15

ter (Volpe) to design and implement a new state-of-the-art data warehouse. We have

worked intensively with Volpe and its subcontractors to ensure that this system will

address our needs, and we expect to have it on-line, on schedule and under budget,

by the end of this year. When the new system becomes operational, we believe it

will enable us to manage and effectively utilize the early warning reporting data.

Throughout the past year, we have been in communication with the Department’s

Office of the Inspector General (OIG), which was asked by Senator McCain to analyze ODI’s investigative processes and evaluate their effectiveness in identifying vehicle safety problems. As Secretary Mineta advised the Committee on January 31,

2002, we looked to the OIG to provide the comprehensive review of ODI’s work that

Section 15(a) of the TREAD Act directed us to conduct. After the OIG released its

report on January 3, 2002, we completed our reporting requirement under Section

15 with a supplementary letter to the chairman and ranking member of the relevant

House and Senate committees.

The Inspector General is here this morning to share his findings with you. But

I want to state that we have concurred in all of the recommendations in his report

and, in fact, have already implemented many of them, including the creation of a

panel to review the issues our screeners have evaluated as possible safety defects.

We have also hired a contractor, in response to the OIG’s recommendation for an

independent review of the project to develop the new data management system.

Mr. Chairman, I believe we are implementing the TREAD Act requirements in

a way that will significantly improve our ability to detect safety defects on a timely

basis.

Tire-related Regulatory Actions

The TREAD Act directs us to conduct several actions to improve the safety of

tires, including rulemaking to improve the endurance and resistance standards for

tires, to improve the information labels on tires, and to require a warning system

to indicate to drivers when a tire is significantly underinflated.

We completed the testing and preparatory work and submitted an NPRM proposing several tire performance improvements to the Office of Management and

Budget (OMB) on December 17, 2001. We received clearance from OMB on February

22, and we are now preparing the NPRM for issuance. Completing this rulemaking

as quickly as possible is one of my highest priorities.

NHTSA issued an NPRM on tire information labeling in December 2001. The

comment period closed on February 19, 2002. We are reviewing the comments on

the NPRM and expect to meet the June 1, 2002 deadline for this rulemaking. The

improved information resulting from this rule should make it easier for consumers

to find and understand safety information about their tires.

The NPRM to require a warning system to indicate to vehicle operators when a

tire is significantly underinflated was published on July 26, 2001. The NPRM drew

extensive comments. We have sought to resolve the issues raised by the comments

and devise a system that will meet the intent of the TREAD Act in a manner that

best serves safety. In the belief that we had devised such a system, we sent a final

rule to OMB on December 18, 2001. On February 12, 2002, OMB returned the rule

to us for reconsideration based on concerns it had identified. When we received

OMB’s return letter, we immediately began examining the issues it raised. Completing this rulemaking as quickly as possible is one of my highest priorities.

Other Regulatory Actions

The TREAD Act also requires us to address two other aspects of motor vehicle

safety. Section 12 of the Act requires us to develop a dynamic test of vehicle rollover

by November 1, 2002, and to conduct rulemaking to determine how best to disseminate test results to the public. Section 14 of the Act contains several directives relating to the improvement of child restraint systems.

NHTSA issued a request for comments on dynamic rollover testing on July 3,

2001. In our notice, we described a number of driving maneuver tests from which

we expect to select a test to used to compare the rollover resistance of motor vehicles. The notice discussed the strengths and weaknesses of the various tests, and

explained our rationale for preferring a driving maneuver test to other types of dynamic tests, such as centrifuge tests. We are now completing our review of the

issues raised by the comments and expect to issue a second notice this spring describing our tentative choice of a test procedure. After we consider the comments

on this second notice, we plan to issue a final notice in the fall of 2002 describing

the final test procedure along with an initial set of rollover resistance ratings.

Less than two weeks ago, NHTSA received the National Academy of Sciences’

(NAS) report on dynamic testing for rollover resistance, as required by the DOT Appropriations Act for 2001 (P.L. 106-346). The report suggests that the agency conVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00019 Fmt 6633 Sfmt 6621 W:\DISC\77993 pfrm01 PsN: 77993
16

sider supplementing the static stability factor test for rollover consumer information

with the results of dynamic rollover tests. The National Academy concluded that

this broader look at rollover performance would give a more robust consumer-rating

program. The report had other findings not related to dynamic rollover testing. We

are currently reviewing all of the report’s findings and we will provide our formal

response.

Section 14 requires us to address several issues relating to child restraints, including improved restraint performance, better labeling, and a rating system to enable purchasers to compare restraints. Each of these issues was to be addressed in

rulemaking actions that were to begin by November 1, 2001, and conclude by November 1, 2002.

We issued an NPRM on October 29, 2001, proposing better and simpler labeling

for child restraints. The changes include requirements for molding some information

into the restraint’s shell to improve durability, for better placement of some labels,

for a uniform font for all labels, for white labels with black text, and for color-coded

installation information to distinguish forward-facing from rear-facing information.

We anticipate issuing a final rule to improve labels before the November 1, 2002

deadline.

To develop a rating system for child restraints, we examined the existing rating

systems that other countries and organizations have developed and conducted our

own performance testing. In our request for comments issued on October 29, 2001,

we stated that we had tentatively concluded that the best rating system is one that

combines information about a restraint’s ease of use with information about its dynamic performance obtained through higher-speed sled testing or in-vehicle testing

through our existing New Car Assessment Program (NCAP). We are also considering using both higher-speed sled tests and NCAP tests. We are reviewing the comments we received and expect to implement the rating system by the November 1,

2002 deadline.

To upgrade the performance requirements of the Federal motor vehicle safety

standard on child restraints, we had to examine a standard whose requirements

have gone through continual review and significant change in the last several years.

In an effort to make it easier to secure child restraints properly in motor vehicles,

we recently upgraded the standard to require uniform attachment features and required light-duty motor vehicles to be equipped with anchorages that will accommodate these features. We will propose to require some of the performance elements

listed in Section 14 in an NPRM. However, on several of the elements, for which

there are uncertainties about the appropriateness of rulemaking, at least at this

time, we will issue an advance notice of proposed rulemaking requesting comments.

Section 14 requires us to submit a report to Congress if we decide not to incorporate

any of the listed elements in a final rule. Before we can decide what should be included in a final rule, we must first obtain and carefully consider comments from

the public.

Mr. Chairman, this concludes my overview of our actions to implement the

TREAD Act. The Act has challenged us, but I believe that we are meeting the challenge and that our actions will improve safety on the nation’s highways. I will be

glad to answer any questions you may have.

Mr. STEARNS. I thank the gentleman.

Mr. Graham.

STATEMENT OF HON. JOHN D. GRAHAM

Mr. GRAHAM. Good morning, Mr. Chairman, and thank you,

members of the committee, for the opportunity to be here. Let me

introduce myself. I was a faculty member at the Harvard School of

Public Health for about 17 years before joining the Bush Administration in the Office of Management and Budget. It turns out during that period I had the opportunity develop a great admiration

of Dr. Runge’s work in the field of trauma care and it was a wonderful surprise for me to learn that we were going to get to know

each other a little better in a very different capacity. I look forward

to the opportunity to work with him and we’re already making

some significant progress.

I’d also like to add that OMB supports the TREAD Act and we’ve

been working very aggressively, as Dr. Runge indicated, for prompt

17

implementation of the TREAD Act. I would also like to note that

my role at OMB given to me by the President is to assure that all

significant regulations by agencies, including NHTSA, have sound

science and economics behind them and that’s the review role that

we play for the President.

I would like to say a few things about the process of OMB review. First, we cover all significant regulatory actions that are designated as such under Executive Order 12866. We have a 90-day

review period. I insist that my staff give a response to agencies

within that 90-day review period. And in cases of a statutory deadline, which is quite relevant in the TREAD Act situation, we engage in expedited review of agency proposals. In my written testimony to you I have provided information on the promptness with

which OMB has responded to NHTSA’s request for OMB review.

There are also cases of Court ordered deadlines and hopefully we

won’t get to that in the case of the TREAD Act, but in those situations we try to respond on the order of the days to help agencies

meet the Court deadlines they face.

The outcomes of any OMB review are one of three possibilities.

We clear the rule, the agency withdraws the rule, or we return the

rule to the agency for reconsideration.

Since I was confirmed in September, I have returned 17 rules to

various regulators throughout the Federal Government because of

an inadequate scientific and economic basis for the conclusions that

they have drawn. In five of those cases thus far, the agencies have

improved their analysis, improved the rulemaking package, resubmitted it to OMB and it has been cleared. We expect those instances will happen more in the future.

Let me talk specifically about the tire pressure monitoring system rule. OMB recognizes not only the statutory mandate, but the

good policy sense behind the idea of a tire pressure monitoring system rule. So there’s no disagreement about whether there should

be a rule. There are some technical issues that we’re working out.

We also have an agreement for model years 2004 to 2006 that

each vehicle that is manufactured and sold in this country should

meet either a one-tire or a four-tire pressure monitoring standard.

The concerns we have raised in the return letter which we

shared with the committee and in my written testimony are what

we should be doing for model years 2007 and beyond. Should we

decide that now or should we gather some additional data before

we make that decision?

The concerns we have are as follows. First, we agree with

NHTSA that the four-tire standard provides better tire-related

safety than the one-tire standard. However, we assert that there is

reason to believe that the one-tire standard may encourage more

vehicles to be equipped with anti-lock braking systems and, while

the evidence on the safety of anti-lock brakes is not definitive,

there is suggestive evidence that those systems, in fact, reduce risk

of death and injury to drivers, particularly drivers who learn how

to use those systems properly.

Second of all, we have concerns that the benefits analysis which

NHTSA has done may have some unsupported assumptions and

some questionable data that we understand NHTSA is working on

right now. In summary, we’ve been doing a rigorous review of the

18

tire pressure monitoring system rule. We did it very promptly

under the circumstances and as Dr. Runge noted, we are very close

to an agreement on that particular rule.

Thank you very much for the opportunity to be here today.

[The prepared statement of Hon. John D. Graham follows:]

PREPARED STATEMENT OF HON. JOHN D. GRAHAM, ADMINISTRATOR, OFFICE OF

INFORMATION AND REGULATORY AFFAIRS, OFFICE OF MANAGEMENT AND BUDGET

Mr. Chairman, and Members of this Subcommittee, thank you for inviting me to

this hearing. I am John D. Graham, Ph.D., Administrator of the Office of Information and Regulatory Affairs (OIRA) in the Office of Management and Budget. My

testimony will (1) explain the role that OMB plays in reviewing proposed and final

regulations under Executive Order (E.O.) 12866, (2) describe the role we have

played in reviewing rules issued by NHTSA pursuant to the Transportation Recall

Enhancement, Accountability and Documentation (TREAD) Act of 2000, and (3) explain why we recently asked NHTSA to reconsider a draft final rule on tire pressure

monitoring systems (TPMSs).

I am especially pleased to testify at the same hearing as my Administration colleague Dr. Jeffrey Runge. For years I have been an admirer of Dr. Runge’s work

in the field of trauma care and I am convinced that he will prove to be one of the

finest Administrators that NHTSA has had in the agency’s 35-year history. I know

how hard Dr. Runge and his staff are working to implement the ambitious provisions of the TREAD Act.

OMB fully supports the safety goals of the TREAD Act and is working with

NHTSA to produce the best possible regulatory actions given the resource and statutory constraints. We appreciate that NHTSA has been working under tight statutory

deadlines and, as a result, OMB has performed its review function in an expedited

yet rigorous manner.

OMB’S REGULATORY REVIEW ROLE

Under E. O. 12866, OMB reviews all significant regulatory actions to ensure consistency with the principles of good regulatory analysis and policy. For those significant actions that cost the economy more than $100 million per year, such as the

tire-pressure monitoring (TPMS) rule, E.O. 12866 requires the agency to perform a

cost-benefit analysis that is reviewed by OMB.

At both the proposed and final stages of a major rulemaking, OMB is provided

up to 90 days to review an agency’s rulemaking package, which includes the draft

rule, the cost-benefit analysis and any other supporting materials. During the 90-

day review period, analysts at OMB scrutinize the agency’s work and, in some cases,

collaborate with the agency to improve the analysis and/or the draft rule. There are

ultimately three possible outcomes of OMB review: (1) clearance for publication in

the Federal Register, (2) withdrawal by the agency for further consideration, and

(3) return by OMB to the agency for further consideration.

When a rule is returned to the agency, it is the practice of this Administration

to prepare a formal return letter that is made available to the public as well as the

agency. Since I was confirmed by the Senate in July of last year, I have signed 20

return letters about various draft regulations. In most cases, the reason for the return was an inadequate regulatory analysis. The public can review these letters on

OMB’s web site at www.whitehouse.gov/omb/inforeg/return—letter.html. In five of

those cases so far, the agency improved the regulatory package and resubmitted it

to OMB, which cleared it for publication in the Federal Register.

Each year OMB performs reviews of about 600 significant regulations, and about

60-80 are at OMB during any given month. During my tenure as OIRA Administrator, we have treated the 90-day review period as a performance indicator except

in unusual circumstances (e.g., when the agency requests an extension of the review

period). Agencies have a right to expect that OMB will perform rigorous yet timely

reviews. The monthly number of OMB reviews that extend beyond 90 days has

plummeted from an average of 25 in calendar year 2000 to close to zero in the last

three months.

When an agency is facing statutory deadlines, such as those in the TREAD Act,

we offer the agency expedited review and rarely consume the entire 90-day review

period. When agencies are facing a court-ordered deadline, our reviews are even

swifter. In some cases, we work informally with the agency to make sure that a regulatory package is in good shape before it is even formally submitted to OMB.

19

PACE OF OMB REVIEWS UNDER THE TREAD ACT

To date, OMB has conducted three formal reviews under the TREAD Act (including the draft final TPMS rule) under E.O. 12866. We have also reviewed another

eight TREAD Act rules informally. Our average review time was 47 days for the

formal reviews and 8 days for the informal reviews.

In the case of the TPMS rule, NHTSA submitted the draft final regulatory package to OMB on December 17, 2001. (The statutory deadline for issuance of the final

rule was November 1, 2001). We returned the rule to NHTSA for reconsideration

on February 12th and have worked diligently with NHTSA since that date.

TIRE PRESSURE MONITORING TECHNOLOGY

The TREAD Act requires NHTSA ‘‘to require a warning system in new motor vehicles to indicate to the operator when a tire is significantly underinflated.’’ Currently, there are two different ways to measure tire pressure: the direct system and

the indirect system.

The direct system has a battery-operated measuring device on each of the four

tires and, as an optional feature, can provide a dashboard display of the inflation

levels in each tire. This system is currently available only on certain high-priced

models (e.g., the Lincoln Continental and the Lexus SC 430) and costs $66 per vehicle to install, plus a lifetime maintenance cost of $40.

The indirect system infers tire pressure by using information from a computer in

the car’s anti-lock braking system. The difference in rotational speeds between

wheels is compared to infer tire pressure. For vehicles with anti-lock brakes, the indirect system is inexpensive ($13 per vehicle to install with negligible maintenance

costs). A dashboard warning light indicates whether one of the tires is underinflated. The indirect system is currently installed on almost two million vehicles

in the United States, including the Toyota Sienna and Ford Windstar.

Given current technology, it appears that both systems could meet a ‘‘1-tire’’ performance standard (i.e., the ability to detect 30% underinflation in one tire) while

only the direct system could satisfy a performance standard that requires information on all 4 tires simultaneously.

THE ROLE OF ANTI-LOCK BRAKES

From a tire-safety perspective, NHTSA has valid reasons for considering a mandatory ‘‘4-tire’’ standard for the future. This approach would assure that consumers

would be warned when any combination of tires (1, 2, 3 or all 4) is underinflated.

The 1-tire standard will provide warnings when 1 tire is underinflated but will not

necessarily detect situations when 2 or more tires are underinflated. A further

weakness of the 1-tire standard is that consumers may misperceive that their tires

are fine (since the warning light is off) when in fact all four of their tires are equally

underinflated. The 4-tire standard overcomes these problems.

The tire-safety advantages of the 4-tire rule may not be decisive because the 1-

tire standard encourages vehicle manufacturers to install anti-lock braking systems

in vehicles that do not currently have them. The best available evidence, though not

definitive, suggests that anti-lock brakes reduce fatal crashes by 4 to 9%. Since

these reductions apply to all fatal crashes, not just tire-related crashes, the safety

benefits of more anti-lock brakes could easily outweigh the extra tire-safety benefits

of the 4-tire rule. About one-third of new vehicles sold today—primarily less expensive vehicles—are not equipped with anti-lock brakes. OMB’s analysis indicates that

retention of the 1-tire standard will encourage more consumer offerings of anti-lock

brakes.

If a vehicle manufacturer is considering adding anti-lock brakes to vehicles that

do not currently have them, the cost to consumers of purchasing anti-lock brakes

will be smaller under a 1-tire standard than a 4-tire standard. NHTSA has estimated that adding anti-lock brakes costs an average of $240 per vehicle. The cost

of a direct tire-monitoring system plus anti-lock brakes would be about $306

($240+$66). The cost of an indirect system plus antilock brakes is about $253

($240+$13). (Note that these comparisons ignore maintenance costs). Thus, the option of complying with an indirect system reduces the cost of adding anti-lock brakes

by about $53 per vehicle ($306-$253), or by about 20%. The basic principles of economics suggest that these cost savings will induce more vehicles to be equipped with

anti-lock brakes than would be equipped under a 4-tire standard. According to

NHTSA, one large vehicle manufacturer intends to install anti-lock brakes in more

vehicles if indirect TPMS are permitted.

Many of the indirect TPMS now on the road are very crude and will need to be

improved to meet NHTSA’s 1-tire standard. It is also likely that technological adVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00023 Fmt 6633 Sfmt 6621 W:\DISC\77993 pfrm01 PsN: 77993
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vances will permit indirect systems to detect moderate underinflation in 1, 2 or 3

tires. However, a purely indirect system cannot meet the 4-tire standard because

the system works by sensing the differences in pressures between wheels.

OMB believes that a technology assessment should be conducted before making

a final decision about whether the 1-tire standard should be retained or replaced

by a 4-tire requirement. OMB has requested that NHTSA gather the following information: (1) an empirical study of actual tire pressure levels in vehicles with indirect

systems and, if feasible, other types of TPMSs, (2) a cost analysis of alternative

TPMSs that accounts for probable economies of scale of mass production, (3) an updated analysis of the sales of anti-lock brake systems and their safety impacts, and

(4) an assessment of technological progress in development of improved TPMS. The

results of these analyses could inform the decision as to whether a new rulemaking

should be conducted for model years 2007 and beyond.

SHOULD ANTI-LOCK BRAKES BE REQUIRED?

Since OMB’s analysis indicates that the safety benefits of anti-lock brakes may

be substantial, it has been suggested that NHTSA should mandate anti-lock brakes

in all new vehicles. This idea is worthy of consideration and would need to be addressed in a separate rulemaking. A good time to consider this option would be two

years from now, when the real-world database on the safety benefits of anti-lock

brakes may be large enough to draw definitive statistical conclusions.

Thank you for the opportunity to appear today.

Mr. STEARNS. I thank the gentleman.

Mr. Mead, for your opening statement.

STATEMENT OF HON. KENNETH M. MEAD

Mr. MEAD. Thank you, Mr. Chairman. I want to commend you

on having this hearing. I think it’s important for oversight committees to hold hearings from time to time on matters as important

as this. In fact, the implementation of the TREAD Act requirements is on our list of the top 10 management challenges facing

the Department. We have issued our report as is noted in my prepared statement. Our testimony mirrors that report. And I would

have to say that overall, I think NHTSA has been very responsive

to the recommendations and findings in that report.

I group our findings into three categories: first, completing the

TREAD Act rulemaking. No. 2 is modifying the process that’s used

to make decisions and whether or not to open a defect investigation. And third is the information management system. It could

well be that you have an excellent rule. All the manufacturers comply with that rule. And that you have volumes and volumes of

data. You need a system that is fairly sophisticated to synthesize

that information on something approaching a real time basis.

First, I’d like to cover the TREAD Act rulemakings. I think the

early warning system rule is certainly one of the centerpieces of

that legislation. NHTSA has stayed on track in issuing the notices

of proposed rulemakings. That’s quite different though from actually issuing the final rule. And in the case of the TREAD Act, the

first three statutory due dates were missed by about 6 months. One

that’s now pending is the tire pressure monitoring rule, I think it

was due out on November 1.

I ought to say that we did a review, a separate review a couple

of years ago of the rulemaking process at DOT. We found that only

about 10 percent of the statutory due dates for issuing regulations

were met. The average cradle-to-grave time for a rule was about 4

years, 3.8 to be precise. Secretary Mineta is strongly committed to

changing that process and certainly the TREAD Act offers a good

test tube environment for doing that.

21

No doubt about it, Mr. Chairman, the heavy lifting on the rulemaking lies ahead. NHTSA has issued the notice of proposed rulemaking on the early warning system, and the due date for that is

this summer. There are 12 final rulemakings required and six have

statutory deadlines.

I believe the tire pressure monitoring rule shows the importance

not only of meeting time lines, but ensuring the quality and substance of the rule. What’s going on right now are discussions about

the quality and substance of the rule and how best to resolve those

issues. On the early warning rule, I expect that too will be controversial. The Alliance of Automobile Manufacturers has already

weighed in on that and has expressed some reservations about how

quickly it can be done and the resources required to implement the

early warning requirement.

I’d like to move to a recommendation we had in our report on a

peer review panel process. We found that one was needed to ensure

consistency when opening investigations. What we saw at NHTSA

is that if a complaint comes in it gets assigned to a screener and

essentially that screener and one other person make the decision

as to whether or not to open an investigation. Without going into

details of individual cases, we found a number of instances where

NHTSA really couldn’t explain why they made a decision to open

an investigation or not open an investigation. It’s an incredibly

subjective process to begin with. So we recommended that they create a panel of senior NHTSA people so they all come together, and

make decisions as to whether or not an investigation should be

opened.

Since we issued our report, 38 cases have appeared before this

panel and in 34 of them NHTSA opened an investigation. We think

a couple of steps still need to be taken. One is that if a screener

decides that he or she will not recommend a potential defect for investigation, it falls into a hole and will not go before the panel. We

think it should go before the panel at a certain point in time. We

also think the panel, particularly on a negative decision, in other

words, no recommendation that an investigation not go forward,

ought to document its decision. So we have a trail to go back to and

it’s archived appropriately.

Finally, I’d like to say a word about the defect information management system which several of the members have alluded to. The

TREAD Act will rise or fall on how good a system that is. Two factors currently hamper NHTSA’s ability to successfully implement

a new defect information management system. The first is the

quality of data in the current defect data base. I think you probably

know from your deliberations in passing the TREAD Act, that the

ratio of complaints that a manufacturer gets to those that consumers notify NHTSA in about is extraordinarily disparate. In fact,

in one case we found during our audit that the manufacturer received over 1400 complaints about a potential defect and when you

look at the data base, there’s 32 consumer complaints in there.

We also found instances where the data base contains inaccurate

and incomplete data. The specific example had to do with complaints that came in about accidents where brakes failed and the

air bag didn’t deploy. Well, if it’s not properly coded what shows

up in the data base is failed air bags, and nothing about the

22

brakes. Or it could also be the converse. That’s an illustration of

the things that the new information management system will have

to correct.

The second factor is the risks associated with developing a data

base of this type. This is going to have to be a sophisticated data

base. We found that the project is in danger of not meeting its

timeframes and quality goals within budget. Actually, I’m not sure

that a data base of this type can be done within the budget that

NHTSA has estimated.

We audit the entire Department of Transportation and we see

software intensive systems under development throughout the Department. You’re probably familiar with some the FAA has undertaken and the track record there has not always been something

to write home about. Software-intensive systems typically have

overruns, both in schedule and budget. That’s why we recommended here that NHTSA bring in an outside third party independent of the contractor to validate and verify the systems contractor’s progress. NHTSA has said that they will do that and we’re

going to monitor the scope of the contract to make sure that that

gets done properly.

Thank you.

[The prepared statement of Hon. Kenneth M. Mead follows:]

PREPARED STATEMENT OF HON. KENNETH M. MEAD, INSPECTOR GENERAL, U.S.

DEPARTMENT OF TRANSPORTATION

Mr. Chairman and Members of the Subcommittee: We appreciate the opportunity

to discuss the implementation of the Transportation Recall Enhancement, Accountability, and Documentation (TREAD) Act. We have identified the implementation of

the TREAD Act as one of the 10 most important management challenges faced by

the Department. Also, on January 3, 2002, we issued a report on the National Highway Traffic Safety Administration’s (NHTSA) implementation of the TREAD Act.

Our report included several recommendations to ensure the timely completion of

the Act’s requirements and to improve the operations of NHTSA. Specifically, the

recommendations focused on adhering to rulemaking deadlines, improving the process for identifying potential defects and opening investigations, improving the quantity and quality of data on potential defects, and mitigating the risks associated

with developing a new defect information system.

In October 2000, Congress passed the TREAD Act to establish, in part, early

warning reporting requirements for manufacturers so NHTSA is aware of potential

defects as soon as possible. In its September 2000 hearings, Congress questioned

why NHTSA, Firestone and Ford did not act sooner to prevent the 103 deaths and

over 400 injuries associated with the defective tires. These numbers have since increased to over 200 deaths and 800 injuries. Congress found the following: (1)

NHTSA had insufficient data regarding the problems with Firestone tires, and (2)

NHTSA did not use data it already had to spot trends related to tire failures.

Since the Act was passed, NHTSA has made progress toward completing the

TREAD Act requirements, but more work remains to achieve the goals of the Act.

• First, completing the TREAD Act rulemakings, most importantly the

early warning reporting requirements rule, in a timely and comprehensive

manner. NHTSA has already completed three final rulemakings including the rule

requiring individuals to report to NHTSA the sale or lease of defective tires. NHTSA

has been on track in issuing 9 notices of proposed rulemakings; but it still needs

to complete 12 final rulemakings including 6 with statutory deadlines. One of the

final rules, the tire pressure warning device rule, was due on November 1, 2001.

However, the rule has yet to be issued. We understand that NHTSA and OMB are

very close to resolving the issues associated with the proposed final rule.

Several other rules are also complex and controversial, and have statutory deadlines for completion on or before November 1, 2002. These rules include establishing

early warning reporting requirements for vehicle and equipment manufacturers; updating the tire standards; and improving child safety restraints. The rules will be

controversial because there are differing views among the affected parties and interVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00026 Fmt 6633 Sfmt 6621 W:\DISC\77993 pfrm01 PsN: 77993
23

est groups on the substance of NHTSA’s proposals. The status of the TREAD Act

rulemakings and other actions are presented in Exhibits A, B, and C.

We noted that factors such as differing views on the substance of a proposed rule,

requirements for cost/benefit analysis, and the need to have other entities, such as

the Department and the Office of Management and Budget (OMB), review a proposed rule, influenced the time required to issue a rule. Further, in our July 2000

report on the Department’s rulemaking process, we noted that the Department met

only 10 percent of statutory deadlines and missed the statutory deadlines by an average of 3.8 years. However, Secretary Mineta has made the timely completion of

rules a departmentwide priority.

Issuing the early warning final rule by June 30, 2002, will be a significant challenge for NHTSA. Significant disagreements are likely between NHTSA and automobile manufacturers over the scope and parameters of the reporting requirements

in the proposed rule. Late last year, NHTSA issued its notice of proposed rulemaking specifying the early warning data that manufacturers will be required to

report. As proposed, the rule requires manufacturers to report data quarterly starting in April 2003. The data include deaths, injuries, property damage claims, warranty claims, field reports, and consumer complaints related to potential defects in

various systems or components, such as electrical systems and air bags. Also, by

April 2003, manufacturers will be required to submit, on a one-time basis, 3 years

of historical early warning data.

In commenting on the proposed rule, the Alliance of Automobile Manufacturers,

an association of 13 domestic and foreign automobile manufacturers, stated that

NHTSA ‘‘has substantially underestimated the burden imposed by the proposed

rules, and the resources in terms of staff time, the cash outlays and the efforts that

will be required to develop systems that can reliably generate the reports proposed

in the Notice of Proposed Rulemaking.’’ Further, the Alliance stated that ‘‘NHTSA

also underestimated the lead time that will be needed to prepare the new systems

before the automatic reports can begin.’’

A current example illustrating how differing views between interested parties

over the substance of a proposed rule can contribute to delays in the time required

to issue final rules is the draft tire pressure warning device final rule. On February

12, 2002, OMB returned the draft final rule to the Department for reconsideration.

NHTSA’s draft rule proposed a standard under which all new vehicles would require

a tire pressure monitoring system. NHTSA proposed a phase-in period lasting until

2006 which generally allows for the use of a direct system or an indirect system.

A direct tire pressure monitoring system has a tire pressure sensor in each tire. The

sensors transmit pressure information to a receiver. According to NHTSA officials,

a direct tire system would alert a driver when a tire or any combination of tires

is underinflated.

In contrast, an indirect system does not actually measure tire pressure. Instead

it relies on the wheel speed sensors in an antilock braking system to detect and

compare differences in the rotational speed of a vehicle’s wheels. Underinflated tires

have smaller diameters and thus rotate faster. The indirect system relies on the

anti-lock brake system which uses existing technology and is less costly than the

direct system. However, according to NHTSA officials current indirect systems cannot detect when two tires on the same axle or two tires on the same side are equally

underinflated.

After the conclusion of the phase-in period in 2006, NHTSA’s approach would require a system that alerts the driver when the pressure in 1 to 4 tires is 25 percent

below the recommended level. According to NHTSA officials, current indirect systems can only alert the driver when the tire pressure has fallen to 30 percent or

more below the recommended level. To meet the standard proposed by NHTSA

would require vehicle manufacturers to install a direct tire pressure monitoring system.

OMB requested that NTHSA provide a stronger analysis of the safety issues and

benefits, including a formal analysis of a regulatory alternative that would permit

indirect systems after the phase-in period. OMB stated that NHTSA could analyze

an option that would defer a decision about the ultimate fate of indirect systems

until the potential impact on installation of anti-lock brake systems is better understood. We understand that NHTSA and OMB are very close to resolving issues associated with the proposed final rule.

In January 2002, we recommended that NHTSA begin reporting to Congress on

a routine basis the milestone dates, budget estimates, and actions required to complete the TREAD Act rules. In December 2001, NHTSA provided Congress with a

TREAD Act follow-up report, as required by the Act. NHTSA told us that they will

provide additional reports when specifically requested by Congress. Given the heavy

24

lifting that lies ahead for the TREAD Act rulemakings, NHTSA should begin reporting on a routine basis, the status of its rulemakings to Congress. • Second, a peer review panel process is needed to ensure consistency

when opening investigations. NHTSA agreed with our recommendation and has

already begun using a peer review panel. We consider this a very positive step. The

principal reason we recommended NHTSA establish a peer review panel and process

is because we found instances where NHTSA did not open an investigation although

the number of complaints, period of time, alleged defect, and potential consequences

were similar to investigations that were previously opened. Further, the decision to

open or not open an investigation was made by one or two persons, the basis for

their decision was not readily apparent, and there was no documentation to support

the decision. For example,

Over a 4-month period, NHTSA received six complaints alleging airbags failed

to deploy in a 1998 sedan after a frontal crash. All of the complaints noted injuries and one complaint stated the driver was seriously injured. An investigation

was not opened, despite a recommendation by the defects analysis staff. Within

1 year the number of complaints quadrupled from 6 to 24 complaints, but

NHTSA still did not open an investigation.

In another example, NHTSA received three complaints over a 4-month period

alleging front suspension torsion bar breakage in 1993-1994 minivans. This alleged defect could cause the driver to lose control of the vehicle and increase

the risk of a crash. Although the defects analysis staff recommended an investigation; one was not opened. In contrast, NHTSA opened an investigation of

three complaints received over a 1-year period alleging front suspension coil

spring breakage in a different vehicle that could pose a potential compromise

to the driver’s ability to control the vehicle.

To ensure consistency and transparency in NHTSA’s processes, we recommended

the use of a peer review panel to discuss potential defects as a group, make decisions as to whether or not an investigation should be opened, and to document the

decision. We recommended that the panel consist of the Chiefs of the Defects Analysis and Investigation Divisions, as well as defects analysis and investigative staff.

NHTSA agreed to implement this recommendation and we consider this a very

positive step. We recognize that it is not possible to define criteria that will identify

every potential defect. But a panel of experts drawing on the institutional knowledge of the staff and bringing management together to identify cases for investigation will ensure consistency in NHTSA’s decision making process.

Since November 2001, NHTSA has held six peer review panel meetings. According

to NHTSA officials, the use of the panels has increased the percent of investigations

opened. Of the 38 cases of potential defects considered for investigation, the peer

review panel approved the opening of 34 investigations.

Establishing a peer review panel is a significant step forward; however, it is not

an end state. In addition to the steps already taken we recommend the NHTSA Administrator should ensure that (1) protocols for the panel process are written, (2)

decisions are documented, and (3) the panel receives and reviews information when

the defects analysis staff determine that an investigation should not be opened.

• Third, developing a new defect information management system to replace the currently flawed system. This is important because the success of the

TREAD Act will ultimately rise or fall on the quality and usefulness of the early

warning data and the capacity of the new system to process the high volume of data.

Two factors currently hamper NHTSA’s ability to successfully implement a new defect information system: (1) the quality of the data in the current defect database

and (2) the risks associated with NHTSA’s systems development efforts.

We reported that NHTSA’s existing defect database, the primary tool it uses to

identify potential safety-related defects in vehicles and equipment, significantly understates the number of potential safety defects. For example, NHTSA’s database contains substantially less complaints than consumers make to manufacturers. In one

case, we found that the manufacturer received 1,411 complaints regarding transmission failures resulting in the loss of fluid and increasing the risk of fire, while

NHTSA received 32 complaints.

Further, the defect database contains incomplete and incorrectly recorded information regarding potential defects. For example, we found complaints in which consumers described problems with failed brakes that led to accidents where the airbags did not deploy. However, only the airbags and not the brakes were recorded

as problems in the database.

The existing data in the defect database will serve as the foundation for the new

information system. Therefore, it is particularly important that NHTSA review and

edit the existing data in the defect database, including the descriptions of complaints, for accuracy and completeness before transferring the data to the new inforVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00028 Fmt 6633 Sfmt 6621 W:\DISC\77993 pfrm01 PsN: 77993
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mation system. In response to our recommendation, the NHTSA Administrator stated that the data will be reviewed for improperly or inconsistently recorded data and

corrected before being transferred to the new system.

We also reported that NHTSA’s project with Volpe National Transportation Systems Center (Volpe) to replace its current database with a new information system

by the fall 2002 was significantly at risk of not meeting quality, cost, and schedule

goals. Historically, the Department’s systems development projects, including those

using commercial off-the-shelf software as a basis, have been plagued by cost overruns and implementation delays. While the Federal Aviation Administration (FAA)

problems in developing software intensive systems are well known, the Department

and NHTSA have experienced their share of problems with software development

as well.

For example, DOT had incurred contract costs of at least $26 million to develop

a new financial management system using commercial off-the-shelf software. However, 1 year after the original implementation date, the system was still not fully

operating as intended. Also, the costs of NHTSA’s National Advanced Driving Simulator, which involved software development, grew to almost twice the original estimate and the simulator was completed 3 years later than originally estimated.

NHTSA describes its new information system efforts as an acquisition of commercial off-the-shelf software. However, the software will require modifications and involve systems development work. The National Institute of Standards and Technology outlines procedures to ensure that software development efforts are successful. One of these procedures includes having an independent third party validate

and verify that the system will meet the user’s needs. We recommended that

NHTSA obtain the services of an independent third party to assess the contractor’s

progress, reduce development risk, and advise NHTSA of its findings.

In response to our recommendations to ensure that the new defect information

system is completed on time and within budget, NHTSA recently hired a third party

contractor to validate and verify that the new system will meet its needs and reduce

development risk. The contractor will provide NHTSA with weekly status reports

and monthly assessment reports. We will monitor the contractor’s findings and the

corrective actions taken by NHTSA.

This concludes my statement. I would be pleased to answer any questions.

EXHIBIT A

TREAD Act Completed Rulemakings—As of February 12, 2002

TREAD Act Section Purpose Statutory

Deadline Action to Date

Sale or Lease of Defective Tires.Requires individuals to report to the Secretary when knowingly and willfully selling or leasing for use on a vehicle a

defective or noncompliant tire when having actual knowledge that the manufacturer has notified dealers of such

defect or noncompliance.

01/29/01 Completed: Final

Rule issued

07/23/01.

Safe Harbor ............... Precludes individuals from receiving criminal punishment if

the person (1) at the time of the violation, did not know

that the violation would cause death or serious injury and

(2) corrects the improper report or failure to report within

a reasonable time. The Secretary shall establish by regulation what constitutes reasonable time and sufficient

correction.

01/29/01 Completed: Final

Rule issued

07/24/01.

Civil Penalties ........... Amends the regulations to reflect changes in the National

Traffic and Motor Vehicle Safety Act regarding civil penalties.

None Completed: Final

Rule issued

11/14/00.

26

EXHIBIT B

TREAD Act Rulemakings to Be Completed—As of February 12, 2002

TREAD Act Section Purpose Statutory

Deadline Action to Date

Early Warning ............ Requires manufacturers to report claims data, warranty

data, customer satisfaction campaigns and recalls, and

any incidents of serious injuries or fatalities (allegedly or

proven to be caused by a possible defect in systems or

components) for which the manufacturer receives actual

notice.

06/30/02 Notice of Proposed

Rulemaking

(NPRM) issued

12/21/01.

Tire Pressure Warning

Device.

Requires a warning system in new vehicles to indicate to the

driver when a tire is significantly underinflated. Requirement becomes effective 2 years after the completion of

the rulemaking.

11/01/01 NPRM issued

07/26/01. OMB

returned final

draft rule to

NHTSA for reconsideration on

02/12/02.

Tire Standards .......... Requires the Secretary to update the tire standards (Standards 109 and 119).06/01/02 NPRM sent to OMB

on 12/14/01.

Improved Tire Information.Requires the Secretary to improve the labeling of tires to assist consumers in identifying tires that may be subject to

a recall.

06/01/02 NPRM issued

12/19/01.

Safety of Child Restraints.Requires the Secretary to draft regulations for improving the

safety of child restraints, including minimizing head injuries from side impact collisions. The Secretary must consider several criteria, therefore resulting in multiple

rulemakings.

11/01/02 NPRM sent to Office

of the Secretary

(OST) on

12/03/01.

Ratings Program ....... Requires the Secretary to establish by regulation a child restraint safety rating consumer information program.11/01/02 NPRM issued

11/06/01.

Report on Defects in

Foreign Countries.

Requires manufacturers to report within 5 working days

when conducting a safety recall or other safety campaign

in a foreign country for an identical or substantially similar vehicle as a vehicle offered for sale in the United

States.

None NPRM issued

10/11/01.

Acceleration of Remedy.Permits the Secretary to require manufacturers to accelerate

the remedy program if the Secretary finds that there is a

risk of serious injury or death and that the acceleration

can be reasonably achieved by expanding the sources of

replacement parts, authorized repair facilities, or both.

None NPRM issued on

12/11/01.

Reimbursement Prior

to Recall.

Requires manufacturers to include in their remedy programs

a plan for reimbursing owners who incurred the cost of

the remedy within a reasonable time in advance of the

manufacturers’ notification of recalls. The Secretary may

establish by regulation what constitutes a reasonable

time and other reasonable conditions for the reimbursement plan.

None NPRM issued on

12/11/01.

Sale of Replaced

Tires.

Requires manufacturers to include in remedy programs a

plan for how manufacturers will prevent replaced tires

from being resold and how to limit disposal of replaced

tires in landfills. Manufacturer will include information

about the implementation of the plan in each quarterly

report to the Secretary.

None NPRM issued on

12/18/01.

Sale of Replaced

Equipment.

Prohibits the sale or lease of any vehicle equipment (including tires) for installation on vehicles when the equipment

is subject to a recall. An exception exists if the defect or

noncompliance is remedied before delivery.

None NPRM issued

07/23/01.

Certification Label .... Requires intermediate or final stage manufacturers, for vehicles built in more than one stage, to certify that they

complied with specifications provided by the first manufacturers or that they have elected to assume responsibility for complying with the Federal Motor Vehicle Safety

Standards.

None Drafting Rulemaking

Support Paper.

27

EXHIBIT C

TREAD Act Non-Rulemaking Actions—As of February 12, 2002

TREAD Act Section Purpose Statutory

Deadline Action to Date

Insurance Study ........ Requires the Secretary to determine the capability and benefits of obtaining aggregate information regarding insurance claims.

03/01/01 Completed: Report

issued on

03/05/01.

Follow-Up Report ....... Requires the Secretary to report to Congress on the implementation of the TREAD Act and provide recommendations

for additional amendments.

11/01/01 Completed: Transmitted to Congress 12/14/01.

Recall Criteria ........... Requires the Secretary to review and update all standards,

criteria, procedures, and methods for determining whether

to open a defect or noncompliance investigation. The Secretary shall report findings to Congress.

11/01/01 Completed: Transmitted to Congress 01/31/02.

Education Program ... Requires the Secretary to develop a 5-year strategic plan to

reduce deaths and injuries, caused by failure to use

booster seats, by 25% among 4 to 8 year olds.

11/01/01 Draft plan to OST

on 02/04/02.

Booster Seat Study ... Requires the Secretary to study the use and effectiveness of

booster seats and submit the results to Congress.

11/01/01 Draft report within

NHTSA.

Rollover Tests Rating

Program.

Requires the development of a dynamic test on rollovers by

11/01/02 and creation of a consumer information program. The Secretary shall conduct a rulemaking to determine how best to disseminate the test results.

11/01/02 Request for Comments published

on 07/03/01.

Mr. STEARNS. I thank the gentleman.

Let me start with questions. For legislators who are involved

with the testimony which we used to develop the TREAD Act and

then when we had the mark-up and it went to full committee and

then to the House floor and the Senate and finally passed, everybody thinks something is going to happen immediately. And I think

constituents, as well as the public feel that there will be answers

and there will be lives saved, but it’s all dependent, as you mention, Mr. Mead, this TREAD Act is going to rise and fall on this

data base and how the criteria is set up so that we can accurately

come up with an implementation to prevent these problems.

One of the things we all talked about with this tire pressure

monitoring system and Dr. Runge, we are aware that NHTSA and

OMB have had a difference of opinion in the direction of this tire

pressure monitoring system rule, but continue to discuss this issue.

I think the first question I would have is what is the status of this

on-going discussion because for many of us this would be helpful

and we could save lives if we had this implemented and show the

public how to use it.

Mr. RUNGE. Thank you, Mr. Chairman. Let me point out, first of

all, that this is a late one and we are very sensitive to that. I also

wanted to point out that OMB has been working very diligently

with us and in fact, very quickly, to my surprise, on all of our

TREAD rules.

Indeed, there has been a great level of discussion and some debate between NHTSA and OMB, but I want to point out that this

is a normal part of the decisionmaking process that certainly is not

unique to us or unique to this Administration. It’s been going on

for a long time. And that discourse, I believe, leads to truth. Certainly, we have no corner on the market on brains and neither do

they. Working together, we can finally achieve what will be a great

28

rule to implement for the American people which will have safety

as its No. 1 priority.

So the goal of this process is to develop those policies that have

a balanced perspective and the final result will be consensus. So we

have over the course of a few months reached a general agreement.

Mr. STEARNS. So you now have produced an agreement between

you and OMB?

Mr. RUNGE. We have some details to work out. The lawyers, in

fact, are working on it. Dr. Graham and I have had numerous discussions on this. We both have an academic background. We enjoy

the exchange of ideas and we believe that we do have a substantive

agreement.

Mr. STEARNS. Is there a date when you can say you’ll have a

final date when this will be obtained?

Mr. RUNGE. I’m hesitant to give you a final date because that’s

out of my hands. We met with our attorneys last night who are

talking about how to structure it. In fact, as Dr. Graham told you

earlier, it will be a rule in which we have a phase-in period which

allows either system and then a gathering of additional data to decide what to do.

Mr. STEARNS. Let’s say the year 2004, will the tire pressure monitoring system be in place by the year 2004?

Mr. RUNGE. The year 2004 is when the phase-in would begin.

Mr. STEARNS. Would begin.

Mr. RUNGE. Yes.

Mr. STEARNS. And it will be complete 2000 when?

Mr. RUNGE. We got comments on the docket from the equipment

manufacturers saying that it would be virtually impossible for

them to ramp up production within the 2-year timeframe. So we

talked to the manufacturers, talked to the equipment manufacturers and have come up with a 3-year interim period in which they

will be phasing in—— Mr. STEARNS. The problem for many of us are these type of discussions that OMB and the Inspector General, you have, go on and

on and on and yet I think the public and we as legislators expect

this to be implemented in less than a decade, in less than 4 or 5

years. Most of these automotive companies probably could implement this thing immediately.

Have you ever had a workshop or has it ever been suggested that

you sit down with all the manufacturers both on the automobile

side and the part side and have a big technical workshop to explore

these issues and how to implement them quickly and then this information be brought back to the Inspector General and OMB and

say this is what industry can do right now. Let’s get on it and let’s

do it, instead of the government agencies continuing to discuss and

negotiate and go back and forth and look at the data. Maybe industry can have an input. So my question is, has there been a technical workshop and if not, do you think that’s a good idea?

Mr. RUNGE. I will say that our staff has gotten lots and lots and

lots of input on all sides of this issue, both formally and informally.

And I believe that we are very knowledgeable at this point about

what the capabilities of industry are to ramp up production and in

fact, to install either type of monitor, either the 1-tire or the 4-tire

standard.

29

Mr. STEARNS. Mr. Mead had mentioned this information system.

Perhaps industry could help you interpret this data and could say

to you okay, this is important, this is not important and could expedite streamline your interpretation analysis of this. So I think

bringing in the industry into this mix and having them discuss

with you in a technical workshop would be a great idea, not just

for their ideas in implementing, but also how to get this data base

that Mr. Mead had talked about so that it’s meaningful because as

I mentioned in my opening statement, we’re going to have data

pouring into you and unless you have the people, the time, the materials and the credibility and criteria, nothing is going to happen.

We’ll be negotiating here for a decade on this stuff because if

there’s a slip today, and there’s a slip tomorrow, this slip will go

for 10 years. And here we pass this bill and then 5, 6, 10 years

later, we’re still talking about a phase in.

Mr. Mead?

Mr. MEAD. Can I reinforce one element of what you said? We

found in our audit on this information system that one of the areas

of shortfall were the interfaces that NHTSA was going to have with

the manufacturers information system. They have to talk to each

other.

Mr. STEARNS. So right now they’re not compatible?

Mr. MEAD. No. In fact, we’re not sure what NHTSA’s system is

going to look like, so it’s very timely to start developing this interface for the information management system.

Mr. STEARNS. Mr. Runge, just before I finish, is there anything

you’d like to add?

Mr. RUNGE. Well, yes. In fact, if I could sort of frame out the estimated finish date for some of these things. Keep in mind that the

final rule is not complete yet and the comment period is closed. We

have a lot of comments. We actually have more comments for the

advance notice of proposed rulemaking. These comments will be incorporated; and by the way, this is a very transparent process. Industry has lots and lots of input into this as well. Many people in

this room have weighed in heavily on this issue. When the rule is

finished, we plan to have the data system completed during this

summer and during that time we plan technical workshops with

the IT people in industry to make sure that they are constructing

their systems so that they can get the proper amount and type of

data into our data system. So we are fully aware of the need to integrate technology. Believe me, the last thing we want is a vanload of paper backing up to the back door of the DOT building. We

are keenly aware of the need to make this as easy as possible for

us to accumulate and analyze the data. Mr. Mead’s zeal about this

issue has been infectious and I’ve caught the disease. I promise you

and the rest of the subcommittee that we will be on top of this to

the max.

Mr. STEARNS. Okay. My time has expired. The gentle lady from

Colorado, Ms. DeGette.

Ms. DEGETTE. Thank you, Mr. Chairman. Well, I think everybody

agrees that the TREAD Act is going to, as Mr. Mead said, rise and

fall on the quality and usefulness of the new information system

and ODI’s ability to identify potential defects. And he said that

today in his testimony and also in his report. But then the InspecVerDate 11-MAY-2000 15:03 Jul 08, 2002 Jkt 010199 PO 00000 Frm 00033 Fmt 6633 Sfmt 6602 W:\DISC\77993 pfrm01 PsN: 77993
30

tor General went on to say that ‘‘to be fully operational by fall 2002

is at risk because of poor project planning and management.’’ And

furthermore he said that NHTSA can’t identify safety defects in a

timely manner because it has an unstructured approach for analyzing data and determining if a potential defect exists and where

there’s further investigation.

So I want to ask a few questions about this information management system because I think this is the pressure point for the

whole success of the TREAD Act.

First of all, Dr. Runge, the Inspector General reports that less

than 10 percent of the complaints made by consumers to manufacturers are contained in the current ODI data base. Is that correct?

Mr. RUNGE. I certainly can’t dispute that.

Ms. DEGETTE. So you think it would be correct?

Mr. RUNGE. One of these guys probably knows the exact percentage, but I would say that’s——

Ms. DEGETTE. The Inspector General also found that the current

database often ‘‘contains incomplete and incorrectly reported information regarding potential defects.’’ Do you agree with that assessment?

Mr. RUNGE. Well, keep in mind that this was part of the purpose

of the TREAD Act.

Ms. DEGETTE. Right. So you would agree that it does contain this

kind of information?

Mr. RUNGE. Sure.

Ms. DEGETTE. Thank you. Is it fair to say that the old system is

probably inadequate and doesn’t work properly?

Mr. RUNGE. I think the new system will be lots and lots better

than the old system.

Ms. DEGETTE. Yes or no, do you think that the old system works

properly?

Mr. RUNGE. I think the old system works fairly well, actually.

Ms. DEGETTE. You do? Okay. So what’s the rush then, in your

mind, for the new system?

Mr. RUNGE. It will be better.

Ms. DEGETTE. Okay.

Mr. STEARNS. Mr. Runge, could you just move the microphone a

little closer to you?

Mr. RUNGE. Sure.

Ms. DEGETTE. Now when ODI is in full compliance with the Act,

100 percent of consumer complaints will be collected by a new information management system. Is that right? That’s the new system you’re talking about?

Mr. RUNGE. That’s the goal.

Ms. DEGETTE. Now, the new ODI information system, according

to the Inspector General, is projected to only cost $5 million to be

paid out over the next 3 years and will consist of commercial offthe-shelf software, correct?

Mr. RUNGE. The architecture will be off-the-shelf.

Ms. DEGETTE. And the software will be off-the-shelf, right?

Mr. RUNGE. The software is being designed by a subcontractor of

Volpe, right now.

31

Ms. DEGETTE. In fact, what we’ve heard on the committee is that

the new system is going to be Excel spreadsheet software. Is that

correct?

Mr. RUNGE. I’m not sure which architecture it is, whether it’s

Excel or another spreadsheet—— Ms. DEGETTE. So you don’t know.

Mr. RUNGE. That’s correct.

Ms. DEGETTE. Can you find out for me and let us know?

Mr. RUNGE. Sure.

Ms. DEGETTE. Great. Now do you think that the proposed system

is going to be adequate to serve its function?

Mr. RUNGE. We have three layers of oversight in this thing. I

have not personally asked for the software design, nor would I

know what to do with it if I saw it. Yes, the commitment to you

guys is is that this will be adequate to do the job.

Ms. DEGETTE. And you think $5 million is going to be sufficient

to pay for that?

Mr. RUNGE. We have a contractor who is currently working

under budget and believes they can get it accomplished.

Ms. DEGETTE. Is part of your contractor’s function to ensure that

the data will be secure?

Mr. RUNGE. Yes, security is an issue.

Ms. DEGETTE. How big of an issue is it?

Mr. RUNGE. I can’t answer that now. I’ll be happy to answer

these technical questions later.

Ms. DEGETTE. That would be great. Mr. Mead, what do you think

about the proposed information management system? Do you think

the funding of this system, the design of the system and the security are going to be adequate? Do you think $5 million is going to

be enough to finance it?

Mr. MEAD. No.

Ms. DEGETTE. Could you please explain why?

Mr. MEAD. As I was saying in my oral statement, we audit information management systems throughout the Department. For

those that are being developed, people often say this system is offthe-shelf. I have yet to see a system that is designated as off-theshelf as really being off-the-shelf. People think off-the-shelf means

that you go out and you buy the software, you install it, and then

you can use it. This system is going to require substantial refinement and revisions.

Ms. DEGETTE. And in fact, that’s what Dr. Runge is saying too.

It’s not really off-the-shelf.

Mr. MEAD. No, it isn’t. And software contracts are typically cost

plus which means that you pay depending upon how much software

development is involved. And they’re rarely fixed price and this one

is not fixed price either.

Ms. DEGETTE. $5 million is not the fixed price?

Mr. MEAD. I would be very impressed if it comes in at $5 million.

Ms. DEGETTE. Why don’t you think that what they’re talking

about would be adequate, if you can zero in on that?

Mr. MEAD. Because I think this system is going to get disparate

data input from multiple sources and that it’s going to have to have

some collocating or synthesizing abilities. In other words, the computer is going to have to operate something like a brain to pull all

32

this information together so the right person in NHTSA when they

pump an inquiry about a particular model, can get all the information about that model and they can get it on a real time basis. This

is not like a program that you can construct at home. That is why

we feel that it is so important to have a third party come in who

has software expertise and advise Dr. Runge of how well the Volpe

Center and their subcontractor is performing and also recommend

to Dr. Runge midcourse corrections. NHTSA really does not have

software development expertise.

Ms. DEGETTE. Dr. Runge, do you have—let me just ask one more

question, if you don’t mind, Mr. Chairman. Do you have any objection to that third party advisor coming in and helping you develop

the system?

Mr. RUNGE. Absolutely not. We have a third party who is looking

at the overall time lines to make sure. We just contracted with

them to make sure that the project is on time and is paying attention to what Volpe is doing.

Ms. DEGETTE. We need a third party—— Mr. STEARNS. The lady’s time has expired. The gentleman from

Michigan is recognized.

Mr. UPTON. Well, thank you. Thank you, again, Mr. Chairman,

for having this oversight hearing and appreciate the testimony and

I know we’ve had a couple of discussions in particular with regard

to the tire pressure monitoring system. And I just want to underscore the importance of getting that done and beginning to see a

rule implemented and I appreciate your understanding of that

issue and just want to underscore again the thought that this was

the intent of the Congress, that we work very closely with industry.

I note that on a number of higher priced models that are available

today, that there is a system that’s available. Frankly, I think we

can improve on what they have in place and I’m delighted that

sound science is going to take the underlying role here by getting

an agreement and working together. I know that the American consumers are going to benefit in a major, major way so that all of

us will know when our tires are under pressurized and I just want

to thank you for what you’re doing to make sure that we get this

implemented as fast as we can and that that science will rule the

day and begin to see the type of system installed, perhaps earlier

than what date you actually set, putting more gas on the fire to

get it done. I appreciate the chairman’s work on this and if you

want to comment further, I guess you had some discussions last

week. And I had to step out momentarily, but do you think that

we’ll have some idea in the next couple of months, next couple of

weeks or early summer? When do you think we’re going to see the

right flags flying?

Mr. RUNGE. I think we’re close enough that we can say it will

be a week or 2.

Mr. UPTON. Terrific. Mr. Graham, do you agree with that as

well? I want to thank you also on your picture on CQ. I thought

it was—I get it at my home now since we still don’t have office deliveries here.

Mr. GRAHAM. We must have good timing with your hearing coming up.

Mr. UPTON. That’s right.

33

Mr. GRAHAM. I think that Dr. Runge and I are in conceptual

agreement on the contours of the tire pressure monitoring rule and

now it is for the lawyers, frankly, to actually put it into the words

and I don’t think that’s going to be too long.

Mr. UPTON. Have you had also some constructive input from both

the tire manufacturers as well as the industry itself, the auto industry itself in terms of what they think is do-able?

Mr. GRAHAM. Yes sir, I have. Both sides.

Mr. UPTON. Good. Well, I just applaud you on that work and look

forward to getting it done and obviously I know this subcommittee

will continue to oversee what’s going on and appreciate your willingness to appear here this morning.

Thank you.

Mr. UPTON. Thank you, sir.

Mr. STEARNS. I thank the gentleman. The gentleman from Tennessee, Mr. Gordon.

Mr. GORDON. Thank you, Mr. Chairman. The proposed rule on

tire labeling envisions placing a tire identification number of both

sides of the tire as has been mentioned earlier today. I’m concerned

that this does not take into account the realities of the tire business. It’s my understanding this will pose a safety hazard to workers in these tire plants and create a significant redesign of the current method of tire production with hundreds of millions of dollars

being passed on to consumers.

In order for the tire identification number to be placed on both

sides of the tire, the mold press would need to be changed midway

through the production process, a practice that would require a

worker to insert himself or herself within the mold which will be

extremely hot, 300 degrees or more. Alternately, the entire line

would need to be shut down for a number of hours, until the mold

could be changed, thereby losing hours of valuable production. This

may actually even delay getting better labeling on the tires as it

takes more time to completely rehaul the manufacturing process.

So Dr. Runge, I guess my question is, the date stamp in question

here, what about the idea that the date stamp be left on one side

of the tire, while the other markings, like the type of the tire,

where it was made, be placed on both sides and also what about

the possibility this information could be replicated on the tire warranty brochure?

Mr. RUNGE. Congressman Gordon, I’m sure we’ll be happy to consider that. The making of tires is sort of new to this doctor and I

have planned to actually go to two auto tire plants and one truck

tire plant in April. This concern has been expressed to me by people who understand the processes and the last thing we want to

do is compromise the safety of workers.

As I understand the motive for this rule in the first place, it has

been difficult when a tire recall occurs for a consumer to find the

number that would identify the tire necessary for the recall. If

there are other motives—there may be other motives, but that’s the

primary one that I recall hearing from staff.

We will listen to all comments. The comment period closed on the

19th of February. I have not seen the comments. Mr. Kratzke, I’m

sure, has. And this has been expressed to me personally by people

from the industry and we’ll be very sensitive to that.

34

Mr. GORDON. I think the most important information is what

type of tire and where it’s produced and the additional cost and the

safety hazard of having to weekly change both sides on terms of

the labeling of the date. Once you have a chance and I commend

you for going out and taking a real world look at this, I think it

might then give you a better idea.

A lot has been talked also about today about the tire pressure.

And it’s my understanding or my concern that this proposed rule

on indirect tire pressure monitoring which I understand is less accurate than the direct monitoring system may not give drivers adequate warning regarding tire inflation.

Is it necessary to ensure that the tire inflation pressure is sufficient to carry maximum load? I’d like Mr. Graham and/or Dr.

Graham or Dr. Runge to maybe address this indirect versus the direct monitoring.

Mr. GRAHAM. Yes, I think your point is, as we understand it,

technically correct, that the direct system that is in a couple of the

high-priced models mentioned previously does have more accuracy

and precision in providing information for consumers on tire pressure than the existing indirect systems now out on the road. And

I think that’s one of the areas where Dr. Runge and I are in agreement.

Mr. GORDON. So what is the thought process? Is it determining

is it a cost matter or what? If it’s a better system, what would be

your rationale for not going with a better system?

Mr. GRAHAM. As OMB has explained in the return letter from a

tire safety perspective, the direct system is a superior system. On

the other hand, the one-tire rule would allow the indirect system,

which has the benefit of encouraging the vehicle makers that don’t

currently offer anti-lock brakes to offer them in the future. And as

a consequence of that, there is an offsetting safety advantage of the

one-tire system. So the approach that we’re taking is to work on

this for a couple more years in terms of the information collection

before we make a final decision on whether to go with a 4-tire or

a 1-tire standard.

Mr. RUNGE. If we consider this holistically also, please keep in

mind that we are proposing rulemaking for tire upgrade. Since it’s

on our website now, I can tell you what’s in the NPRM and one

of the things we’re recommending or we are proposing is that tires

be tested at an under inflation-level consistent with what we see

in real world data, so that if, in fact, this rule comes into place,

tires will be safer even at lesser inflation. So we’re trying to consider this holistically with the idea that ABS brakes may turn out

to be a beneficial, even though real-world data has not yet shown

that to be true. We believe that they are because they stop quicker

and so forth. So we’re in harmony here.

Mr. GORDON. Thank you.

Mr. STEARNS. I thank the gentleman. Mr. Pitts is recognized.

Mr. PITTS. Thank you, Mr. Chairman. Sorry I’m late. I had other

meetings. You may have covered this, Dr. Runge, the early warning

system. How are you planning to use the early warning data that

you will be receiving?

Mr. RUNGE. If I could just back up a second and talk to you

about the process that we have. There’s been some mention made

35

that we don’t have a methodology for looking at complaints, and

that’s the farthest thing from the truth. We have a formal process

that involves eight screeners and an office director and a panel to

look at the various sorts of data from consumer complaints, from

reports from industry, insurance company reports and the like. And

they decide when the number of complaints rises to the level of an

initial evaluation.

Now the difficulty with that right now is that there is a haystack

of information arriving and we are constantly trying to find the

needle. What we look forward to with the early warning rule is

some help from technology. There are computer systems in existence that can help perform that type of surveillance. They can find

the needles a lot easier than an individual screener can find them.

So when we have access to all of the data that we are proposing

in the NPRM for the early warning rule, in a systematized fashion

that will be electronic and not paper, and in concert with the industry, we do believe that it will be possible to pick up problems

sooner, before they rise to the level of a huge defect involving thousands or millions of vehicles or tires or anything else. So there will

still be a subjective element to this when the data arrive, but very

clearly, we’ll have the ability to detect those problems before they

really get out of hand.

Mr. PITTS. Can you comment on the challenges that NHTSA

faces in creating and implementing a dynamic rollover test?

Mr. RUNGE. Yes sir, thank you. Let me just say at the outset

that as a physician who has treated numerous, numerous crash injuries over the last couple of decades, rollover crashes are the

worst. They predict to us physicians that we need to look and look

and look and make sure that nothing is wrong because the injuries

are often not overtly severe, but are occult in nature. Having said

that, rollover is one of my very top priorities as Administrator of

NHTSA. Right now, rollovers, even though they represent only

about 4 percent of crashes, are responsible for almost one-third of

occupant fatalities. So we have a problem. I will pledge to you that

we will be tackling rollover from a multi-faceted point of view.

With respect to the standard, I think that the subcommittee may

have had access to the NAS report that came out a couple of weeks

ago. One of the things that I was delighted to see is that the static

stability factor tracks extremely closely with real world crashes, so

we already have an excellent way to rate vehicles with respect to

their propensity to roll over.

Now the NAS report also said that a dynamic test could offer additional benefits, so we are actively pursuing that in compliance

with the TREAD Act.

There are many opinions about how this should be done. There

are robotics methods. There are driver methods that are much

more subjective. There are J-turns and S-turns and there are probably many other alphabetical terms out there. So NHTSA’s objective is to evaluate all of these and then narrow them down and

then select the one in time for the final rulemaking that becomes

part of our rating system and will be published.

I am also concerned on this part of TREAD that we need to get

this information out to the broader public. We have it on our

website. We market it through printed materials. We would love it

36

if everyone would visit our website before they purchase a car, but

that’s probably not practical. So in addition to coming up with a

dynamic standard and our static standard which you know does

track the real world very well, we will intensively market our findings once those occur.

Mr. PITTS. Thank you. I see my time is up.

Mr. STEARNS. Thank the gentleman. The gentleman from Massachusetts, Mr. Markey.

Mr. MARKEY. Thank you, thank you, Mr. Chairman, very much.

Dr. Runge, it’s good to have a physician here today. I’ve been on

Contact for 4 days. Do you think I should move to the Z-pack? I

can’t shake this thing.

Mr. RUNGE. Only insofar as antibiotics do not help with viruses,

Mr. Congressman, I think you’re probably fine.

Mr. MARKEY. I am the author of this direct/indirect ABS provision, so I’m going to try to help you with congressional intent here,

if it’s relevant over to 1B, especially. And I can understand the balancing that you’re trying to engage in, but it’s my understanding

that this ABS, the antilock brake system indirect protection works

dealing with kind of the rotational speed of the wheel. And if

there’s only one tire that’s underinflated, it works very well. But

if there’s two that are underinflated, then it might not detect it because it might look as though to the device that there is a perfect

rotation, that these wheels are still engaging it. So it wouldn’t give

you a warning.

My own personal experience is that when I go into a gas station

and we’re all a little bit, in general, behind the curve in terms of

how frequently we go over to that air pump to check it out, it’s just

kind of human nature, like going to the doctor. You always try to

delay an extra day or two, maybe it will clear up. So you don’t do

it as frequently as you should, that you often find them fine after

you put the air in the tire you thought had a problem and then you

walk around and go oh yeah, look at the other one over there too.

I better do the other one as well. Now does that happen 25 percent

of the time or 50 percent of the time? It’s a pretty high percentage

of the time. You do another tire as well.

And since we’re trying to deal with people who are not obsessive

about filling their tires with air, it’s probably that group of people

that we’re most concerned with. It might be the Mom with the

three kids and all the other activities that she’s trying to have a

job as well, not checking all the tires. But waiting for that light to

go on because she bought a new vehicle that has a light that will

go on when there’s a problem, but not if two tires are under inflated.

Now I’m told that there are collateral benefits of having an

antilock brake system go into place and I guess there would be because if one of the tires did blow, when two of them were out, you’d

have a higher percentage of likelihood that the brakes would work

at that point. So you would have a good braking system when the

tires blew. But you wouldn’t necessarily get warnings that the tires

were going to blow because it would only warn you if one tire was

underinflated and you’d get deceived, in other words. You’d actually be put into a situation where it was an attractive nuisance. It

was an invitation to keep driving, driving faster, because the light

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will go on whenever you have a problem, but not if two are out,

all four are out, underinflated, which I’m afraid for too many families, that is the case. They just don’t pay attention. That’s the point

of the light, to warn you. And of course, if you inflated them all

at the same time, originally, they’re probably deflating at the same

rate into that dangerous category. Makes sense to me. Maybe I’m

wrong, but that’s how my human nature works.

So my concern is that we not miss an opportunity here to get

people what they really do need to deal with their real lives, which

are busy. They see a vehicle as just another appliance. They don’t

pay as much attention to it, all too many Americans as they should

perhaps, but we can’t assume that they’re going to. And since most

of us do get surprised when we start filling up our tires, it’s not

just that one that you notice on the side as you’re getting into the

car, but it is the one or the other on the other side as well, that

NHTSA, I think, is heading in the right direction here. So I’d like,

if you could, Mr. Graham, just to respond to that because I think

that’s a legitimate real world concern that has to be addressed as

NHTSA tries to balance your concerns.

Mr. GRAHAM. Congressman, you raise a number of excellent

points and I have to say in all candor that in many ways a lot of

the arguments are very familiar to me because Dr. Runge has been

making these arguments to me over the last week or so and I think

that there is a pretty clear case that direct monitoring devices on

each of the four tires is going to provide better tire-related safety

than a 1-tire standard that uses the type of indirect measurement

system that you referred to.

However, we should keep in mind that the indirect technology

linked to the ABS system is not fixed, it’s not constant. There’s effort under way now to improve the quality of indirect systems and

if we were to make a decision too early that we’re not going to be

permitting those indirect systems in the future, that has the potential to slow the rate of technological progress in the development

of indirect systems. So the agreement that Dr. Runge and I have

engineered is that for the next 2 years we will continue to study

the actual tire pressure levels in those vehicles out there that have

indirect systems to determine whether or not they’re of significant

safety benefit. And, at the same time, we shall watch the development in the technology. It may be in the final analysis that

NHTSA is right, that we ought to go for the 4-tire system and mandate that or it may be that we’ll learn some things in the next couple of years that would lead us to a different conclusion. But I

think our agreement is for Model year 2007 and beyond, we don’t

need to decide that issue today.

Mr. MARKEY. Here’s my problem, Doctor.

Mr. STEARNS. The gentleman’s time has expired.

Mr. MARKEY. If I may have 1 additional minute, I would appreciate it.

Mr. STEARNS. By unanimous consent, so ordered. One additional

minute.

Mr. MARKEY. Thank you. I am, after 26 years on this committee,

become a technological agnostic. I don’t know what the future holds

and yeah, there are a lot of geniuses out there and they’re going

to try to shoot down a Soviet missile in a minute and a half after

38

it’s launched and this committee is going to try to make sure that

we can call across the country and have video conferences with our

families across the country and it only costs 10 cents a minute. We

know that that will happen some day, but maybe not in our lifetimes. So while all of this technologically possible, it doesn’t mean

that it’s ever going to be achieved. And so my message to you is

this, that unless you can put on the books a standard which guarantees that families driving their children to school or to vacations

have a warning light that comes on that is accurate, and timely to

protect the safety of those families, then this amendment, the Markey Amendment is not being implemented. And we cannot delay

pending industry disinterest in putting the strongest possible

standard on the books pending some investment that they’re going

to make in the future. Because if that doesn’t happen, there must

be some guillotine, some hammer which comes down which mandates that it happens because 4 years from now every new car in

the United States should have a guarantee that when there is one

underinflated tire, one, that the light comes on. Now it could be a

direct or indirect, but if they don’t develop it, you can’t give them

an indefinite extension of time because they will take that as a

blank check to not provide the public safety which for the past generations these industries—— Mr. STEARNS. The gentleman’s time has expired.

Mr. MARKEY. [continuing] have not provided to the public. That’s

why we’re here. We’re here because these industries did not provide the safety for these families. And we’re deluding ourselves if

we believe they’re going to pay the price voluntarily. They will

delay. They will stall. They will use any scientific or technological

hedge to make sure they don’t have to put this in place. And we

went through too much in here, we saw too much suffering to allow

this to be delayed any further than it absolutely has to. And there

has to be a guarantee that the hammer comes down and that they

put in a system that works in a very brief period of time.

Mr. STEARNS. The gentleman’s time has expired. We’re going to

take a break, but the gentleman from New Hampshire has one

quick question and then we’ll take a break.

Mr. BASS. Yes, thank you very much. Dr. Runge, does NHTSA

have any idea at this point what the cost of the early warning rulemaking will be to the automobile equipment manufacturing industry?

Mr. RUNGE. Congressman Bass, I do not have the answer to that

question. I’d be happy to consult my staff. They may have it. I will

get that during the break and we’ll get back to you.

Mr. BASS. I yield back, Mr. Chairman.

Mr. STEARNS. I thank the gentleman. The committee will take a

break. If you allow, indulge us, we’re going to vote and we’ll be

back and we’ll have a second round of questioning.

[Brief recess.]

Mr. STEARNS. The subcommittee will reconvene and at this point

we finished, except for Mr. Sawyer and then we’ll start a second

round of questioning and so the gentleman from Ohio is recognized

for 5 minutes for his set of questions.

Mr. SAWYER. Thank you very much, Mr. Chairman. I have a couple of observations and then a line of questioning I’d like to ask.

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First of all, I am very pleased to see Dr. Runge engaged in the

question of worker safety. It is both a question of safety and very,

very substantial cost for what I suspect you may find is a marginal

gain in consumer information. But nonetheless, I commend you for

your interest in making sure that consumers are able to locate tires

that may be at risk.

Second, I want to suggest to you that I really value anything

that you can do to make ABS and other traction management systems more universal in automobiles. I value those systems, but I

would hope that in determining which tire pressure monitoring system you go to, that standards for accuracy tolerance be the way in

which you measure which system works better. I continue to believe that it is not the—it is less frequently a matter of absolute

defect in tires than it is cumulative damage over time for marginal

under inflation that ultimately leads to catastrophic failure. It’s the

effect of heat in an under inflated tire that does the damage, it

seems to me. So I was really grateful to hear the conversation that

took place.

Let me turn to a more direct question. I understand that the labeling rule would re-order the location of the production date in the

alpha numeric sequence that identifies the tire. Am I correct about

that?

Mr. RUNGE. Congressman Sawyer, I’ve got to confess that my

knowledge of the technical details of where these numbers are,

other than on either side of the tire is very limited.

Mr. SAWYER. What I’m suggesting is that it goes from the last

item in the identification series to the first item in the identification series and I for the life of me can’t understand why that’s important? But I do know that in the course of making the transition

from older tires where it’s located on the back to newer tires where

it’s located on the front, that it has a high likelihood of exacerbating consumer confusion rather than illuminating the information it’s trying to convey.

I also suspect it could affect the data base system and the difficulty in managing huge amounts of data where you’ve got different sequences of identifier.

Have you looked at those kinds of things or have your folks

looked at those kind of things? Has the IG looked at that as a problem in consumer information and data base management?

Mr. RUNGE. No sir, but I can promise you that Mr. Kratzke, my

Associate Administrator for Performance Standards, has been writing diligently behind me. He notes here that the reorder is because

consumers often give us the first four digits of the long number

that they see when they are reporting complaints. And the comments that we receive during the comment period mirrored yours,

that we may be causing more confusion than we are solving and

this will be resolved in the rule. I do thank you for your comment.

Mr. SAWYER. Thank you very much.

Mr. MEAD. No, we have not, but the illustration of the code reminds me of an issue with the system. Say you get a complaint in

or something from the manufacturer that does list the code. You

want your system to be able to put that in the right place. Say

somebody else writes in and doesn’t have the full code, but they’re

referring to the same tire. Will this system be smart enough to be

40

able to reconcile it or at least edit it out and put it in a bin and

say to some staffer at NHTSA this doesn’t fit in the right place.

You have to figure out where to fit it. I think it’s a really good

point, but the direct answer to your question is no, we haven’t

looked at that issue.

Mr. SAWYER. I am grateful for your willingness to take a look at

it. I see I’m about to run out of time. Are we going to have a second

round, Mr. Chairman?

Mr. STEARNS. Yes, we are.

Mr. SAWYER. I’ll yield back. The gentleman’s time has expired.

I’ll start the second round.

Mr. Mead, are there any recommendations that the Inspector

General made that NHTSA is not implementing?

Mr. MEAD. They were responsive overall. I was very encouraged,

and particularly encouraged with Dr. Runge’s and our interface.

Now I would hasten to add that we made two recommendations,

one dealing with the information management system and the second dealing with the rulemakings. I do think there is a benefit in

letting this committee and other appropriate committees know regularly the status of all these rulemakings and not just oh, it’s coming, but also kind of a heads up that there are some very contentious issues surrounding the early warning rulemaking and this

date may not be met.

I think that’s beneficial, good interchange between the executive

branch and the legislative branch. I want to make sure on the information management system that we get a third party in there

that knows something about software that is verifying and validating that software to make sure that it’s going to meet NHTSA’s

requirements and that Dr. Runge has very good advice on problems

that are developing and what mid-course corrections to make.

On the peer review, they’ve been very responsive to our recommendation. I think that’s an extraordinarily positive step and a

change, material change in the procedures. They also need to have

some procedure where a staffer, a screener of complaints does not

recommend an investigation. How does that get on the radar screen

of this panel? Because that’s, in effect, a decision not to move forward with something, made at a low, not a low—but a middle management level.

I think NHTSA can figure out some way to implement that recommendation.

Mr. STEARNS. I think, Dr. Runge, it sounds like you got a passing

grade here.

I think that’s what he gave here. He mentioned this peer review

panel to ensure consistency in decisions, whether an investigation

should be opened. I am just your response to what he just said.

Mr. RUNGE. Well, in general, he’s exactly right. I would point out

that when a screener chooses not to bring a series of cases to the

attention of the panel, it’s not because they have written it off, it’s

because they’re following it along. When these complaints come in,

they are coded in certain ways, as Mr. Mead pointed out earlier,

and they’re coded by individuals who code these things all the time.

So they know into what category these complaints should go and

the screeners develop an expertise around the areas of complaints

that they deal with.

41

When something smells bad to them, for lack of a better term,

they bring it up. If it has not yet risen to that level, they follow

it along. So he’s exactly right in that we do need some fail safe

method—— Mr. STEARNS. Of peer review?

Mr. RUNGE. Of identifying cases that may not have risen to that

level, but a periodic look at the cases that are being followed.

Mr. STEARNS. He had mentioned that the NHTSA data base is

fraught with problems and errors. And are you folks agreed to sort

of review and edit the existing data before transferring this new information in if it’s already fraught with errors and how are you

handling that?

Mr. RUNGE. That’s a great question. I think we have some difference of opinion about how fraught with errors it is.

Mr. STEARNS. So you’re saying it’s not?

Mr. RUNGE. Well, we can always do better. One of the beauties

of the new system coming in is that we are going to have to incorporate a lot of our existing information into the new surveillance

system. I believe as part of that process the cleaning up and recoding will be a natural course of events there.

Mr. STEARNS. Let me ask each of you what is the No. 1 concern

toward implementing the TREAD Act today? What would you think

the most important No. 1 problem that we could leave this hearing

with an understanding from each of you that we would have to accomplish?

Dr. Runge, I’ll start with you first.

Mr. RUNGE. As I consult my cheat sheet of corrections here—— Mr. SAWYER. Forty or 50 probably.

Mr. RUNGE. I learned the entire human body in 4 years; after 6

months, I’m barely scratching the surface of the TREAD Act.

Mr. SAWYER. Yes. That’s a nice honest—— Mr. RUNGE. I would say quite honestly, this is a difficult question

to answer because so many of these things are so very important

and you have given us the resources and the opportunity to address things that had frankly been not addressed. I do believe personally that the early warning system, if done the way we expect

it to be done, will result in our ability to detect problems sooner

before they rise to the problem of a national public health emergency.

Getting help from artificial intelligence will enable us to do a better job, and I really do believe that when we look back at this thing

10 years from now, of all these rules that have come out, that will

be the one where we will look at it and say that really was a good

investment of the taxpayer’s money.

Mr. STEARNS. Dr. Graham?

Mr. GRAHAM. Yes, Mr. Chairman, there has been a lot of attention this morning on the deadlines issues and the pace of rulemaking and this sort of thing and I think it’s perfectly appropriate

that a committee like this put that type of constructive encouragement on both NHTSA and OMB. However, I think like Dr. Runge

suggested, 10 years down the road when we look back, the quality

of these rules in terms of the underlying engineering and economic

information behind them, is going to influence whether or not we

have saved as many lives as we can with the resources available.

42

In that sense, I think the technical issues here should not be overlooked.

Mr. MEAD. I think you’re going to get a very good rulemaking for

the early warning system. I think the manufacturers will largely

comply and you’ll have lots of information at NHTSA and it will

be important that you know how to distill, synthesize that information, sort through it, get rid of the junk, the garbage and hone in

on the important ones.

Mr. STEARNS. So the No. 1, toward implementation is getting rid

of the information that’s not relevant and making sure that the relevant information is part of the early warning system?

Mr. MEAD. Yes sir. I think the advanced rulemaking that I’ve reviewed for the early warning system is quite credible.

Mr. STEARNS. Okay. Thank you. My time has expired. The gentle

lady from Colorado.

Ms. DEGETTE. Thank you, Mr. Chairman. To finish the question

I was asking earlier to Dr. Runge, Mr. Mead suggested that you

need an outside person to help you, to make the software work.

And Dr. Runge, what I was simply asking was do you have any big

objection to implementing that kind of control to make sure that

your software is actually working to get the data that you’re going

to need?

Mr. RUNGE. Absolutely no objection at all, other than the economic barrier that we face in hiring that kind of consultant.

Ms. DEGETTE. I think I can speak for the whole committee, Dr.

Runge, in saying we want to make sure this is done right and so

if it costs extra money, I would not hesitate to hire an outside individual consultant to make sure that your software is right to begin

with. If you need the money, please come and let us know because

the important thing is that the Act get implemented right and I

think you would agree with that.

Mr. RUNGE. Yes ma’am, thank you very much.

Ms. DEGETTE. Let me just ask one more question. I know, Doctor,

that you testified earlier that you were coordinating with a number

of industry representatives and what the TREAD Act says is, of

course, that the suppliers and manufacturers are going to have to

comply with this early warning rule.

So I’m wondering, of these groups, how many of these industry

participants have you consulted in developing the information management system? The 23 light vehicle manufacturers, all heavy

truck manufacturers? All recreational vehicle manufacturers? Auto

suppliers, child seat manufacturers, school bus manufacturers and

on and on? How many of those have you consulted in developing

the data base?

Mr. RUNGE. Thus far, I can’t answer that question. I can tell you

that we are planning to have technical working groups in the summer to get together on how to best receive the data from them. The

quality of the data will depend greatly upon on how it’s done at the

front end and we recognize that.

Ms. DEGETTE. That’s right. Mr. Mead, what do you think about

the fact that none of these or few of these groups have been consulted to date on developing the data base?

Mr. MEAD. I think now is the time to consult with them.

Ms. DEGETTE. Thank you. I would urge that that happen, too.

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And Mr. Chairman, if I might, I think there’s a great deal of

good will in this committee toward NHTSA and to Dr. Runge who’s

recently come into the job. I think the motives are good, but I think

there’s also a growing amount of concern about the delays and implementation of the TREAD Act. And frankly, Mr. Chairman, I’d

hate to be back here in another year finding out that implementation is once again delayed. But worse, I’d hate to be back here in

5 years having a hearing and learn that NHTSA did not find the

needle in the haystack that Dr. Runge talks about, that because of

an inadequate database or inadequate information management,

more American lives have been lost and so I would really urge all

of you to work with all due speed, but also with all due thoroughness, to make sure that this Act is implemented correctly.

And I yield back the balance of my time.

Mr. STEARNS. I thank the gentle lady. The gentleman from Ohio.

Mr. SAWYER. Thank you, Mr. Chairman. As I understand it, currently when a passenger tire is installed on an SUV or a light

truck, the tire’s load rating is reduced by 10 percent. That 10 percent reduction was omitted from the proposed rule. Having the, I

suspect, unintended consequence of permitting a load increase of 10

percent for passenger tires used on those kinds of vehicles seems

to conflict with the intent of the Act and I’m just inquiring whether

this was an omission or whether it’s a change in policy?

Mr. RUNGE. Mr. Kratzke tells me that this was not omitted from

the rulemaking. They are aware that passenger car tires are derated for load at 10 percent.

Can you ask me more specifically and I’ll make sure I get you

the right answer quicker.

Mr. SAWYER. I’d be glad to. Let me, Mr. Chairman, while I’ve got

a little extra time, I remember last year when we asked the great

Jacques Nasser whether tires and automobiles function together as

a system and he sat just about where you are, Doctor, and said no,

they do not. And I was just dumbfounded by that. I found something I’d like to read for the committee, put into the record. A Ford

engineer arrived, named Jacques Beget, arrived in the United

States in 1955 and found a niche in the relatively unexplored world

of quantifying tire and suspension interaction. Beget stressed the

need to analyze tire, vehicle and road together rather than to think

of the tire alone. And he wanted hard numbers. His persistence led

to a string of SAE publications explaining numerical analyses of

skid and rolling resistance, wet traction, nonuniformity among tires

and the behavior of radial tires on American cars. In 1965, Automobile News could report ‘‘for the first time, Detroit auto makers

are actually setting the design requirements of the 35 to 45 million

tires they purchase annually.’’ Their demands had never been truly

quantifiable before.

This is the same Jacques Nasser who when asked by William

Ford who is the highest paid employee of the Ford Motor Company,

replied well, I’m the President and you’re not compensated directly,

so I guess it’s me. He said no, it’s a fellow named Edward Irvine.

And he said do you know who Edward Irvine is? He says he makes

$13 million a year. He had no idea who he was. He said he’s our

Formula One driver with our Jaguar Division. You should have

known that. My guess is he should have known this too.

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I thank you, Mr. Chairman, and yield back.

Mr. STEARNS. As CEO of Ford Motor Company, of course, he’s no

longer there.

Mr. SAWYER. Yes, that’s true.

Mr. STEARNS. The gentleman from Massachusetts is recognized

for a second round of questioning.

Mr. MARKEY. Thank you, Mr. Chairman. And I don’t want to prolong this because obviously, I made pretty clear what I was interested in during my first round. I guess what I wanted to say

though is that whether it be a direct or indirect system, they’re fine

during a transition, obviously. Makes sense. At the time that we

did the TREAD Act, this tire safety act, a couple of years ago, there

were already models out there. So we already had a model. Early

stage stuff. It was already out there, in vehicles, proving that it

could be done and done inexpensively which is why I think my

amendment was basically something that everyone could agree on

this committee should be adopted, if it was already out there in

that early stage of development. And that was an indirect system

based on ABS which was fine, but at some point in the future we

need to move to a system that lets you know if you’re at risk if two

or all of your tires are underinflated which I’m afraid is an all too

typical situation for average, busy American families. And we just

have to give them that. And that’s the real intent of the Act.

Now some day an ABS system might achieve that, but at some

point after a transition I think NHTSA is right, we have to move

to the technology that provides the safer, more accurate warnings

for American families. And we can’t delay that indefinitely waiting

for a technology to arrive that might never arrive, as much as

would hope that it would. And so that’s basically my message here

today, that we have to have the goal as being firm if families are

given all the information about all their tires. And if the industry

announces they’re in a crash program and that they’re going to develop an ABS based system and it’s going to be there in 2 or 4

years, that’s fine. But again, as I said, I’m an agnostic technologically. I want a hydrogen-based automobile. I want many things

in life. I want nonfat strawberry shortcake, I want many things,

okay, and I’m sure there are people trying to do it, but it’s unlikely

that—well, I’m not going to say it’s impossible, but Mr. Graham,

Dr. Runge, all I’m saying is that as long as your agreement gives

us certitude and a deadline and that the public at a date certain

knows that their family, when they buy a vehicle has all four

wheels, whether it will be for some system or the other that will

be given the proper warning to the driver that their family might

be in danger, then we can live with that. It can’t be something

that’s used by the industry to achieve a delay in installing the

kinds of protection. So as you work together that would be my one

message.

Thank you.

Mr. STEARNS. Thank you, sir. I thank the gentleman, and Dr.

Runge, I want to thank you for your participation; Dr. Graham,

Mr. Mead. We have heard during this hearing some testimony

which has us concerned, obviously, because this is not being as expedited as Members of Congress we thought it would be on a much

quicker schedule.

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What I’m going to suggest, Dr. Runge, is that you—we get together periodically and you brief us where you are at and I’m suggesting perhaps if we see another delay, we see problems, to your

benefit it may require us to have another hearing in the fall so that

we can have a wrap up and see where we are and see whether it’s

materials, resources or something that we can provide or what we

can do to help you, but you have an arduous task. We’re here to

support you and we appreciate all of your testimony and you indulged us while we took a vote and the committee is adjourned.

[Whereupon, at 11:50 a.m., the subcommittee was adjourned.]

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