18866 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

DEPARTMENT OF TRANSPORTATION

Federal Highway Administration

49 CFR Parts 361, 362, 363, 364, 385,

386 and 391

[FHWA Docket No. MC–96–18]

RIN 2125–AD64

Rules of Practice for Motor Carrier

Proceedings; Investigations;

Disqualifications and Penalties

AGENCY: Federal Highway

Administration (FHWA), DOT.

ACTION: Notice of proposed rulemaking

(NPRM); request for comments.

SUMMARY: The FHWA proposes to

amend its rules of practice for motor

carrier safety, hazardous materials, and

other enforcement proceedings, motor

carrier safety rating procedures, driver

qualification proceedings, and its

schedule of penalties for violations of

the Federal Motor Carrier Safety

Regulations and the Hazardous

Materials Regulations. The FHWA

further proposes to add provisions on

investigative authority and procedures

and general motor carrier

responsibilities. These rules would

increase the efficiency of the practices,

consolidate existing administrative

review procedures, enhance due process

and the awareness of the public and

regulated community, and

accommodate recent programmatic

changes. The rules would apply to all

motor carriers, other business entities,

and individuals involved in motor

carrier safety and hazardous materials

administrative actions and proceedings

with the FHWA after the effective date

of the final rule.

DATES: Comments must be received on

or before July 29, 1996.

ADDRESSES: Submit written, signed

comments to FHWA Docket No. MC–

96–18, FHWA, Office of the Chief

Counsel, HCC–10, Room 4232, 400

Seventh Street SW., Washington, DC

20590. All comments received will be

available for examination at the above

address from 8:30 a.m. to 3:30 p.m., e.t.,

Monday through Friday, except Federal

holidays. Those desiring notification of

receipt of comments must include a selfaddressed, stamped postcard/envelope.

FOR FURTHER INFORMATION CONTACT:

Paul Brennan, Office of the Chief

Counsel, (202) 366–0834, Federal

Highway Administration, 400 Seventh

Street SW., Washington, DC 20590.

Office hours are from 7:45 a.m. to 4:15

p.m., e.t., Monday through Friday,

except Federal holidays.

SUPPLEMENTARY INFORMATION:

Introduction

This rulemaking includes the first

comprehensive rewrite of the FHWA’s

rules of practice for motor carrier

administrative proceedings since 1985.

It is the forerunner of a comprehensive

revision of the Federal Motor Carrier

Safety Regulations (FMCSR) anticipated

to follow the completion of a zero-based

review of those regulations presently

underway in the agency. These

proposed regulations would appear in

previously unused chapters of that

portion of the Code of Federal

Regulations reserved for the FMCSR,

thus leaving ample room for the future

revisions. The current rules of practice

for safety enforcement and driver

qualification proceedings, found in 49

CFR part 386 and in § 391.47, would be

replaced by new part 363. New part 361

restates, explains and expands upon

statutory authority, administrative

enforcement powers, and general

responsibilities. New part 364 is the first

general treatment of penalties for

violations of safety rules provided in

regulatory form. The amendments

embodied in these three proposed parts

are based on the FHWA’s experience

enforcing the motor carrier safety

regulations through part 386. It is

intended that the new procedures

would make administrative actions and

proceedings more efficient while

enhancing the guarantee of due process

to carriers, individuals, and other

entities by substantially increasing

awareness of the consequences of

noncompliance with commercial motor

vehicle safety and hazardous materials

regulations.

New part 362 would replace current

part 385, which provides administrative

review procedures within the safety

ratings process. Safety ratings continue

to gain in relative importance in the

entire safety program in response to

legislative mandate, as a part of agency

programmatic changes, and in the

significance attached to the ratings by

the industry itself. Updated procedures

will allow for better accommodation of

these interests. Parts 385 and 386 would

be deleted and reserved for future use.

This rulemaking preamble will first

briefly discuss the current statutory

background. Each proposed part is then

analyzed by describing some of the

antecedents of any corresponding

current procedures, followed by a

section-by-section analysis of the

proposed rules. Finally, the proposed

rules themselves appear.

Statutory Background

Congress has delegated certain powers

to regulate interstate commerce to the

Department of Transportation in

numerous pieces of legislation, most

notably in the Department of

Transportation Act (DOT Act), section 6,

Pub. L. 85–670, 80 Stat. 931 (1966).

Section 55 of the DOT Act transferred

the authority of the Interstate Commerce

Commission (ICC) to regulate the

qualifications and maximum hours of

service of employees, the safety of

operations, and the equipment of motor

carriers in interstate commerce to the

Federal Highway Administration (the

agency), an operating administration of

the DOT. 49 U.S.C. 104. This authority,

first granted to the ICC in the Motor

Carrier Act of 1935, Pub. L. 74–255, 49

Stat. 543, now appears in 49 U.S.C.

Chapter 315. The regulations issued

under this authority became known as

the Federal Motor Carrier Safety

Regulations (FMCSRs), appearing

generally at 49 CFR parts 390–399. The

administrative powers to enforce

Chapter 315 were also transferred from

the ICC to the DOT in 1966, and appear

in 49 U.S.C. Chapter 5.

The Motor Carrier Safety Act of 1984

(1984 Act), Pub. L. 98–554, 98 Stat.

2832, restated, for the first time, the

interstate safety authority in terms of

particular classes of commercial motor

vehicles (CMV). These statutory classes

coincided identically with the

definition of CMV adopted by the

agency in the existing FMCSRs issued

under the Motor Carrier Act of 1935.

The 1984 Act is codified at 49 U.S.C.

Chapter 311, Subchapter III. These two

largely overlapping statutes, i.e.,

Chapters 311 and 315, serve as parallel

and complementary authorities for

issuance of safety regulations for motor

carriers and commercial motor vehicles

operating in interstate commerce.

It should be noted that both chapters

define interstate commerce as trade,

traffic, or transportation in the United

States which is between a place in a

state and a place outside of such state

or is between two places in the same

state through another state or place

outside the state. The DOT and the ICC

interpret as within this jurisdiction

transportation wholly within a state

which is part of a continuing through

movement of property or passengers

across state lines. This ‘‘crossing state

lines’’ definition represents a delegation

of less than the full power possessed by

Congress to regulate interstate

commerce. A more complete delegation

is found in other laws in which all

trade, traffic, and transportation

affecting interstate commerce is deemed
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18867

interstate commerce regardless of its

direct connection with a movement of

goods across state lines.

For example, the Commercial Motor

Vehicle Safety Act of 1986 (CMVSA),

Pub. L. 99–570, 100 Stat. 3 207–170, 49

U.S.C. chapter 313) applies to trade,

traffic, and transportation on public

highways wholly within a state as

affecting interstate commerce because

such trade, traffic and transportation

intermingles with cross-border

movements and therefore affects

interstate commerce. The CMVSA

established a national commercial

driver’s license program (CDL) for all

drivers of CMVs, which were defined to

exclude certain smaller vehicles covered

under the 1984 Act and longstanding

FHWA regulations, unless the agency

determined that it was appropriate to

include them. The FHWA did restrict

the CDL program to larger vehicles. At

the same time, the CMVSA extended

jurisdictional coverage to drivers in

commerce that had previously been

considered entirely intrastate and thus

beyond the jurisdictional reaches of the

earlier acts. This was a major departure

from the traditional, ICC-inherited zone

of jurisdiction based on the origin and

destination of the cargo being

transported. The distinction can be seen

most readily in drug testing

requirements, which were initially

issued by DOT 1989 under its parallel

general safety authority in sections

31502 and 31136. Congress enacted

specific drug and alcohol testing

statutory requirements in 1991 by

amending the CMVSA (49 U.S.C.

31306). This action had the effect of

expanding the reach of testing from

drivers of vehicles carrying interstate

cargo to drivers of any vehicles meeting

the definition of ‘‘commercial motor

vehicle’’ provided in the CMVSA,

which, by their very nature, affect

interstate commerce.

The Hazardous Materials

Transportation Uniform Safety Act of

1990 (HMTUSA) Pub. L. 101–615, 104

Stat. 3244, replacing the Hazardous

Materials Transportation Act (HMTA),

Pub. L. 93–633, 88 Stat. 2156 (1975)

required the DOT to issue regulations

for the safe transportation of hazardous

materials in inter- and intrastate

commerce. 49 U.S.C. Chapter 51. The

Research and Special Programs

Administration (RSPA) of DOT issues

the Hazardous Materials Regulations

(HMR), which provide standards on the

classification, packaging, handling, and

registration of hazardous materials. The

FHWA enforces the HMR in relation to

the transportation of hazardous

materials by highway.

The Motor Carrier Act of 1980, Pub.

L. 96–296, 94 Stat. 793, and the Bus

Regulatory Reform Act of 1982, Pub. L.

97–261, 96 Stat. 1121, established

requirements for minimum levels of

insurance for for-hire interstate motor

carriers and all carriers of certain

hazardous materials in inter- and

intrastate commerce. 49 U.S.C. 31138–

31139.

The Intermodal Safe Container Act of

1992, Pub.L. 102–548, 106 Stat. 3646,

established weight certification

requirements for tenderors and carriers

of intermodal containers. 49 U.S.C.

Chapter 59.

The various acts authorize the

enforcement of the FMCSRs and HMRs

and provide both civil and criminal

penalties for violations. In practice,

when circumstances dictate that an

enforcement action be instituted, civil

penalties are more commonly sought

than criminal sanctions. The

administrative rules proposed in this

rulemaking apply, among other things,

to the administrative adjudication of

civil penalties assessed for violations of

the FMCSR and the HMR.

Analysis

Part 361: Administrative

As proposed, this part sets forth the

authority granted to the agency to

enforce the commercial motor vehicle

safety regulations—the FMCSRs and

HMRs. It also describes the practices

followed by the agency in exercising

this authority and prescribes certain

responsibilities imposed by these

authorities upon motor carriers and

others subject to these acts.

Background

Except for a somewhat obscure

provision in appendix B to chapter III,

subchapter B of the CFR, the authority

for the agency’s inspection and other

administrative powers appears only in

statute (see, e.g., 49 U.S.C. 501–525,

31133, and 5121). Standards and

practices for the agency’s training

materials, policy guidance, and internal

manuals which are available to the

public, but only upon request. Including

these standards and practices in the

regulations would provide one

convenient and authoritative reference

source for all regulatees and put them

on notice of what may be expected from

Federal enforcement officials as well as

what is expected of the regulated

community.

Detailed intra-agency delegations of

motor carrier safety-related functions at

one time appeared in 49 CFR 301.60,

but were removed in 1988 following a

significant reorganization of the motor

carrier safety functions and anticipated

republication of the regulations under

new authority. 53 FR 2035 (January 26,

1988). Specific delegations of authority

from the Administrator to the Office of

Motor Carriers now appear only in

FHWA organizational documents.

Section-by-Section Analysis

Section 361.101 Purpose

This part would spell out the

authority and procedures used by the

FHWA to conduct investigations and

other enforcement activities related to

commercial motor vehicle safety, and

the corresponding obligations of the

regulated industry. Its purpose is to

inform the public of the agency’s role,

to increase awareness of and

compliance with the safety regulations,

and to facilitate public contact with

FHWA officials enforcing the

regulations.

361.102 Authority and Delegations

The first sentence of paragraph (a)

would list the chapters of title 49, U.S.

Code, in which Congress has conferred

on the Secretary of Transportation the

authority to regulate commercial motor

vehicle safety. Many sections of these

chapters are cited throughout this

document. One statutory provision

which is not mentioned again is 42

U.S.C. 4917, which gives the Secretary

the authority to enforce Environmental

Protection Agency standards for the

limitation of noise emissions resulting

from the operation of motor carriers

engaged in interstate commerce. The

regulations implementing this provision

appear in part 325, and would not be

amended in this rulemaking.

The second sentence of paragraph (a)

would specify the administrative

powers the FHWA may employ in

carrying out its regulatory authority.

The intention of this sentence would be

to allow application of all of these

powers in the enforcement of each

relevant regulatory chapter (i.e., 49

U.S.C. chs. 51, 59, 311, 313, and 315).

The powers specified are virtually

identical to those listed in title 49 U.S.C.

5121 and 31133, which are to be used

in the enforcement of chapters 51 and

311, respectively. The administrative

powers to enforce chapter 315 are

provided in chapter 5 (see 49 U.S.C.

501(b)). Because the jurisdiction of

chapters 311 and 315 are identical as

applied by the FHWA, with 49 U.S.C.

31136 and 31502 routinely cited as

parallel authority for safety regulations,

the administrative powers available to

enforce chapter 315 may also be said to

be coextensive with those under chapter

311.
18868 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

The authority to investigate violations

of chapter 313, the commercial driver’s

license program, including drug and

alcohol testing, appears in 49 U.S.C. 322

and 31317. (See 12018(a) of the CMVSA

of 1986, in which the FHWA is granted

the power to issue such regulations as

may be necessary to carry out the

chapter). It is under this authority that

the administrative powers in 49 U.S.C.

31133 and chapter 5 would be applied

in this rule to enforcement of chapter

313. Similar authority to enforce chapter

59 may be found in 49 U.S.C. 5907.

Paragraphs (b) and (c) would restate

the delegation of these authorities

within the Department of

Transportation from the Secretary to

FHWA officials in the field who

routinely contact motor carriers. The

delegations are broad in order to allow

flexibility. The term ‘‘agency’’ is used

wherever possible when referring to

FHWA officials. The exact delegations

from the Secretary of Transportation

which have been made to the Federal

Highway Administration appear in 49

CFR 1.48. Further delegations within

the FHWA appear in FHWA

organizational documents (generally

FHWA Order 1–1) available for review

at FHWA regional offices. See 49 CFR

part 301. All of these subdelegations of

powers delegated to the Secretary of

Transportation are within the agency’s

discretion and are carefully designed to

comport with principles of fairness, due

process, and efficiency.

Paragraph (d) would restate the

delegation of authority to the States

which is provided in 49 U.S.C. 31134.

Because States are partners with the

Federal Government in enforcing motor

carrier safety laws, it is important to

reemphasize that nothing in this part

would preempt States from enforcing

State law. Other parts of the regulations

do, however, provide standards for the

preemption of State laws. See 49 CFR

part 355; part 397, subpart E; and

§ 382.109.

Section 361.103 Inspection and

Investigation

With the exception of paragraph (e),

this section would detail the scope of

the FHWA power to conduct on-site

inspections or, as they are more

commonly called, compliance reviews,

one of the administrative powers listed

in the previous section. It would be

reemphasized in paragraph (a) that this

power applies in carrying out all of the

listed commercial motor vehicle safety

chapters of the U.S. Code. The language

on the conduct of on-site inspection and

copying of records and equipment is

taken from 49 U.S.C. 504(c) and 5121(c),

with the added proviso that such

inspections take place at reasonable

times, a fundamental requirement of the

law relating to administrative searches.

Reasonable times would be further

explained in paragraph (c) as the regular

working hours of the carrier and certain

other times in particular circumstances.

Consistent with 49 U.S.C. 504, the onsite inspection powers would apply

only to motor carriers and other

regulated entities, such as hazardous

materials shippers and tenderors of

intermodal containers. The term ‘‘motor

carrier’’ is broadly defined in 49 CFR

390.5 as including a carrier’s agents,

officers, and representatives. In contrast,

the other investigatory administrative

powers, such as the power to issue

subpoenas, require production of

records, and take depositions, would

apply to any entity so long as the

administrative action is related to an

authorized safety investigation. Thus, an

entity perhaps not directly regulated by

the FHWA, such as a trucking service

company, a non-hazardous materials

shipper, or a medical examiner, which

possesses information related to an

investigation of a violation of the safety

regulations by a motor carrier would be

required to produce records of that

information upon request, enforceable

through administrative subpoena and

subsequent court order.

No distinction among regulated and

other entities in application of any of

the administrative powers, including

on-site inspections, appears in 49 U.S.C.

31133(a). The proposed regulatory

approach, however, is consistent with

49 U.S.C. 502 and 504 and the longstanding practice of the FHWA.

Proposed paragraph (b) restates two

general principles of administrative law

regarding the scope of investigations,

questions about which have arisen in

the past during the course of

inspections. First, any records related to

an investigation may be inspected,

regardless of whether or not the FHWA

requires the records to be maintained

under its regulatory authority. Second,

as part of an inspection and

investigation, FHWA officials may

question carrier officials and employees.

The last sentence of paragraph (b)

would incorporate the carrier’s right of

accompaniment during an inspection, as

provided in 49 U.S.C. 31133(b). This

means the carrier or its representative

must be given the opportunity to

accompany the investigator during the

inspection of records and equipment.

The invitation does not have to be

accepted, but it must be offered.

Paragraph (d) is modeled on provisions

in other agencies’ regulations. It is

proposed that an employer’s consent to

allow entry on its business premises of

an agency official for purposes of

conducting an investigation may not be

conditioned on the outcome of the

investigation or any resulting

enforcement actions.

An agency official denied entry by an

employer would not attempt to force

entry. The right of access for inspection

of records and equipment and

administrative subpoenas are

enforceable through a civil action in

U.S. District Court for an appropriate

order and such other relief as may be

necessary and proper under the

circumstances pursuant to proposed

§ 304.302 (derived from 49 U.S.C. 507).

Paragraph (e) would restate 49 U.S.C.

505(a) and would be included because

it is related to the scope of

investigations. Given the fluid nature of

the motor carrier industry, reviewing

lease arrangements may be essential in

determining legal responsibility for

compliance with the safety regulations.

Paragraph (f) would detail the

confidentiality of investigatory reports.

Section 361.104 Definitions

To avoid repetition, the definitions

provided in § 390.5 are also applicable

to this rule. The few additional

definitions necessary for this rule are

provided.

Section 361.105 Employer Obligations

Paragraph (a) would simply restate

the responsibility of motor carriers and

other persons to comply with applicable

safety regulations. 49 U.S.C. 31135.

Paragraph (b) would establish the duty

of persons to post notices of violations

when required by the FHWA. See 49

U.S.C. 521(b)(3). In addition, reasonable

standards for posting such notices are

proposed. Paragraph (c) would inform

the public that safety regulations

published in the Federal Register are

available for review in FHWA offices.

Paragraph (c) also proposes to require

that employers maintain a copy of

applicable safety regulations and make

it available to employees upon request.

It has long been a requirement that

employers assure compliance by their

employees of the safety regulations (see

49 CFR 390.11). This obligation could

not be met without ready access to the

governing regulations. 49 U.S.C. 31502

authorizes the Secretary to prescribe

requirements for the ‘‘safety of operation

and the equipment’’ of motor carriers

and the practical mandate to maintain

an accessible source of knowledge of the

requirements is clearly within this

authority. The FHWA does not consider

this an increased paperwork burden

because printed copies of the

regulations are readily available from a

number of sources in addition to the
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18869

Government Printing Office at little or

no cost.

Paragraphs (d) through (e) would

reiterate the on-site inspection process

from the point of view of the person

being investigated.

Section 361.106 Vehicle Inspection

Although the FHWA does not

generally focus its enforcement efforts

on safety equipment inspections of

CMVs on the roadside, this section

would mirror 49 U.S.C. 31142, which

provides the authority to conduct such

inspections. Vehicles may also be

inspected at a motor carrier’s terminal.

See 49 U.S.C. 504(c).

Section 361.107 Complaints

Little in this proposed section goes

beyond the statutory language.

Paragraphs (a) through (e) would be a

mixture of 49 U.S.C. 506(b) and

31143(a), which set forth the FHWA’s

procedure and obligations in responding

to complaints of violations of the safety

regulations lodged by members of the

public. The only addition to the statutes

is the second sentence of paragraph (b),

which would clarify what constitutes a

nonfrivolous complaint. Proposed

paragraphs (f) through (g) repeat the

prohibitions in 49 U.S.C. 31105(a) on

retaliation against employees who file

complaints alleging violations of the

safety regulations. Because of the

numerous questions which the FHWA

regularly receives in this area, paragraph

(h) would inform the public that the

prohibitions are enforced by the

Department of Labor and cites the

relevant regulations.

Section 361.108 Administrative

Subpoenas

The administrative subpoena power

would be elaborated, as authorized in 49

U.S.C. 502(d).

Section 361.109 Depositions and

Production of Records

Two more administrative powers

would be elaborated, as authorized in 49

U.S.C. 502 (e) and (f).

Part 362: Safety Ratings

This part would set forth the

standards and procedures applicable to

the determination of a motor carrier’s

safety fitness and the issuance of a

safety rating by the FHWA.

Background

Section 215 of the 1984 Act, enacted

on October 30, 1984 (now codified at 49

U.S.C. 31144), required the Secretary of

Transportation to establish a procedure

to determine the safety fitness of owners

and operators of commercial motor

vehicles in interstate commerce. Even

before the statutory mandate, the FHWA

had been providing safety fitness

information to the Interstate Commerce

Commission since 1967, and had

developed a rating system for motor

carriers. Following the 1984 Act, the

FHWA published an NPRM on June 25,

1986 (51 FR 23088), and issued a final

rule on December 19, 1988, with an

effective date of January 18, 1989 (53 FR

50961). The regulations are codified at

49 CFR part 385. The regulations were

amended by the interim final rule

published on August 16, 1991 (56 FR

40801) to implement the provisions of

the Motor Carrier Safety Act of 1990

(MCSA of 1990) (section 15 of the

Sanitary Food Transportation Act of

1990, Pub. L. 101–500, 104 Stat. 1218)

which prohibits a motor carrier that

receives an ‘‘unsatisfactory’’ safety

rating from operating commercial motor

vehicles to transport certain hazardous

materials or more than 15 passengers.

The regulations established a ‘‘safety

fitness standard’’ which the FHWA uses

for assigning motor carrier safety ratings

of ‘‘satisfactory,’’ ‘‘conditional,’’ or

‘‘unsatisfactory.’’ The safety ratings are

used to prioritize motor carriers for

review and focus enforcement resources

on carriers with the most serious

compliance problems. The safety ratings

had routinely been made available to

the ICC for consideration of operating

authority applications and selfinsurance, and have been available to

the Department of Defense in the

selection of carriers to transport

hazardous materials and passengers, to

other governmental and private industry

shippers for carrier selection purposes,

to insurance companies to assist in risk

determinations and to the public upon

request.

The current rule also prescribes

procedures for administrative review of

the rating based on factual disputes, and

for requested changes in safety ratings

based upon evidence that corrective

actions have been taken to bring the

motor carrier into compliance with the

safety fitness standard.

Since the adoption of the safety rating

regulations, the process has been the

subject of occasional dispute. To some,

the method used in determining a safety

rating is abstract and confusing,

especially when determined at the same

time as, but not necessarily in

conjunction with, the decision whether

or not to initiate enforcement actions.

The existence of both ‘‘unsatisfactory’’

and ‘‘conditional’’ ratings, moreover,

has resulted in unintended significance

being given to the ‘‘conditional’’ rating.

Since it is less than a ‘‘satisfactory’’

rating, some shippers and others

comparing the performance of various

carriers may give the ‘‘conditional’’

ratings an overlay negative connotation

not intended by the agency. Some motor

carriers, on the other hand, equate the

satisfactory rating with a level of

excellence unintended by the agency

and inconsistent with the general

meaning of the term ‘‘satisfactory,’’ i.e.,

adequate.

Other motor carriers have argued that

a rating may be based on alleged

violations of the regulations discovered

during on-site audits but not fully

documented. It may then become

difficult to contest these violations in an

administrative proceeding challenging

the rating. In practice, the FHWA has

addressed this concern by taking a

second investigative look at disputed

violations.

Although the FHWA believes that

current procedures satisfy the due

process provisions of the Administrative

Procedure Act, 5 U.S.C. 551 et seq.,

there is room for improvement and

greater efficiency. The situation took on

added significance with the enactment

of the Motor Carrier Safety Act of 1990

and its requirement that motor carriers

that receive an ‘‘unsatisfactory’’ safety

rating be prohibited from operating

commercial motor vehicles to transport

hazardous materials and passengers.

This prohibition, which becomes

effective 45 days after receipt of an

‘‘unsatisfactory’’ safety rating, would

clearly affect a motor carrier’s ability to

stay in business. In light of these

concerns, and to improve the objectivity

of the information on which ratings are

based, the FHWA has already made

several adjustments to the safety rating

methodology and has heightened its

responsiveness to carriers exposed to

serious consequences following ratings.

Full compliance with all of the safety

and hazardous materials regulations

should certainly be the objective of all

responsible motor carriers. At a

minimum, however, a motor carrier

must have managerial control over the

critical functions of its operations that

reflect on safety, i.e., it must have an

effective system to assure compliance

with the regulations. A negative rating

is, of course avoided through full

compliance. It is also avoided by

adopting reliable measures to assure

that the motor carrier’s employees know

what is required by the regulations,

have the opportunity to achieve full

compliance, and do not violate those

regulations.

In reviewing a motor carrier’s

operations for rating purposes, the

FHWA places more emphasis on

compliance with those regulations that

have the greatest immediate and direct
18870 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

impact on safety. In evaluating the

several factors that comprise the rating,

violations of those regulations will have

a greater effect on the overall rating. The

FHWA has been using the concepts of

‘‘acute’’ and ‘‘critical’’ regulations to

carry out this purpose. The term ‘‘acute’’

refers to regulatory requirements the

violations of which would create an

immediate risk to persons or property,

e.g., using a driver after he has tested

positive for alcohol. The term critical

refers to those regulatory requirements

the violation of which, if occurring in

patterns, would indicate a breakdown in

effective control over essential safety

functions, e.g., using drivers beyond

their allowable driving or duty hours.

These concepts would now be codified

if this proposal becomes final.

It is also being proposed that the

safety ratings be reduced to only one

category, eliminating both the

‘‘satisfactory’’ and ‘‘conditional’’ safety

rating categories. Conditions may be

attached to the avoidance of an

‘‘unsatisfactory’’ rating, but they would

not place the motor carrier in a rating

category from which negative

assumptions may be drawn. This raises

some additional questions to be

resolved in the final rule, e.g., whether

and how best to describe those carriers

which are not rated ‘‘unsatisfactory’’

and what should be done with the

ratings of those carriers currently rated

‘‘conditional.’’

The FHWA believes that Congress has

expressed its will in the MCSA of 1990

(49 U.S.C. 5113) and in subsequent

oversight reports that severe

consequences should attach to an

‘‘unsatisfactory’’ rating. Although the

language in that provision employs the

terms ‘‘satisfactory’’ and ‘‘conditional,’’

no particular significance is attributed

to those terms other than they are an

improvement from the ‘‘unsatisfactory’’

classification. This proposal reflects the

FHWA’s continuing intention to focus

on the ‘‘unsatisfactory’’ category and

assure that before carriers are assigned

such a rating, it is indeed a reflection of

demonstrably poor compliance or

performance. If the unsatisfactory safety

rating is to be considered tantamount to

a determination that the carrier assigned

such a rating should not to be operating

commercial motor vehicles in interstate

commerce without appropriate

corrective measures, then such a carrier

should be well below average and the

percentage of carriers earning such a

rating ought to be relatively small. The

information used to assign such a rating

should be put to a more strenuous test

before consequences attach.

The FHWA is, therefore, also

proposing to give motor carriers

advance notice of unsatisfactory ratings

so that any challenges to the ratings can

be resolved before the rating takes effect.

In addition, expedited procedures for

the review of unsatisfactory ratings are

proposed for carriers when their ability

to stay in business might be affected by

such a rating. Finally, the FHWA is also

proposing to recognize a practice that

has been evolving over the last few

years by affording some discretionary

relief to motor carriers adversely

affected by ratings that are able to

demonstrate a willingness to comply

and accept conditions designed to

improve their safety management

systems and practices.

It must be recognized that the FHWA

will never be able to complete an

individual on-premises compliance

review of every motor carrier in

existence. More and more, the

information obtained from State

accident reports and reports generated

by the 2 million roadside inspections

conducted each year is being used to

identify carriers that may be

experiencing safety or compliance

problems and therefore pose potential

safety risks. (As prescribed in current

regulations, this information is also

factored into a carrier’s rating.)

Complaints are also indications of the

possible existence of compliance

problems, and there is a statutory duty

to investigate nonfrivolous complaints.

As the amount and reliability of external

information grows, the absence of

negative indicators becomes a more

reliable premise for refraining from

individual, on-site compliance reviews.

Moreover, a ‘‘satisfactory’’ rating

produced by a compliance review is

only a current assessment of a motor

carrier’s level of compliance, and its

significance obviously diminishes with

time.

In a one-category rating system,

therefore, an ‘‘unsatisfactory’’ rating is

definitely a negative finding, which is

likely to have adverse impacts on the

motor carrier’s business opportunities.

The remaining group of carriers that are

not rated ‘‘unsatisfactory’’ would be

comprised of those carriers with

existing ‘‘satisfactory’’ or ‘‘conditional’’

ratings (which may be dated) and other

carriers that are not rated (this would be

the largest group). The latter subgroup

of unrated carriers would be comprised

both of carriers that survive future

compliance reviews without receiving

an ‘‘unsatisfactory’’ rating and those that

have not been subject to on-premises

compliance reviews. In this proposal,

we would not use any terminology to

describe carriers that are not rated

‘‘unsatisfactory,’’ so that no connotation,

positive or negative, would attach. If

readers are particularly opposed to this

approach, the FHWA is interested in

receiving comments on the use of

categories and the proper terminology to

be applied to them.

In this proposal, the FHWA would be

prescribing the immediate termination

of ‘‘satisfactory’’ and ‘‘conditional’’

ratings. This would have no impact on

carriers presently holding such ratings

as they would not be grouped in the

unsatisfactory category. The FHWA is

also particularly interested in comments

on this issue.

In recent times, the FHWA has

considered programs that would

provide incentives to those carriers that

demonstrate exceptional performance

and compliance. Nothing in this

proposal should be interpreted to mean

that we have abandoned such concepts.

The agency will continue to work with

other organizations and associations,

such as the Commercial Vehicle Safety

Alliance, to develop the potential of

using positive incentives to promote

compliance.

Finally, the safety rating is only one

means of promoting compliance with

the safety regulations. The FHWA will

continue to employ selective

compliance and enforcement measures

in the form of inspections,

investigations, civil penalty assessments

and criminal prosecutions. These will

be driven, for the most part, by

performance indicators and complaints.

We will also continue to rely heavily on

the partnership developed with State

safety enforcement agencies through the

Motor Carrier Safety Assistance

Program. Enforcement actions are

considered an effective tool to promote

compliance and penalties will be

imposed for violations of the safety

regulations when circumstances

warrant, regardless of the carrier’s

rating. This recognizes that many

otherwise satisfactory motor carriers

will tolerate violations of the regulations

from time to time, or will get careless in

their management practices designed to

detect and eliminate violations.

Enforcement is appropriate in such

situations without necessarily affecting

a carrier’s overall rating.

This following section-by-section

analysis explains these changes in more

detail.

Section-by-Section Analysis

Section 362.101 Purpose

This section would identify the scope

and purpose of the part. The definitions

section of part 385 would be removed as

unnecessary.
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18871

Section 362.102 Motor Carrier

Identification Report

This requirement is presently found at

§ 385.21, and provides that interstate

and foreign carriers must file a Motor

Carrier Identification Report, Form

MCS–150 (copy provided in the

appendix), within 90 days of beginning

operations. This is essential to an

accurate motor carrier census and

relates to the assignment of a DOT

identification number. It also assists the

FHWA in scheduling reviews of unrated

motor carriers. Since this is a continuing

requirement, the provision in the

current rule requiring the filing of the

report within 90 days of the effective

date of the rule has been eliminated.

Section 362.103 Safety Fitness—

Standard and Factors

The safety fitness standard in the

current § 385.5 and the factors in § 385.7

would be clarified, simplified and

combined into one section. This

proposal also elaborates on the factors

used to determine the rating and

codifies the practice of placing special

emphasis on compliance with ‘‘acute’’

and ‘‘critical’’ regulations.

Section 362.104 Determination of

Safety Fitness—Safety Ratings

The current 49 CFR 385.9 would be

amended to define the one safety rating

that may be issued by the FHWA

(‘‘unsatisfactory’’), and to describe what

constitutes such rating. For example, a

carrier would be issued an

unsatisfactory rating if it is determined

that the carrier does not have adequate

safety management controls in place to

ensure compliance with the safety

fitness standards and factors prescribed

in proposed § 362.103, and which has

resulted in one or more of the specific

occurrences listed in § 362.103(b)(1) (i)

through (x). In addition, this section

provides that an ‘‘unsatisfactory’’ safety

rating may be avoided based on

conditions, such as compliance with

specific provisions of the safety or

hazardous materials regulations, the

requirements of a compliance order or

settlement agreement, or notices to

abate, which may be imposed at the

time the proposed safety rating is

issued.

This requirement is not intended to

replace the current ‘‘conditional’’ safety

rating. Rather, it is intended to provide

the agency with flexibility to promote

compliance with the regulations by

obtaining the correction of deficiencies

in specific areas of a carrier’s operations

without calling the motor carrier’s entire

safety fitness into question. The

conditions upon which it would avoid

‘‘unsatisfactory’’ would be known by the

motor carrier and the agency. No

separate status would attach to the

rating, nor would the existence or the

nature of the conditions be routinely

available to the public under § 362.110.

The motor carrier could correct

deficiencies without having its ability to

stay in business negatively affected, as

is generally the case with the current

‘‘conditional’’ safety rating.

Section 362.105 Unsatisfactory Rated

Motor Carriers—Prohibition on

Transportation of Hazardous Materials

and Passengers; Ineligibility for Federal

Contracts

This section would incorporate and

clarify the existing prohibitions and

penalties listed in section 49 CFR

385.13 that are applicable to motor

carriers that receive a safety rating of

unsatisfactory. The listing of applicable

penalty statutes would be replaced with

a reference to the penalty provisions

listed in appendix A to part 386 of this

chapter (Part 364 in this proposal).

Finally, the references to the 45-day

period during which a motor carrier

must improve the safety rating would be

removed and incorporated into the

procedures for obtaining review of the

rating (new § 362.108, see description

below).

Section 362.106 Notification of a

Safety Rating

This section would clarify and

incorporate the rating notification

requirements of the current § 385.11,

and establish the concept of a proposed

safety rating of unsatisfactory. A

proposed safety rating of unsatisfactory

would become the motor carrier’s final

safety rating 45 days after the date the

notice of proposed safety rating is

received by the motor carrier, unless the

carrier petitions for a review or obtains

relief pursuant to proposed § 362.108

(see below). This proposed rating

incorporates the requirement in the

MCSA of 1990 that a motor carrier

receiving an unsatisfactory safety rating

be given 45 days to improve its rating

before the Act’s prohibition of

hazardous materials and passengers

transportation takes effect. It would also

eliminate a distinction between carriers

based on type of operation by applying

the concept of the proposed rating to all

unsatisfactory findings and would

afford all carriers the opportunity to be

heard during that period and to improve

the rating before consequences attach.

This section also would provide that a

proposed safety rating would not be

made routinely available to the public

until it becomes final. This would

ensure that a proposed safety rating of

unsatisfactory will not affect a motor

carrier’s business before the carrier is

given the opportunity to improve or

challenge its proposed rating.

The FHWA recognizes that the

assignment of a negative safety rating

often has graver consequences for the

rated motor carrier than any civil

penalties that might be sought for

individual violations considered in the

compilation of the rating. Several

prohibitions attach to the assignment of

an unsatisfactory rating and decisions

are made daily by shippers and insurers

on the basis of safety ratings. This is a

primary purpose of the rating as

conceived by Congress and

implemented by the agency. For this

reason, the agency treats the rating as a

valuable compliance and enforcement

measure and provides an administrative

proceeding to afford the ratee with the

opportunity to be heard before the rating

is made known. The FHWA believes

that withholding information about a

proposed rating from the public is

consistent with the Freedom of

Information Act, which provides an

exemption from required release of

information compiled for law

enforcement purposes (Exemption 7).

The exemption applies because (a) a law

enforcement proceeding would be

pending, i.e. the determination of the

motor carrier’s safety fitness; and (b) the

premature release of a proposed rating

could reasonably be expected to cause

harm in that the consequences would

attach before a final decision was made.

Since the purpose of providing the

administrative proceeding is to prevent

unintended consequences from inchoate

determinations, release of proposed

ratings to shippers and insurers who

may very well act on the information

could easily frustrate that purpose. It

could also increase demand for

expedited adjudication which could

adversely impact an orderly

consideration of all relevant issues.

Moreover, the length of time between a

proposed rating and a final rating is

finite and would rarely exceed 45 days.

The FHWA also recognizes that release

of a proposed rating may be unavoidable

under some circumstances, but it would

be the agency’s intent that routine

release under § 362.110 would not

occur.

Section 362.107 Change to Safety

Rating Based on Corrective Actions

This section would continue the

remedy presently available in § 385.17

by allowing for a change in an

unsatisfactory rating to be requested

both within the 45 days the rating

remains in a proposed status and at any

time after the rating becomes final. The
18872 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

filing of a petition for change of a

proposed rating would not stay this 45-

day period, but if the FHWA cannot

make a determination within the 45-day

period and the motor carrier has

submitted evidence that corrective

actions have been taken, the period may

be extended for up to an additional 10

days. This would allow the agency to

prioritize requests based on the

consequences a particular carrier may

face from an adverse rating. This section

would also provide for a higher level

agency review of a denial of a request

for a rating change. In cases where the

resulting unsatisfactory rating causes an

out-of-service order to be issued, an

expedited review by the Associate

Administrator would also be available.

Section 362.108 Administrative

Review

This section would consolidate,

clarify, and revise the existing

procedures in §§ 385.15 and 385.17

dealing with petitions for review of

safety ratings. The section would

establish a single procedure applicable

to reviews of proposed safety ratings of

unsatisfactory and of denials of requests

for changes in ratings under § 362.106.

Petitions for reviews of safety ratings of

unsatisfactory under this section would

be similar to the procedures in the

present § 385.15 applicable to reviews

by the Director, Office of Motor Carrier

Field Operations, in cases where there

are factual or procedural disputes to be

resolved. A motor carrier receiving

notice of a proposed safety rating of

unsatisfactory would still have the

option of requesting a change in the

rating based on corrective actions taken.

This section would provide a carrier

selecting that action with the additional

opportunity to petition for review if it

believes the rating or the denial of a

change was based on errors of procedure

or fact.

The existing 90-day filing deadline for

petitions under this section would be

reduced to 45 days for consistency and

finality. When the procedure applies to

proposed safety ratings of

unsatisfactory, the request for review

must be submitted during the 45-day

period before the proposed rating

becomes final. This section would

maintain the current statutory

requirement that the FHWA complete

the review within 30 days in cases

where the petition is filed by a motor

carrier subject to the hazardous

materials and passenger prohibition in

§ 362.105.

The petitioner would be required to

submit with its petition all arguments

and information it desires to be

considered on review. In most cases, the

Director, Office of Field Operations, will

complete the review and render a

decision on the basis of the written

submission. The Director would have

the discretion to request additional

information or to call a conference. If it

is determined that the motor carrier

operations still fail to meet the safety

fitness standard, the motor carrier

would be provided with written

notification that its petition has been

denied and that the proposed safety

rating of unsatisfactory is final. Except

as provided below, the decision of the

Director, Office of Motor Carrier Field

Operations, would become the final

agency action. Because the

unsatisfactory rating generates an out-ofservice order for a passenger or

hazardous materials carrier, such motor

carrier would have the right to an

expedited administrative review of this

decision by the Associate Administrator

for Motor Carriers in accordance with 5

U.S.C. 554 and corresponding

procedures are proposed in part 363.

This is a new review procedure

proposed to better guarantee due

process of law. The expedited review, if

timely requested, would be provided

within 10 days from the date of the

notice of denial of the initial review

petition. The Associate Administrator

may refer the petition for review for a

hearing before an Administrator Law

Judge (ALJ). The Associate

Administrator or ALJ may stay any

safety rating during the pendency of the

expedited administrative review.

Section 362.109 Temporary Relief

From Rating

This section would provide a means

to grant temporary relief to a motor

carrier from dire consequences of an

unsatisfactory rating upon a showing of

willingness to adopt necessary changes

in safety management polices and

practices and to make good faith efforts

to improve safety performance. The

temporary relief would be entirely

discretionary on the part of the Regional

Director, in the case of a petition for

change in the rating, and the Director of

the Office of Field Operations, in the

case of an initial administrative review.

The exercise of discretion by these

officials is not reviewable as every

carrier affected by a proposed rating or

final rating is provided with ample

opportunity for administrative review in

this Part. This provision merely

institutionalizes a practice that has been

growing in the recent past whereby a

rating is ‘‘conditionally rescinded,’’ to

allow a motor carrier to demonstrate its

improved practices in order to earn a

better rating. If a motor carrier is forced

to cease operating because of an

unsatisfactory rating, it presumably

would be unable to gather any

experience with improved systems that

would convince a reviewer that it had

indeed committed itself to safety

compliance. The proposed procedure

would require the motor carrier to

operate under a consent order for a

period not to exceed 60 days at the

conclusion of which a final rating

would be assigned.

Section 362.110 Safety Fitness

Information

This section would incorporate the

requirements of the current § 385.19.

The section has been clarified to make

clear that the information would also be

made available to State agencies.

Part 363: Enforcement Proceedings

The goal of this proposal is to

improve the current rules of procedure

for motor carrier enforcement

proceedings. Mindful that this must also

have been the goal each of the numerous

times the rules have been amended

since their inception in 1969, the task

has been approached deliberately. To

open the process to new ideas, various

external sources have been consulted,

notably the Model Adjudication Rules

of the Administrative Conference of the

United States (December 1993) and

various procedural rules of other

Federal agencies. On the other hand, in

recognition of the importance of the

historical context of the rules, the

predecessors of the current rules, and

their extensive amendments, were

reviewed in hopes of identifying

shortcomings and determining the

underlying rationale for certain

provisions which may now seem

unnecessary, unclear, or unavailing.

This review reveals that even the first

incarnation of motor carrier procedural

rules by the FHWA, spare though they

may have been, were not created in a

vacuum, but were largely based on

practices and procedures of the

Interstate Commerce Commission from

whence the FHWA inherited its motor

carrier safety functions. Each

subsequent amendment was believed to

be necessary to address programmatic or

statutory changes or to increase

efficiency and fairness. And each

amendment or wholesale revision was

built on the foundation of previous

rules. This effort is no different,

notwithstanding the recourse to model

rules.

Because of the importance of past

practice in understanding both the

current system and needed changes, and

because such a history has not been

compiled elsewhere, a fairly extensive

examination of previous rules is offered.
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18873

The proposed rules will then be

explained in this context.

Background

The current rules are the legacy of two

distinct strains of administrative

procedures of the ICC. Until 1966, the

ICC had the sole responsibility on the

Federal level for regulating motor carrier

safety. In addition to its pervasive

regulation of interstate routes, rates and

services through a comprehensive

system of certificates of authority to

operate, the ICC also established

standards for the safety of operation of

motor carriers. Interstate Commerce Act,

sec. 104, 24 Stat. 379, (1887); added ch.

498, 49 Stat. 546 (1935). Most of the

safety standards were enforced through

a rather onerous process involving

numerous formal steps—opening an

investigation, investigation, record

production and depositions,

proceedings before the full Commission,

compliance orders, and, if it came to

that, the withdrawal of operating

authority.

In addition, the ICC had limited

authority under section 222(h) of the

Interstate Commerce Act to levy civil,

monetary penalties against carriers for

failure to keep records, file reports, or

respond to questions posed by the ICC,

so-called recordkeeping violations. Acts

of fraud, misrepresentation, false

statements, and intentional violations of

nonrecordkeeping requirements in the

FMCSRs were punishable solely as

criminal offenses in Federal court, or

through the formal process relating to

operating authority. The section 222(h)

recordkeeping violations subject to

monetary penalties were enforced by the

ICC in civil actions in the United States

District Courts in the event informal

administrative procedures to resolve

such actions were unsuccessful.

The two separate enforcement tracks

were carried over to the FHWA after the

ICC’s safety functions were transferred

to DOT. In 1969, the FHWA issued rules

of practice for motor carrier proceedings

which crystallized the dichotomy. 34 FR

936 (January 22, 1969). Part 385 of title

49 CFR was entitled ‘‘Collection and

Compromise of Claims for Forfeiture

under Section 222(h) of the Interstate

Commerce Act.’’ Part 386 provided

‘‘The Rules of Practice for Motor Carrier

Safety Proceedings under section 204(c)

of the Interstate Commerce Act.’’

Part 385 was very brief, providing

requirements for claim notices and

settlement agreements. Respondents

were instructed that they should

respond to the claim and should state

whether they wished to discuss

payment. A response was not

mandatory. Section 222(h) claims that

did not result in a settlement or to

which there was no response were

enforced through litigation in U.S.

District Court. Mirroring the ICC

situation, no administrative procedure

was provided to resolve the claims.

As the FHWA’s version of the ICC’s

formal process, part 386 was

considerably more involved than part

385 and established the framework for

the current rules of procedures.

All proceedings under part 386

alleging safety violations began with

issuance of a notice of investigation

(NOI) to a motor carrier, a procedural

relic of the cumbersome ICC process.

Under 49 U.S.C. 506, an order to compel

compliance could not be issued without

an NOI and an ‘‘opportunity for a

proceeding.’’ The Federal Highway

Administrator assigned to a hearing

examiner all NOIs properly contested by

the carrier in the form provided in the

rule. After a hearing, the hearing

examiner issued an order disposing of

the proceedings, which was reviewable

by the Administrator on his/her own

motion or that of a party. The

proceedings could also be disposed of

by issuance of a consent order pursuant

to the agreement of the parties.

Improperly contested or unanswered

NOIs could result in unilateral issuance

of a final order by the Administrator.

For the most part, the orders directed

the carrier to comply with the safety

regulations it was already duty bound to

follow.

For enforcement of orders against

regulated carriers, the FHWA had to

petition the ICC to open its own

investigation into the carrier’s operating

authority, thus bringing the matter back

to that cumbersome process. Moreover,

a revocation proceeding by the ICC

would generally not be commenced

without a showing that an FHWA order

had been violated.

In 1977, the FHWA made the first

extensive revisions to these procedural

rules. 42 FR 18076 (April 5, 1977). Part

385 was repealed and its settlement

procedures incorporated into part 386.

The respondent’s statement of desire to

discuss payment of the amount of the

claim became mandatory and an

occasional source of confusion or, at

least, an excuse not to file a proper

response. It is not difficult to see that a

statement expressing a willingness to

settle could be seen by the uninitiated

as a quasi admission of culpability at

odds with a statement contesting the

allegations of the claim. Some

respondents merely stated they wished

to discuss settlement and failed to file

a reply consistent with the rules,

thereby risking waiver of the right to

contest the claim, waiver of the right to

a hearing, or worse, default. This

situation was exacerbated by regulatory

changes in action taken by the FHWA

upon a failure to reply.

In the interest of uniformity, the scope

of Part 386 was expanded in 1977 to

include monetary penalty actions

arising under section 222(h) of the ICC

Act (formerly processed under part 385)

and the HMTA and to include driver

qualification determinations.

Unfortunately for uniformity, the

standards for these proceedings varied

in particulars. For example, the

commencement of proceedings was

trifurcated into issuances of claim

letters for civil penalties, letters of

disqualification or determinations for

driver qualifications, and NOIs for

violations of other safety rules.

Significantly, monetary penalty

assessments were now, for the first time,

subject to an extensive administrative

process.

In terms of procedures, no longer

would all properly contested matters

result in a hearing. Instead, ‘‘to expedite

the decisionmaking process and to

reduce the number of unnecessary

hearings,’’ the Associate Administrator

(AA) for Safety, rather than the Federal

Highway Administrator, would only

assign matters with material factual

issues in dispute to a hearing officer. If

no hearing was requested in the reply,

the AA could simply issue a final order

based on the evidence and arguments

submitted.

When no reply was received at all, the

outcome varied by the type of

proceeding. If a driver failed to reply in

accordance with the rules to a letter or

determination of disqualification in a

driver qualification proceeding, the

letter or determination automatically

became the final order of the Associate

Administrator 30 days later. In contrast,

no such automatic procedure existed

when no reply at all was made to claim

letters or NOIs. The AA still had to issue

a final order, although it could be done

sua sponte.

Also added to part 386 were pre-trial

procedures on discovery and motion

practice designed to expedite the

proceedings and clarify procedural

points which had arisen under the 1969

rules.

Minor revisions were made to the

rules later in 1977, based on comments

received from the public and six months

of practice. 42 FR 53965 (October 4,

1977). Most significant among the

changes, a motion by a party was

required before the AA could issue a

final order where no reply was made to

the NOI or claim letter. In addition,

discovery and amendment of pleadings

were expanded to situations in which a
18874 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

1FHWA Orders 1–1, Part I, Chapter 7, Motor

Carrier Safety, is available for inspection and

copying as provided at 49 CFR part 7, appendix D.

matter was not assigned for a hearing

but decided by the AA based on the

pleadings. Finally, for matters under the

HMTA only, an option was added

whereby a respondent could reply to a

claim or NOI with a notice to submit

evidence, rather than request a hearing,

and then submit the evidence at a later

date.

In 1985, the rules were again

comprehensively amended. 50 FR 40304

(October 2, 1985). The precipitating

factors were again statutory changes and

internal reorganization. Pursuant to the

Motor Carrier Safety Act of 1984 and

amendments to the HMTA, the rule

contained provisions for the FHWA to

seek to enjoin in U.S. District Court

carrier actions in violation of the

FMCSRs and HMRs and to order out-ofservice all carrier operations

constituting an imminent hazard to

safety.

A section on judicial appeal of final

orders was also added to the rule

consistent with the 1984 Act. This

became important because the 1984 Act

authorized the FHWA, for the first time,

to assess civil, monetary penalties for

non-recordkeeping violations of the

FMCSRs. Prior to the 1984 Act,

monetary penalties could only be

assessed for violations of the HMRs and

recordkeeping requirements in section

222(h) of the ICC Act and the FMCSR.

The 1984 Act expressly made all

penalty assessments subject to the

notice and hearing requirements of the

Administrative Procedure Act. Thus, the

reach and depth of the FHWA’s civil

penalty authority was greatly expanded,

and the procedural rules were amended

to reflect this new authority and

responsibility.

In terms of procedure, however, the

basic trichotomy of the 1977 rules was

continued—driver qualification, civil

penalty, and NOI proceedings. Despite

the sudden predominance of civil

penalties in terms of the safety program

generally, and, specifically, of the

relative number of administrative

proceedings, the civil penalty

procedures were little changed from the

1977 rules, which, in turn, were largely

based on the old ICC NOI procedures.

Although these procedures met the

requirement in the 1984 Act to comply

with the Administrative Procedure Act,

they perhaps did not offer the clearest

and most efficient method of resolving

the new influx of cases.

The civil penalty procedures were

amended, however, in several minor

ways relevant to this discussion. First,

similar to the earlier provisions for

driver qualification proceedings, the

failure to reply to a claim letter

automatically resulted in the letter

becoming the final order of the

Associate Administrator for the newly

organized Office of Motor Carriers (AA)

without a separate order having to be

issued upon the motion of a party.

Unlike the qualification section,

however, this seemingly applied only to

a complete failure to reply, and not

merely a failure to reply in the form

provided in the rule. For NOIs, nothing

changed in this regard. Final orders

continued to be issued by the AA only

upon motion of a party. Second, the

procedure for notice of intent to submit

evidence without a hearing was

extended from hazardous materials

cases to all civil penalty proceedings.

Third, Administrative Law Judges

formally replaced hearing officers as

arbiters, although this had been the

practice for some time. Fourth, the

discovery and hearing procedure

sections were made more detailed to

closer approximate the Federal Rules of

Civil Procedure (title 28, U.S.C.).

The important results of the 1985

amendments were the expansion of civil

penalty authority and the addition of

out-of-service order authority. These

two developments further marginalized

the venerable NOI process. In practice,

civil penalty proceedings came to

greatly overshadow the cumbersome

NOI proceedings. Instead of having to

endure a long administrative process

possibly resulting in an order to comply

with regulations with which a carrier

was already bound to comply, and

which could only be enforced through

intervention in ICC proceedings,

another long process, direct

administrative action could be taken

against the carrier in the form of

financial penalty. If a carrier persisted

in a state of noncompliance, it could

now be directly ordered out of service

as an imminent hazard. An NOI-based

order to comply with the regulations

paled in comparison with these new

powers.

The next revision of the rules made

only technical amendments. 53 FR 2035

(January 26, 1988). Added to the

authorities and scope sections in part

386 were references to the CMVSA of

1986 (49 U.S.C. Chapter 313), in order

to implement the CMVSA-based civil

and criminal penalties added to 49

U.S.C. 521(b). The Administrative Law

Judge’s power to dismiss matters

referred by the AA for a hearing was

made explicit. And the rather detailed

delegations of authority from the

Administrator to various positions

within the Office of Motor Carriers were

removed from the regulations and

placed in the FHWA Organization

Manual,1 consistent with an agencywide trend to maximize flexibility.

A small change was made to the rules

on December 19, 1988 (53 FR 50961).

The FHWA clarified that an out-ofservice order designed to eliminate an

imminent hazard applied immediately,

pending an opportunity for review

within 10 days.

More extensive amendments were

made in 1991. 56 FR 10183 (March 11,

1991); NPRM, 55 FR 11224 (March 27,

1990). A new subpart G spelled out the

statutory civil penalty assessment

criteria and specified the four types of

FHWA orders the violation of which

could lead to additional penalties. The

four types of orders were notice to abate,

notice to post, final order, and out-ofservice order. New appendix A to part

386 established a penalty schedule

ranging from $500 to $10,000 for

violations of such orders. These

amendments implemented a provision

of the 1984 Act (49 U.S.C. 521(b)(7)).

Another 1991 amendment added a

‘‘new’’ order to the AA’s enforcement

arsenal—the compliance order, last

heard from in ICC proceedings

predating the formation of the DOT. See

§ 386.21. The compliance order

attempted to give meaning to the largely

moribund NOI process, the procedures

for which nevertheless remained in the

regulations. The compliance order

became the name of the final order

issued by the AA in an NOI proceeding

in which a consent order could not be

achieved. A compliance order could go

beyond the NOI in that it could direct

a carrier to ‘‘take reasonable measures

beyond the requirements of the

regulations, in the time and manner

specified, to assure future compliance.’’

The order warned that failure to take

those measures would constitute a

violation of a final order of the AA,

subjecting the carrier to the additional

penalties of appendix A and an out-ofservice order if the carrier’s operations

constituted an imminent hazard to

safety. In practice, it is not common for

a compliance order to be issued

directing a carrier to take compliance

measures beyond those required in the

safety regulations, but such measures

may be dictated by the circumstances.

The rule allows challenges to the

reasonableness of these measures. In

order to expedite the use of NOIs, the

NOI and civil penalty procedures were

merged into § 386.14, though the

differences in default standards,

discussed above, remained. The

combination of NOIs and civil penalty
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18875

claims into a single administrative

proceeding has been permitted since the

1985 rules.

In practice, it is common for NOIs and

notices of claims to be both combined

or issued separately at the same time in

parallel proceedings, on those occasions

when NOIs are used. The primary use

of the NOI is as a warning that further

violations of the same regulations could

constitute an imminent hazard and lead

to an out-of-service order, as provided

in § 386.21(c).

The 1991 rulemaking made two

further amendments worth mentioning.

First, settlement agreements were

amended to require a statement that

failure to pay in accordance with the

agreement resulted in the original claim

amount becoming due and payable

immediately. Second, a provision was

added to the out-of-service procedure

allowing a vehicle in transit at the time

it is ordered out of service to proceed to

its immediate destination. Both of these

concepts are incorporated in the

proposed rules.

Section-by-Section Analysis

Subpart A—Civil Penalty Proceedings

Section 363.101 Nature of Proceeding

Civil penalty proceedings would be

defined broadly as administrative

proceedings in which the FHWA seeks

payment of a fine or orders a motor

carrier, individual, or other regulated

entity, the ‘‘respondent,’’ to take some

action. Civil penalty proceedings are

based on violations of the FMCSRs or

HMRs, which must be established

administratively by final order of the

agency. Civil penalty proceedings

would include all motor carrier safety,

hazardous materials and intermodal

container administrative enforcement

proceedings by the FHWA, other than

those involving driver qualification and

safety ratings. For example, proceedings

resulting from issuance of an out-ofservice order are civil penalty

proceedings.

Driver qualification procedures are

proposed in subpart B of this part.

Safety ratings are issued and may

generally be contested in accordance

with proposed part 302. However, when

the safety rating has the effect of placing

a carrier out of service, the carrier is

offered the same opportunity for an

expedited hearing as is available to a

carrier subject to a direct out-of-service

order.

The notice of investigation (NOI)

procedure, the resurfaced, ICCoriginated process which allows for a

finding of violations but provides no

penalties, would finally be laid to rest.

Any orders, findings, notices, or

warnings the NOI procedure may have

allowed would be incorporated into the

civil penalty process. The use of one set

of procedures for all claims arising from

a single set of violations should result

in clearer standards and greater

efficiency, and would eliminate parallel

proceedings arising from an NOI and a

monetary claim based on a single set of

violations.

The procedures are designed to

comport with the Administrative

Procedure Act and principles of due

process. The proposed rules ensure that

persons are adequately notified of the

violations they are alleged to have

committed and of their right to the

opportunity to be heard by the agency,

and, in the appropriate circumstances,

to a hearing before an Administrative

Law Judge.

Section 363.102 Notice of Violation

(Complaint)

A Notice of Violation setting forth the

allegations of the claim of the agency

against the respondent would begin a

proceeding. Paragraphs (a) and (b)

propose the minimum information to be

included in the notice. The only item

which is not a restatement of part 386

is the reply form at paragraph (a)(5),

which will be discussed below. To

ensure that respondents are notified of

the agency’s claim, paragraph (c) would

specify as the form of service to be used

in issuing the notice one which utilizes

a return receipt. This requirement is

consistent with current practice.

Section 363.103 Form Reply to Notice

of Violation

It is proposed to include with each

notice of violation a reply form on

which the respondent is asked to check

off its intended response to the claim.

The respondent may check only one

option on the reply form. The choices

are to: (1) Pay the penalty, (2) discuss

settlement, and (3) contest the claim. If

(2) is chosen, respondent retains the

right to contest the claim or pay the

penalty at a later date, as detailed

below. For the first time, replies may be

sent by telefax, although respondent

retains the burden to prove it has made

a timely reply. If no reply form (or

payment or answer to the claim) is

served on the agency within 15 days,

the notice of violation becomes the final

order, the violations are established as

alleged, and the respondent waives the

right to contest the claim.

The intent of these provisions is to

increase the efficiency of the notice of

claim process currently provided in part

386. Providing one or two time periods

in which to respond to claims and

disqualification determinations would

be simpler than the 3 or 4 periods

currently provided in part 386. Though

it adds a step, the reply form is designed

to provide a clear starting point to the

process and to obtain a clear and simple

statement from the respondent of its

intentions with regard to the claim.

Cases involving respondents that do not

reply can be processed expeditiously.

On the other hand, the reply form

would add flexibility. The agency can

easily amend the claim to reflect any

changed circumstances discovered as a

result of settlement negotiations.

Respondents would avoid generating

perhaps lengthy and involved replies on

the record, only to resolve the matter

later outside formal channels.

Because of the immediate severity of

an out-of-service order, and the

consequent reduction in the time period

to resolve contested issues, no reply

form is sent along with an out-of-service

order. See § 363.110.

Section 363.104 Special Procedures for

Out-of-Service Orders

This section is largely a restatement of

what presently appears in § 386.72(b)(1),

but would add a requirement for

personal service, a reference to the

penalty for noncompliance, and a

provision for expedited adjudication

under proposed § 363.110. The

authority summarily to order a motor

carrier to cease all or parts of its

operations because violations of the

FMCS are creating an imminent hazard

is found at 49 U.S.C. 521(b)(5)(A).

Section 363.105 Payment of the Claim

This is the first, and obviously

simplest, resolution to a notice of

violation assessing a monetary penalty.

Because payment terminates the

proceeding, it may be made with or

without filing the reply form. However,

if payment is chosen on the reply form,

but is not made to the agency within the

time to reply, the notice becomes the

final agency order as if the respondent

failed to reply. Paragraph (a) would

provide that payment may be made at

any time in the course of the proceeding

before issuance of a final order. If it

takes the form of a settlement

agreement, however, it must be done in

accordance with § 363.106. Of course,

payment of the monetary claim might

not terminate the proceeding if some

other order is also being sought.

Paragraph (c) makes it clear that

payment of the claim is tantamount to

a final order finding the facts of the

violations as alleged in the notice,

unless the parties expressly agree in

writing to treat the violations otherwise.

This is important because certain future

agency enforcement actions may be
18876 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

based on, and certain consequences may

flow from, prior and continued

violations of the safety regulations.

Section 363.106 Settlement of Civil

Penalty Claims; Generally

Settlement may occur at any time in

the process including after the

termination of negotiations under

§ 363.107 and during a hearing.

Settlement procedures have been a key

feature of the FHWA civil penalty

process since their inception in 1969.

Settlement of alleged violations before

resort to a final formal adjudication is

efficient and promotes the partnership

of the FHWA and its regulated entities

directed toward safer commercial motor

vehicle transportation.

The content of settlement agreements

would not be substantively altered from

that required in part 386. As civil

penalty proceedings are not limited in

this proposed rule to monetary claims,

so may settlement agreements resolve

the terms of other orders sought against

respondent by the agency. Thus, the

consent order procedure in part 386,

which provided for issuance by the

agency of such other orders, and which

could include settlement agreements

resolving monetary claims anyway, is

no longer necessary.

It should be noted that settlement

agreements will contain a finding that

certain violations did, in fact, occur.

Settlement agreements should not be

necessary in cases in which full

payment of the claim is made and no

other orders are sought or terms placed

on respondent. Full payment

automatically results in a finding of the

violations as alleged in the notice.

Paragraph (d) involves the situation in

which partial payment is made by a

respondent, with or without an

accompanying unilateral expression of

the respondent’s intent in offering the

payment. The FHWA’s acceptance of

partial payment, as indicated by cashing

a check, for instance, in no way should

be interpreted as settlement of the claim

or as forgiving the remainder of the

claim. All settlement agreements must

be in the form provided in paragraph

(b).

Paragraph (e) would allow execution

of settlement agreement during the

course of administrative proceedings,

upon the consent of parties and without

the approval of the AA.

Section 363.107 Settlement

Negotiations

In contrast to the general

requirements in the preceding section

applying in all instances of settlements,

this section would establish procedures

when the settlement negotiations option

is chosen by the respondent on the form

reply. Respondents would retain the

opportunity to convert the proceeding

into a contested claim at any point in

the negotiation process. They could do

this by requesting an administrative

adjudication and filing an answer to the

notice of violation. For its part, the

agency could discontinue negotiations it

feels are not proving fruitful by sending

the respondent a final notice of

violation.

Paragraph (d) proposes a 90-day limit

on this initial negotiation process. If a

settlement agreement is not reached

within 90 days, the agency may issue a

final notice of violation to the

respondent. The purpose of this

provision is to keep the administrative

case moving toward resolution. As

justice delayed is justice denied, so does

a delayed penalty reduce its

effectiveness. Under current practice,

some cases in which a respondent has

indicated a willingness to settle have a

tendency to languish when agreement

cannot be readily reached. This

provision should help to avoid

consequent case backlogs and should

actually promote settlement as it pushes

the case along the track toward

resolution. In accordance with

§ 363.106, a settlement may be reached

at any point in the civil penalty process,

including in contested claims being

administratively adjudicated.

Paragraph (e) would establish the

procedures when a final notice of

violation is sent to a respondent after

negotiations have been expressly

terminated by one of the parties or 90

days have passed without settlement.

For flexibility, the final notice may

simply incorporate the original notice of

violation. For efficiency, if the

negotiations have revealed, for example,

that one of the claimed violations did

not occur, the final notice may be

amended deleting that charge. The

procedures for replying to the final

notice similarly would incorporate

those for immediately contesting the

original claim. At this point, after

negotiations have indicated that the

parties cannot agree on resolution of the

claim and that it is indeed contested,

the respondent would have no choice

but to answer the notice in writing.

Section 363.108 Request for an

Administrative Adjudication

This section proposes procedures for

contested claims. The procedures would

apply when the ‘‘contest the claim’’

option is chosen on the reply form or

when the settlement option is chosen

but settlement is not reached. A

contested claim would be resolved in an

administrative proceeding adjudicated

by a neutral third party provided by the

agency. Depending on the choice of the

respondent and the existence of material

factual issues in dispute, the third party

may be the Associate Administrator

(AA) or an Administrative Law Judge

(ALJ). The AA would decide whether or

not a case will be referred to an ALJ.

Paragraph (a) would provide a

respondent 28 days from receipt of the

notice of violation to serve a written

answer on the agency contesting the

claim. If the answer is responding to an

original notice of violation this means

that the respondent would be required

to send the agency the reply form in 15

days and the written answer within

another 13 days after that. Of course,

respondent may choose to file an

answer within 15 days of the notice of

violation, in which case a reply form

would be unnecessary. As with the

reply form, the answer may be served on

the agency by telefax.

The content of the answer in

paragraph (c) would be similar to that

currently required in replies under Part

386. Paragraph (c)(3) would clarify that

referral to an ALJ may not be available

in all instances where it is requested,

but only where there are factual issues

in dispute. Part 386 presently states this

concept in terms of an oral hearing, i.e.,

an oral hearing is only available for

cases with factual issues. Questions

sometimes arise when contested claims

without factual issues are decided by

the AA without referral to an ALJ, much

less an oral hearing, even though a

hearing was requested. Though

§ 386.16(b) clearly gives the AA this

power, as provided by the 1977

amendments, the section on content of

replies does not reflect it. The proposed

rule clearly states the agency’s intent

that the opportunity for a hearing does

not mean that all contested matters are

referred to an ALJ for a hearing. Finally,

consistent with the standard in Part 386,

failure to request referral to an ALJ

would result in a waiver of the right to

opportunity for it.

The provision in part 386 allowing

the respondent to file a notice of intent

to submit evidence without an oral

hearing, with its own array of deadlines,

would be eliminated as unnecessary.

Paragraph (c)(3) would simply give the

respondent the option of requesting

referral to an ALJ or not. For tactical or

efficiency reasons, a respondent may

very well wish the AA, instead of an

ALJ, to resolve its contested claim, even

where factual issues are present. (See,

however, discussion under § 363.109).

If the respondent fails to answer the

claim, paragraph (d) would provide that

the notice of violation becomes the final

agency order in the same manner as
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when the reply form was not served on

the agency. Moreover, merely choosing

an administrative adjudication on the

reply form without filing an answer

would also be deemed a failure to

answer.

If the notice is answered, but not in

the form provided in this section, the

respondent may be found in default in

the discretion of the AA or ALJ. Default

would have the same effect as a failure

to answer. In both situations, the ALJ or

AA would issue a final order without

inquiry as to the charged violations.

These provisions would clearly assign

the power to determine the adequacy of

the answer in various situations.

Findings of default and failure to

answer, and resulting Final Order

finding of the violations as alleged,

would support any subsequent

collection actions taken by the agency.

Section 363.109 Procedures in

Administrative Adjudications

All contested claims would be

transmitted to the AA to either decide

or refer to an ALJ for decision. Only the

AA could determine whether or not

there are factual issues in dispute and

assign an ALJ to resolve a contested

claim, unless the AA expressly requests

the ALJ to make that determination.

Assigning to an ALJ only those cases

with apparent or potential factual issues

has been a feature of the rules since

1977, and has been upheld in litigation

on numerous occasions as complying

both with the Administrative Procedure

Act and due process principles. Issues

of efficiency and adjudicative economy

dictate that this standard continue in

effect.

The first sentence of subsection (b)

proposes that if there are facts in

dispute and respondent has requested

referral, the AA must refer the matter to

an ALJ. Subsection (c) proposes to

provide the AA with the discretion to

decide the matter in two circumstances:

(1) Where referral is requested but there

are no factual issues, and (2) where

referral is not requested.

There may be another situation

between these two poles, however. If

respondent has not requested referral,

but the AA nevertheless believes referral

would be beneficial to resolve a factual

or other issue, should the AA have such

discretion? May respondents be

required to participate in possibly costly

adjudication even though respondent is

comfortable with potentially ‘‘lesser’’

process? The second sentence of

subsection (b) would allow referral in

those instances in the discretion of the

AA. The FHWA requests comments on

this issue.

Subsections (d) and (e) would

accomplish in two short statements and

one reference what the procedures have

attempted over the years to do by detail.

The Federal Rules of Civil Procedure,

the approximation of which served as

justification for the ever expanding

standards in part 386 on discovery and

motion practice, are incorporated into

the civil penalty process, thereby

eliminating the need for virtually all of

subpart D to part 386. The AA and ALJ

may suspend or adapt the Federal rules

as appropriate, in conformance with the

Administrative Procedure Act.

Subsections (f) and (g) would

authorize the ALJ to employ appropriate

process, including alternative dispute

resolution. Subsection (h) would set

minimal standards for appearance of

representatives of respondents in

administrative proceedings.

Subsection (i) would provide that the

parties in an administrative

adjudication may withdraw the matter

under certain circumstances.

Withdrawal by a party, or by the

consent of the parties, would terminate

the jurisdiction of the ALJ.

Section 363.110 Expedited Review by

Associate Administrator

This section proposes expedited

procedures for administrative review of

out-of-service orders or unsatisfactory

safety ratings after review by the

Director of the Office of Field

Operations. Subsection (c) would

reduce the time to conduct an entire

administrative adjudication to 10 days

because subsection (b) provides that the

out-of-service order shall remain in

effect pending resolution of the

contested claim. This last provision has

been a part of the regulations since the

1985 amendments added the out-ofservice procedure. The FHWA believes

that it complies with intent of Congress

in the 1984 Act. The rest of subsection

(b) would restate the ‘‘immediate

destination’’ exception which was

added to part 386 in the 1991

amendments. In the interest of

uniformity, subsection (d) would

incorporate the procedures in § 363.109.

Sections 363.111 Through 363.116

With few exceptions, these sections

would incorporate the provisions of

subpart E of part 386, on decisions and

appeals, into the new rule without

substantive change. Section 386.66,

which set a one year period before

considering motions for modification of

orders, would not be carried over. There

would be no minimum time for an order

to be in effect before it may be rescinded

or modified by order of the AA or ALJ.

Any such motions may be made

pursuant to § 363.109(e).

For the sake of clarity, § 363.114

would add a sentence to what is now in

§ 386.67, liberally interpreting 49 U.S.C.

521(b)(8) to allow judicial review for

contested claims resulting in a final

agency order, but not for those claims

that are resolved through settlement

agreement or in which respondent failed

to answer or defaulted. The statute

provides that judicial review is only

available after a hearing. The FHWA

believes its interpretation is appropriate

because these proposed rules provide

for resolution of contested claims in an

administrative adjudication without a

formal reply. Of course, ultimately the

courts must interpret the statute to

determine their scope of review.

The grounds for review of an ALJ’s

decision by the Associate Administrator

would be explained in somewhat greater

detail in 49 CFR 363.111(b) than current

49 CFR 386.62.

Subpart B—Driver Qualification

Proceedings

Section 363.201 Nature of the

Proceeding

Driver qualification (DQ) proceedings

are the means by which the agency

adjudicates challenges to its

determinations concerning a driver’s

qualifications to operate a CMW.

Section 363.202 Commencement of

Proceedings

DQ proceedings would begin with a

notice of determination or letter of

disqualification, which may be sent to a

driver unilaterally by the agency, in

resolution of a conflict of medical

evaluations under § 363.204 (formerly

§ 391.47), or to notify the driver of the

consequences of a conviction for certain

driving offenses.

Section 363.203 Answer

The content of an answer is proposed.

A failure to answer would result in the

notice of determination or letter of

disqualification becoming the final

order of the agency automatically in the

same manner as a failure to answer a

notice of violation in a civil penalty

proceeding. Thus, the three different

standards for failure to reply under Part

386 are condensed into one under this

proposed rule.

Section 363.204 Special Proceeding for

Resolution of Conflicts of Medical

Evaluation

This section, because it is entirely

procedural in nature, would be moved

from its present location in § 391.47 and

remain relatively unchanged. A change

is proposed as to the status of drivers
18878 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

during the pendency of this special

proceeding and is discussed under

§ 363.205, below.

Section 363.205 Driver’s Qualification

Status Pending Proceedings

Two different statuses are possible

under current provisions. A driver is

either physically qualified or

unqualified. This section would clarify

the driver’s status during proceedings

based on the circumstances that brought

about the proceedings. It would also

change current § 391.47, which requires

that a driver be considered unqualified

while any conflict of medical opinion is

being resolved. Although the agency

operated in the past on a presumption

that, in the interest of safety, the driver

was unqualified, such a result is not

required in all cases. It is likely,

moreover, that this presumption

inhibited drivers from seeking

resolution through the FHWA, which

has primary authority to make

qualification determinations for drivers

in interstate commerce.

After consultations with the

Department of Labor and the Equal

Employment Opportunity Commission,

which have responsibilities for

implementing the anti-discrimination

provisions of the Rehabilitation Act, 29

U.S.C. 701 et seq., and the Americans

with Disabilities Act, 42 U.S.C. 12101 et

seq., respectively, the change in status is

being proposed. The changes would

allow the driver’s status, supported by

at least one medical opinion, to remain

qualified during the pendency of driver

qualification proceedings with respect

to the driver’s employer if the conflict

arose during the term of employment.

However, if a driver involved in a

conflict is not currently employed, e.g.,

an applicant, the driver, would be

deemed unqualified with respect to a

potential employer with which the

driver’s status is in conflict.

Section 363.206 Administrative

Adjudication

The procedures for agency action on

answers to notices of determination

would track those for administrative

adjudication of contested civil penalty

claims. The civil penalty administrative

procedures would be incorporated by

reference.

Subpart C—General Provisions

Section 363.301 Applicability

These general provisions would apply

to this part and part 362 on safety

ratings.

Section 363.302 Computation of Time

The time computation standards

would be largely unchanged from

§ 386.32 (a) and (b). Those provisions in

that section which currently allow the

addition of five days to specified time

periods to account for use of the U.S.

Postal Service in serving documents,

§ 386.32(c) (1) and (3), would not be

carried over to the proposed rule.

Instead, the proposed rule would

provide that service is complete upon

mailing so that the date of the postmark

would control.

Section 363.303 Service

A general definition of service would

be added to the regulations. A certificate

of service would be required to

accompany all documents served in an

administrative proceeding, except the

agency’s notice and the respondent’s

form reply, which occur before a matter

is contested. A service list will be

provided in the agency’s notice, which

will establish the persons who must be

served with documents. Whereas

§ 386.31 states these certificate and list

requirements in terms of pleadings and

motions, this section would make it

clear that service requirements apply

early in administrative proceedings,

before any assignment of an ALJ.

Section 363.304 Extension of Time

This section would be carried over

from part 386, with the added provision

that an extension of time may be

effected pursuant to mutual consent of

the parties.

Section 363.305 Administrative Law

Judge

This section would enumerate the

powers of the ALJs, as well as the

limitations on that power. It would also

provide for the disqualification of ALJs.

The provisions on limitations and

disqualification are modeled after the

procedural regulations of the Federal

Aviation Administration. See 14 CFR

13.205 (b) and (c).

Section 363.306 Certification of

Documents

This section would provide good faith

standards for the filing of documents in

administrative proceedings. Sanctions

are also proposed for the ALJ or AA to

impose if the standards are not met.

This section is based on 14 CFR 13.207.

Section 363.307 Interlocutory Appeals

This section, based on 14 CFR 13.219,

would provide standards and

procedures for interlocutory appeals to

the AA of matters before the ALJ.

Part 364: Violations, Penalties, and

Collections

Background

Much of the penalty information in

this part appears in the U.S. Code and,

until now, has not appeared in

published regulations. One exception is

appendix A to part 386 on penalties for

violations of agency notices and orders,

which was published in 1991. Other

exceptions are the driver

disqualification periods in 49 CFR

383.51 and 391.15 and the special

penalties for violations of out-of-service

orders in § 383.53, all of which were

required to be published by the CMVSA

of 1986 and subsequent amendments.

Section-by-Section Analysis

Subpart A—General

Section 364.101 Purpose

The purpose of this proposed subpart

is to inform the public of the standards

for assessment and collection of

penalties for violations of the FMCSRs

and HMRs.

Section 364.102 Policy

This section would serve as a general

summary of the part. Subsection (a)

would state the general policy that

penalties serve as a tool to obtain

compliance with the regulations.

Generally, the enforcement program is

but a part, albeit significant, of the

mission of the Office of Motor Carriers

to reduce highway accidents and

injuries by increasing compliance with

safety regulations. Most carriers, drivers,

and other entities choose to comply

with the regulations willingly. Various

educational and other compliance

programs are available to assist them.

For those carriers who intentionally

refuse to comply with or carelessly

ignore the regulations, however,

enforcement may become necessary.

Subsection (b) would list the statutory

penalty criteria used by the FHWA to

assess penalty amounts. These factors

would be explained in depth in

§ 364.104. The last sentence would

inform respondents that information

developed in an administrative

adjudication may affect the amount of

penalty ultimately ordered. Subsection

(c) would express the notion that good

faith efforts to achieve compliance will

be taken into account in assessing

penalties or settling claims. Subsection

(e) would apply concepts of comity and

resource allocation in stating that it is

within the discretion of the agency not

to act to enforce violations of the safety

regulations when another governmental

entity has already imposed appropriate

penalties for the same violations.
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18879

Subpart B—Civil Penalties

Section 364.201 Types of Violation

and Maximum Monetary Penalties

The penalty amounts in this section

would be listed by the type of violation

and would track the structures of the

relevant statues.

Subsection (a) would refer to

violations of parts 382 and 390–399 of

the FMCSRs and is based on the penalty

structure in 49 U.S.C. 521(b)(2)(A), part

of the 1984 Act. The penalty structure

is incorporated into the enforcement

scheme for violations of Part 382 drug

and alcohol testing requirements in 49

CFR 382.507, as authorized by 49 U.S.C.

31306, 31317, and 322(a).

The statutory description of violation

types would be augmented in places by

language from the legislative history of

the 1984 Act, especially the description

in proposed § 364.201(a)(2) of what

constitutes a serious pattern of

violations. See S. Rep. No. 424, 98th

Cong., 2d Sess. 10–13 (1984). The

definition of a serious pattern would be

further elucidated by the agency’s

interpretation. The interpretation in

§ 364.201(a)(1) of a ‘‘knowing’’

recordkeeping violation as including

violations occurring where the means to

verify the incorrect records existed is

based on published decisions of ALJs in

civil penalty proceedings. See In the

Matter of Trinity Transportation, Inc.,

55 FR 43291 (October 26, 1990); for

other decisions, see Federal Register

notices beginning at 55 FR 43264; 55 FR

2924 (January 29, 1990); 57 FR 29710

(June 26, 1992); 58 FR 16916 (March 31,

1993); 58 FR 62450 (November 26,

1993). Various examples of types of

violations are also proposed in the

section.

Subsection (b) would list violations

and amounts pertaining to commercial

driver’s licenses and is based on 49

U.S.C. 521(b)(2)(B).

Paragraph (1) of subsection (c), on the

penalty amount for failing to maintain

minimum levels of financial

responsibility, is based on 49 U.S.C.

31138–31139. Paragraph (2) would state

the rebuttable presumption that lack of

proof of insurance indicates lack of

insurance. It also states the current

enforcement practice which allows

rebuttal of that presumption upon

presentation of proof within 10 days.

Though the statute makes no distinction

in penalties, allowing a $10,000

maximum for all violations, paragraph

(3) would provide that mere failure to

present proof of insurance, where the

insurance actually exists, is a separate

recordkeeping offense, subject to a

much smaller penalty than the failure to

have the insurance.

Proposed subsection (d), on violations

of the HMRs, is based on 49 U.S.C.

5123. Subsection (e) would represent

the current appendix A to part 386, on

violations of notices and orders.

Section 364.202 Civil Penalty

Assessment Factors

This section would further explain

the penalty assessment criteria listed in

§ 364.102(b). The criteria are statutory

and found in 49 U.S.C. 5123(c) and

521(b)(2)(C). The criteria would be

categorized as involving either the

violation or the violator. The proposed

explanation of each factor is based on

the agency’s reasonable interpretation of

the statute in light of current agency

practice. Particular attention should be

paid to the factor proposed in paragraph

(2) of subsection (b), history of prior

offenses, which may be used by the

agency to determine if a carrier’s

operations constitute an imminent

hazard to safety subject to an out-ofservice order. Proposed subsection (c) is

a reminder that the application of the

factors in a particular case may be used

in a decision to pursue means of

enforcement other than monetary

penalties.

Subpart C—Criminal Penalties and

Other Sanctions

Section 364.301 Criminal Penalties

Criminal penalties are rarely pursued

by the Federal government of violations

of commercial motor vehicle safety

regulations. Since passage of the 1984

Act, the object of the great majority of

safety enforcement cases has been

compliance with the regulations

through the assessment of monetary

penalties. Other civil penalties, such as

out-of-service orders, have also gained

in importance since 1984. The

commercial motor vehicle safety

program is administrative in the first

instance. Generally, commercial motor

vehicle transportation is a highly

regulated industry, with safety as an

important part of the overall regulatory

scheme. International Brotherhood of

Teamsters v. U.S. DOT, 932 F.2d 1292,

1300 (9th Cir. 1991). The FHWA’s

regulatory program is not converted into

a criminal law enforcement scheme

merely because the government also

retains certain parallel criminal penalty

authority.

The advantage to this structure is that

the agency can take direct

administrative action against violators,

when necessary, supported by the

authority to enforce agency orders in

court. Before the 1984 Act, the agency

had only limited civil and criminal

penalty authority which could not be

enforced directly by the agency in

Federal court. In practice, these cases

generally did not receive very high

priority in the hierarchy of demands

placed upon many United States

Attorneys and the courts. This

regrettable situation was largely

ameliorated with the expanded civil

penalty authority of the 1984 Act. This

section would serve as notice, however,

that the criminal penalty authority still

exists. In fact it was enhanced in the

1984 Act. Subsection (e) would notify

the public that willful violations may be

referred to the Department of Justice for

possible criminal enforcement.

Section 364.302 Injunctions

This proposed section is intended to

notify the public of the authority of the

FHWA to bring civil actions in U.S.

District Court to enforce many of its

safety regulations and orders, and, in

the case of the transportation of

hazardous materials, to eliminate an

imminent hazard to safety. It is based on

49 U.S.C. 507 and 5122. In practice, the

form of relief sought is usually

injunctive, typically an order to a motor

carrier to cease operations, although the

statutes allow all appropriate or

necessary relief, including punitive

damages.

It is important to note that the

regulations and orders which may be

enforced in this way are somewhat

limited, and do not include all of the

safety regulations which have been

discussed in this document. Hazardous

materials regulations and orders may be

enforced, and imminent hazards

eliminated, pursuant to 49 U.S.C. 5122.

For most, but not all, CMV safety

violations not involving hazardous

materials, 49 U.S.C. 507 authorizes

enforcement actions. But 49 U.S.C. 507

specifically excepts violations of the

financial responsibility requirements for

motor carriers, found in 49 U.S.C. 31138

and 31139, from the authority to enforce

directly through civil action. This is

unlike the statutory section authorizing

the use of administrative powers (49

U.S.C. 31133), which contains no such

exclusion and thus does apply to

enforcement of financial responsibility

requirements.

Neither chapter 313, on the CDL

program, nor chapter 59, on Intermodal

Safe Container Transportation, contain

any express provisions for injunctive

relief, nor are those chapters mentioned

at all in 49 U.S.C. 507. Therefore, those

chapters are not included in this section

articulating the statutory authority for

injunctive relief.

Finally, the authority to seek an

injunction directly in court (49 U.S.C.

507) should be distinguished from the
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authority to administratively order a

vehicle, employee, or employer to cease

operations which pose an imminent

hazard to safety (49 U.S.C. 521(b)(5)(A)).

The latter process contemplates an

administrative proceeding before any

attempts at enforcement in court. This

‘‘out-of-service order’’ procedure is

discussed in subsections (c) and (d), and

may be used to enforce CDL and

intermodal container violations.

Section 364.303 Driver

Disqualifications

This section would be a restatement

of disqualification periods applicable to

drivers who commit certain violations.

These disqualification sanctions also

appear in §§ 383.51 and 391.15. Drivers

are also unqualified for any period in

which they fail to meet the qualification

requirements of part 391.

Subpart D—Monetary Penalty

Collections

Section 364.401 Payment

Payment is demanded upon issuance

of a final order imposing a monetary

penalty and generally due and payable

within 30 days thereafter. Unless

judicial review is sought, the penalty

amount is subject to the accrual of

interest after the date specified in the

final order.

Section 364.402 Collections

This section would provide that

monies due and payable will be

collected pursuant to the Federal debt

collection regulations. If administrative

actions fail to result in payment, the

matter will be referred to the

Department of Justice for collection in a

civil action filed in U.S. District Court.

49 U.S.C. 521(b)(4), 5123(d),

31138(d)(4), 31139(f)(4).

Removal of Parts 385 and 386

Because this rulemaking is a

comprehensive revision of safety ratings

and enforcement case procedures, it is

proposed to remove and reserve parts

385 and 386 from the Code of Federal

Regulations.

Removal and Reservation of Section

391.47

Because the procedure for resolution

of medical conflicts would be revised

and relocated in subpart B of part 303,

it is proposed to remove and reserve

§ 391.47 of 49 CFR part 391.

Rulemaking Analyses and Notices

Executive Order 12866 (Federal

Regulation) and DOT Regulatory

Policies and Procedures

FHWA has determined that this

action is not a significant regulatory

action within the meaning of Executive

Order 12866 or significant within the

meaning of Department of

Transportation regulatory policies and

procedures. The proposals contained in

this document would not result in an

annual effect on the economy of $100

million or more, or lead to a major

increase in costs or prices, or have

significant adverse effects on the United

States economy. This proposal would

augment, replace or amend existing

procedures and practices. Any

economic consequences flowing from

the procedures in the proposal are

primarily mandated by statute. A

regulatory evaluation is not required

because of the ministerial nature of this

action.

Regulatory Flexibility Act

In compliance with the Regulatory

Flexibility Act (5 U.S.C. 601 et seq.), the

agency has evaluated the effects of this

NPRM on small entities. No economic

impacts of this rulemaking are foreseen

as the rule would impose no additional

substantive burdens that are not already

required by the regulations to which

these procedural rules would serve as

the adjective law. Therefore, the FHWA

certifies that this proposed rule would

not have a significant economic impact

on a substantial number of small

entities.

Executive Order 12612 (Federalism

Assessment)

This action has been analyzed in

accordance with the principles and

criteria contained in Executive Order

12612. The rules proposed herein in no

way preempt State authority or

jurisdiction, nor do they establish any

conflicts with existing State role in the

regulation and enforcement of

commercial motor vehicle safety. It has

therefore been determined that the

NPRM does not have sufficient

federalism implications to warrant the

preparation of a federalism assessment.

Executive Order 12372

(Intergovernmental Review)

Catalog of Federal Domestic

Assistance Program Number 20.217,

Motor Carrier Safety. The regulations

implementing Executive Order 12372

regarding intergovernmental

consultation of Federal programs and

activities apply to this program.

Paperwork Reduction Act

This proposed rule does not contain

a collection of information requirement

for purposes of the Paperwork

Reduction Act of 1980. 44 U.S.C. 3501

et seq.

National Environmental Policy Act

The agency has analyzed this action

for purposes of the National

Environmental Policy Act of 1969 (42

U.S.C. 4321 et seq.) and has determined

that the proposed rule would not have

any effect on the quality of the

environment.

Regulation Identification Number

A regulation identification number

(RIN) is assigned to each regulatory

action listed in the Unified Agenda of

Federal Regulations. The Regulatory

Information Service Center publishes

the Unified Agenda in April and

October of each year. The RIN contained

in the heading of this document can be

used to cross reference this action with

the Unified Agenda.

List of Subjects in 49 CFR Parts 361,

362, 363, 364, 385, 386, and 391

Administrative procedures,

Commercial motor vehicle safety,

Highways and roads, Highway safety,

Motor carriers.

Issued on: April 18, 1996.

Rodney E. Slater,

Federal Highway Administrator.

In consideration of the foregoing, the

FHWA proposes to amend title 49, CFR,

subtitle B, chapter III, by removing and

reserving parts 385 and 386, and by

adding parts 361, 362, 363, and 364 as

set forth below:

1. Chapter III is amended by adding

parts 361, 362, 363, and 364 to read as

follows:

PART 361—ADMINISTRATIVE

ENFORCEMENT

Sec.

361.101 Purpose.

361.102 Authority and delegation.

361.103 Inspection and investigation.

361.104 Definitions.

361.105 Employer obligations.

361.106 Vehicle/driver inspection.

361.107 Complaints.

361.108 Administrative subpoenas.

361.109 Depositions and production of

records.

Authority: 49 U.S.C. 104, 307, chapters 5,

51, 59, 311, 313, and 315.

§ 361.101 Purpose.

This part:

(a) Restates the authority of the

Department of Transportation (DOT) to

regulate and investigate persons,

property, equipment, and records

relating to commercial motor vehicle

transportation, intermodal safe

container transportation, and the

highway transportation of hazardous

materials;
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18881

(b) Describes certain obligations and

rights of motor carriers and other

entities subject to DOT regulations; and

(c) Identifies the DOT officials

authorized to enforce motor carrier and

hazardous materials regulations.

§ 361.102 Authority and delegation.

(a) The authority of the Secretary of

Transportation to regulate and

investigate commercial motor vehicle

safety, including motor carriers,

commercial motor vehicles and drivers,

and the highway transportation of

hazardous materials, is codified in 49

U.S.C. Chapters 5, 51, 59, 311, 313, and

315, and 42 U.S.C. 4917. In carrying out

the provisions of these chapters, the

Secretary may conduct inspections and

investigations, compile statistics, make

reports, issue subpoenas, require the

production of records and property, take

depositions, hold hearings, prescribe

recordkeeping and reporting

requirements, conduct or make

contracts for studies, development,

testing evaluation and training, and

perform other acts the Secretary

considers appropriate.

(b) The authority of the Secretary

listed in paragraph (a) of this section has

been delegated to the Federal Highway

Administrator (49 U.S.C. 104(c); 49 CFR

1.48), and is codified in 49 CFR part 325

(Noise Control), the Federal Motor

Carrier Safety Regulations (FMCSRs) (49

CFR Parts 350–399) and relevant

portions of the Hazardous Materials

Regulations (HMRs) (primarily 49 CFR

Parts 171–173, 177–178, and 180). The

Federal Highway Administrator has

delegated the authority to enforce the

FMCSRs and the HMRs to the Associate

Administrator for Motor Carriers.

(c) The Associate Administrator for

Motor Carriers has retained the

authority to approve operating

procedures for investigations under this

part, including inspections, and has

delegated to subordinate managers,

supervisors, and field personnel,

hereinafter ‘‘special agents,’’ the

authority to perform such

investigations.

(d) The Administrator may delegate to

a State which is receiving a grant under

49 U.S.C. 31102 such functions

respecting the enforcement (including

investigations) of the provisions of this

subchapter and regulations issued

herein as the Administrator determines

appropriate. Nothing in this part shall

preempt the authority of any State to

conduct investigations, initiate

enforcement proceedings, or otherwise

implement applicable provisions of

State law with respect to motor carrier

safety.

§ 361.103 Inspection and investigation.

The FHWA may begin an

investigation on its own initiative or on

a complaint.

(a) Upon a display of official DOT

credentials, special agents may enter

without delay at reasonable times any

place of business, property, equipment,

or commercial motor vehicle of a person

subject to the provisions of 49 U.S.C.

Chapters 5, 51, 59, 311, 313, and 315,

and 42 U.S.C. 4917. Special agents may

take the following actions:

(1) Inspect the equipment and

property of a motor carrier or other

person on the premises of the motor

carrier, or the equipment of the motor

carrier at any other location, and inspect

any commercial motor vehicle of the

motor carrier whether or not in

operation; and

(2) Inspect and copy any record of—

(i) A carrier, lessor, association, or

other person subject to the provisions of

49 U.S.C. Chapters 5, 51, 59, 311, 313,

and 315, and 42 U.S.C. 4917; and

(ii) A person controlling, controlled

by, or under common control with a

carrier, if the agent considers inspection

relevant to that person’s relation to, or

transaction with, that carrier.

(3) Inspect and copy records,

property, and equipment related to

manufacturing, fabricating, marking,

maintaining, reconditioning, repairing,

testing, or distributing a package or a

container for use by a person

transporting hazardous material by

commercial motor vehicle, and to the

highway transportation of hazardous

materials.

(b) Special agents may inspect and

copy any record related to an

investigation, whether or not it is

required to be maintained by Federal

Highway Administration (FHWA)

regulations or orders. Special agents

may ask any employer, owner, operator,

agent, employee, or other person for

information necessary to carry out their

statutory and regulatory functions.

Special agents shall offer the employer

or other person subject to the

investigation a right of accompaniment

during an inspection and shall notify

the person of the general purpose for

which the information is sought.

(c) Reasonable times for inspections

are the regular working hours of the

motor carrier or other person, or other

times agreed to by the carrier or other

person, required by exigent

circumstances, or authorized by any

court of the United States. If the person

operates twenty-four hours per day,

reasonable time means whenever

authorized agents can obtain access to

records necessary to conduct an

inspection, and a representative of the

person can exercise the right of

accompaniment.

(d) The right of a special agent to

enter upon the premises of any person,

inspect vehicles, examine records, or

interview any person shall not imply or

be conditioned upon a waiver of any

cause of action, claim, order or penalty.

(e) The Associate Administrator may

require a motor carrier to file with the

FHWA a copy of any lease agreement or

other business arrangement that is

related to transportation safety.

(f) Information received in an

investigation, including the identity of

the person investigated and any other

person who provides information

during the investigation, may be kept

confidential under the investigatory file

exception, or other appropriate

exception, to the public disclosure

requirements of 5 U.S.C. 552.

§ 361.104 Definitions.

Words or phrases defined in 49 CFR

383.5 and 390.5 of this subchapter apply

in parts 361–364. In addition—

Abate or abatement means to

discontinue regulatory violations by

refraining from or taking actions,

identified in a notice, to correct

noncompliance.

Administrative law judge means an

administrative law judge appointed

pursuant to the provisions of 5 U.S.C.

3105.

Associate Administrator means the

Associate Administrator for Motor

Carriers or an authorized delegate of

that official.

Federal Motor Carrier Safety

Regulations (FMCSRs) means safety

regulations issued by the Federal

Highway Administration under the

authority provided in 49 U.S.C. 104(c)

or delegated by the Secretary of

Transportation in 49 CFR 1.48, and set

forth in subchapter B of this chapter.

Hazardous Materials Regulations

(HMR) means safety regulations issued

by the Research and Special Programs

Administration under authority

delegated by the Secretary of

Transportation in 49 CFR 1.53, and set

forth in subchapter C of chapter I of this

title.

Respondent means a party against

whom relief is sought or claim is made.

Special agent means an individual

employed by the Federal Highway

Administration and empowered by the

Secretary through delegations of

authority to perform the activities

referred to in § 361.103.

§ 361.105 Employer obligations.

(a) An employer, employee, and other

person shall comply with applicable

commercial motor vehicle safety

regulations.
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(b) A violator shall post all notices of

violation which have become final, as

required by any notice issued by a

special agent. Such notices shall be

posted by the employer in each motor

carrier’s places of employment in a

conspicuous place or places where

notices to employees are customarily

posted. Each employer shall insure that

such notices are not altered, defaced, or

covered by other materials.

(c) All regulations on commercial

motor vehicle safety and hazardous

materials safety are published in the

Federal Register, codified in the Code of

Federal Regulations, and available for

review and copying at the Regional

Offices of the Federal Highway

Administration. An employer shall

maintain current copies of applicable

regulations, and shall make them

available for inspection to any employee

upon request.

(d) After proper identification of a

special agent through the display of

credentials, and an explanation of the

purpose of the investigation, a person

shall, upon the request of the special

agent, provide access to:

(1) The records requested to be

reviewed;

(2) Employees of the person to be

interviewed; and

(3) Any equipment or property used

in the transportation of persons or

property or to ensure compliance with

the Federal Motor Carrier Safety

Regulations and the Hazardous

Materials Regulations.

(e) The request for the production of

records or access to employees or

equipment may be made at the initiation

of the investigation or at any time

thereafter.

§ 361.106 Vehicle/driver inspection.

Upon the instruction of a duly

authorized Federal, State or local

enforcement official, each commercial

motor vehicle used in interstate

commerce shall be subject to an

inspection of all safety equipment and

operating conditions required under the

Federal Motor Carrier Safety

Regulations and Hazardous Materials

Regulations. Each driver of such vehicle

shall also be subject to an inspection by

such enforcement officials of all

documents required to be maintained by

that driver under those regulations.

§ 361.107 Complaints.

(a) A person, including a

governmental authority, may file with

the Associate Administrator a complaint

concerning an alleged violation of this

chapter. The complaint must state the

facts that are alleged to constitute a

violation. Any office of the FHWA’s

Office of Motor Carriers will accept a

written complaint. For a listing of

FHWA Regional Offices see § 390.27 of

this subchapter. There are also Office of

Motor Carrier facilities located in each

State and listed in local telephone

directories.

(b) The Associate Administrator shall

timely investigate any nonfrivolous

written complaint alleging that a

substantial violation of any regulation

issued under this chapter is occurring or

has occurred within the preceding 60

days. Nonfrivolous written complaints

are allegations of violations of

applicable safety regulations containing

sufficient descriptive detail and

knowledge of events to create a

reasonable suspicion that the violations

occurred or are occurring. Substantial

violation in this context means the same

as a pattern of serious violations or a

substantial health and safety violation,

as those terms are defined in part 364

of this subchapter, or patterns of record

falsification that evidences an intent to

avoid detection of such violations.

(c) The Associate Administrator may

dismiss a complaint determined not to

state reasonable grounds for

investigation and need not conduct

separate investigations of duplicative

complaints.

(d) The complainant shall be timely

notified of findings resulting from an

investigation or of dismissal of a

complaint.

(e) The agency shall not disclose the

identity of complainants without their

consent unless it is determined that

such disclosure is necessary to

prosecute a violation. If disclosure

becomes necessary, the Associate

Administrator shall take every practical

measure within his authority to assure

that the complainant is not subject to

harassment, intimidation, disciplinary

action, discrimination, or financial loss

as a result of such disclosure.

(f) No motor carrier or other employer

subject to the regulations in this chapter

shall discharge, discipline, or in any

manner discriminate against any

employee with respect to the

employee’s compensation, terms,

conditions, or privileges of employment

because such employee (or any person

acting pursuant to a request of such

employee) has filed any complaint or

instituted or caused to be instituted any

proceeding relating to a violation of a

commercial motor vehicle safety rule,

regulation, standard, or order, or has

testified or is about to testify in any

such proceeding.

(g) No motor carrier or other employer

subject to the regulations in this chapter

shall discharge, discipline, or in any

manner discriminate against an

employee with respect to the

employee’s compensation, terms,

conditions, or privileges of employment

for refusing to operate a vehicle when

such operation constitutes a violation of

any Federal rules, regulations,

standards, or orders applicable to

commercial motor vehicle safety or

health, or because of the employee’s

reasonable apprehension of serious

injury to himself or the public due to

the unsafe condition of such equipment.

The unsafe conditions causing the

employee’s apprehension of injury must

be of such nature that a reasonable

person, under the circumstances then

confronting the employee, would

conclude that there is a bona fide danger

of an accident, injury, or serious

impairment of health, resulting from the

unsafe condition. In order to qualify for

protection under this section, the

employee must have sought from his

employer, and have been unable to

obtain, correction of the unsafe

condition.

(h) Violations of paragraphs (f) and (g)

of this section are subject to

enforcement by the Occupational Safety

and Health Administration (OSHA) of

the Department of Labor. The proper

steps for an employee to follow when

pursuing their rights under these

paragraphs are found in 49 U.S.C.

31105(b) and 29 CFR part 1978.

§ 361.108 Administrative subpoenas.

(a) The Associate Administrator may

subpoena witnesses and records related

to a proceeding or investigation from a

place in the United States to the

designated place of the proceeding or

investigation.

(b) If a person fails to comply with a

subpoena, the Associate Administrator

may file a civil action in the district

court of the United States in which the

proceeding or investigation is being

conducted to enforce the subpoena. The

court may punish a refusal to obey an

order of the court to comply with a

subpoena.

(c) A motor carrier not complying

with a subpoena of the Associate

Administrator to appear, testify, or

produce records is subject to a fine of

at least $100 but not more than $5,000,

and imprisonment of not more than one

year.

§ 361.109 Depositions and production of

records.

(a) In any proceeding, compliance

review, or investigation, the Associate

Administrator may take testimony of a

witness by deposition and may order

the witness to produce records. If a

witness refuses to be deposed or to

produce records under this section, the
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18883

Associate Administrator may subpoena

the witness to appear for a deposition,

produce the records, or both.

(b) A deposition may be taken before

a judge of a court of the United States,

a United States magistrate, a clerk of a

district court, or a chancellor, justice, or

judge of a supreme or superior court,

mayor or chief magistrate of a city, judge

of a county court, or court of common

pleas of any State, or a notary public

who is not counsel or attorney of a party

or interested in the proceeding or

investigation.

(c) Notice must be given in writing to

the person being deposed in accordance

with the Federal Rules of Civil

Procedure. The notice shall state the

name of the witness and the time and

place of taking the deposition.

(d) The testimony of a person deposed

under this section shall be taken under

oath. The person taking the deposition

shall prepare, or cause to be prepared,

a transcript of the testimony taken. The

transcript shall be subscribed by the

deponent, unless signature is waived.

(e) The testimony of a witness who is

in a foreign country may be taken by

deposition before an officer or person

designated by the Associate

Administrator or agreed on by the

parties by written stipulation filed with

the Associate Administrator. The

deposition shall be promptly filed with

the Associate Administrator.

(f) Each witness summoned before the

Associate Administrator or whose

deposition is taken under this section

and the individual taking the deposition

are entitled to the same fees and mileage

paid for those services in the courts of

the United States.

PART 362—SAFETY RATINGS

Sec.

362.101 Purpose.

362.102 Motor Carrier Identification Report.

362.103 Safety fitness—standards and

factors.

362.104 Determination of safety fitness—

safety ratings.

362.105 Unsatisfactory rated motor

carrier—prohibition on transportation of

hazardous materials and passengers;

ineligibility for Federal contracts.

362.106 Notification of a safety rating.

362.107 Change to safety rating based on

corrective actions.

362.108 Administrative review.

362.109 Temporary relief from rating.

362.110 Safety fitness information.

Appendix to Part 362—Form MCS–150,

Motor Carrier Identification Report

Authority: 49 U.S.C. 104, 504, 521(b)(5)(A),

31144, and 31502; 49 CFR 1.48.

§ 362.101 Purpose.

(a) This part establishes standards and

procedures applicable to motor carrier

identification, the determination of a

motor carrier’s safety fitness and the

issuance of a safety rating by the FHWA.

This part also notes the restrictions

applicable to unsatisfactory rated motor

carriers, provides for availability of

safety fitness information, and includes

procedures for administrative review of

safety ratings.

(b) The procedures set forth in 49 CFR

part 363, subpart C also apply to this

part.

§ 362.102 Motor Carrier Identification

Report.

(a) All motor carriers currently

conducting operations in interstate or

foreign commerce shall file a Motor

Carrier Identification Report, Form

MCS–150 (see appendix to this part),

within 90 days after beginning

operations.

(b) The Motor Carrier Identification

Report, Form MCS–150, is available

from all FHWA region and division

motor carrier safety offices nationwide

and from the FHWA Office of Motor

Carrier Information and Analysis, 400

Seventh Street, SW., Washington, DC

20590.

(c) The completed Motor Carrier

Identification Report, Form MCS–150,

shall be filed with the FHWA, Office of

Information and Analysis, 400 Seventh

Street, SW., Washington, DC 20590.

§ 362.103 Safety fitness—standards and

factors.

(a) To meet safety fitness standards, a

motor carrier must demonstrate through

its performance that it has adequate

safety management controls in place to

ensure compliance with applicable

safety and hazardous materials

regulations and to facilitate the safe

movement of property and passengers

by highway.

(b) The information obtained from

reviews, investigations, roadside

inspections, and other available

performance data is used to assess a

motor carrier’s safety fitness in the

context of the following factors:

(1) The adequacy of safety

management controls. Safety

management controls are those systems,

programs, practices and procedures

implemented by a motor carrier to

ensure regulatory compliance and

reduce the safety risks associated with:

(i) Commercial driver’s license

violations (49 CFR part 383), including

controlled substances and alcohol

testing violations (49 CFR part 382):

(ii) Inadequate levels of financial

responsibility (49 CFR part 387);

(iii) The failure to record and track

accidents and incidents. (49 CFR part

390).

(iv) The use of unqualified drivers (49

CFR part 391);

(v) Improper use and driving of motor

vehicles (49 CFR part 392);

(vi) Unsafe vehicles operating on the

highways (49 CFR part 393);

(vii) The use of fatigued drivers (49

CFR part 395);

(viii) Inadequate inspection, repair,

and maintenance of vehicles (49 CFR

part 396);

(ix) Transportation and routing of

hazardous materials (49 CFR part 397);

and

(x) Violations of hazardous materials

regulations (49 CFR parts 107–177, 180).

(2) Frequency and severity of

violations of applicable safety and

hazardous materials regulations and

orders, including violations of

compatible state regulations and orders.

(3) Number and frequency of driver/

vehicle violations resulting in driver/

vehicle being placed out of service.

(4) Frequency of accidents and

hazardous materials incidents,

including: The recordable accident rate

per million miles; the recordable

preventable accident rate per million

miles; other accident indicators; and

whether these accident and incident

indicators have improved or

deteriorated over time.

(c) In considering violations referred

to in paragraph (b)(2) of this section,

particular attention is given to

violations of regulations that are critical

or acute. These terms as used in this

paragraph to denote the seriousness of

regulatory requirements are defined as

follows:

(1) Critical regulation—violations of

which, if occurring in patterns, reflect a

breakdown of management control

directly related to essential safety

functions. A pattern is evident when

violations are occurring at a rate in

excess of 10 percent. Examples of

violations of critical regulations are

using drivers to operate commercial

motor vehicles after they have exceeded

the allowable driving time or on-duty

time.

(2) Acute regulation—violations of

which are so severe as to require

immediate correction, and by

themselves reflect negatively on the

motor carrier’s ability to manage safety

compliance, regardless of its overall

safety posture. An example of a

violation of an acute regulation is

allowing a driver to operate after the

drivers has tested positive for alcohol

have exceeded the allowable driving

time or on-duty time.

§ 362.104 Determination of safety fitness—

safety ratings.

(a) Following a review of a motor

carrier, the degree to which the
18884 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

operations of the motor carrier are

consistent with the safety fitness

standards and factors set forth in

§ 362.103 determines whether the

following rating will be assigned:

(1) Unsatisfactory—an unsatisfactory

safety rating means a failure by a motor

carrier to have adequate safety

management controls in place to

prevent involvement in crashes by its

vehicles and drivers, evidenced by

higher than normal accident rates, or to

ensure compliance with the applicable

safety standards, regulations and orders,

as evidenced by inordinate ratios of

violations detected in on-site reviews or

roadside inspections associated with the

factors listed in § 362.103(b).

(2) [Reserved]

(b) An otherwise unsatisfactory safety

rating may be deferred, suspended or

otherwise avoided if conditions

imposed as a result of a review of a

motor carrier’s operation and

performance are met, which would

include compliance with specific

provisions of the safety or hazardous

materials regulations, the requirements

of an order or notices to abate, or other

commitments to improve compliance

and performance. The conditions may

be imposed in lieu of an unsatisfactory

rating, and failure of the conditions may

result in the immediate assignment of

an unsatisfactory rating.

§ 362.105 Unsatisfactory rated motor

carriers—prohibition on transportation of

hazardous materials and passengers;

ineligibility for Federal contracts.

(a) A motor carrier rated

unsatisfactory is prohibited from

operating a commercial motor vehicle to

transport—

(1) Hazardous materials for which

vehicle placarding is required pursuant

to part 172 of Chapter I of this title; or

(2) More than 15 passengers,

including the driver.

(b) A motor carrier subject to the

provisions of paragraph (a) of this

section is ineligible to contract or

subcontract with any Federal agency for

transportation of the property or

passengers referred to in paragraphs

(a)(1) and (a)(2) of this section.

(c) Penalties. When it is known that

the carrier transports the property or

passengers referred to in paragraphs

(a)(1) and (a)(2) of this section, an order

will be issued placing those operations

out of service. Any motor carrier that

operates commercial motor vehicles in

violation of this section will be subject

to the penalty provisions listed in part

364 of this chapter.

§ 362.106 Notification of a safety rating.

(a) Written notification of the safety

rating will be provided to a motor

carrier as soon as practicable after

assignment of the rating.

(b) Before a safety rating of

unsatisfactory is assigned to any motor

carrier, the FHWA will issue a notice of

proposed safety rating. The notice of

proposed safety rating will list the

deficiencies discovered during the

review of the motor carrier’s operations,

for which corrective actions must be

taken.

(c) A notice of a proposed safety

rating of unsatisfactory will indicate

that, if the unsatisfactory rating becomes

final, the motor carrier will be subject to

the provisions of § 362.105, which

prohibit motor carriers rated

unsatisfactory from transporting

hazardous materials or passengers, and

other consequences that may result from

such rating.

(d) A proposed safety rating will not

be made available to the public under

§ 362.110.

(e) Except as provided in § 362.107, a

proposed safety rating issued pursuant

to paragraph (b) of this section will

become the motor carrier’s final safety

rating 45 days after the date the notice

of proposed safety rating is received by

the motor carrier.

§ 362.107 Change to safety rating based

on corrective actions.

(a) Within the 45-day period specified

in § 362.106(e), or at any time after a

rating has become final, a motor carrier

may request a change to a proposed or

final safety rating based on evidence

that corrective actions have been taken

and that its operations currently meet

the safety standards and factors

specified in § 362.102.

(b) A request for a change to a safety

rating must be made, in writing, to the

Regional Director, Office of Motor

Carriers, for the FHWA Region in which

the carrier maintains its principal place

of business, and must include a written

description of corrective actions taken

and other documentation that may be

relied upon as a basis for the requested

change to the proposed rating.

(c) The final determination on the

request for change will be based upon

the documentation submitted and any

additional investigation deemed

necessary.

(d) The filing of a request for change

to a proposed rating under this section

does not stay the 45-day period

established in § 362.106(e), after which

a proposed safety rating becomes final.

If the motor carrier has submitted

evidence that corrective actions have

been taken pursuant to this section and

a final determination cannot be made

within the 45-day period, the period of

the proposed safety rating may be

extended for up to 10 days at the

discretion of the Regional Director.

(e) If it is determined that the motor

carrier has taken the corrective actions

required and that its operations

currently meet the safety standards and

factors specified in § 362.103, the motor

carrier will be provided with written

notification that the proposed

unsatisfactory rating will not be

assigned, or, if already assigned,

rescinded.

(f) If it is determined that the motor

carrier has not taken all the corrective

actions required or that its operations

still fail to meet the safety standards and

factors specified in § 362.103, the motor

carrier shall be provided with written

notification that its request has been

denied and that the proposed safety

rating of unsatisfactory will become

final pursuant to § 362.106(e), or that an

unsatisfactory safety rating currently in

effect will not be change.

(g) Any motor carrier whose request

for change is denied pursuant to

paragraph (f) of this section may

petition for administrative review

pursuant to § 362.108 within 45 days of

the denial of the request for rating

change. If the unsatisfactory rating has

become final, it shall remain in effect

during the period of any administrative

review unless stayed by the reviewing

official.

§ 362.108 Administrative review.

(a) Within the 45-day notice period

provided in § 362.106(e), or within 45

days after denial of a request for a

change in rating as provided in

§ 362.107(g), the motor carrier may

petition the FHWA for administrative

review of a proposed or final safety

rating by submitting a written request to

the Director, Office of Motor Carrier

Field Operations, 400 Seventh Street,

SW., Washington, DC 20590.

(b) The petition must state why the

proposed safety rating is believed to be

in error and list all factual and

procedural issues in dispute. The

petition may be accompanied by any

information or documents the motor

carrier is relying upon as the basis for

its petition.

(c) The Director, Office of Motor

Carrier Field Operations, may request

the petitioner to submit additional data

and attend a conference to discuss the

safety rating. Failure to provide the

information requested or attend the

conference may result in dismissal of

the petition.

(d) The petitioner shall be notified in

writing of the decision on

administrative review. The notification

will occur within 30 days after receipt
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18885

of a petition from a hazardous materials

or passenger motor carrier.

(e) If the decision on administrative

review results in a final rating of

unsatisfactory for a hazardous materials

or passenger motor carrier, the decision

shall be accompanied by an appropriate

out-of-service order and provide for an

expedited agency appeal of such

decision pursuant to §§ 363.108 and

363.110 of this subchapter.

(f) All other decisions on

administrative review of ratings

constitute final agency action.

Thereafter, improvement in the rating

may be obtained under § 362.107.

§ 362.109 Temporary relief from rating.

(a) Proposed rating. At any time

before a proposed unsatisfactory rating

becomes final, the Regional Director in

the region wherein the motor carrier

maintains its principal place of business

for safety purposes may temporarily

suspend the proposed rating for a period

up to 60 days; provided: the motor

carrier consents in writing to an order

directing compliance with conditions

designed to assure that the safety fitness

standard will be met and satisfactory

performance will be achieved. The

temporary suspension is discretionary

with the Regional Director after

consideration of circumstances

satisfying that official that a good faith

effort by the motor carrier will be made

and that this effort is reasonably certain

to bring about compliance. The consent

order must contain a provision that the

temporary recision will be withdrawn

and the proposed unsatisfactory rating

will become final upon a failure of one

or more of the conditions in the order.

If a satisfactory level of compliance is

achieved after the period covered by the

consent order, the Regional Director

may withdraw the proposed

unsatisfactory rating, which action may

or may not be subject to prescribed

conditions.

(b) Final rating. The Director of the

Office of Field Operations, or other

official designated by the Associate

Administrator, may temporarily

suspend a final rating of unsatisfactory

under the same conditions set forth in

paragraph (a) of this section.

§ 363.110 Safety fitness information.

(a) Final ratings will be made

available to other Federal and State

agencies in writing, telephonically or by

remote computer access.

(b) The final safety rating assigned to

a motor carrier will be made available

to the public upon request. Any person

requesting the assigned rating of a motor

carrier shall provide the FHWA with the

motor carrier’s name, principal office

address, and, if known, the DOT

number or the ICC docket number, if

any.

(c) Requests shall be addressed to the

Office of Motor Carrier Information

Management and Analysis, HIA–1,

Federal Highway Administration, 400

Seventh Street, SW., Washington, DC

20590.

(d) Oral requests by telephone will be

given an oral response.

Appendix to Part 362—Form MCS–

150.Motor Carrier Identification Report

(Approved by OMB under control number

2125–0544)

BILLING CODE 4910–22–M
18886 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

BILLING CODE 4910–22–C
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18887

Notice

The Form MCS–150, Motor Carrier

Identification Report, must be filed by all

motor carriers operating in interstate or

foreign commerce. A new motor carrier must

file Form MCS–150 within 90 days after

beginning operations. Exception: A motor

carrier that has received written notification

of a safety rating from the Federal Highway

Administration (FHWA) need not file the

report. To mail, fold the completed report so

that the self-addressed postage paid panel is

on the outside. This report is required by 49

CFR Part 385 and authorized by 49 U.S.C.

504 (1982 & Supp. III 1985).

The public reporting burden for this

collection of information on the Form MCS–

150 is estimated by the FHWA to average 20

minutes. If you wish to comment on the

accuracy of the estimate or make suggestions

for reducing this burden, please direct your

comments to the Office of Management and

Budget and the FHWA at the following

addresses:

Office of Management and Budget,

Paperwork Reduction Project, Washington,

DC 20503

and

Federal Highway Administration, OMC Field

Operations, HFO–10, 400 7th Street, SW.,

Washington, DC 20590

Instructions for Completing the Motor

Carrier Identification Report (MCS–150)

(Please Print or Type All Information)

1. Enter the legal name of the business

entity (i.e., corporation, partnership, or

individual) that owns/controls the motor

carrier/shipper operation.

2. If the business entity is operating under

a name other than that in Block 1, (i.e., ‘‘trade

name’’) enter that name. Otherwise, leave

blank.

3. Enter the principal place of business

street address (where all safety records are

maintained).

4. Enter mailing address if different from

the physical address, otherwise leave bank.

Also, applies to #7, #8, #12–#14.

5. Enter the city where the principal place

of business is located.

6. If a Mexican motor carrier or shipper,

enter the Mexican neighborhood or barrio

where the principal place of business is

located.

7. Enter the city corresponding with the

mailing address.

8. If a Mexican motor carrier or shipper,

enter the Mexican neighborhood or barrio

corresponding with the mailing address.

9. Enter the name of the county in which

the principal place of business is located.

10. Enter the two-letter postal abbreviation

for the State, or the name of the Canadian

Province or Mexican State, in which the

principal place of business is located.

11. Enter the zip code number

corresponding with the street address.

12. Enter the name of the county

corresponding with the mailing address.

13. Enter the two-letter postal abbreviation

for the State, or the name of the Canadian

Province or Mexican State, corresponding

with the mailing address.

14. Enter the ZIP code number

corresponding with the mailing address.

15. Enter the telephone number, including

area code, of the principal place of business.

16. Enter the identification number

assigned to your motor carrier operation by

the U.S. Department of Transportation, if

known. Otherwise, enter ‘‘N/A.’’

17. Enter the motor carrier ‘‘MC’’ or ‘‘MX’’

number under which the Interstate

Commerce Commission (ICC) issued your

operating authority, if appropriate.

Otherwise, enter ‘‘N/A.’’

18. Enter the employer identification

number (EIN #) or social security number

(SSN #) assigned to your motor carrier

operation by the Internal Revenue Service.

19. Circle the appropriate type of carrier

operation.

A. Interstate.

B. Intrastate, transporting hazardous

materials (49 CFR 100–180).

C. Intrastate, NOT transporting hazardous

materials.

Interstate—transportation of persons or

property across State lines, including

international boundaries, or wholly within

one State as part of a through movement that

originates or terminates in another State or

country.

Intrastate—transportation of persons or

property wholly within one State.

20. Circle the appropriate type of shipper

operation.

A. Interstate

B. Intrastate

Interstate & Intrastate—See #19 above.

21. Enter the carrier’s total mileage for the

past calendar year.

22. Circle appropriate classification. Circle

all that apply. If ‘‘L. Other’’ is circled, enter

the type of operation in the space provided.

A. Authorized For Hire

B. Exempt For Hire

C. Private (Property)

D. Private Passengers (Business)

E. Private Passengers (Non-Business)

F. Migrant

G. U.S. Mail

H. Federal Government

I. State Government

J. Local Government

K. Indian Tribe

L. Other

Authorized For Hire—transportation for

compensation as a common or contract

carrier of property, owned by others, or

passengers under the provisions of the ICC.

Exempt For Hire—transportation for

compensation of property or passengers

exempt from the economic regulation by the

ICC.

Private (Property)—means a person who

provides transportation of property by

commercial motor vehicle and is not a forhire motor carrier.

Private Passengers (Business)—a private

motor carrier engaged in the interstate

transportation of passengers which is

provided in the furtherance of a commercial

enterprise and is not available to the public

at large (e.g., bands).

Private Passengers (Non-Business)—a

private motor carrier involved in the

interstate transportation of passengers that

does not otherwise meet the definition of a

private motor carrier of passengers (business)

(e.g., church buses).

Migrant—interstate transportation,

including a contract carrier, but not a

common carrier of 3 or more migrant workers

to or from their employment by any motor

vehicle other than a passenger automobile or

station wagon.

U.S. Mail—transportation of U.S. Mail

under contract with the U.S. Postal Service.

Federal Government—transportation of

property or passengers by a U.S. Federal

Government agency.

State Government—transportation of

property or passengers by a U.S. State

Government agency.

Local Government—transportation of

property or passengers by a local

municipality.

Indian Tribe—transportation of property or

passengers by a Indian tribal government.

Other—transportation of property or

passengers by some other operation

classification not described by any of the

above.

23. Circle all the letters of the types of

cargo you usually transport. If ‘‘Z. Other’’ is

circled, enter the name of the commodity in

the space provided.

24. Circle all the letters of the types of

hazardous materials (HM) you transport/ship.

In the columns before the HM types, either

circle C for carrier of HM or S for a shipper

of HM. In the columns following the HM

types, either circle T if the HM is transported

in cargo tanks or P if the HM is transported

in other packages (49 CFR 173.2).

25. Enter the total number of vehicles

owned, term leased and trip leased, that are,

or can be, operational the day this form is

completed.

Motorcoach—a vehicle designed for long

distance transportation of passengers, usually

equipped with storage racks above the seats

and a baggage hold beneath the cabin.

School Bus—a vehicle designed and/or

equipped mainly to carry primary and

secondary students to and from school,

usually built on a medium or large truck

chassis.

Mini-bus/Van—a multi-purpose passenger

vehicle with a capacity of 10–24 people,

typically built on a small truck chassis.

Limousine—a passenger vehicle usually

built on a lengthened automobile chassis.

26. Enter the number of interstate/

intrastate drivers used on an average work

day. Part-time, casual, term leased, trip

leased and company drivers are to be

included. Also, enter the total number of

drivers and the total number of drivers who

have a Commercial Drivers License (CDL).

Interstate—driver transports people or

property across State lines, including

international boundaries, or wholly within

one State as part of a through movement that

originates or terminates in another State or

country.

Intrastate—driver transports people or

property wholly within one State.

100-mile radius driver—driver operates

only within a 100 air-mile radius of the

normal work reporting location.

27. Print or type the name, in the space

provided, of the individual authorized to sign
18888 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

documents on behalf of the entity listed in

Block 1. That individual must sign, date, and

show his or her title in the spaces provided

(Certification Statement, see 49 CFR 385.21

and 385.23).

PART 363—ENFORCEMENT

PROCEEDINGS

Subpart A—Civil Penalty Proceedings

Sec.

363.101 Nature of proceeding.

363.102 Notice of violation (complaint).

363.103 Form reply to notice of violation.

363.104 Special procedures for out-ofservice orders.

363.105 Payment of the claim.

363.106 Settlement of civil penalty claims;

generally.

363.107 Settlement negotiations.

363.108 Request for administrative

adjudication.

363.109 Procedures in administrative

adjudications.

363.110 Expedited review by the Associate

Administrator.

363.111 Administrative Law Judge

decision.

363.112 Review of Administrative Law

Judge decision.

363.113 Decision on review.

363.114 Reconsideration.

363.115 Judicial review.

363.116 Failure to comply with final order.

Subpart B—Driver Qualification

Proceedings

Sec.

363.201 Nature of Proceeding.

363.202 Commencement proceedings.

363.203 Answer to medical qualification

determination or letter of

disqualification.

363.204 Special proceeding for resolution

of conflicts of medical evaluation.

363.205 Driver’s qualification status

pending determinations and

proceedings.

363.206 Administrative adjudication.

Subpart C—General Provisions

Sec.

363.301 Applicability.

363.302 Computation of time.

363.303 Service.

363.304 Extension of time.

363.305 Administrative Law Judge.

363.306 Certification of documents.

363.307 Interlocutory appeals.

Subpart A—Civil Penalty Proceedings

§ 363.101 Nature of proceeding.

Civil penalty proceedings are

proceedings pursuant to 5 U.S.C. 554 in

which the agency makes a monetary

claim or seeks an order against the

respondent, based on violation of the

FMCSRs or HMRs. Final agency orders

that may result from civil penalty

proceedings include one or more of the

following:

(a) Monetary penalty;

(b) Settlement agreement;

(c) Out-of-service order;

(d) Notice to post;

(e) Notice of abate; and

(f) Any other order within the

authority of the agency.

§ 363.102 Notice of violation (complaint).

(a) Civil penalty proceedings are

commenced by the issuance of a notice

of violation, which serves as the

complaint in subsequent proceedings

and represents the claim of the agency

against respondent. Each notice shall

contain the following:

(1) The provisions of law and

regulation alleged to have been violated;

(2) A recitation, separately stated and

numbered, of each alleged violation,

including a brief statement of the

material facts constituting each

violation.

(3) The amount being claimed and the

maximum amount authorized to be

claimed under the statute, and the

contents of any order sought to be

imposed;

(4) A statement that failure to answer

the notice within the prescribed time

will constitute a waiver of the

opportunity to contest the claim;

(5) A reply form to be completed and

returned to the agency, except in the

case of an out-of-service order; and

(6) The address and telefax number to

which the reply form and/or full

payment of the amount claimed may be

sent, and the telephone number to call

to discuss settlement.

(b) A notice may contain such other

matters as the FHWA deems

appropriate, including a notice to abate.

(c) A notice of violation is transmitted

by the agency to the respondent using

a method of delivery with a return

receipt, such as, but not limited to,

certified mail and personal delivery

evidenced by a certificate of service.

§ 363.103 Form reply to notice of violation.

(a) Time for reply. The reply form

included in the notice of violation must

be served on the agency by the

respondent within 15 days of

respondent’s receipt of the notice. The

form reply may be sent to the agency by

mail, personal delivery, or telefax.

Although a return receipt is not

required, the burden is on the

respondent to prove it has made a

timely answer.

(b) Contents of reply form. The

respondent must provide the

information requested on the reply

form, and indicate, by checking the

appropriate box, its response to the

Notice of Violation. Respondent may

select only one option on the reply

form. The response options are:

(1) Pay the full amount claimed in the

Notice of Violation (check included),

and/or agree to comply with the order

by signing where indicated;

(2) Enter into settlement negotiations

(while preserving the right to contest the

claim at a later date); and

(3) Contest the claim immediately

through the institution of administrative

adjudication.

(c) Failure to reply. If a completed

reply on the form provided, or in a form

containing the same information, is not

served on the agency within 15 days of

the respondent’s receipt of the notice of

violation, the notice of violation

becomes the final agency order in the

proceeding. Respondent’s failure to

reply constitutes an admission of all

facts alleged in the notice of violation

and a waiver of the respondent’s

opportunity to contest the claim.

§ 363.104 Special procedures for out-ofservice orders.

(a) Whenever it is determined that a

violation of the FMCSRs poses an

imminent hazard to safety, the agency

may order a vehicle or employee

operating such vehicle out of service, or

order a motor carrier to cease all or part

of the employer’s commercial motor

vehicle operations. In making any such

order, no restrictions shall be imposed

on any employee or motor carrier

beyond that required to abate the

hazard.

(b) An out-of-service order must be

personally served on the driver when a

driver or vehicle is being placed out of

service, and on a responsible

representative of the motor carrier at its

principal place of business or other

location to which the order applies

when all or part of a motor carrier’s

commercial motor vehicle operations

are being placed out of service.

(c) A motor carrier or employee shall

comply with the out-of-service order

immediately upon its issuance. The

penalty for violating an out-of-service

order shall be specifically noted in the

order. An out-of-service order shall not

prevent vehicles of the motor carrier in

transit at the time the order is served

from proceeding to their immediate

destinations, unless any such vehicles

or drivers are specifically ordered out of

service effective immediately. Vehicles

and drivers proceeding to their

immediate destination shall be subject

to compliance with the order upon

arrival.

(d) If the out-of-service order is

contested, an administrative

adjudication shall be made available on

an expedited basis under procedures

provided in § 363.110.

(e) For purposes of this section, the

term immediate destination means the

next scheduled stop of the vehicle
Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules 18889

already in transit where the cargo on

board can be safely secured, and the

term imminent hazard means any

condition of vehicle, employee, or

commercial motor vehicle operations

which is likely to result in serious

injury of death if not discontinued

immediately.

§ 363.105 Payment of the claim.

(a) Payment of the full amount

claimed may be made at any time before

issuance of a final order, with or

without the reply form. After the

issuance of a final order, claims are

subject to interest, penalties, and

administrative charges in accordance

with 4 CFR part 103.

(b) If the full payment option is

selected by the respondent on the reply

form, but payment is not made on the

agency within 15 days of the

respondent’s receipt of the notice of

violation, the notice of violation

becomes the final agency order in the

proceeding.

(c) Unless otherwise provided in

writing by the mutual consent of the

parties, payment and/or compliance

with the order constitutes an admission

of all facts alleged in the notice of

violation and a waiver of the

respondent’s opportunity to contest the

claim, and results in the notice of

violation becoming the final agency

order.

§ 363.106 Settlement of civil penalty

claims; generally.

(a) Settlement of disputed civil

penalty claims may occur at any time

before the issuance of a final order.

(b) Content of settlement agreements.

When agreement is reached to resolve

the claim, a settlement agreement

constituting the final disposition of the

proceeding shall be signed by the

parties. The settlement agreement shall

contain the following:

(1) The legal basis of the claim,

including an admission of all

jurisdictional facts;

(2) Unless otherwise provided, a

finding of the facts constituting the

violations committed;

(3) The amount due the FHWA and

the terms of payment, and/or the terms

of the order;

(4) An express waiver of the right to

further procedural steps and of all rights

to judicial review;

(5) A statement that the agreement is

not binding on the agency until

executed by the agency’s authorized

representative; and

(6) A statement that failure to pay

other otherwise perform in accordance

with the terms of the agreement will

result in the notice of violation

becoming the final agency order, and

the amount claimed in the notice of

violation becoming due and payable

immediately.

(c) An executed settlement agreement

is binding on the parties according to its

terms. The respondent’s signed, written

consent to a settlement agreement may

only be withdrawn, in writing, if the

agency has not executed the agreement

within 28 days after execution by

respondent.

(d) The agency’s acceptance of partial

payment of a claim tendered

unilaterally by a respondent does not

constitute a settlement agreement. All

settlement agreements must be in the

form specified in paragraph (b) of this

section.

(e) Settlement agreements reached

during the course of an administrative

adjudication need not be approved by

the Administrative Law Judge or

Associated Administrator unless

specifically directed by those officials.

§ 363.107 Settlement negotiations.

This section establishes procedures

when the settlement negotiations option

is selected on the reply form.

(a) The parties should enter into

negotiations expeditiously and in good

faith, using all reasonable means.

(b) Opportunity for an administrative

adjudication. Respondents electing on

the reply form to engage in settlement

negotiations retain the opportunity to

contest the claim through an

administrative adjudication if the

negotiations do not result in a

settlement agreement.

(c) Discontinuance of negotiations

within 90 days. The agency may

discontinue negotiations within 90 days

of the notice of violation by sending the

respondent a final notice of violation.

The respondent may discontinue

negotiations within the same period by

requesting an administrative

adjudication and sending the agency a

written answer to the notice of

violation.

(d) Failure to reach agreement after 90

days. If the parties do not reach a

settlement agreement within 90 days, a

final notice of violation shall be issued

by the agency to the respondent.

(e) Final Notice of Violation. The final

notice of violation represents the

agency’s final claim against the

respondent. The final notice of violation

may incorporate the notice of violation

by reference, amend the notice of

violation to reflect the settlement

negotiations, or include some

combination of both.

(1) A final notice of violation shall be

transmitted to the respondent using a

method of delivery within a return

receipt, such as, but not limited to,

certified mail and personal delivery

evidenced by a certificate of service.

(2) The reply to the final notice of

violation shall be completed in

conformance with the requirements of

§ 363.108(c).

§ 363.108 Request for administrative

adjudication.

The respondent may contest the claim

by requesting an administrative

adjudication and sending a written

answer to the agency. An administrative

adjudication is a process to resolve

contested claims before the Associate

Administrator or an Administrative Law

Judge. Unless settled, the Associate

Administrator shall decide the matter or

refer it to an Administrative Law Judge

expeditiously.

(a) Time for answer. Respondents who

select administrative adjudication on

the reply form to the notice of violation,

or who receive a final notice of

violation, must serve a written answer

on the agency within 28 days of receipt

of the applicable notice.

(b) Form of answer. The answer may

be sent to the agency by mail, personal

delivery, or telefax. Though a return

receipt is not required, the burden is on

the respondent to prove it has made a

timely answer.

(c) Contents of answer. Generally, the

answer must state the grounds for

contesting the claim and any affirmative

defenses that the respondent intends to

assert. Specifically, the answer:

(1) Must admit or deny each

separately stated and numbered

allegation of violation in the claim. A

statement that the person is without

sufficient knowledge or information to

admit or deny will have the effect of a

denial. Any allegation in the claim that

is not specifically denied in the answer

is deemed admitted. A general denial of

the claim is grounds for a finding of

default;

(2) Must include all affirmative

defenses, including those relating to

jurisdiction, limitations, and procedure;

(3) Must request referral to an

Administrative Law Judge, if desired.

Referral to an Administrative Law Judge

is generally available only to resolve

material issues of fact. Failure to request

it results in a waiver of the right to an

opportunity for referral; and

(4) May include a motion to dismiss,

but a motion to dismiss is not a

substitute for an answer.

(d) Failure to answer. If a written

answer meeting the requirements of this

section is not served on the agency by

the respondent or representative of the

respondent within 28 days, the notice of

violation or final notice of violation,
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whichever is applicable, becomes the

final agency order in the proceeding.

Merely selecting the adjudication option

on the reply form, without submitting a

written answer in accordance with this

section, also results in the notice of

violation becoming the final agency

order in the proceeding. Respondent’s

failure to answer constitutes an

admission of all facts alleged in the

notice of violation and a waiver of the

respondent’s opportunity to contest the

claim.

(e) Default. If an answer is not in the

form required by paragraph (c) of this

section the respondent may be found in

default by the Associate Administrator

or Administrative Law Judge and a final

agency order issued in the proceeding.

Default by respondent constitutes an

admission of all facts alleged in the

notice of violation and a waiver of the

respondent’s opportunity to contest the

claim, and results in the Notice of

Violation becoming the final agency

order in the proceeding.

§ 363.109 Procedures in administrative

adjudications.

(a) Associate Administrator.

Contested claims shall be transmitted to

the Associate Administrator for

resolution by final order or for

assignment to an Administrative Law

Judge. The Associate Administrator

determines if there are material factual

issues in dispute, but may refer the

matter to an administrative law judge to

make the determination.

(b) Referral to an Administrative Law

Judge. If there are material factual issues

in dispute and respondent has requested

referral to an Administrative Law Judge,

the Associate Administrator shall assign

the matter to an Administrative Law

Judge. The Associate Administrator

may, in his or her discretion, refer other

matters to an Administrative Law Judge.

(c) Decision. If there are no material

factual issues in dispute or the matter

has not been referred to an

Administrative Law Judge, the Associate

Administrator may resolve the Matter

and issue a final order.

(d) Except as otherwise provided in

these rules, in the Administrative

Procedure Act, 5 U.S.C. 551 et seq., or

by the Associate Administrator or

Administrative Law Judge, the Federal

Rules of Civil Procedure and the Federal

Rules of Evidence shall apply in all

administrative adjudications.

(e) Motions. An application for an

order or ruling in an administrative

adjudication shall be by motion. Unless

made during an oral hearing, motions

shall be made in writing, shall state

with particularity the grounds for relief

sought, and shall be accompanied by

any relevant affidavits or other

evidence. Any party may file a response

to a written motion within 7 days, or

within such other time provided by the

Associate Administrator or the

Administrative Law Judge. Failure to

respond to a motion may constitute

grounds for granting it. Oral argument or

briefs on a motion may be ordered by

the Administrative Law Judge or by the

Associate Administrator.

(f) The Associate Administrator and

the Administrative Law Judge have the

discretion to conduct an oral hearing on

the record, decide the matter on the

pleadings, or employ any other

appropriate process.

(g) The Associate Administrator and

the Administrative Law Judge may

conduct or permit forms of alternative

dispute resolution upon the consent of

the parties.

(h) Appearance. Any party to an

administrative proceeding may appear

personally and be represented by an

attorney or other person. A

representative must serve a notice of

appearance on all parties, including the

name of the respondent or title of the

matter, as well as the representative’s

name, address, and telephone number,

before participating in the proceeding.

(i) Withdrawal. At any time after a

request for an administrative

adjudication, but prior to the issuance of

a decision by the Administrative Law

Judge or Associate Administrator, any

party may, in writing, withdraw a

request for an administrative

adjudication or the agency may

withdraw the notice of violation. If a

proceeding before an Administrative

Law Judge is so withdrawn, the

assignment of the Administrative Law

Judge is terminated and the

Administrative Law Judge shall dismiss

the proceeding with prejudice. A

withdrawal by the respondent

constitutes and irrevocable waiver of the

respondent’s right to an administrative

adjudication on the matter presented in

the notice of violation.

§ 363.110 Expedited review by the

Associate Administrator.

(a) Decisions to order a motor carrier’s

operations out of service is whole or in

part are subject to review by the

Associate Administrator in accordance

with 5 U.S.C. 554, except that such

review must be provided within 10 days

from the date of the out-of-service order;

provided a written request for review is

received by the Associate Administrator

within 5 days from the date of the

notice. Written requests received after

the 5th day but within 10 days of the

effective date of the out-of-service order

or final unsatisfactory rating resulting in

an out-of-service order will be reviewed

within 10 days from the date of the

request.

(b) Any petition for review received

more than 10 days after the date of an

out-of-service order will be treated as a

request for administrative adjudication

under § 363.108 of this part, unless the

Associate Administrator, in his or her

discretion, provides otherwise.

(c) Any requests for review submitted

pursuant to this section must be in

writing and particularly address the

matters which are disputed, the grounds

for the dispute, and the reasons why

expedited review is required.

(d) The Associate Administrator may

refer the matter for a hearing before and

Administrative Law Judge within the

same time prescribed for expedited

review. The procedures in § 363.109,

except for time periods, shall apply to

the hearing.

(e) The Associate Administrator or

Administrative Law Judge may stay any

order or safety rating during the

pendency of the expedited review.

Thereafter, the matter may be

administered pursuant to § 363.109.

(f) Unless a stay is granted under

paragraph (e) of this section or the

period extended by mutual consent of

the parties, the decision on an expedited

review shall be issued within the time

prescribed for such expedited review.

(g) The decision of the Administrative

Law Judge on referral from the Associate

Administrator shall become the final

agency order after 24 hours unless

amended or vacated by the Associate

Administrator.

§ 363.111 Administrative Law Judge

decision.

(a) After considering the evidence and

arguments of the parties, the

Administrative Law Judge shall issue a

decision. The decision shall be sent to

the parties and to the Associate

Administrator. The Administrative Law

Judge may issue an oral decision in the

presence of the parties, which will be

entered in the record of the proceedings.

(b) Finality. Except for expedited

review under § 363.110, the decision of

the Administrative Law Judge becomes

the final decision of the agency 45 days

after it is issued, unless a petition for

review is filed under § 363.112 within

that period, or the Associate

Administrator, on his own motion,

reviews or vacates the decision.

§ 363.112 Review of Administrative Law

Judge decision.

(a) All petitions to review

administrative adjudication decisions of

the Administrative Law Judge must be

accompanied by a statement of the
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grounds for review. Each petition must

set out in detail objections to the

decision and refer to any evidence in

the record which is relied upon to

support the petition. It shall also state

the relief requested. Failure to object to

any error in the decision constitutes a

waiver of the right to allege such error

in subsequent proceedings.

(b) A party may petition for review of

a decision of the Administrative Law

Judge on only the following three

grounds:

(1) A finding of fact is not supported

by substantial evidence;

(2) A conclusion of law is not made

in accordance with applicable law,

precedent, or public policy; and

(3) The Administrative Law Judge

committed prejudicial error in applying

the governing procedural rules.

(c) Reply briefs may be filed within 35

days after the petition for review is

filed. Further pleadings may be filed by

a party only if expressly allowed by the

Associate Administrator.

(d) Copies of the petition for review

and all motions and briefs must be

served on all parties.

(e) Oral argument will be permitted

only if expressly allowed by the

Associate Administrator.

§ 363.113 Decision on review.

(a) The Associate Administrator may

adopt, modify, or reverse the

Administrative Law Judge’s decision

and may make any necessary findings of

law or fact. The Associate Administrator

may also remand the matter to the

Administrative Law Judge with

instructions for further proceedings. If

the matter is not remanded, the

Associate Administrator shall issue a

final order disposing of the proceedings

and serve it on all parties.

(b) Finality. Unless otherwise stated,

an order of the Associate Administrator

on review becomes the final order of the

agency upon issuance.

§ 363.114 Reconsideration.

Within 21 days of a decision by the

Associate Administrator, any party may

petition for reconsideration. The filing

of a petition for reconsideration does

not stay the effectiveness of a final order

unless so ordered by the Associate

Administrator.

§ 363.115 Judicial review.

(a) Any aggrieved person, who, after

an administrative adjudication, is

adversely affected by a final order

issued may, within 30 days, petition for

review of the order in the United States

Court of Appeals in the circuit wherein

the violation is alleged to have occurred,

or where the violator has its principal

place of business or residence, or in the

United States Court of Appeals for the

District of Columbia Circuit.

(b) Judicial review shall be based on

a determination of whether or not the

findings and conclusions in the final

order were supported by substantial

evidence or otherwise in accordance

with law. No objection that has not been

urged before the agency must be

considered by the court, unless

reasonable grounds existed for failure or

neglect to do so. The commencement of

proceedings under this section shall not,

unless ordered by the court, operate as

a stay of the final order of the agency.

§ 363.116 Failure to comply with final

order.

If, within 30 days of receipt of a final

agency order issued under this part, the

respondent does not pay a civil penalty

assessed, take any other action required

by the order, or file a petition under

§§ 363.114 or 363.115, the case may be

referred to the Attorney General with a

request that an action be brought in the

appropriate United States District Court

to enforce the terms of the order or

collect the civil penalty.

Subpart B—Driver Qualification

Proceedings

§ 363.201 Nature of proceeding.

Driver qualification proceedings are

the means by which the agency resolves

challenges to or disputes involving a

determination of a driver’s medical

qualification to operate a commercial

motor vehicle or challenges to

disqualification by the Federal Highway

Administration of a driver following

convictions for certain driving offenses.

§ 363.202 Commencement of proceedings.

(a) Driver qualification proceedings

are commenced by the issuance to a

driver or motor carrier of:

(1) A notice of determination by the

agency (the determination may be

issued unilaterally by the agency or in

resolution of a conflict of medical

evaluations pursuant to § 363.204); or

(2) A letter of disqualification issued

by the agency, based upon a conviction

for a disqualifying offense or other cause

listed in § 383.51 or 391.15 of this

subchapter.

(b) Each notice of determination or

letter of disqualification shall contain

the following:

(1) A statement of the provisions of

the regulations under which the action

is being taken;

(2) A copy of all documentary

evidence relied on or considered in

taking such action, or, in the case of

voluminous evidence, a summary of

such evidence;

(3) Notice that the determination or

disqualification may be contested, and

that failure to answer will constitute a

waiver of the opportunity to contest the

determination or disqualification; and

(4) Notice that the burden of proof

will be on the applicant in cases arising

under § 363.204.

(c) In a medical qualification

proceeding, the notice of determination

must be transmitted to the driver

involved. In cases arising under

§ 363.204, the notice of determination

shall also be transmitted to the motor

carrier and any other parties involved in

the resolution of a conflict of medical

evaluations. Any party may respond. In

a disqualification proceeding, the letter

of disqualification must be transmitted

both to the driver and to the employing

motor carrier, if the latter is known.

(d) The notice or letter commencing

the proceeding is transmitted by the

agency to any respondent or necessary

party using a method of delivery with a

return receipt, such as, but not limited

to, certified mail and personal delivery

evidenced by a certificate of service.

§ 363.203 Answer to medical qualification

determination or letter of disqualification.

(a) Time to answer. An answer to the

notice of determination or letter of

disqualification must be completed by

the respondent and served on the

agency within 2 months of respondent’s

receipt of the notice of determination.

The answer may be sent to the agency

by mail or telefax. Though a return

receipt is not required, the burden is on

the respondent to prove it has made a

timely answer.

(b) Contents of the answer. The

answer must contain the following:

(1) The grounds for contesting the

determination;

(2) Copies of all evidence upon which

petitioner relies.

(3) A request for referral to an

Administrative Law Judge, if one is

desired, which must set forth material

factual issues believed to be in dispute.

(c) Supporting evidence. All written

evidence shall be submitted in the

following forms:

(1) An affidavit of a person having

personal knowledge of the facts alleged;

(2) Documentary evidence in the form

of exhibits attached to an affidavit

identifying the exhibit and giving its

source;

(3) A medical report (or reports)

prepared by a medical examiner or

authorized representative of a medical

institution; and

(4) An official record of a government

agency.

(d) Failure to answer. If a written

answer contesting the notice or letter is
18892 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

not received by the agency within 2

months, the notice of determination or

letter of disqualification becomes the

final agency order in the proceeding.

Respondent’s failure to answer

constitutes and admission of all facts

alleged in the letter or notice and a

waiver of the respondent’s opportunity

to contest the determination of

disqualification.

(e) Letter of Disqualification. In

proceedings based on convictions for

disqualifying offenses, the only relevant

defenses are that:

(1) The respondent driver was not

convicted as alleged;

(2) The alleged conviction was

overturned, vacated, remanded, or

otherwise voided on appeal;

(3) The violation for which the

conviction was entered is not a

disqualifying offense; or

(4) The term of the disqualification

period has already been served in whole

or in part because of State action.

§ 363.204 Special procedures for

resolution of conflicts of medical

evaluation.

(a) Applications. An application for

determination of a driver’s medical

qualifications under standards in part

391 of this chapter will only be accepted

if they conform to the requirements of

this section.

(b) Conditions. Each applicant must

meet the following conditions.

(1) The application must be in writing

and contain the name and address of the

driver, motor carrier, and all physicians

involved in the conflict.

(2) The applicant must provide

documentary evidence that there is

disagreement between the physician for

the driver and the physician for the

motor carrier concerning the driver’s

medical qualifications.

(3) The applicant must submit a

written opinion and report from an

independent medical specialist in the

field in which the conflict arose,

together with the results of all tests

performed by that independent

specialist. The independent medical

specialist should be one agreed to by the

motor carrier and the driver.

(4) If no agreement to select an

independent specialist can be reached,

the applicant must demonstrate it

agreed and the other party refused to

submit the matter to a specialist. If

possible, the applicant must then

submit the report of an independent

specialist selected by the applicant. The

report should be based on personal

examination or, if that is not possible,

on an evaluation of the reports of the

two examining physicians in conflict.

(5) The independent medical

specialist must be provided with a copy

of the regulations in part 391 of this

subchapter, and this part, a medical

history of the driver, and a detailed

statement of the work the driver

performs or is to perform, which must

be noted in the specialist’s report.

(6) The applicant must submit all

medical records, statements and reports

of all physicians known to have

provided opinions as to the driver’s

qualifications.

(7) The applicant must submit any

other documentary evidence which may

reflect on the driver’s qualifications.

(8) The application must allege that

the driver intends to drive or is

intended to be used as driver in

interstate commerce.

(9) The application and all supporting

documents must be submitted in

triplicate to the Director, Office of Motor

Carrier Research and Standards, Federal

Highway Administration, Washington

DC 20590.

(c) Initiation. Upon receipt of a

satisfactory application, the Director

will issue a notice to all parties that an

application for resolution of a medical

conflict has been received with respect

to the identified driver, and may require

additional information from the parties.

(d) Reply. Any party may submit a

reply to the notice within 30 days after

service. The reply must be accompanied

by all evidence the party desires to be

considered by the Director in making a

determination.

(e) Parties. For purposes of this

section, the parties are the driver, the

motor carrier, and any other person

whom the Director designates as such.

(f) Determination. After considering

all the medical evidence submitted by

the parties and the opinions of medical

experts to whom any matter under

consideration may have been referred,

the Director shall issue a Determination

of Qualification deciding whether the

drive is qualified under part 391 of this

subchapter.

(g) Petitions for review. A driver or

motor carrier adversely affected by the

Director’s determination may within 60

days petition for review to the Associate

Administrator under this part.

§ 363.205 Driver’s qualification status

pending determinations and proceedings.

(a) In proceedings which are

unilaterally commenced by the agency,

the driver shall be deemed qualified

unless and until a final order is issued

disqualifying the driver.

(b) In proceedings arising under

§ 363.204:

(1) If the driver is not yet employed

by the motor carrier with which the

conflict of medical qualification arises,

the driver shall be deemed unqualified

as a driver only with respect to that

motor carrier.

(2) If the conflict arises from a

biennial or other medical examination

conducted after the driver was

previously found qualified and

employed as a driver by the motor

carrier with which the conflict exists,

the driver shall be deemed qualified

only with respect to that motor carrier

unless and until a final determination

by the Director, Office of Motor

Standards is issued finding the driver

unqualified, or unless the Associate

Administrator otherwise provides.

(c) During the pendency of a

proceeding on a petition for review of

the Determination of Qualification

issued by the Director under § 363.204,

the driver’s status will remain as

decided in that Determination, unless

otherwise provided by the Associate

Administrator.

§ 363.206 Administrative adjudication.

(a) Referral to an Administrative Law

Judge. If there are material factual issues

in dispute and respondent has requested

referral to an Administrative Law Judge,

the Associate Administrator may assign

the matter to an Administrative Law

Judge.

(b) Decision. If there are not material

factual issues in dispute or respondent

has not requested referral, the Associate

Administrator may resolve the matter

and issue a final order.

(c) Procedures. Administrative

adjudication and any agency review are

conducted in accordance with

§§ 363.109 and 363.111–363.115.

Subpart C—General Provisions

§ 363.301 Applicability.

The general provisions in this subpart

apply to part 362 of this subchapter and

this part 363.

§ 363.302 Computation of time.

(a) Generally, in computing any time

period set out in these rules or in an

order issued hereunder, the time

computation begins with the day

following the act, event, or default. The

last day of the period is included unless

it is a Saturday, Sunday, or legal Federal

holiday, in which case the time period

shall run to the end of the next day that

is not a Saturday, Sunday, or legal

Federal holiday. All Saturdays,

Sundays, and legal Federal holidays

except those falling on the last day of

the period shall be counted.

(b) Date of entry of orders. In

computing any period of time involving

the date of the entry of an order, the

date of entry shall be the date the order

is served.
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§ 363.303 Service.

(a) Definition.

Service means the delivery of

documents to necessary entities in the

context of an administrative proceeding.

Service by mail is complete upon

mailing.

(b) Certificate of service. A certificate

of service shall accompany all

documents served in an administrative

proceeding, except the notice of

violation on § 363.102, the reply form in

§ 363.103, and the notice of

determination and letter of

disqualification in § 363.202. It shall

consist of a certificate of personal

delivery or a certificate of mailing,

executed by the person making the

personal delivery or mailing the

document.

(c) Service list. The initial notice or

other document of the agency in an

administrative proceeding shall have

attached a list of persons to be served.

This service list shall be updated by the

agency as necessary. Copies of all

documents must be served on the

persons, and in the number of copies,

indicated on the service list.

(d) Form of delivery. All service

required by these rules shall be made by

mail or personal delivery, unless

otherwise prescribed.

§ 363.304 Extension of time.

(a) Unless directed otherwise by the

Associate Administrator or

Administrative Law Judge before whom

a matter is pending, the parties may

stipulate to reasonable extensions of

time by filing such stipulation in the

official docket and serving copies on all

parties on the service list.

(b) All requests for extensions of time

shall be filed with the office in the

agency to which the answer is to be

sent, or, if the matter is an

administrative adjudication, with the

Administrative Law Judge or the

Associate Administrator, whichever is

appropriate. All requests must state the

reasons for the request. Only those

requests showing good cause or upon

the mutual consent of the parties may be

granted by the appropriate official. No

motion for continuance or

postponement of a hearing date filed

within 7 days of the date set for a

hearing will be granted unless it is

accompanied by an affidavit showing

that extraordinary circumstances

warrant a continuance.

§ 363.305 Administrative Law Judge.

(a) Powers of an Administrative Law

Judge. In accordance with the rules in

this subchapter, an Administrative Law

Judge may:

(1) Give notice of and hold prehearing

conferences and hearings;

(2) Administer oaths and affirmations;

(3) Issue subpoenas authorized by law

(4) Rule on offers of proof;

(5) Receive relevant and material

evidence;

(6) Regulate the course of the

administrative adjudication in

accordance with the rules of this

subchapter;

(7) Hold conferences to settle or

simplify the issues by the consent of the

parties;

(8) Dispose of procedural motions and

requests;

(9) Make findings of fact and

conclusions of law, and issue decisions.

(b) Limitations on the power of the

Administrative Law Judge. The

Administrative Law Judge is bound by

the procedural requirements of this part

and the precedent opinions of the

agency as recorded in written opinions

of the Associate Administrator or in

opinions adopted by the Associate

Administrator. If the Administrative

Law Judge imposes any sanction not

specified in this subchapter, a party may

file an interlocutory appeal of right with

the Associate Administrator pursuant to

§ 363.307. This section does not

preclude an Administrative Law Judge

from barring a person from a specific

proceeding based on a finding of

obstreperous or disruptive behavior in

that proceeding.

(c) Disqualification. The

Administrative Law Judge may

disqualify himself or herself at any time,

either at the request of any party or

upon his or her own initiative.

Assignments of Administrative Law

Judges are made by the Chief

Administrative Law Judge upon the

request of the Associate Administrator.

Any request for a change in such

assignment, including disqualification,

will be considered only for good cause

which would unduly prejudice the

proceeding.

§ 363.306 Certification of documents.

(a) Signature required. The attorney of

record, the party, or the party’s

representative shall sign each document

tendered for filing with the hearing

docket clerk, the Administrative Law

Judge, the Associate Administrator, or

served on a party.

(b) Effect of signing a document. By

signing a document, the attorney of

record, the party, or the party’s

representative certifies that the attorney,

the party, or the party’s representative

has read the document and, based on

reasonable inquiry and to the best of

that person’s knowledge, information,

and belief, the document is—

(1) Consistent with these rules;

(2) Warranted by existing law or that

a good faith argument exists for

extension, modification, or reversal of

existing law; and

(3) Not unreasonable or unduly

burdensome or expensive, not made to

harass any person, not made to cause

unnecessary delay, not made to cause

needless increase in the cost of the

proceedings, or for any other improper

purpose.

(c) Sanctions. If the attorney of record,

the party, or the party’s representative

signs a document in violation of this

section, the Administrative Law Judge

or the Associate Administrator may:

(1) Strike the pleading signed in

violation of this section;

(2) Strike the request for discovery or

the discovery response signed in

violation of this section and preclude

further discovery by the party;

(3) Deny the motion or request signed

in violation of this section;

(4) Exclude the document signed in

violation of this section from the record;

(5) Dismiss the interlocutory appeal

and preclude further appeal on that

issue by the party who filed the appeal

until an initial decision has been

entered on the record; or

(6) Dismiss the petition for review of

the Administrative Law Judge’s decision

to the Associate Administrator.

§ 363.307 Interlocutory appeals.

(a) General. Unless otherwise

provided in this subpart, a party may

not appeal a ruling or decision of the

Administrative Law Judge to the

Associate Administrator until the

Administrative Law Judge’s decision

has been entered on the record. A

decision or order of the Associate

Administrator on the interlocutory

appeal does not constitute a final order

for the purposes of judicial review

under § 363.115.

(b) Interlocutory appeal for cause. If a

party files a written request for an

interlocutory appeal for cause with the

Administrative Law Judge, or orally

requests an interlocutory appeal for

cause, the proceedings are stayed until

the Administrative Law Judge issues a

decision on the request. If the

Administrative Law Judge grants the

request, the proceedings are stayed until

the Associate Administrator issues a

decision on the interlocutory appeal.

The Administrative Law Judge shall

grant an interlocutory appeal for cause

if a party shows that delay of the appeal

would be detrimental to the public

interest or would result in undue

prejudice to any party.

(c) Interlocutory appeals of right. If a

party notifies the Administrative Law
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Judge of an interlocutory appeal of right,

the proceedings shall be stayed until the

Associate Administrator issues a

decision on the interlocutory appeal. A

party may file an interlocutory appeal

with the Associate Administrator,

without the consent of the

Administrative Law Judge, before the

Administrative Law Judge has made a

decision, in the following situations:

(1) A ruling or order by the

Administrative Law Judge barring a

person from the proceedings;

(2) Failure of the Administrative Law

Judge to dismiss the proceedings in

accordance with § 363.109(i);

(3) A ruling or order by the

Administrative Law Judge in violation

of § 363.305(b); and

(4) Denial by the Administrative Law

Judge of a motion to disqualify under

§ 363.305(c).

(d) Procedure. A party must file a

notice of interlocutory appeal, with any

supporting documents, with the

Associate Administrator, and serve

copies on each party and the

Administrative Law Judge, not later

than 10 days after the Administrative

Law Judge’s decision forming the basis

of an interlocutory appeal of right or not

later than 10 days after the

Administrative Law Judge’s decision

granting an interlocutory appeal for

cause, whichever is appropriate. A party

must file a reply brief, if any, with the

Associate Administrator and serve a

copy of the reply brief on each party,

not later than 10 days after service of the

appeal brief. The Associate

Administrator shall render a decision on

the interlocutory appeal, on the record

and as a part of the decision in the

proceedings, within a reasonable time

after receipt of the interlocutory appeal.

(e) The Associate Administrator may

reject frivolous, repetitive, or dilatory

appeals, and may issue an order

precluding one or more parties from

making further interlocutory appeals in

a proceeding in which there have been

frivolous, repetitive, or dilatory

interlocutory appeals.

PART 364—VIOLATIONS, PENALTIES,

AND COLLECTIONS

Subpart A—General

Sec.

364.101 Purpose.

364.102 Policy.

Subpart B—Civil Penalties

364.201 Types of violations and maximum

monetary penalties.

364.202 Civil penalty assessment factors.

Subpart C—Criminal Penalties and Other

Sanctions

364.301 Criminal penalties.

364.302 Injunctions.

364.303 Disqualifications.

Subpart D—Monetary Penalty Collection

364.401 Payment.

364.402 Collections.

Authority: 49 U.S.C. Chapters 5, 51, 311,

313 and 315.

Subpart A—General

§ 364.101 Purpose.

The purposes of this part are to define

the various types of violations of the

Federal Motor Carrier Safety

Regulations (FMCSRs) and Hazardous

Materials Regulations (HMRs), and

orders authorized to be issued

thereunder; to describe the range of

penalties that may be imposed for such

violations and how those penalties are

assessed; and to identify the means that

may be employed to collect those

penalties once it has been finally

decided by the agency that they are due.

§ 364.102 Policy.

(a) Penalties are assessed

administratively by the agency for

violations of the FMCSRs, HMRs, and

administrative orders at levels sufficient

to bring about satisfactory compliance.

Criminal penalties are also authorized to

be sought in U.S. District Court under

certain circumstances.

(b) The maximum amounts of civil

penalties that can be assessed for

regulatory violations subject to the

proceedings in this subchapter are

established in the statutes granting

enforcement powers. The determination

of the actual civil penalties assessed in

each proceeding is based on those

defined limits and consideration of

information available at the time the

claim is made concerning the nature,

circumstances, extent and gravity of the

violation and, with respect to the

violator, the degree of culpability,

history of prior offenses, ability to pay,

effect on ability to continue to do

business, and such other matters as

justice and public safety may require. In

adjudicating the claims and orders

under the administrative procedures in

this subchapter, additional information

may be developed regarding these

factors that may affect the final amount

of the claim.

(c) When assessing penalties for

violations of notices and orders or

settling claims based on these

assessments, consideration will be given

to good faith efforts to achieve

compliance with the terms of the

notices and orders.

(d) Criminal penalties may be sought

against a motor carrier, its officers or

agents, a driver, or other persons when

it can be established that violations

were deliberate or resulted from a

willful disregard for the regulations.

Criminal penalties may be sought

against an employee only when a

causative link can be established

between a knowing and willful violation

and an accident or hazardous materials

incident or the risk thereof.

(e) If a State, political subdivision of

a State, foreign nation, or other

governmental entity imposes any civil

or criminal penalty for acts constituting

violations of the regulations covered by

this part, and those penalties are

determined by the Associate

Administrator to be appropriate for such

violations, no further penalties will be

assessed by the Federal Highway

Administration.

Subpart B—Civil Penalties

§ 364.201 Types of violations and

maximum monetary penalties.

(a) Violations of parts 350–399 of the

FMCS are divided into three categories,

each of which carries a maximum

penalty as noted below. Unless

otherwise noted, a separate violation

occurs for each day the violation

continues:

(1) Recordkeeping—violations which

involve knowing failure to prepare or

maintain a record required by the

regulations, or knowing preparation or

maintenance of a required record which

is incomplete, inaccurate or false.

Maximum penalty: $500 per violation,

which may be increased by $500 for

each day the violation continues up to

$2,500. Actual or constructive

possession of the means with which to

verify the existence or accuracy of the

record is presumptive evidence that the

person responsible for maintaining such

record committed a knowing violation

when such record is incomplete,

inaccurate, or false.

(2) Serious pattern of safety

violations—no civil penalties are

assessed for isolated violations of nonrecordkeeping provisions of the

regulations. The term ‘‘serious patterns

of violations’’ describes a middle range

of violations between those of

recordkeeping noncompliance and

willful disregard of the regulations.

These types of violations are not the

isolated human errors, but are tolerated

patterns of equipment violations or

operating conduct that any responsible

business entity could detect and correct

if it wanted to meet its full safety

responsibility to the public. A pattern

may be established by single violations
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of more than one regulation, as well as

by multiple violations of a single

regulation. No set number of acts are

required. All that is needed is a basis to

infer that the acts are not isolated or

sporadic. More than one pattern may be

alleged in a single claim. For example,

in one notice of violations, patterns of

hours-of-service violations, use of

unsafe equipment, and employment of

unqualified drivers may be alleged and

supported with separately counted

violations in each category. The area of

noncompliance may be further broken

down if patterns are discernible to that

extent. In the same notice, for instance,

it may be alleged that each driver used

by a carrier constitutes a separate

pattern and further that each such driver

may account for separate patterns of

violations of the 10-hour driving rule

(49 CFR 395.3(a)(1)), the 15-hour onduty rule (§ 395.3(a)(2)), and the 70-

hours in 8 days on-duty rule

(§ 395.3(b)(2)), each of which presents a

separate pattern. When serious patterns

of violation are detected, civil penalties

not to exceed $1,000 for each violation

within a pattern up to a maximum of

$10,000 for each pattern may be

assessed.

(3) Substantial Health and Safety

Violations. This category applies to

violations which could reasonably lead

to, or have resulted in, serious personal

injury or death. These are violations that

are serious in their nature and have

been allowed to occur or continue by

the motor carrier who knew or should

have known of their existence.

Illustrative of such violations are

vehicles that are dispatched or

continued in a condition which would

result in an out-of-service order; drivers

who are dispatched or continued in use

when they are unqualified, disqualified,

or have tested positive for drugs; and

drivers who are dispatched or continue

in an unsafe or fatigued condition.

Penalties up to $10,000 may be assessed

for each violation.

(4) Limitation on employee nonrecordkeeping violations. Except for

recordkeeping violations, no civil

penalty may be assessed against an

employee of a motor carrier unless it is

determined that the employee’s actions

amounted to gross negligence or

reckless disregard for safety. When that

can be shown, the maximum civil

penalty is $1,000.

(i) Owner operators. For purposes of

this section, an owner-operator while in

the course of personally operating a

commercial motor vehicle is considered

an employee. When that same owneroperator is not acting in a driving

capacity, he or she shall be treated as a

motor carrier or employer.

(ii) Gross negligence is an act or

omission of an aggravated nature

regarding a legal duty, as opposed to a

mere failure to exercise ordinary care. It

amounts to indifference to or utter

disregard of a legal duty so far as other

persons may be affected. Reckless

disregard for safety is conduct evincing

indifference to consequences under

circumstances involving danger to life

or safety of others even though no harm

was intended.

(b) Violations pertaining to

commercial drivers licenses (CDL).

Violations with respect to the operations

of commercial motor vehicles (CMV) for

which a CDL is required under part 383

of this chapter are subject to civil

penalties up to a maximum of $2,500

per violation. These violations include

the operation of a CMV by a driver who

has not obtained a CDL or has more than

one driver’s license; failure to make

required notifications of traffic

violations, license suspensions or

previous employment; and operating a

CMV after the driver or the CMV was

placed out-of-service by a duly

authorized enforcement official.

(c) Violations pertaining to minimum

levels of Financial Responsibility.

(1) Failure by a motor carrier to

maintain the prescribed levels of

financial responsibility pursuant to Part

387 of this chapter constitutes a

violation for which a civil penalty of up

to $10,000 may be assessed for each

violation. Each time a motor carrier

dispatches a commercial motor vehicle

without the required level of Financial

Responsibility may be counted as a

separate violation with no overall

limitation.

(2) Failure to produce the required

proof of Financial Responsibility (MCS–

90 or MCS–82) is presumptive evidence

of failure to maintain the required levels

of Financial Responsibility. The

presumption may be rebutted by

presentation of the required proof of

Financial Responsibility covering the

applicable period of time within 10 days

of demand.

(3) Failure to maintain the required

proof of Financial Responsibility upon

demand is a separate offense for which

a civil penalty of up to $500 may be

assessed. A separate civil penalty of

$500 may be assessed for each day such

record is not produced after demand has

been made.

(d) Violations of the Hazardous

Materials Regulations. The violations in

this subsection apply to motor carriers,

drivers, and shippers when the

transportation is by highway in

commercial motor vehicles.

(1) All violations of the Hazardous

Materials Transportation Act (HMTA),

as amended, or orders or regulations

issued under the authority of that Act

applicable to the transporting of

hazardous materials by highway or the

causing of them to be transported by

highway are subject to a civil penalty of

not more than $25,000 and not less than

$250 for each violation. When the

violation is a continuing one, each day

of the violation constitutes a separate

offense.

(2) All violations of the HMTA, as

amended, or orders, regulations, or

exemptions issued under the authority

of that Act applicable to the

manufacture, fabrication, marking,

maintenance, reconditioning, repair or

testing of a packaging or container

which is represented, marked, certified

or sold as being qualified for use in the

transportation of hazardous materials by

highway are subject to a civil penalty of

not more than $25,000 and not less than

$250 for each violation.

(3) Whenever regulations issued

under the authority of the HMTA, as

amended, require compliance with

another set of regulations, e.g., the

Federal Motor Carrier Safety

Regulations, while transporting

hazardous materials, any such violation

of the latter regulations will be

considered a violation of the HMR and

subject to a civil penalty of not more

than $25,000 and not less than $250.

(4) Transporting hazardous materials

requiring the display of placards or

transporting more than 15 passengers by

a motor carrier during any period in

which such motor carrier has a final

safety rating of unsatisfactory is

considered a violation of the MHTA and

subject to a civil penalty of not more

than $25,000 and not less then $250,

and each transportation movement by

such carrier is considered a separate

violation.

(e) Violations of Notices and Orders.

Additional civil penalties pursuant to

49 U.S.C. 521(b) are chargeable for

violations of notices and orders which

are issued in proceedings under part

306, as follows:

(1) Notice to Abate.

(i) Failure to cease violations of the

safety regulations in the time prescribed

in the notice may subject the motor

carrier to reinstatement of any deferred

assessment or payment of a penalty or

portion thereof. (The time within which

to comply with a notice to abate shall

not begin with respect to contested

violations until such time as the

violations are established.)

(ii) Failure to comply with specific

actions prescribed in an order (other

than to cease violations of the

regulations), which were determined to

be essential to abatement of future
18896 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

violations is subject to a civil penalty of

$1,000 per violation per day up to a

maximum of $10,000 per violation.

(2) Notice to Post. Failure to post the

notice of violation as directed is subject

to a civil penalty of $500 for each such

failure.

(3) Final Order. Failure to pay the

penalty assessed in a final order within

the time prescribed in the order will

result in an automatic waiver of any

reduction in the original claim found to

be valid and immediate restoration to

the full amount assessed in the notice of

violation.

(4) Out-of-Service Order.

(i) Operation of a commercial motor

vehicle by a driver during the period the

driver was placed out of service subjects

the driver to civil penalty of $1,000 to

$2,500 per violation. (For purposes of

this violation, the term ‘‘driver’’

includes an independent contractor

who, while in the course of operating a

commercial motor vehicle, is employed

or used by another person.)

(ii) Requiring or Permitting a driver to

operate a commercial motor vehicle

during the period the driver was placed

out of service subjects the motor carrier

to a civil penalty of $2,500 to $10,000

per violation.

(iii) Operation of a commercial motor

vehicle by a driver after the vehicle was

placed out of service and before the

required repairs are made subjects the

driver to a civil penalty of $1,000 to

$2,500 each time the vehicle is so

operated. (This violation applies to

drivers as defined in paragraph (e)(4)(i)

of this section.)

(iv) Requiring or Permitting the

operation of a commercial motor vehicle

after the vehicle was placed out of

service and before the required repairs

were made subjects the motor carrier to

a civil penalty of $2,500 to $10,000 each

time the vehicle is so operated after

notice of the defect is received. (This

violation applies to motor carriers,

including independent contractors who

are not ‘‘drivers’’ as defined in

paragraph (e)(4)(i) of this section).

(v) Failure to return written

certification of correction as required by

the out-of-service order is subject to a

civil penalty of up to $500 per violation.

(vi) Knowingly falsifying written

certification of correction required by

the out-of-service order is considered

the same as operating or requiring or

permitting a driver to operate an out-ofservice vehicle and is subject to the

same civil penalties provided in

paragraph (e)(4)(iii) and (iv) of this

section. Falsification of certification

may also result in criminal prosecution

under 18 U.S.C. 1001.

(vii) Operating or causing to operate

in violation of an order to cease all or

part of the motor carrier’s commercial

motor vehicle operations, i.e., failure to

cease operations as ordered, is subject to

a civil penalty of up to $10,000 per day

after the effective date and time of the

order to cease.

§ 364.202 Civil penalty assessment

factors.

(a) The nature, circumstances, extent,

and gravity of the violations listed in

§ 364.201 may serve as mitigating or

aggravating factors affecting the amount

of the penalty assessed. These factors

relate to the violations per se, i.e., their

magnitude, blatancy, frequency and

potential for immediate consequences.

They could be determinative in charging

substantial health and safety violations

or patterns of safety violations, as well

as assessing a high, medium, or low

penalty. In evaluating a motor carrier’s

safety fitness, the terms acute and

critical are used in reference to

particular regulations of which

violations are noted. Violations of these

regulations, therefore, are by their

nature serious, and this will be

considered in assessing penalties.

Similarly, when the circumstances in

which violations occur are so obvious

that any responsible motor carrier could

easily correct them, the continuation of

such violations is an aggravating factor

to be considered in assessing the level

of civil penalty. When violations are so

numerous, frequent or longstanding as

to indicate habitual noncompliance, the

extent of the violations is a

consideration. Finally, the gravity of the

violation relates to the likelihood of

immediate and harmful consequences.

When violations have resulted in death

or serious injuries, the level of civil

penalty is likely to be higher. Similarly,

the occurrence of death or serious injury

in other instances resulting from the

same type of violation increases the

gravity of the offense.

(b) Violator factors. The following

factors relate to the disposition or

conduct of the violator for consideration

in the assessment of civil penalties.

(1) Degree of culpability. This factor

requires an evaluation of

blameworthiness on the part of the

violator. It will range from the low end,

where a motor carrier may have had

various knowledge of violations but

little actual involvement, to the high

end, where the motor carrier had actual

knowledge and disregarded or even

promoted noncompliance.

(2) History of prior offenses. Persistent

noncompliance reflects a disregard for

safety which, in turn, increases the

prospect for imminently hazardous

conditions leading to accidents. Timely

correction of violation patterns should

prevent imminent hazards from

developing and reduce the likelihood of

accidents. Consequently, this factor is a

major indicator of a motor carrier’s

knowledge of its responsibility and

disposition toward compliance.

Evaluation of this factor will range from

a low end, where there is no history of

previous violation, to a history of

previous noncompliance with the

regulations generally, to prior violations

of similar regulations, to recent

violations of the same regulations, to the

high end of repeated and persistent

violations of the same regulations.

(3) Ability to pay. The violator’s size,

gross revenues, resources, and the

standards in 4 CFR part 103 (Standards

for Compromise of Claims: Inability to

Pay) should be taken into consideration

in making a determination whether to

charge the total potential assessment.

This consideration may affect the

decision as to the number of violations

to cite as well as the level of the penalty

to be assessed for each violation. The

violator may submit evidence of its

ability to pay at any time, and it will be

considered in mitigation of the amount

claimed. However, this evidence may

not be given much weight when the

other factors in this paragraph (b)

indicate a high assessment is warranted.

(4) Effect on ability to continue to do

business. Insofar as this factor is

distinguishable from paragraph (b)(3) of

this section, it relates to the timeliness

of payment and abatement of violations.

Evidence that immediate payment of

even a mitigated civil penalty will

effectively terminate a motor carrier’s or

shipper’s business will be considered in

determining whether to defer payment

or to allow installment payments of the

civil penalty assessed.

(5) Other matters as justice and public

safety may require. Matters other than

those specifically included in the factors

listed in this section may also be either

aggravating or mitigating in the interest

of justice or public safety. These may

include such factors as cooperation or

lack thereof; general attitude toward

compliance; institution or revision of a

safety program; hiring or assignment of

personnel with specifically defined

safety responsibilities;

comprehensiveness of corrective

actions; and effectiveness and speed of

compliance.

(c) The preponderance of aggravating

factors may also indicate the need for

more intensive enforcement in the form

of other orders, revocations of operating

authority, out-of-service, injunctions, or

criminal prosecutions.
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Subpart C—Criminal Penalties and

Other Sanctions

§ 364.301 Criminal penalties.

(a) Except as provided in paragraph

(b) of this section, any person who

knowingly and willfully violates any

provision of the FMCS shall, upon

conviction, be subject for each offense to

a fine not to exceed $25,000 or

imprisonment for a term not to exceed

one year, or both, except that, if such

violator is an employee, the violator

shall only be subject to penalty if, while

operating a commercial motor vehicle,

the violator’s activities have led to or

could have led to death or serious

injury, in which case the violator shall

be liable upon conviction, for a fine not

to exceed $2,500.

(b) Any person who knowingly and

willfully violates sections 12002, 12003,

12004, 12005(b), or 12008(d)(2) of the

Commercial Motor Vehicle Safety Act of

1986 (49 U.S.C. 31302, 31303, 31304,

31305(b), or 31310(g)(2)), or regulations

issued under such sections, shall, upon

conviction, be subject for each offense to

a fine not to exceed $5,000 or

imprisonment for a term not to exceed

90 days, or both.

(c) Any person who knowingly

violates 49 U.S.C. 5104(b), or any person

who knowingly and willfully violates

any provision of the HMTA, as

amended, or any regulation issued

thereunder, shall be fined under title 18

of the United States Code, imprisoned

for 5 years, or both.

(d) Additional criminal penalties

appear in 49 U.S.C. 522–526.

(e) If the agency becomes aware of any

willful act for which a criminal penalty

may be imposed as noted in this section,

the facts and circumstances of such

violation may be reported to the

Department of Justice for criminal

prosecution of the offender.

§ 364.302 Injunctions.

(a) The Associate Administrator may

file a civil action to enforce or redress

a violation of a commercial motor

vehicle safety regulation or order of the

FHWA under 49 U.S.C. chapters 5, 51,

311 (except sections 31138 and 31139),

and 315, in an appropriate district court

of the United States. The court may

grant such relief as is necessary or

appropriate, including injunctive and

equitable relief and punitive damages.

(b) Imminent Hazard—Hazardous

Materials Regulations. The Associate

Administrator may file a civil action to

suspend or restrict the transportation of

hazardous material responsible for an

imminent hazard or to eliminate or

ameliorate such a hazard, in an

appropriate district court of the United

States. The court may grant such relief

as is necessary or appropriate, including

injunctive and equitable relief and

punitive damages. ‘‘Imminent hazard’’

means that there is substantial

likelihood that death, serious illness, or

severe personal injury will result from

the transportation by motor vehicle of a

particular hazardous material before an

administrative proceeding to abate the

risk of harm can be completed.

(c) Imminent Hazard—Federal Motor

Carrier Safety Regulations. Whenever it

is determined that a violation of the

FMCS poses an imminent hazard, the

Associate Administrator or the

authorized delegate of that official shall

order a commercial motor vehicle or the

operator of a commercial motor vehicle

out of service, or order an employer to

cease all or part of its commercial motor

vehicle operations until such time as the

violations creating the imminently

hazardous condition are satisfactorily

abated. ‘‘Imminent hazard’’ means any

condition of commercial motor vehicle,

driver or commercial motor vehicle

operations which is likely to result in

serious personal injury or death if not

discontinued immediately.

(d) The employer or driver shall

comply immediately upon the issuance

of an order under paragraph (c) of this

section. Opportunity for review shall be

provided in accordance with § 363.110

of this subchapter. An order to an

employer to cease all or part of its

operations shall not prevent vehicles in

transit at the time the order is served

from proceeding to their immediate

destinations, unless any such vehicle or

its driver is specifically ordered out of

service forthwith. Vehicles and drivers

proceeding to their immediate

destinations shall be subject to full

compliance with the order upon arrival.

(e) For purposes of paragraph (d), the

term immediate destination means the

next scheduled stop of the vehicle

already in motion where the cargo on

board can be safely secured.

§ 364.303 Disqualifications.

In addition to any civil or criminal

penalties provided for in this part,

operators of commercial motor vehicles

who are convicted of certain offenses

may also be disqualified for periods

from 60 days to lifetime, as follows:

(a) Serious traffic violations.

(1) Two serious traffic violations in a

3-year period—sixty days.

(2) Three serious traffic violations in

a 3-year period—one hundred twenty

days.

(b) Violations of out-of-service orders.

(1) First violation of operating a

commercial motor vehicle during the

period that the operator, operation, or

vehicle are placed out of service—

ninety days.

(2) Second violation in a ten-year

period of operating a commercial motor

vehicle during the period that the

operator, operation, or vehicle are

placed out of service—one to five years.

(3) Third violation or more in a tenyear period of operating a commercial

motor vehicle during the period that the

operator, operation, or vehicle are

placed out of service—three to five

years.

(4) First violation of operating a

commercial motor vehicle transporting

hazardous materials or passengers

during the period that the operator,

operation, or vehicle are placed out of

service—180 days.

(5) Second violation or more of

operating a commercial motor vehicle

transporting hazardous materials or

passengers during the period that the

operator, operation, or vehicle are

placed out of service—three to five

years.

(c) First violation of driving a

commercial motor vehicle under the

influence of alcohol or a controlled

substance—at least one year.

(d) First violation of leaving the scene

of an accident involving a commercial

motor vehicle operated by the violator—

at least one year.

(e) Using a commercial motor vehicle

in the commission of a felony (except a

felony described in paragraph (i) of this

section—at least one year.

(f) Second or further violations

described in paragraphs (c) and (d) of

this section—lifetime.

(g) Using a commercial motor vehicle

in the commission of more than one

felony arising out of different criminal

episodes—lifetime.

(h) Any combination of violations

described in paragraphs (c) through (f)

of this section—lifetime.

(i) Using a commercial motor vehicle

in the commission of a felony involving

manufacturing, distributing, or

dispensing a controlled substance, or

possession in a commercial motor

vehicle with intent to manufacture,

distribute, or dispense a controlled

substance—lifetime.

Subpart D—Monetary Penalty

Collection

§ 364.401 Payment.

All monetary penalties are due and

payable as provided in the final agency

order or settlement agreement disposing

of the notice of violation or claim.

Interest will accrue from the date

payment was due and payable after

issuance of a final order, and will be

added to all outstanding balances not

timely paid.
18898 Federal Register / Vol. 61, No. 83 / Monday, April 29, 1996 / Proposed Rules

§ 364.402 Collections.

Unpaid monetary penalties or

balances will be pursued aggressively

under the Federal Standards for the

Administrative Collection of Claims at 4

CFR part 102, as adopted by the

Department of Transportation and

delegated to the Federal Highway

Administration in 49 CFR part 89.

Penalties may be recovered in an action

on behalf of the United States in the

appropriate U.S. District Court.

PARTS 385 AND 386 AND § 391.47—

[REMOVED AND RESERVED]

2. Chapter III of title 49, CFR, is

amended by removing and reserving

parts 385 and 386 and § 391.47.

[FR Doc. 96–10125 Filed 4–26–96; 8:45 am]

BILLING CODE 4910–22–M