Document ID: FMCSA-2012-0049-0001
Agency: fmcsa
Document Type: Rule
Title: Unsatisfactory Safety Rating: Revocation of Operating Authority Registration
Posted Date: 2012-05-14T04:00Z

[Federal Register Volume 77, Number 93 (Monday, May 14, 2012)]
[Rules and Regulations]
[Pages 28451-28454]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-11438]

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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Parts 350, 385, and 395

[Docket No. FMCSA-2012-0049]
RIN 2126-AB50

Unsatisfactory Safety Rating; Revocation of Operating Authority 
Registration; Technical Amendments

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Final rule.

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SUMMARY: This final rule repromulgates in the Code of Federal 
Regulations a statutory requirement that FMCSA revoke the operating 
authority registration of a for-hire motor carrier for failure to 
comply with safety fitness requirements; if the Agency determines that 
a motor carrier is ``Unfit'' based on its Safety Fitness Determination 
procedures, the Agency must revoke the carrier's operating authority 
registration. Unfit motor carriers are prohibited from operating in 
interstate commerce, and the Secretary of Transportation is required by 
statute to revoke their operating authority registration. This

[[Page 28452]]

final rule also repromulgates several technical provisions and makes 
non-substantive administrative changes. These changes, initially 
adopted as part of the April 5, 2010, final rule entitled ``Electronic 
On-Board Recorders for Hours-of-Service Compliance,'' are necessary 
because, for reasons unrelated to this final rule, the United States 
Court of Appeals for the Seventh Circuit invalidated the previous rule.

DATES: Effective May 14, 2012.

ADDRESSES: For access to the docket to read background documents, 
including those referenced in this document, go to:
     Regulations.gov, http://www.regulations.gov, at any time 
and insert FMCSA-2012-0049 in the ``Keyword'' box, and then click 
``Search.''
    Docket Management Facility, Room W12-140, DOT Building, 1200 New 
Jersey Avenue SE., Washington, DC 20590. You may view the docket online 
by visiting the facility between 9 a.m. and 5 p.m. e.t., Monday through 
Friday except Federal holidays.

FOR FURTHER INFORMATION CONTACT: Mr. William Varga, Office of Chief 
Counsel, Federal Motor Carrier Safety Administration, 1200 New Jersey 
Avenue SE., Washington, DC 20590; telephone (202) 493-0349.

SUPPLEMENTARY INFORMATION

I. Legal Basis for Rulemaking

    The legal basis for the repromulgation of 49 CFR 385.13(e) is 
section 4104 of the Safe, Accountable, Flexible, Efficient 
Transportation Equity Act: A Legacy for Users (SAFETEA-LU), Public Law 
109-59, 119 Stat. 1144, 1716-1717 (Aug. 10, 2005), which requires the 
Secretary of Transportation to revoke the operating authority 
registration of a motor carrier that has been prohibited from operating 
in interstate commerce for failure to comply with safety fitness 
requirements. See 49 U.S.C. 13905(f)(1)(B) and (3). The implementing 
regulations for the safety fitness requirements are codified under 49 
CFR Part 385. Under these requirements, motor carriers determined to be 
``Unfit'' are prohibited from operating commercial motor vehicles in 
interstate commerce. Implementation of 49 U.S.C. 13905(f)(1)(B) and (3) 
has been delegated to the Administrator of FMCSA. 49 CFR 1.73(a)(5). 
FMCSA has no policy discretion in the implementation of this statutory 
mandate. See 49 U.S.C. 13905(f)(1)(B). This provision was not the focus 
of the Seventh Circuit Court of Appeals' August 26, 2011 vacature, nor 
is it related to electronic on-board records (EOBRs), which were the 
subject of that litigation.
    The additional administrative and technical corrections described 
below, although not related to the use of EOBRs, are nevertheless 
supported by several broad grants of statutory authority that were 
fully addressed in the April 2010 rulemaking's Legal Basis discussion, 
available at 75 FR 17209--17210.
    While the Administrative Procedure Act (APA) normally requires 
issuance of a notice of proposed rulemaking (NPRM) and an opportunity 
for public comment, the APA provides an exception when an agency ``for 
good cause finds * * * that notice and public procedure * * * are 
impracticable, unnecessary, or contrary to the public interest.'' 5 
U.S.C. 553(b)(B). The repromulgation of 49 CFR 385.13(e) conforms 
FMCSA's regulations with a statutory requirement for revocation of 
operating authority under prescribed circumstances. The APA exception 
is appropriate because FMCSA lacks any policy discretion in 
implementing this mandate. Furthermore, the additional amendments are 
administrative and technical changes that do not result in any 
substantive modifications in the CFR. For these reasons, FMCSA finds 
that the opportunity for notice and public comment is unnecessary and 
contrary to the public interest under the APA.
    Similarly, FMCSA finds that the normal 30-day minimum delayed 
effective date following publication of a final rule under the APA does 
not apply. 5 U.S.C. 553(d)(3). Because the repromulgation of 49 CFR 
385.13(e) simply codifies a statutory requirement that the Agency is 
currently required to follow, a 30-day delay would serve no purpose 
other than to postpone conforming the regulation with current Agency 
practice consistent with the statutory requirements. The additional 
administrative and technical changes do not result in any substantive 
modifications. None of the changes requires the regulated industry to 
prepare for implementation. For these reasons, FMCSA finds good cause 
as to why the normal delayed effective date under the APA is not 
required and the rules adopted here should become effective on the date 
of publication.

II. Background Information and Discussion of This Final Rule

Background Information

    On April 5, 2010, FMCSA published a final rule titled ``Electronic 
On-Board Recorders for Hours-of-Service Compliance.'' See 75 FR 17208, 
as amended by 75 FR 55488 (Sept. 13, 2010).\1\ As part of that 
rulemaking, FMCSA set forth in regulation a statutory requirement 
enacted in SAFETEA-LU Sec.  4104. Subject to certain procedural 
provisions, FMCSA is required under this statute to revoke the 
operating authority registration of a motor carrier that has failed to 
comply with safety fitness requirements under 49 U.S.C. 31144. See 49 
U.S.C. 13905(f)(1)(B) and (3). The EOBR final rule took effect on June 
4, 2010.
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    \1\ The September 13, 2010, rulemaking made technical changes to 
the April 2010 rule, including changes to the temperature range in 
which EOBRs must be able to operate and the connector type specified 
for the Universal Serial Bus interface.
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    On June 3, 2010, the Owner-Operator Independent Drivers 
Association, Inc., filed a petition in the United States Court of 
Appeals for the Seventh Circuit challenging the April 2010 final rule. 
The court found that FMCSA's failure to address the issue of harassment 
through the use of electronic monitoring devices as part of the 
rulemaking, as required under 49 U.S.C. 31137(a), rendered the 
rulemaking arbitrary and capricious. Owner-Operator Indep. Drivers 
Ass'n, Inc. v. Federal Motor Carrier Safety Admin., 656 F.3d 580, 582, 
589 (7th Cir. 2011). Although the court had focused on a remedial 
program under the rule that would have required carriers that 
demonstrated noncompliance with hours of service rules to install and 
use EOBRs, the court vacated the entire rule, including, sub silentio, 
the provision on revocation of operating authority registration. 656 
F.3d at 584, 589. On October 7, 2011, FMCSA announced in a Federal 
Register notice that it would not appeal the court's decision. 76 FR 
62496.
    In a separate final rule published in today's Federal Register, 
titled Electronic On-Board Recorders for Hours-of-Service Compliance; 
Removal of Final Rule Vacated by Court, (see the Final Rules section of 
this Federal Register), FMCSA restores the regulatory text to its 
posture on June 3, 2010, immediately before the effective date of the 
rule the court vacated.

Discussion of This Final Rule

    This final rule does two things. First, it repromulgates 49 CFR 
385.13(e), codifying in the CFR the statutory requirement that FMCSA 
revoke the operating authority registration of a motor carrier that is 
prohibited from operating in interstate commerce for failure to comply 
with the safety fitness requirements, subject to certain statutory 
procedural requirements.
    Second, this final rule also repromulgates certain technical

[[Page 28453]]

corrections in regulatory text that were included for administrative 
convenience as part of the April 2010 rulemaking, but that are not 
related to EOBR devices. The administrative and technical corrections 
include: (1) In 49 CFR 350.201, correcting a reference to the number of 
factors listed for Basic Program Funds under the Motor Carrier Safety 
Assistance Program; (2) in 49 CFR 385.5, clarifying cross-references to 
other provisions of Title 49 of the CFR; (3) in 49 CFR 385.15(a), 
correcting and clarifying a cross-reference relating to administrative 
review; (4) in 49 CFR part 385, Appendix B, (d)2, making a grammatical 
correction so that the singular word ``Material'' is plural; and (5) in 
49 CFR 395.8(a)(2), clarifying an internal reference to that section.

III. Statutory and Regulatory Reviews

Executive Order 12866 (Regulatory Planning and Review), Executive Order 
13563 (Improving Regulation and Regulatory Review), and DOT Regulatory 
Policies and Procedures

    FMCSA has determined that this action does not meet the criteria 
for a ``significant regulatory action'' as specified in Executive Order 
12866, as supplemented by Executive Order 13563, or within the meaning 
of the Department of Transportation regulatory policies and procedures 
(44 FR 11034, Feb. 26, 1979). While the April 2010 final rule was an 
economically significant regulatory action, that assessment was based 
on the costs and benefits of requiring certain motor carriers to use 
EOBRs. As explained above, this final rule is strictly technical in 
that it repromulgates a nondiscretionary statutory requirement and 
includes administrative and technical corrections not related to EOBRs. 
However, these changes were made necessary by the court's decision 
vacating the entire April 2010 rule.

Regulatory Flexibility Act

    FMCSA is not required to prepare a final regulatory flexibility 
analysis for this final rule under the Regulatory Flexibility Act, as 
amended by the Small Business Regulatory Enforcement Fairness Act of 
1996, 5 U.S.C. 601, et seq., because the Agency has not issued an NPRM 
prior to this action. This final rule also complies with the 
President's memorandum of January 18, 2011, entitled Regulatory 
Flexibility, Small Business, and Job Creation (76 FR 3827). As 
addressed above, promulgation of this final rule is strictly technical 
in that it repromulgates in FMCSA regulations a nondiscretionary 
statutory requirement currently in place and includes administrative 
and technical corrections.

Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (2 U.S.C. 1531-1538) 
requires Federal agencies to assess the effects of their discretionary 
regulatory actions. In particular this Act addresses actions that may 
result in the expenditure by a State, local, or tribal governments, in 
the aggregate, or by the private sector of $100,000,000 or more in any 
one year. This final rule will not result in such an expenditure.

Paperwork Reduction Act

    This final rule calls for no new collection of information under 
the Paperwork Reduction Act of 1995 (44 U.S.C. 3501-3520).

National Environmental Policy Act and Clean Air Act

    FMCSA analyzed this final rule for the purpose of the National 
Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) and 
determined under our environmental procedures Order 5610.1, issued 
March 1, 2004 (69 FR 9680), that this action does not have any effect 
on the quality of the environment. Therefore, this final rule is 
categorically excluded from further analysis and documentation in an 
environmental assessment or environmental impact statement under FMCSA 
Order 5610.1, paragraph 6(b) of Appendix 2. This categorical exclusion 
covers editorial and procedural regulations. A Categorical Exclusion 
determination is available for inspection or copying in the 
Regulations.gov Web site listed under ADDRESSES.
    FMCSA also analyzed this action under section 176(c) of the Clean 
Air Act (CAA), as amended (42 U.S.C. 7401 et seq.), and implementing 
regulations promulgated by the Environmental Protection Agency. 
Approval of this action is exempt from the CAA's general conformity 
requirement since it would result in no emissions increase or an 
increase in emissions that is clearly de minimis.

Executive Order 12372 (Intergovernmental Review of Federal Programs)

    The regulations implementing Executive Order 12372 regarding 
intergovernmental consultation on Federal programs and activities do 
not apply to this action.

Executive Order 12630 (Constitutionally Protected Property Rights)

    This final rule does not effect a taking of private property or 
otherwise have implications under Executive Order 12630.

Executive Order 12898 (Environmental Justice)

    This final rule raises no environmental justice issues nor is there 
any collective environmental impact resulting from its promulgation.

Executive Order 12988 (Civil Justice Reform)

    This final rule meets applicable standards in section 3(a) and 
3(b)(2) of Executive Order 12988 to minimize litigation, eliminate 
ambiguity, and reduce burden.

Executive Order 13045 (Protection of Children)

    This final rule does not pose an environmental risk to health or 
safety that may disproportionately affect children.

Executive Order 13132 (Federalism)

    A rulemaking has implications for Federalism under Executive Order 
13132, Federalism, if it has a substantial direct effect on State or 
local governments and would either preempt State law or impose a 
substantial direct cost of compliance on State or local governments. 
FMCSA analyzed this action in accordance with Executive Order 13132. 
This final rule does not preempt or modify any provision of State law, 
impose substantial direct unreimbursed compliance costs on any State, 
or diminish the power of any State to enforce its own laws. 
Accordingly, this rulemaking does not have Federalism implications 
warranting the application of Executive Order 13132.

Executive Order 13211 (Energy Supply, Distribution, or Use)

    FMCSA analyzed this action under Executive Order 13211, Actions 
Concerning Regulations That Significantly Affect Energy Supply, 
Distribution, or Use. FMCSA determined that it is not a ``significant 
energy action'' under that Executive Order because it is not 
economically significant and is not likely to have an adverse effect on 
the supply, distribution, or use of energy.

List of Subjects

49 CFR Part 350

    Grant programs--transportation, Highway safety, Motor carriers, 
Motor vehicle safety, Reporting and recordkeeping requirements.

[[Page 28454]]

49 CFR Part 385

    Administrative practice and procedure, Highway safety, Motor 
carriers, Motor vehicle safety, Reporting and recordkeeping.

49 CFR Part 395

    Highway safety, Motor carriers, Reporting and recordkeeping

    For the reasons discussed in the preamble, FMCSA amends 49 CFR 
chapter III as set forth below:

PART 350--COMMERCIAL MOTOR CARRIER SAFETY ASSISTANCE PROGRAM

0
1. The authority citation for part 350 continues to read as follows:

    Authority:  49 U.S.C. 13902, 31101-31104, 31108, 31136, 31140-
31141, 31161, 31310-31311, 31502; and 49 CFR 1.73.

0
2. Amend Sec.  350.201 by revising the introductory text to read as 
follows:

Sec.  350.201  What conditions must a State meet to qualify for Basic 
Program Funds?

    Each State must meet the following 25 conditions:
* * * * *

PART 385--SAFETY FITNESS PROCEDURES

0
3. The authority citation for part 385 continues to read as follows:

    Authority: 49 U.S.C. 113, 504, 521(b), 5105(e), 5109, 13901-
13905, 31133, 31135, 31136, 31137(a), 31144, 31148, and 31502; Sec. 
113(a), Pub. L. 103-311; Sec. 408, Pub. L. 104-88; Sec. 350 of Pub. 
L. 107-87; and 49 CFR 1.73.

0
4. Revise Sec.  385.5 to read as follows:

Sec.  385.5  Safety fitness standard.

    The satisfactory safety rating is based on the degree of compliance 
with the safety fitness standard for motor carriers. For intrastate 
motor carriers subject to the hazardous materials safety permit 
requirements of subpart E of this part, the motor carrier must meet the 
equivalent State requirements. To meet the safety fitness standard, the 
motor carrier must demonstrate it has adequate safety management 
controls in place, which function effectively to ensure acceptable 
compliance with applicable safety requirements to reduce the risk 
associated with:
    (a) Commercial driver's license standard violations (part 383 of 
this chapter),
    (b) Inadequate levels of financial responsibility (part 387 of this 
chapter),
    (c) The use of unqualified drivers (part 391 of this chapter),
    (d) Improper use and driving of motor vehicles (part 392 of this 
chapter),
    (e) Unsafe vehicles operating on the highways (part 393 of this 
chapter),
    (f) Failure to maintain accident registers and copies of accident 
reports (part 390 of this chapter),
    (g) The use of fatigued drivers (part 395 of this chapter),
    (h) Inadequate inspection, repair, and maintenance of vehicles 
(part 396 of this chapter),
    (i) Transportation of hazardous materials, driving and parking rule 
violations (part 397 of this chapter),
    (j) Violation of hazardous materials regulations (parts 170-177 of 
this title), and
    (k) Motor vehicle accidents and hazardous materials incidents.

0
5. Amend Sec.  385.13 by adding paragraph (e) to read as follows:

Sec.  385.13  Unsatisfactory rated motor carriers; prohibition on 
transportation; ineligibility for Federal contracts.

* * * * *
    (e) Revocation of operating authority. If a proposed 
``unsatisfactory'' safety rating or a proposed determination of 
unfitness becomes final, FMCSA will, following notice, issue an order 
revoking the operating authority of the owner or operator. For purposes 
of this section, the term ``operating authority'' means the 
registration required under 49 U.S.C. 13902 and Sec.  392.9a of this 
subchapter. Any motor carrier that operates CMVs after revocation of 
its operating authority will be subject to the penalty provisions 
listed in 49 U.S.C. 14901.

0
6. Amend Sec.  385.15 by revising paragraph (a) to read as follows:

Sec.  385.15  Administrative review.

    (a) A motor carrier may request FMCSA to conduct an administrative 
review if it believes FMCSA has committed an error in assigning its 
proposed or final safety rating in accordance with Sec.  385.11.
* * * * *

Appendix B to Part 385--Explanation of Safety Rating Process

0
7. Amend Appendix B to part 385 by revising paragraph (d)2 to read as 
follows:

* * * * *
    (d) * * *
    2. Identify motor carriers needing improvement in their 
compliance with the Federal Motor Carrier Safety Regulations 
(FMCSRs) and applicable Hazardous Materials Regulations (HMRs). 
These are carriers rated unsatisfactory or conditional.
* * * * *

PART 395--HOURS OF SERVICE OF DRIVERS

0
8. The authority citation for part 395 continues to read as follows:

    Authority: 49 U.S.C. 504, 31133, 31136, 31137, and 31502; sec. 
113, Pub. L. 103-311, 108 Stat. 1673, 1676; sec. 229, Pub. L. 106-
159 (as transferred by sec. 4115 and amended by secs. 4130-4132, 
Pub. L. 109-59, 119 Stat. 1144, 1726, 1743, 1744); sec. 4133, Pub. 
L. 109-59, 119 Stat. 1144, 1744; sec. 108, Pub. L. 110-432, 122 
Stat. 4860-4866; and 49 CFR 1.73.

0
9. Amend Sec.  395.8 by revising paragraph (a)(2) to read as follows:

Sec.  395.8  Driver's record of duty status.

    (a) * * *
    (2) Every driver who operates a commercial motor vehicle shall 
record his/her duty status by using an automatic on-board recording 
device that meets the requirements of Sec.  395.15 of this part. The 
requirements of this section shall not apply, except paragraphs (e) and 
(k)(1) and (2) of this section.
* * * * *

    Issued on: May 1, 2012.
Anne S. Ferro,
Administrator.
[FR Doc. 2012-11438 Filed 5-11-12; 8:45 am]
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