Motor Carrier Safety: Preliminary Information on the Federal Motor Carrier Safety Administration's Efforts to Identify and Follow Up with High-risk Carriers
Published: 2007-07-11T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Federal Motor Carrier Safety Administration (FMCSA) has the primary federal responsibility for reducing crashes involving large trucks and buses. FMCSA uses its "SafeStat" tool to select carriers for reviews for compliance with its safety regulations based on the carriers' crash rates and prior safety violations. FMCSA then conducts these compliance reviews and can place carriers out of service if they are found to be operating unsafely. This statement is based on a recent report (GAO-07-585) and other nearly completed work. GAO assessed (1) the extent to which FMCSA identifies carriers that subsequently have high crash rates, (2) how FMCSA ensures that its compliance reviews are conducted thoroughly and consistently, and (3) the extent to which FMCSA follows up with carriers with serious safety violations. GAO's work was based on a review of laws, program guidance, and analyses of data from 2004 through early 2006.
section_title: What GAO Found
paragraphs: FMCSA generally does a good job in identifying carriers that pose high crash risks for subsequent compliance reviews, ensuring the thoroughness and consistency of those reviews, and following up with high-risk carriers. SafeStat is nearly twice as effective (83 percent) as random selection in identifying carriers that pose high crash risks. However, its effectiveness could be improved by using a statistical approach (negative binomial regression), which provides for a systematic assessment to apply weights to the four SafeStat safety evaluation areas (accidents and driver, vehicle, and safety management violations) rather than FMCSA's approach, which relies on expert judgment. The regression approach identified carriers that had twice as many crashes in the subsequent 18 months as did the carriers identified by the current SafeStat approach. FMCSA is concerned that adopting this approach would result in it placing more emphasis on crashes and less emphasis on compliance with its safety management, vehicle, and driver regulations. GAO believes that because (1) the ultimate purpose of compliance reviews is to reduce the number and severity of truck and bus crashes and (2) GAO's and others' research has shown that crash rates are stronger predictors of future crashes than is poor compliance with FMCSA's safety regulations, the regression approach would improve safety. GAO's preliminary assessment is that FMCSA promotes thoroughness and consistency in its compliance reviews through its management processes, which meet GAO's standards for internal controls. For example, FMCSA uses an electronic manual to record and communicate its compliance review policies and procedures and teaches proper compliance review procedures through both classroom and on-the-job training. Furthermore, investigators use an information system to document their compliance reviews, and managers review these data, helping to ensure thoroughness and consistency between investigators. For the most part, FMCSA and state investigators cover the nine major applicable areas of the safety regulations (e.g., driver qualifications and vehicle condition) in 95 percent or more of compliance reviews, demonstrating thoroughness and consistency. GAO's preliminary assessment is that FMCSA follows up with almost all carriers with serious safety violations, but it does not assess the maximum fines against all serious violators that GAO believes the law requires. FMCSA followed up with at least 1,189 of 1,196 carriers (99 percent) that received proposed unsatisfactory safety ratings from compliance reviews completed in fiscal year 2005. For example, FMCSA found that 873 of these carriers made safety improvements and it placed 306 other carriers out of service. GAO also found that FMCSA (1) assesses maximum fines against carriers for the third instance of a violation, whereas GAO reads the statute as requiring FMCSA to do so for the second violation and (2) does not always assess maximum fines against carriers with a pattern of varied serious violations, as GAO believes the law requires.

section_title: Letter
paragraphs: We appreciate the opportunity to participate in this hearing to discuss the  Federal Motor Carrier Safety Administration’s (FMCSA) oversight of  motor carriers that pose high crash risks. This is an important issue  because each year about 5,500 people die as a result of crashes involving  large commercial trucks or buses, and about 160,000 more people are  injured. These crashes may result from errors by truck, bus, or passenger  vehicle drivers; vehicle condition; and other factors. Effective oversight is  important because of the large size of the motor carrier industry (over  700,000 carriers are registered with FMCSA) compared to the number of  compliance reviews—reviews of carriers at their bases of operations for  compliance with FMCSA’s safety regulations—that FMCSA and its state  partners are able to conduct each year (about 15,000 in 2006). As a result,  it is crucial that FMCSA identify the most unsafe carriers so that the  carriers either improve their operations or are put out of service.
My remarks are based on work we have recently completed for this  Subcommittee and the full committee and on the preliminary results of  our ongoing work for the Chairman of the full committee. This latter work  is nearing completion, and we expect to report on our final results on  these and other topics later this summer. Specifically, we have been  assessing (1) the extent to which FMCSA identifies carriers that  subsequently have high crash rates, (2) how FMCSA ensures that its  compliance reviews are conducted thoroughly and consistently, and   (3) the extent to which FMCSA follows up with carriers with serious safety  violations.
Our work was based on a review of laws, regulations, program guidance,  analyses of data, and discussions with FMCSA. To determine the extent to  which FMCSA identifies carriers that subsequently have high crash rates,  we analyzed data from FMCSA’s Motor Carrier Management Information  System for its June 2004 assessment of carriers and compared it to data on  crashes the carriers experienced over the subsequent 18 months (July 2004  through December 2005). To assess how FMCSA ensures that its  compliance reviews are completed thoroughly and consistently, we  identified our key internal control standards related to the communication  of policy, documentation of results, and monitoring and reviewing of  activities and findings. We gathered information on these key internal  controls through discussions with FMCSA officials in its headquarters as  well as in 7 of FMCSA’s 52 field division offices and reviews of policy  documents and reports. To assess the extent to which FMCSA follows up  with carriers with serious violations and assesses maximum fines in  certain situations, we reviewed regulations and FMCSA policies directing  how FMCSA must follow up and track these violators, analyzed data to  determine if FMCSA had met these requirements, and held discussions  with FMCSA officials. As part of our review, we assessed internal controls  and the reliability of FMCSA’s data on motor carriers’ safety history and  compliance review and enforcement activities pertinent to this effort.  While there are known problems with the quality of the crash data  reported to FMCSA, we determined that the data were sufficiently reliable  for our use, which was to assess whether different approaches to  categorizing carriers could lead to better identification of carriers that  subsequently have high rates of crashes. We conducted our work from  February 2006 through July 2007 in accordance with generally accepted  government auditing standards.
By and large, FMCSA does a good job of identifying carriers that pose high  crash risks for subsequent compliance reviews, ensuring the thoroughness  and consistency of those reviews, and following up with high-risk carriers.  That being said, we have identified areas that could be improved. In  summary:    Overall, the data-driven model that FMCSA uses to identify carriers that  pose high crash risks—the Motor Carrier Safety Status Measurement  System (SafeStat)—does a good job of identifying carriers that pose high  crash risks. In this regard, we found that it is nearly twice as effective   (83 percent better) as random selection in identifying carriers that pose  high crash risks. Thus, in our view, it has value for improving safety.  However, we believe that its effectiveness could be improved through  either of two enhancements that we analyzed. One enhancement entails  applying a statistical approach, called the negative binomial regression  model, to the four SafeStat safety evaluation areas (accidents and driver,  vehicle, and safety management violations) instead of its current  approach, which relies on expert judgment to assign weights to each of the  four areas. The other enhancement—the results of which are  preliminary—uses the existing SafeStat overall design but places greater  weight on carriers that scored among the worst in the accident safety  evaluation area. Both enhancements performed better than the current  SafeStat approach. For example, the regression approach identified  carriers that had twice as many crashes in the subsequent 18 months as  the carriers the current SafeStat approach identified. We believe that the  negative binomial regression model approach offers a greater potential for  improving safety over the other enhancement that we analyzed and the  current SafeStat approach because it provides for a systematic assessment  of the relative contributions of accidents and driver, vehicle, and safety  management violations rather than the use of expert judgment to apply  weights to these areas. FMCSA agreed that our approach looks promising  but believes that placing more emphasis on crashes is counterproductive,  in part, because it would have to place less emphasis on compliance with  its safety management, vehicle, and driver regulations. We disagree  because the ultimate purpose of compliance reviews is to reduce the  number and severity of truck and bus crashes, and high crash rates are  stronger predictors of future crashes than is poor compliance with safety  regulations.
Our preliminary assessment showed that FMCSA’s management of its  compliance reviews meets our standards for internal controls, thereby  promoting thoroughness and consistency. FMCSA records its compliance  review policies and procedures in an electronic operations manual and  distributes the manual to investigators and managers. FMCSA also trains  investigators on these policies and procedures. Investigators we spoke  with found both the electronic manual and the training to be effective  means of communicating policies and procedures. FMCSA and state  investigators use an information system to document the results of the  compliance reviews. This information system supports thoroughness and  consistency by alerting investigators if they are not following key policies  or if data appears suspect; the system also provides managers readily  available data to review. For the most part, FMCSA and state investigators  cover the nine major applicable areas of the safety regulations (e.g., driver  qualifications and vehicle repair and maintenance) in 95 percent or more  of compliance reviews, demonstrating thoroughness and consistency.
Our preliminary assessment showed that FMCSA follows up with many  carriers with serious safety violations, but it does not assess maximum  fines against all serious violators, as we believe is required by law. FMCSA  followed up with at least 1,189 of 1,196 carriers (99 percent) that received  a proposed safety rating of unsatisfactory following compliance reviews  completed in fiscal year 2005. For example, FMCSA found that 873 of  these carriers made safety improvements and it placed 306 other carriers  out of service. FMCSA monitors carriers to identify those that are violating  out-of-service orders, but in fiscal years 2005 and 2006, it cited only 26 of  768 carriers that its monitoring showed had a roadside inspection or crash  while subject to an out-of-service order. An FMCSA official told us that  some of the 768 carriers, such as carriers that were operating intrastate,  may not have been violating the out-of-service order and that FMCSA did  not have enough resources to determine whether each of the carriers was  violating an out-of-service order. Finally, we found that while FMCSA  assesses maximum fines against carriers that repeat a serious violation, it  does not, as we believe federal law requires, assess maximum fines against  carriers with a pattern of serious violations. In addition, FMCSA assesses  maximum fines only for the third instance of a violation. We read the  statute as requiring FMCSA to assess the maximum fine if a serious  violation is repeated once—not only after it is repeated twice.
In our June report we recommended that FMCSA use a negative binomial  regression model approach to identify carriers that pose high crash risks.  We are considering making several recommendations based on our  ongoing work, including that FMCSA assess maximum fines, as discussed  above, in circumstances that we believe the law requires it to do so.  Finally, we have also reported on other aspects of FMCSA’s operations  within the past 18 months. These products are listed at the end of this  statement.
subsections: section_title: Background
paragraphs: In the United States, commercial motor carriers account for less than 5  percent of all highway crashes, but these crashes result in about 13  percent of all highway deaths, or about 5,500 of the approximately 43,000  nationwide highway fatalities that occur annually. In addition, about  160,000 of the approximately 3.2 million highway injuries per year involve  motor carriers. While the fatality rate for trucks has generally decreased  over the past 30 years, it has been fairly stable since 2002. (See fig. 1.) The  fatality rate for buses decreased slightly from 1975 to 2005, but it has more  annual variability than the fatality rate for trucks due to a much smaller  total vehicle miles traveled.
FMCSA’s primary mission is to reduce the number and severity of crashes  involving large trucks and buses. FMCSA relies heavily on the results of  compliance reviews to determine whether carriers are operating safely  and, if not, to take enforcement action against them. FMCSA conducts  these on-site reviews to determine carriers’ compliance with safety  regulations that address areas such as alcohol and drug testing of drivers,  driver qualifications, driver hours of service, vehicle maintenance and  inspections, and transportation of hazardous materials.
FMCSA uses a data-driven analysis model called SafeStat to assess  carriers’ risks relative to all other carriers based on safety indicators, such  as their crash rates and safety violations identified during roadside  inspections and prior compliance reviews. A carrier’s score is calculated  based on its performance in four safety evaluation areas: accidents and  driver, vehicle, and safety management violations. (See fig. 2.)
section_title: SafeStat Identifies Many High-risk Carriers, but Enhancements Could Identify Carriers with Even Higher Risks
paragraphs: SafeStat identifies many carriers that pose a high risk for crashes and is  about twice as effective (83 percent) as randomly selecting carriers for  compliance reviews. As a result, it has value for improving motor carrier  safety. However, two enhancements that we analyzed could lead to  FMCSA identifying carriers that pose greater crash risks overall. These  approaches entail giving more weight to crashes than the current SafeStat  model does. FMCSA has concerns about these approaches, in part,  because placing more emphasis on accidents would require it to place less  emphasis on other types of problems. FMCSA recognizes that SafeStat can  be improved, and as part of its Comprehensive Safety Analysis 2010 reform  initiative—which is aimed at improving its processes for identifying and  dealing with unsafe carriers and drivers—the agency is considering  replacing SafeStat by 2010.
subsections: section_title: Using Either a Statistical Approach or Modifying Existing SafeStat Categorization Rules Could Improve Identification of High-risk Carriers
paragraphs: In June 2007, we reported that FMCSA could improve SafeStat’s ability to  identify carriers that pose high crash risks if it applied a statistical  approach, called the negative binomial regression model, to the four  SafeStat safety evaluation areas instead of its current approach. We used  this approach to determine whether systematic analyses of data through  regression modeling offered improved results in identifying carriers that  pose high crash risks over FMCSA’s model, which uses expert judgment  and professional experience to apply weights to each of the safety  evaluation areas. The negative binomial model results in a rank order  listing of carriers by crash risk and the predicted number of crashes. This  differs from SafeStat’s current approach, which gives the highest priority  to carriers that are deficient in three or more safety evaluation areas or  that score over a certain amount—SafeStat categories A and B.   (See table 1.)
The other enhancement that we analyzed—the results of which are  preliminary—utilized the existing SafeStat overall design but examined the  effect of providing greater priority to carriers that scored among the worst  5 percent of carriers in the accident safety evaluation area (SafeStat  category D). We chose this approach because we found that while the  driver, vehicle, and safety management evaluation areas are correlated  with the future crash risk of a carrier, the accident evaluation area  correlates most with future crash risk. This approach would retain the  overall SafeStat framework and categorization—categories A through G  for carriers with safety problems—but would substitute carriers in  category D (the accident category) for carriers in categories A and B that  have either (1) lower overall SafeStat scores or (2) lower accident area  scores.
We compared the performance of our regression model approach and  placing greater weight on carriers that scored among the worst 5 percent  of carriers in SafeStat category D to the current SafeStat model. The  comparison showed that both these approaches performed better than the  current SafeStat approach. (See table 2.) For example, the regression  model approach identified carriers with an average of 111 crashes per  1,000 vehicles over an 18-month period compared with the current  SafeStat approach, which identified carriers for compliance reviews with  an average of 102 crashes per 1,000 vehicles. This 9 percent improvement  would have enabled FMCSA to identify carriers with almost twice as many  crashes in the following 18 months as those carriers identified in its  current approach (19,580 v. 10,076). Placing greater emphasis on carriers  in category D provided superior results to the current SafeStat approach  both in terms of identifying carriers with higher crash rates (from 6 to 9  percent higher) and greater numbers of crashes (from about 600 to 800  more). In addition, the regression approach performed at least as well as  placing greater emphasis on carriers in category D in terms of identifying  carriers with the highest crash rates and much better in identifying  carriers with the greatest number of crashes.
Because both the approaches that we analyzed would identify a larger  number of carriers that pose high crash risks, FMCSA would choose the  number of carriers to review based on the resources available to it, much  as it currently does.
We believe that our statistically based regression model is preferable to  placing greater weight on carriers in category D because it provides for a  systematic assessment of the relative contributions of accidents and  driver, vehicle, and safety management violations. We recommended that  FMCSA adopt such an approach. By its very nature the regression  approach looks for the “best fit” in identifying the degree to which prior  accidents and driver, vehicle, and safety management violations identify  the likelihood of carriers having crashes in the future, compared to the  current SafeStat approach, in which the relationship among the four  evaluation areas is based on expert judgment. In addition, because the  regression model could be run monthly—as is the current SafeStat  model—any change in the degree to which accidents and driver, vehicle,  and safety management violations better identify future crashes will be  automatically considered as different weights to the four evaluation areas  are assigned. This is not the case with the current SafeStat model, in which  the evaluation area weights generally remain constant over time.
FMCSA agreed that use of a negative binomial regression model looks  promising but officials said that the agency believes that placing more  emphasis on the accident area would be counterproductive. First, FMCSA  is concerned that this would require placing correspondingly less  emphasis on the types of problems the compliance review is designed to  address so that crashes can be reduced (i.e., the lack of compliance with  safety regulations related to drivers, vehicles, and safety management that  is captured in the other evaluation areas). Along this line, FMCSA said that  compliance reviews of carriers in SafeStat category D have historically  resulted in fewer serious violations than compliance reviews of carriers in  SafeStat category A or B. We agree with FMCSA that the use of the  approaches that we are discussing here today could tilt enforcement  heavily toward carriers with high crash rates and away from carriers with  compliance issues. We disagree, however, that this would be  counterproductive. We found that while driver, vehicle, and safety  management evaluation area scores are correlated with the future crash  risk of a carrier, high crash rates are a stronger predictor of future crashes  than poor compliance with safety regulations. FMCSA’s mission—as well  as the ultimate purpose of compliance reviews—is to reduce the number  and severity of truck and bus crashes.
Second, FMCSA officials said that placing more emphasis on the accident  evaluation area would increase emphasis on the least reliable type of data  used by SafeStat—crash data—and in so doing, it would increase the  sensitivity of the results to crash data quality issues. However, in June  2007 we reported that FMCSA has made considerable efforts to improve  the reliability of crash data. The report also concluded that as FMCSA  continues its efforts to have states improve crash data, any sensitivity of  results from our statistically based model to crash data quality issues  should diminish.
section_title: FMCSA Is Considering Replacing SafeStat with a New Tool by 2010
paragraphs: As part of its Comprehensive Safety Analysis 2010, a reform initiative  aimed at improving its processes for identifying and dealing with unsafe  carriers and drivers, FMCSA is considering replacing SafeStat with a new  tool by 2010. The new tool could take on greater importance in FMCSA’s  safety oversight framework because the agency is considering using the  tool’s assessments of carriers’ safety to determine whether carriers are fit  to continue operating. In contrast, SafeStat is primarily used now to  prioritize carriers for compliance reviews, and determinations of  operational fitness are made only after compliance reviews are completed.  FMCSA also plans to develop a tool to assess the safety status of  individual drivers, along with tools for dealing with unsafe drivers. Even  though FMCSA is considering replacing SafeStat, we believe that  implementing either of the approaches discussed in this statement would  be worthwhile because it would be relatively easy to do and result in  immediate safety benefits that could save lives.
section_title: FMCSA’s Management of Its Compliance Reviews Promotes Thoroughness and Consistency
paragraphs: Our preliminary assessment is that FMCSA manages its compliance  reviews in a way that meets our standards for internal control, thereby  promoting thoroughness and consistency in the reviews. It does so by  establishing compliance review policies and procedures through an  electronic manual and training, using an information system to document  the results of its compliance reviews, and monitoring performance. We  also found that compliance reviews cover most of the major areas of the  agency’s safety regulations.
subsections: section_title: FMCSA Communicates Its Compliance Review Policies and Procedures through an Electronic Manual and Training
paragraphs: FMCSA’s communication of its policies and procedures related to  conducting compliance reviews meets our standards for internal control.  These standards state that an organization’s policies and procedures  should be recorded and communicated to management and others within  the entity who need it and in a form (that is, for example, clearly written  and provided as a paper or electronic manual) and within a time frame  that enables them to carry out their responsibilities. FMCSA records and  communicates its policies and procedures electronically through its Field  Operations Training Manual, which it provides to all federal and state  investigators and their managers. The manual includes guidance on how to  prepare for a compliance review (for example, by reviewing information  on the carrier’s accidents, drivers, and inspections), and it explains how  this information can help the investigator focus the compliance review. It  also specifies the minimum number of driver and vehicle maintenance  records to be examined and the minimum number of vehicle inspections  to be conducted during a compliance review. FMCSA posts updates to the  manual that automatically download to investigators and managers when  they connect to the Internet. In addition to the manual, FMCSA provides  classroom training to investigators and requires that investigators  successfully complete that training and examinations before they conduct  a compliance review. According to FMCSA officials, investigators then  receive on-the-job training, in which they accompany an experienced  investigator during compliance reviews. Investigators can also take  additional classroom training on specialized topics throughout their  careers.
section_title: FMCSA Investigators Use an Information System to Document the Results of Compliance Reviews
paragraphs: FMCSA’s documentation of compliance reviews meets our standards for  internal control. These standards state that all transactions and other  significant events should be clearly and promptly documented, and the  documentation should be readily available for examination. FMCSA and  state investigators use an information system to document the results of  their compliance reviews, including information on crashes and any  violations of the safety regulations that they identify. This documentation  is readily available to FMCSA managers, who told us that they review it to  help ensure completeness and accuracy. FMCSA officials told us that the  information system also helps ensure thoroughness and consistency by  prompting investigators to follow FMCSA’s policies and procedures, such  as requirements to meet a minimum sample size. The information system  also includes checks for consistency and reasonableness and prompts  investigators when the information they enter appears to be inaccurate.  FMCSA said managers may assess an investigator’s thoroughness by  comparing the rate of violations the investigator identified over the course  of several compliance reviews to the average rate for investigators in their  division office; a rate that is substantially below the average suggests  insufficient thoroughness.
section_title: FMCSA Monitors the Performance of Its Compliance Reviews and Has Taken Actions to Address Identified Issues
paragraphs: FMCSA’s performance measurement and monitoring of its compliance  review activities meet our standards for internal control. These standards  state that managers should compare actual performance to planned or  expected results and analyze significant differences. According to FMCSA  and state managers and investigators, the managers review all compliance  reviews in each division office and state to ensure thoroughness and  consistency across investigators and across compliance reviews. The  investigators we spoke with generally found these reviews to be helpful,  and several investigators said that the reviews helped them learn policies  and procedures and ultimately perform better compliance reviews.
In addition to assessing the performance of individual investigators,  FMCSA periodically assesses the performance of FMCSA division offices  and state agencies and conducted an agencywide review of its compliance  review program in 2002. According to officials at one of FMCSA’s service  centers, the service centers lead triennial reviews of the compliance  review and enforcement activities of each division office and its state  partner. These reviews assess whether the division offices and state  partners are following FMCSA policies and procedures, and they include  an assessment of performance data for items such as the number of  compliance reviews conducted, rate of violations identified, and number  of enforcement actions taken. The officials said that some reviews identify  instances in which division offices have deviated from FMCSA’s  compliance review policies but that only minor adjustments by the  division offices are needed. The officials also said that the service centers  compile best practices identified during the reviews and share these  among the division offices and state partners.
FMCSA’s review also concluded that most investigators were not  following FMCSA’s policy requiring them to perform vehicle inspections as  part of a compliance review if the carrier had not already received the  required number of roadside vehicle inspections. Since conducting its  2002 review, FMCSA changed its policy so that inspecting a minimum  number of vehicles is no longer a strict requirement—if an investigator is  unable to inspect the minimum number of vehicles, he or she must explain  why in the compliance review report.
section_title: Each of the Major Applicable Areas of the Safety Regulations Is Consistently Covered by Most Compliance Reviews
paragraphs: From fiscal year 2001 through fiscal year 2006, each of the nine major  applicable areas of the safety regulations was consistently covered by  most of the approximately 76,000 compliance reviews conducted by  FMCSA and the states. (See table 3.) For the most part, 95 percent or more  of the compliance reviews covered each major applicable area in the  agency’s safety regulations.
An FMCSA official told us that not every compliance review is required to  cover these nine areas. For example, follow-up compliance reviews of  carriers rated unsatisfactory or conditional are sometimes streamlined to  cover only the one or a few areas of the regulations in which the carrier  had violations. As another example, minimum insurance coverage  regulations apply only to for-hire carriers and private carriers of hazardous  materials; they do not apply to private passenger and nonhazardous  materials carriers.
However, according to an FMCSA official, the area of these regulations  that had the lowest rate of coverage—vehicle parts and accessories  necessary for safe operation—is required for all compliance reviews  except streamlined reviews. Vehicle inspections are supposed to be a key  investigative technique for assessing compliance with this area, and an  FMCSA official said that the lower rate of coverage for the parts and  accessories area likely reflects the small number of vehicle inspections  that FMCSA and the states conduct during compliance reviews.
section_title: FMCSA Follows Up with Many Carriers with Serious Safety Violations but Does Not Assess Maximum Fines for All of the Violations Required by Law
paragraphs: Our preliminary assessment is that FMCSA placed many carriers rated  unsatisfactory in fiscal year 2005 out of service and followed up with  nearly all of the rest to determine whether they had improved. In addition,  FMCSA monitors carriers to identify those that are violating out-of-service  orders. However, it does not take additional action against many violators  of out-of-service orders that it identifies. Furthermore, FMCSA does not  assess maximum fines against all carriers, as we believe the law requires,  partly because FMCSA does not distinguish between carriers with a  pattern of serious safety violations and those that repeat a serious  violation.
subsections: section_title: FMCSA Followed Up with Almost All Carriers That Received a Proposed Safety Rating of Unsatisfactory
paragraphs: FMCSA followed up with at least 1,189 of 1,196 carriers (99 percent) that  received a proposed safety rating of unsatisfactory following compliance  reviews completed in fiscal year 2005. These follow-ups resulted in either  upgraded safety ratings or the carriers being placed out of service.  Specifically,    Based on follow-up compliance reviews, FMCSA upgraded the final safety  ratings of 658 carriers (325 to satisfactory and 333 to conditional).
FMCSA assigned a final rating of unsatisfactory to 309 carriers. FMCSA  issued out-of-service orders to 306 of these carriers. An FMCSA official  told us that it did not issue out-of-service orders to the remaining three  carriers either because the agency could not locate them or because the  carrier was still subject to an out-of-service order that FMCSA issued  several years prior to the 2005 compliance review.
After FMCSA reviewed evidence of corrective action submitted by  carriers, it upgraded the final safety ratings of 214 carriers (23 to  satisfactory and 191 to conditional).
Due to an error in assigning the proposed safety rating to one carrier,  FMCSA upgraded its final safety rating to conditional.
For the remaining 14 carriers, FMCSA did not (1) provide us information  on whether and how it followed up with 7 carriers in time for us to  incorporate it in this statement and (2) respond to our request to clarify its  follow-up approach for another 7 carriers in time for us to incorporate it in  this statement.
Under its policies, FMCSA is generally required to assign the carrier a final  rating of unsatisfactory and to issue it an out-of-service order after either  45 or 60 days, depending on the nature of the carrier’s business. Of the  about 300 out-of-service orders that FMCSA issued to carriers rated  unsatisfactory following compliance reviews conducted in fiscal year 2005,  FMCSA told us that 89 percent were issued on time, 9 percent were issued  between 1 and 10 days late, and 2 percent were issued more than 10 days  late. We are working with FMCSA to verify these numbers. An FMCSA  official told us that in the few instances where an out-of-service order was  issued more than 1 week late, the primary reason for the delay was that  the responsible FMCSA division office had difficulty scheduling follow-up  compliance reviews and thus held off on issuing the orders.
section_title: FMCSA Monitors Carriers to Identify Those That Are Violating Out-of-Service Orders, but It Does Not Take Additional Action against Many of the Violators It Identifies
paragraphs: FMCSA uses two primary means to try to ensure that carriers that have  been placed out of service do not continue to operate. First, FMCSA  partners with states to help them suspend, revoke, or deny vehicle  registration to carriers that have been placed out of service. FMCSA refers  to these partnerships as the Performance and Registration Information  Systems Management program (PRISM). PRISM links FMCSA databases  with state motor vehicle registration systems and roadside inspection  personnel to help identify vehicles operated by carriers that have been  issued out-of-service orders. As of January 2007, 45 states had been  awarded PRISM grants and 27 states were operating with PRISM  capabilities.
Second, FMCSA monitors carriers for indicators—such as roadside  inspections, moving violations, and crashes—that they may be violating an  out-of-service order and visits some of the suspect carriers to examine  their records to determine whether they did indeed violate the order.  FMCSA told us it is difficult to detect carriers operating in violation of out- of-service orders because its resources do not allow it to visit each carrier  or conduct roadside inspections on all vehicles, and we agree. In fiscal  years 2005 and 2006, 768 of 1,996 carriers (38 percent) that were subject to  an out-of-service order had a roadside inspection or crash; FMCSA cited  only 26 of these 768 carriers for violating an out-of-service order. An  FMCSA official told us that some of these carriers, such as carriers that  were operating intrastate or that had leased its vehicles to other carriers,  may not have been violating the out-of-service order. He said that FMCSA  did not have enough resources to determine whether each of the carriers  was violating an out-of-service order.
section_title: FMCSA Conducted Compliance Reviews on About Half of All High-risk Carriers That It Was Required to By Statute
paragraphs: From August 2006 through February 2007, FMCSA data indicate that the  agency performed compliance reviews on 1,136 of the 2,220 (51 percent)  carriers that were covered by its mandatory compliance review policy.  The Safe, Accountable, Flexible, Efficient Transportation Equity Act: A  Legacy for Users act requires that FMCSA conduct compliance reviews on  carriers rated as SafeStat category A or B for 2 consecutive months. In  response to this requirement, FMCSA implemented a policy in June 2006  requiring a compliance review within 6 months for any such carrier unless  the carrier had received a compliance review within the previous 12  months. An FMCSA official told us that the agency did not have enough  resources to conduct compliance reviews on all of the 2,220 carriers  within 6 months.
In April 2007, FMCSA revised the policy because it believes that it required  compliance reviews for some carriers that did not need them, leaving  FMCSA with insufficient resources to conduct compliance reviews on  other carriers that did need them. Specifically, FMCSA believes that  carriers that had already had a compliance review were targeted  unnecessarily after they had corrected identified violations, but these  violations continued to adversely affect their SafeStat rating because  SafeStat penalizes carriers for violations regardless of whether they have  been corrected. The new policy requires compliance reviews within 6  months for carriers that have been in SafeStat category A or B for 2  consecutive months and received their last compliance 2 or more years  ago (or have never received a compliance review) and offers some  discretion to FMCSA division offices. For example, division offices can  decide not to conduct a compliance review if its SafeStat score is based  largely on violations that have been corrected or on accidents that  occurred prior to the carrier’s last compliance review. We believe that  these changes are consistent with the act’s requirement and give FMCSA  appropriate discretion in allocating its compliance review resources.
section_title: FMCSA Does Not Assess Maximum Fines for All the Violations Required by Law
paragraphs: FMCSA does not assess the maximum fines against all carriers as we  believe the law requires. The law requires FMCSA to assess the maximum  allowable fine for each serious violation by a carrier that is found (1) to  have committed a pattern of such violations (pattern requirement) or (2)  to have previously committed the same or a related serious violation  (repeat requirement). However, FMCSA’s policy on maximum fines does  not fully meet these requirements. FMCSA enforces both requirements  using what is known as the “three-strikes rule,” applying the maximum  allowable fine when it finds that a motor carrier has violated the same  regulation three times within a 6-year period. FMCSA officials said they  interpret both parts of the act’s requirements to refer to repeat violations,  and because they believe that having two distinct policies on repeat  violations would confuse motor carriers, it has chosen to address both  requirements with its single three-strikes policy.
FMCSA’s interpretation does not carry out the statutory mandate to  impose maximum fines in two different cases. In contrast to FMCSA, we  read the statute’s use of the distinct terms “a pattern of violations” and  “previously committed the same or a related violation” as requiring  FMCSA to implement two distinct policies. A basic principle of statutory  interpretation is that distinct terms should be read as having distinct  meanings. In this case, the statute not only uses different language to refer  to the violations for which maximum fines must be imposed but also sets  them out separately and makes either type of violation subject to the  maximum penalties. Therefore, one carrier may commit a variety of  serious violations and another carrier may commit the same or a  substantially similar serious violation as a previous violation; the language  on its face requires FMCSA to assess the maximum allowable fine in both  situations—patterns of violations as well as repeat offenses.
FMCSA could define a pattern of serious violations in numerous ways that  are consistent with the act’s pattern requirement. Our assessment of eight  potential definitions shows that the number of carriers that would be  subject to maximum fines depends greatly on the definition. (See table 4.)  For example, a definition calling for two or more serious violations in each  of at least four different regulatory areas during a compliance review  would have made 38 carriers subject to maximum fines in fiscal year 2006.  In contrast, a definition calling for one or more serious violations in each  of at least three different regulatory areas would have made 1,529 carriers  subject to maximum fines during that time.
We also interpret the statutory language for the repeat requirement as  calling for a “two-strikes” rule as opposed to FMCSA’s three-strikes rule  interpretation. FMCSA’s interpretation imposes the maximum fine only  after a carrier has twice previously committed such violations. The  language of the statute does not allow FMCSA’s interpretation; rather, it  requires FMCSA to assess the maximum allowable fine for each serious  violation against a carrier that has previously committed the same serious  violation.
In fiscal years 2004 through 2006, more than four times as many carriers  had a serious violation that constituted a second strike than carriers that  had a third strike. (See table 5.) For example, in fiscal year 2006, 1,320  carriers had a serious violation that constituted a second strike, whereas  280 carriers had a third strike.
Carriers that commit a pattern of violations may also commit a second  strike violation. For example, three of the seven carriers that had two or  more serious violations in each of at least five different regulatory areas  also had a second strike in fiscal year 2006. Were FMCSA to make policy  changes along the lines discussed here, we believe that the new policies  should address how to deal with carriers with serious violations that both  are part of a pattern and repeat the same or similar previous violations.
Mr. Chairman, this concludes my prepared statement. I would be pleased  to respond to any questions that you or other Members of the  Subcommittee might have.
section_title: GAO Contacts and Staff Acknowledgement
paragraphs: For further information on this statement, please contact Susan Fleming at  (202) 512-2834 or flemings@gao.gov. Individuals making key contributions  to this testimony were David Goldstein, Eric Hudson, and James  Ratzenberger.
section_title: Related GAO Products
paragraphs: Motor Carrier Safety: A Statistical Approach Will Better Identify  Commercial Carriers That Pose High Crash Risks Than Does the  Current Federal Approach. GAO-07-585. Washington, D.C.: June 11, 2007.
Unified Motor Carrier Fee System: Progress Made but Challenges to  Implementing New System Remain. GAO-07-771R. Washington, D.C.: May  25, 2007.
Consumer Protection: Some Improvements in Federal Oversight of  Household Goods Moving Industry Since 2001, but More Action Needed  to Better Protect Individual Consumers. GAO-07-586. Washington, D.C.:  May 16, 2007.
Transportation Security: DHS Efforts to Eliminate Redundant  Background Check Investigations. GAO-07-756. Washington, D.C.: April  26, 2007.
Truck Safety: Share the Road Safely Pilot Initiative Showed Promise, but  the Program’s Future Success Is Uncertain. GAO-06-916. Washington,  D.C.: September 8, 2006.
Federal Motor Carrier Safety Administration: Education and Outreach  Programs Target Safety and Consumer Issues, but Gaps in Planning  and Evaluation Remain. GAO-06-103. Washington, D.C.: December 19,  2005.
Large Truck Safety: Federal Enforcement Efforts Have Been Stronger  Since 2000, but Oversight of State Grants Needs Improvement. GAO-06- 156. Washington, D.C.: December 15, 2005.
Highway Safety: Further Opportunities Exist to Improve Data on  Crashes Involving Commercial Motor Vehicles. GAO-06-102. Washington,  D.C.: November 18, 2005.
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