Fuel surcharge bill gains valuable support
At the House of Representatives' ground transportation subcommittee June 8, opponents of a mandatory fuel surcharge bill were largely silenced by the support that HR 4441 received. As OOIDA helped gain support for the bill, members of the press went so far as to say the bill's opponents received "a shellacking."

During the hearing, propo nents of the bill appeared to gain favor with subcommittee members. Rep. Nick Rahall (D-WV), sponsor of the Motor Carrier Fuel Cost Equity Act of 2000, was quick to shoot holes in the opposition's arguments. And Todd Spencer (executive vice president of OOIDA) provided support from the owner-operator's point of view.

"Small business truckers have been the hardest hit by this year's rapid increase in diesel fuel prices," Spencer told the subcommittee. "Many have lost their trucks and are going out of business. As of today, small business truckers have received no relief from the current fuel crisis, fuel prices remain high, and could shoot higher at any time."

Spencer also stressed that recent hikes in the price of fuel have left many trucks (and truckers) by the side of the road.

"Other drivers are forcing themselves to drive more miles and longer hours to keep revenue up," he said. "There is the potential that lower incomes will affect the motor carriers' ability to maintain their equipment. Many drivers who have been forced to quit the trucking business have been those with the most experience and were therefore some of the safest drivers on the highway. They will be replaced by inexperienced drivers who themselves will face the same obstacles to success."

Aimed at providing truckers with some financial relief when fuel prices soar, HR 4441 was introduced in May by Rep. Nick Rahall (D-WV). Rep. Roy Blunt (R-MO) co-sponsored the bill.

HR 4441 mandates that during periods of time when fuel prices rise quickly, a minimum fuel surcharge be imposed on all truckload shipments by truckload carriers, brokers and freight forwarders. The bill also requires that all fuel surcharges be passed through in their entirety to the party responsible for paying the cost of fuel. In this manner, no truckload carrier will be at a competitive disadvantage by imposing a fuel surcharge to recoup the increased costs in fuel.

During the hearing, opponents of HR 4441 spoke out against a mandatory fuel surcharge. Groups like the National Industrial Transportation League, the National Small Shipments traffic Conference and the Transportation Intermediaries Association argued that the bill could be likened to a re-regulation of the industry.

"The proposal is flatly inconsistent with two decades of legislation reducing economic regulation of the motor carrier industry," said Kathy Luhn, vice president of public affairs for NIT. "(It) is an unwarranted and unnecessary interference in the marketplace."

Spencer countered these arguments, saying that a fuel surcharge is not a new concept. The first legislation mandating a fuel surcharge was passed in 1974. Recognizing a crisis, Congress was able to approve that bill in three days.

"We are not coming for a government handout, not asking for you to solve the problems of the world oil market, not asking for re-regulation of the trucking industry, and not proposing any new radical idea," he indicated. "We are asking for a tried and tested response to the fuel crisis: a surcharge, to cover sharp increases in the price of fuel, paid for by the transportation customers for whose benefit diesel fuel is burned and freight is moved."

Members of the committee, including Chairman Thomas Petri (R-WI), weren't buying into the re-regulation argument. Rahall pointed out that TIA was being hypocritical in its criticism of trucking re-regulation, as TIA is part of a coalition seeking to strengthen federal regulation of the railroad industry.

Robert Pulley, a representative from TIA appeared flustered at Rahall's remark, stating simply, "I am confused."

Several OOIDA members also joined in the hearings, showing their support for HR 4441. In his testimony, OOIDA member Dorsey Musselman brought to light the financial ruin many owner-operators have suffered at the hands of OPEC's price fixing tactics.

"Most (truckers) have had to dig into their savings to stay in business," he said. "You cannot look at the trucking industry and convince any of us that there is a booming economy out there. Prosperity has not reached the independent trucker."

Similarly, OOIDA member Debra Mordus, president of Black Ribbon Express Trucking, told the subcommittee that this financial burden is moving into other areas of the private sector. Black Ribbon Express lost 14 of their 31 trucks, due to amazingly - high fuel costs.

"Even the lending companies are feeling the effects of the fuel cost rise," she noted. "They do not want any more equipment. They have told us they are already repossessing year 2000 equipment-some (trucks) with as few as 40,000 miles. Now is the time to help - not a couple of years from now, but right now."

HR 4441 - not the first time Rahall has gone to bat for American workers

When U.S. Congressman Nick J. Rahall II introduced fuel surcharge legislation (HR 4441) in May, the action offered a glimpse of hope for tens of thousands of small business truckers. However, it could not have been much of a surprise to those who know him. Rahall is known on Capitol Hill and in his home state of West Virginia as a fighter for sensible reforms.

He has successfully sponsored legislation that has boosted highway funding and reformed the federal onshore oil and gas leasing system. He is known as a tireless fighter for the Appalachia Regional Commission, black lung benefits, veterans benefits and coal mine health and safety issues. As the Ranking Democrat on the Subcommittee on Surface Transportation, Rep. Rahall was a sponsor and instrumental in gaining the enactment of the landmark legislation known as "TEA 21" to reauthorize federal highway and transit programs through the year 2003. This "transportation efficiency act" extends "ISTEA" programs for a six year period at a considerably higher level of funding and initiates several new programs to improve the infrastructure.

Rahall, former broadcast executive from Beckley, WV, has been knocking around the halls of Congress since 1976, when he was elected to the U.S. House of Representatives at age 27. Now in his 12th term, Rahall is the 33rd most senior member of the house and is the dean of the West Virginia delegation to the U.S. House.

When he introduced HR 4441 on May 11, Rahall quoted OOIDA President Jim Johnston's words - "if we don't fix this problem soon, and truckers continue to lose their businesses or refuse to drive unprofitably, we are going to see greater disruptions in our economy as goods do not get to market and just-in-time deliveries to manufacturers cease to arrive 'just in time.'"

The bill is a bipartisan effort, being co-sponsored by U.S. Rep. Roy Blunt (R-MO). 

-Sandi Soendker