Page 19 - ATR 2 2013

Pay to Play

Carriers now brokers when subcontracting freight

by steve brawner
Contributing Writer

Under the Moving Ahead for
Progress in the 21 Century Act, MAP-
st
21, motor carriers must register as
brokers effective Oct. 1. They also must
have a staff member with three years of
relevant brokering experience, or they
must prove they have the equivalent.
Brokers must also post a $75,000 bond
when they subcontract work to another
carrier.
The provision applies only when
a carrier brokers but never touches
the freight. According to the Federal
Motor Carrier Safety Administration
(FMSCA), the practice of interlining,
where the carrier handles part of the
haul and then contracts with another
carrier for the rest, does not require
bonding authority.
However, this new law has about 30
state trucking associations up in arms.
Efforts are underway to repeal these
broker requirements. The Arkansas
Trucking Association is not among
them. Its board voted to support the law pays the carrier and closes down. And “The membership had for years
with some changes. the $10,000 bond amount was really tried to get an increase in the broker
The $10,000 amount encour- not a deterrent from that practice.” bond and agreed that this was the best
aged fraudulent behavior, according Carriers subcontracting freight opportunity to do it,” Sharma said.
to Prasad Sharma, American Trucking with other carriers without brokering The $75,000 figure was the
Associations (ATA) general counsel. authority is a longstanding industry result of a compromise involving the
“We’ve long supported an increase practice, but according to Sharma, its Transport Intermediaries Association,
in raising the broker bond amount,” he legality under previous law was ques- which has about 1,300 member bro-
said. “Particularly our smaller carriers, tionable. MAP-21, he said, clarified the kers, the Owner-Operator Independent
they use brokers pretty frequently and law while increasing the bond amount Drivers Association (OOIDA) and ATA.
have experienced increasingly growing — a goal long sought by carriers. Trucking groups originally had hoped
problems with the broker that sets up The ATA’s Policy Committee and for $500,000. MAP-21 requires FMCSA
shop, handles out a bunch of loads, gets the Executive Committee both voted to
the money from the shipper, but never endorse the proposal last year. 

arkansas Trucking rePorT | issue 2 2013 19