OKLAHOMA ACTS TO REGULATE SAFETY OF PRIVATE CARRIERS

OKLAHOMA ACTS TO REGULATE SAFETY OF PRIVATE CARRIERS

Oklahoma, prevented by federal law from overseeing intrastate commercial freight, is trying to regulate its intrastate private carriers under the banner of public safety.

Oklahoma shippers operating private fleets insist that they are not in the trucking business. Their private fleets are simply part of their operations, whether it be manufacturing, retailing, service, warehousing or distribution.The Oklahoma Corporation Commission on Aug. 14 proposed that private fleet carriers operating within the Sooner State provide proof of insurance before obtaining an annual intrastate operating license. The licenses would have to be renewed every year.

It is the first time the state has chosen to regulate private fleet carriers, Bill Hobbs, traffic manager at Farm Fresh Bakery Inc. in Lawton, Okla.

Under the Trucking Industry Regulatory Reform Act of 1994 (Tirra), 41 states, including Oklahoma, lost their authority to dictate routes and rates that for-hire truckers could use within their borders on Jan. 1.

This move in effect put scores of regulatory and compliance officials out of work at many state transportation departments and public service commissions. Many see Oklahoma's new regulations as a way to justify continuing oversight in some areas of intrastate trucking.

Tirra did not eliminate the right of states to continue regulation of safety and insurance programs, including carrier inspections and requirements. States still can require that truckers supply states with safety and insurance records.

Under Oklahoma's proposal, private fleets operating vehicles in excess of 26,000 pounds and hauling non-hazardous commodities must have minimum insurance of $350,000 while those hauling hazardous materials must post proof of $5 million coverage.

The purpose is to protect Oklahoma's public interest, environment and highways and ensure compliance with state safety, size and weight laws, the agency said.

But these new rules are both unnecessary and redundant, said Jim Magner, manager of government affairs for the National Private Fleet Council in Washington. Private carriers have long demonstrated that they are self- policing when it comes to insurance, he said.

"These manufacturers, distributors, retailers, grocers and service companies are unable to function without adequate liability insurance. Pure and simple, it is a prerequisite to doing business," Mr. Magner said.

He added no evidence exists that suggest that private fleet operators in Oklahoma pose a greater risk for accidents than they have in the past nor are there any grounds to imply that they would be less able to cover their exposure in the event of an incident.

If the new regulations are approved, they will force Howard Drilling Co. in Beaver, Okla., to spend $40,000 to switch its 500-gallon diesel tanks aboard 50 trailers to two 200-gallon trailer-mounted tanks to avoid a hazardous materials rating.

"I don't need a $5 million rider," said Alva Howard, president and co- owner.

He said the new rules ultimately will cost him and other private fleet owners money in compliance fees.

The corporation commission added that any private fleet carrier applying for licenses would be exempt from a public hearing on the matter, providing they have a current satisfactory U.S. Department of Transportation safety rating, the agency said.

In addition to the insurance requirements, all private carriers would have to mark their equipment with identification and domicile city.