[Federal Register Volume 77, Number 124 (Wednesday, June 27, 2012)]
[Rules and Regulations]
[Pages 38215-38217]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-15740]



Federal Motor Carrier Safety Administration

49 CFR Part 385

Change to FMCSA Policy on Calculating and Publicizing the Driver, 
Vehicle, and Hazardous Materials Out-of-Service Rates and Crash Rates

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

ACTION: Notice of amendment to enforcement policy.


SUMMARY: As stated in 49 CFR 385.407, in order for FMCSA to issue a 
hazardous materials safety permit (HMSP), a motor carrier must not have 
a crash rate, or driver, vehicle, or hazardous materials (HM) Out-of-
Service (OOS) rate in the top 30 percentile of the national average.
    The current method for determining the qualifying crash and OOS 
rates under this rule, in effect since the inception of the HMSP 
program, utilizes two years of inspection data from FMCSA's Motor 
Carrier Management Information System (MCMIS) to calculate the OOS 
rates representing the top or worst-performing 30 percent of the 
national average. FMCSA has been recalculating the threshold crash and 
OOS rates every two years, using MCMIS data from the preceding two 
    This notice of amendment explains the new methodology the Agency 
will begin to use to calculate the threshold crash rate and driver, 
vehicle, and HM OOS rates that qualify or disqualify a carrier for HMSP 
issuance. The revised methodology uses eight years of data from MCMIS 
(data from 2003 to 2010) to determine the national average for eligible 
crash and OOS thresholds that qualify for an HMSP. These rates will 
remain static rather than change every two years. The Agency decided 
that crash and OOS rates, which remain static over a longer period of 
time, will improve safety by providing a clearly identifiable standard 
for industry compliance and minimize the burden on motor carriers and 
the HM industry by allowing more appropriate measures that ensure 
eligibility for the HMSP. The calculations of crash and OOS rates in 
this notice of amendment will be implemented immediately and posted to 
FMCSA's Web site. These new static rates will remain in effect until 
further notice.

DATES: Effective Date: This policy amendment becomes effective June 27, 

[email protected] or phone (202) 366-0735; or John Hardridge, at 
[email protected] or or (202) 366-0811. Both staff members may be 
reached at Federal Motor Carrier Safety Administration, Office of 
Enforcement and Program Delivery, 1200 New Jersey Avenue SE., 
Washington, DC 20590. Office hours are from 8:30 a.m. to 5 p.m., EST, 
Monday through Friday, except Federal holidays.

SUPPLEMENTARY INFORMATION: The HMSP requirement became effective for 
motor carriers as of January 1, 2005. Additionally, 49 CFR part 385, 
subpart E identifies which motor carriers must hold a HMSP, and 
establishes the application process for a HMSP. It also specifies the 
need for a carrier's crash rate and driver, vehicle, and HM OOS rates 
to be below the 70th percentile and describes other conditions that 
must be satisfied to qualify for this permit. As specified in Sec.  
385.407(a)(2), FMCSA will not issue a HMSP to a motor carrier having a 
crash rate in the top 30 percent of the national average, or a driver, 
vehicle, HM, or total OOS rate in the top 30 percent of the national 
average, as indicated in MCMIS. The methodologies for calculating these 
rates are posted on the FMCSA Web site www.fmcsa.dot.gov. More 
conditions are set forth in Sec.  385.407 that require a carrier to 
have a Satisfactory safety rating, certify that it has a satisfactory 
security program, and be properly registered with the Pipeline and 
Hazardous Materials Safety Administration (PHMSA). The carrier also is 
required to submit proof of minimum levels of financial responsibility 
as stated in Sec.  387.9.
    Pursuant to 49 CFR 390.19, a motor carrier is required to file its 
MCS-150 form with FMCSA every two years. The application for the HMSP 
was incorporated into the MCS-150 as an expanded version of the form 
entitled ``MCS-150B or Combined Motor Carrier Identification Report and 
HM Permit Application.'' Thus, the HMSP must be renewed every two 
years. Revision to the calculations of the crash and OOS rates will not 
change this requirement.
    On November 7, 2007, FMCSA published a Notice of Enforcement Policy 
(72 FR 62795) explaining the methodology used by the Agency to 
calculate those averages. The rates had been calculated using roadside 
inspection data in MCMIS for both HM and non-HM inspections for driver 
and vehicle OOS rates. For the HM OOS rate, only inspections that 
indicated that HM was present were used. The applicant motor carriers 
needed to have a least three roadside inspections indicated in MCMIS 
for each of the 2-year rate calculation timeframes. For instance, when 
calculating the 2005-2006 registration cycle rates, in order to be 
included in the calculation, a motor carrier would had to have at least 
three roadside inspections during the 2003-2004 time period.
    During the course of the program, the calculated 70th percentile 
OOS thresholds have fluctuated causing uncertainty in the industry. It 
has become increasingly more difficult for a motor carrier to attain or 
retain a HMSP because it must maintain OOS rates below 7.14% for 
drivers, 33.33% for vehicles, and 3.45% for HM. These rates compare 
with the national averages for all motor carriers at 5.51%, 20.72%, and 
4.50% respectively.
    A historical picture of the OOS and crash rates, data from the 
entire eight-year period since the inception of the program, was used 
in the calculations (2003-2010) for the fixed rates. This provides a 
balanced perspective of motor carrier performance over a longer period 
of time and virtually eliminates the short term fluctuations that some 
motor carriers experience. It is also reflective of all of the time 
periods used to calculate rates for the present and three former 
registration periods. The threshold rate calculation included only 
carriers that had at least 12 inspections over the 8 years previously 
described, making this analysis comparable to the 3-inspections-per-
cycle method used in previous calculations. The main difference in the 
fixed-rate calculations when compared to previous 2-year calculations 
is that, due to the number of inspections required during the extended 
timeframe (12), the number of inspections with an HM OOS rate of 0.00% 
decreased. This resulted in raising the overall HM OOS average for the 
population of motor carriers used in the calculation, and while higher, 
it is a more appropriate indicator of placarded motor carriers' 
roadside inspection HM OOS performance.
    In order to calculate the fixed crash rate, a MCMIS snapshot was 
taken on February 24, 2012. The 8-year period was divided into four 2-
year periods reflecting fiscal years (FY) 2003-2004, FY 2005-2006, FY 
2007-2008, and FY 2009-2010. Qualifying motor carriers had at least 2 
crashes in at least one 2-

[[Page 38216]]

year period. Then the number of power units for each qualifying 2-year 
period was captured based on snapshots taken immediately after the end 
of each FY. The crash rate for each 2-year period motor carrier was 
then determined in each time period by taking the number of crashes 
indicated and dividing by the number of power units times two. Finally, 
all carrier/time period combinations were ranked based on crash rate, 
with a resulting crash rate threshold at the 70th percentile of 
    Since this evaluation criterion is a departure from the methods 
used in the previous years of the HMSP program, the OOS rates and 70th 
percentile thresholds have shifted, and in some instances increased 
when compared to previous years. The driver and HM OOS rates are higher 
because the calculations included carriers that have 12 inspections 
over 8 years as opposed to only 3 inspections over 2 years. There are 
more companies with non-zero OOS rates, and thus the 70th percentile is 
higher than what was previously seen with using only 3 inspections over 
a 2-year timeframe. FMCSA sees this as a necessary adjustment to the 
methodology based on experience over the life of the program, that more 
accurately reflects motor carrier inspection activity and performance 
with no diminution of safety.
    Utilizing the methodologies described above, the top (worst-
performing) 30th percentile of the National averages were determined by 
establishing a cut-off at the numerical threshold value located at the 
70th percentile in each category using eight years of data. All 
carriers with a driver, vehicle, or HM OOS rate less than the cut-off 
are considered to be below the National Average for each category, and, 
therefore, eligible for participation in the program. Carriers with a 
driver, vehicle, or HM OOS rate that is equal to or greater than the 
cut-off in each category are in the 30th percentile, or the worst-
performing category, and will be denied an HMSP.
    FMCSA Web sites,www.fmcsa.dot.gov and www.safersys.org/HazMatRates.aspx will continue to provide notice to the regulated 
community on how FMCSA calculates the National averages and threshold 
figures for the top-performing motor carrier population. The new 
threshold rates will remain effective for all future registration 
periods until such time as FMCSA can incorporate eligibility standards 
into the Safety Measurement System. These rates will provide the 
standard for granting or denying HMSPs beginning immediately, and will 
remain in effect until further notice.


    Table 1 below shows the calculated National average cut-off 
threshold rates established for past Registration Cycles and the Fixed 

              Table of Calculated Threshold Rates for Previous Registration Cycles and Fixed Rates
                                                          Driver OOS rate    Vehicle OOS rate     HM OOS rate
         Registration cycles              Crash rate         (percent)          (percent)          (percent)
2005 & 2006.........................              0.125               8.92               33.3               5.88
2007 & 2008.........................              0.125               9.52               33.3               6.06
2009 & 2010.........................              0.125               9.09               33.3               4.76
2011 & 2012.........................              0.114               7.14               33.3               3.45
Fixed Rates.........................              0.136               9.68               33.3               6.82
1. Rates for registration cycles 2005-2006, 2007-2008, and 2009-2010 were calculated on Calendar Year MCMIS
  data. For instance, the 2005-2006 rates were based on CY 2003-2004 data and issued on December 31, 2004, for
  implementation on January 1, 2005.
2. Rates for registration cycle 2011-2012 were calculated using MCMIS Fiscal Year 2009-2010 data and issued on
  September 30, 2010, 90 days prior to implementation on January 1, 2011.

Carriers' Calculation of Their OOS Rates and Crash Rate

    When a motor carrier submits an HMSP application through the MCS-
150B process, FMCSA examines the current one year (12 months) of the 
carrier's crash and OOS data. This policy is consistent with the 
Agency's practice of reviewing one year of motor carrier's records 
during the conduct of a compliance review. The period examined is the 
12 months immediately preceding the date that the application is 
processed in MCMIS. A motor carrier should therefore, calculate its 
vehicle, driver, and HM OOS rates in each of the three categories by 
examining the number of inspections and OOS violations during the 
preceding 12-month period before applying. To determine its OOS rate, 
the carrier would divide the number of OOS inspections by the total 
number of inspections for each category. The resulting figure is the 
motor carrier's OOS rate for that category. For driver and vehicle OOS 
calculations, the carrier should use all inspections, both HM and non-
HM. For the HM OOS calculation, the carrier should use only HM 
inspections. The FMCSA does not consider a single OOS violation in any 
one category to be statistically valid. Thus, OOS rates will be 
calculated only for carriers with more than one OOS violation in the 
previous 12-month period.
    FMCSA likewise examines one year of crash data to determine a 
carrier's crash rate. A motor carrier should divide the number of 
crashes for the previous 12-month period by the total number of power 
units that it operated during that period, prior to applying. For 
example, if a motor carrier had 2 crashes and 10 power units, the crash 
rate would be 0.20 based upon a calculation of (2/10 = 0.20), and would 
thus be ineligible for obtaining an HMSP because the carrier's crash 
rate is above the established 70th percentile of 0.136. FMCSA does not 
consider a single crash to be statistically valid. Thus, crash rates 
will be calculated only for carriers with more than one crash in the 
previous 12-month period.

Upcoming HMSP Program Registration Cycles

    While the rates will remain fixed, motor carriers will still be 
required to update their MCS-150B every two years. The OOS rates in 
this document are effective for the remainder of the current 
registration cycle (January 1, 2011 through December 31, 2012) and all 
2-year registration cycles starting with the cycle that begins on 
January 1, 2013. This method for determining crash and driver, vehicle, 
and HM OOS rates will remain in effect until such time as FMCSA can 
incorporate eligibility standards into the Safety Measurement System or 
otherwise updated through the publication of a notice.

[[Page 38217]]

    Issued on: June 21, 2012.
Anne S. Ferro,
[FR Doc. 2012-15740 Filed 6-26-12; 8:45 am]