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Hazardous Materials Safety Permit (HMSP) Program: Amendment to Enforcement Policy

American Government Special Collections Reference Desk

American Government Topics:  Autoliv

Hazardous Materials Safety Permit (HMSP) Program: Amendment to Enforcement Policy

T.F. Scott Darling, III
Federal Motor Carrier Safety Administration
June 19, 2015


[Federal Register Volume 80, Number 118 (Friday, June 19, 2015)]
[Rules and Regulations]
[Pages 35253-35255]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2015-15091]


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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 385


Hazardous Materials Safety Permit (HMSP) Program: Amendment to 
Enforcement Policy

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

ACTION: Amendment to enforcement policy.

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SUMMARY: Section 33014 of the Moving Ahead for Progress in the 21st 
Century Act (MAP-21) required the Secretary of the U.S. Department of 
Transportation (DOT) to conduct a study and submit a report to Congress 
on the implementation of the DOT Hazardous Materials Safety Permit 
(HMSP) program. DOT completed the study and submitted a report to 
Congress in March 2014. This document announces implementation of two 
of the six recommendations in the report to Congress: Fully utilize the 
Safety Measurement System (SMS) as part of the HMSP review process and 
institute an ongoing requirement to conduct compliance reviews for HMSP 
motor carriers with insufficient data to utilize SMS. These 
recommendations are being implemented under the existing Safety Fitness 
Procedure regulations. FMCSA will use SMS scores to provide enhanced 
oversight of HMSP holders, to identify poor-performing carriers for a 
safety fitness compliance review, and to provide grounds for suspension 
or revocation. Both of these processes afford the motor carrier the 
right to administrative review and the opportunity to present 
corrective action.

DATES: The changes to the enforcement policy will take effect on August 
18, 2015.

FOR FURTHER INFORMATION CONTACT: Mr. Paul Bomgardner, (202) 493-0027, 
or Paul.Bomgardner@dot.gov, Chief of the Hazardous Materials Division, 
Office of Enforcement and Compliance, Federal Motor Carrier Safety 
Administration, 1200 New Jersey Ave. SE., Washington, DC 20590. Office 
hours are from 9 a.m. to 5 p.m., E.T., Monday through Friday, except 
for Federal holidays.

SUPPLEMENTARY INFORMATION:

Background

    On January 1, 2005, the Federal Motor Carrier Safety Administration 
(FMCSA) began the HMSP program for intrastate, interstate, and foreign 
motor carriers transporting specified types and amounts of particularly 
dangerous hazardous material. HMSPs are required for a small subset of 
motor carriers transporting the following DOT-regulated hazardous 
material:
    1. Highway Route Controlled Quantity (HRCQ) of a Class 7 
(radioactive) material;
    2. More than 55 pounds of a Division 1.1, 1.2, or 1.3 Explosive, or 
an amount of a Division 1.5 material requiring placarding;
    3. Certain Poison by Inhalation Hazard (PIH) materials, including 
anhydrous ammonia, and
    4. Compressed or refrigerated liquefied methane or liquefied 
natural gas in packaging equal to or greater than 3,500 water gallons.
    FMCSA's Motor Carrier Management Information System (MCMIS) 
contains records for approximately 525,000 active interstate motor 
carriers operating in the United States. MCMIS records show almost 
11,000 interstate and intrastate motor carriers that have had an 
inspection indicating that they transport hazardous material requiring 
placards.\1\ Approximately 1,500 motor carriers possess an HMSP.
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    \1\ See: 49 CFR part 172 Subpart F--Placarding
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    The HMSP program is based on the premise that carriers transporting 
certain amounts of particularly dangerous hazardous material must 
maintain a higher minimum level of safety in their operations than 
other carriers and must additionally demonstrate compliance with the 
critical regulatory requirements in the DOT Hazardous Materials 
Regulations (HMR), 49 CFR parts 171-180, and Federal Motor Carrier 
Safety Regulations (FMCSR), 49 CFR parts 350-399. Under FMCSA's current 
program, in order to obtain or renew a HMSP, a carrier must demonstrate 
that it meets the following regulatory requirements specified in the 
FMCSR at 49 CFR 385.407 and 387.7:
    1. Maintains the minimum level of financial responsibility required 
by 49 CFR part 387.
    2. Maintains current Pipeline and Hazardous Materials Safety 
Administration (PHMSA) registration.
    3. Certifies that it has security and communications plans that 
comply with 49 CFR part 172 of the HMR and 49 CFR part 385 of the 
FMCSR.
    4. Is assigned a ``satisfactory'' safety fitness rating.
    5. Additionally, at the time of initial application and renewal, 
the carrier's crash and inspection records in MCMIS for the prior 12 
month period may not exceed the threshold rate established by FMCSA, 
based on crash and out-of-service rates for the hazardous material 
motor carrier industry, indicating that the carrier has:
    a. A crash rate in the ``top 30 percent of the national average,'' 
or
    b. A driver, vehicle, hazardous material, or total out-of-service 
(OOS) rate in the ``top 30 percent of the national average.''
    As stated above, section 33014 of MAP-21, Pub. L. 112-141, div. C, 
title III, 126 Stat. 405, 840 (July 6, 2012) (set out as a note to 49 
U.S.C. 5109) required the Secretary to conduct a study and submit a 
report to Congress on the implementation of the DOT's HMSP program. 
Congress further directed the Secretary to include in the study a 
review of ``actions the Secretary could implement to improve the 
program, including whether to provide opportunities for an additional 
level of fitness review prior to the denial, revocation, or suspension 
of a safety permit.'' Finally, section 33014 required the Secretary to 
institute a rulemaking to make any necessary improvements to the HMSP 
program or publish in the Federal Register the Secretary's 
justification for why a rulemaking is not necessary.
    DOT completed the study and submitted its ``Hazardous Materials 
Safety Permit Program Implementation Report'' (HMSP Report) to Congress 
in March 2014. This notice announces implementation of two of the six 
recommendations in the report to Congress: (1) Fully utilize the Safety 
Measurement System (SMS) as part of the HMSP review process and (2) 
institute an ongoing requirement to conduct comprehensive 
investigations for HMSP motor carriers with insufficient data to 
utilize SMS. This Federal Register publication provides notice of the 
Agency's revised interpretation of certain regulations in 49 CFR part 
385, subpart E, in accordance with congressional directives and the 
recommendations in the report to Congress.
    On December 16, 2014, Congress passed the 2015 Omnibus

[[Page 35254]]

Appropriations law entitled, ``Consolidated and Further Continuing 
Appropriations Act, 2015,'' Pub. L. 113-235, 128 Stat. 2130 (Dec. 16, 
2014) which restricts FMCSA's use of appropriated funds ``to deny an 
application to renew a Hazardous Materials Safety Program permit for a 
motor carrier based on that carrier's Hazardous Materials Out-of-
Service rate, unless the carrier has the opportunity to submit a 
written description of corrective actions taken, and other 
documentation the carrier wishes the Secretary to consider, including 
submitting a corrective action plan, and the Secretary determines the 
actions or plan is insufficient to address the safety concerns that 
resulted in that Hazardous Materials Out-of- Service rate.'' Pub. L. 
113-235, div. K, Title I, Sec.  134. By using SMS scores to identify a 
HMSP holder for a safety fitness review, the Agency, while complying 
with this congressional limitation, will ensure that transportation of 
the hazardous materials specified in 49 CFR 385.403 does not present an 
undue safety risk to the public.
    FMCSA provides notice herein that the Agency is distinguishing the 
requirements for issuance of an initial HMSP as specified in 49 CFR 
385.407, from the requirements for HMSP renewal, as specified in 49 CFR 
385.419. Distinguishing these requirements, as discussed below, enables 
the Agency to more actively monitor an HMSP holder's safety and 
compliance status, while providing more flexibility to HMSP holders 
attempting to correct identified deficiencies. Pursuant to the 2015 
spending restriction, the Agency is no longer denying HMSP renewals 
based on a carrier's unacceptable hazardous materials out-of-service 
rate. Upon the effective date of this notice, the Agency will no longer 
deny a HMSP holder's application for renewal of its HMSP based on a 
crash rate, driver, vehicle, hazardous material or total out-of-service 
rate that is in the top, or worst-performing, 30 percent of the 
national average.
    New applicants for HMSPs, which includes any applicant that is not 
a current HMSP holder, and holders of temporary HMSPs (T-HMSP) will 
continue to be subject to the established crash, driver, vehicle, 
hazardous material or total out-of-service threshold rates in order to 
qualify for the initial issuance of a HMSP. The requirement that new 
applicants not have a crash rate or a driver, vehicle, hazardous 
material, or total out-of-service (OOS) rate for the prior 12 months, 
as shown below, remains unchanged:
    a. A crash rate in the ``top 30 percent of the national average,'' 
or
    b. A driver, vehicle, hazardous material or total out-of-service 
(OOS) rate in the ``top 30 percent of the national average.''
    Pursuant to the interpretive rule announced in this Notice, non-
temporary HMSP holders will no longer be required to have crash and OOS 
rates that are below the ``30 percent threshold'' at the time of the 
HMSP holder's two-year renewal. Rather, FMCSA will continually monitor 
these HMSP holders using SMS analysis as a basis for a compliance 
review referral or proposed revocation or suspension based on the 
criteria listed in 49 CFR 385.421. HMSP holders will continue to be 
subject to the renewal provisions in 49 CFR 385.419, which require the 
carrier to submit its biennial update.
    The first recommendation in the HMSP Report to Congress was for 
FMCSA to fully utilize the Agency's SMS to provide continuous 
monitoring of HMSP holders' safety performance in order to determine a 
carrier's continuing suitability to retain or renew a non-temporary 
HMSP. Carriers applying for a six-month T-HMSP will be subject to the 
requirements for initial issuance of a HMSP in Sec.  385.407. Temporary 
HMSPs are issued when a motor carrier meets all of the qualifications 
in Sec.  385.407 except for having a safety rating assigned. If the 
carrier has no safety rating, the T-HMSP is issued, and the motor 
carrier is assigned for a comprehensive investigation within six months 
of the FMCSA field staff being notified. FMCSA may extend the T-HMSP 
for two months, when necessary due to the Agency's inability to 
schedule a comprehensive investigation during the initial six-month 
timeframe. Once the carrier receives a comprehensive investigation, and 
subsequently is assigned a satisfactory safety rating, the carrier is 
eligible for a full, non-temporary HMSP subject to the initial 
requirements in Sec.  385.407. Once the non-temporary HMSP is issued, 
the Agency will place the carrier under the continuous monitoring 
program described herein.
    Non-temporary HMSP carriers will continue to be subject to the 
current intervention thresholds for all carriers of placarded hazardous 
material under the seven Behavior Analysis and Safety Improvement 
Categories (BASIC) in SMS. These intervention thresholds are listed 
below:
     60th percentile for Unsafe Driving, Hours of Service 
Compliance, and Crash Indicator;
     75th percentile for Driver Fitness, Controlled Substances/
Alcohol, and Vehicle Maintenance; and
     80th percentile for Hazardous Material Compliance.
For carriers that have a non-temporary HMSP, FMCSA will review the 
permit holder's SMS scores monthly to determine if the carrier has met 
or exceeded intervention thresholds for either the Hazardous Materials 
Compliance BASIC (HM BASIC) or met or exceeded thresholds for any two 
of the other BASICs for the preceding two consecutive months. If the 
carrier meets or exceeds the HM BASIC or meets or exceeds thresholds of 
any other two BASICs over a consecutive two-month period, FMCSA will 
identify the carrier for investigation with hazardous material 
compliance emphasis. Using the monthly data provides a more powerful 
tool for identifying the HMSP carriers that have overall compliance 
problems, warranting a comprehensive investigation, or issues in one 
particular area of safety performance (i.e., crash rate, driver, 
vehicle, or hazardous material). A comprehensive investigation will 
entail a full-rated review that will also determine whether the carrier 
meets the safety fitness requirement in 49 CFR 385.421(a)(3).
    The SMS approach provides a strengthened, continuous monitoring 
process for HMSP holders, which merit heightened oversight and 
monitoring due to the dangerous nature of the materials they transport. 
SMS monitoring further allows the Agency to expeditiously identify 
carrier problems and better focus on specific areas that the carrier 
must address immediately, in order to avoid potential suspension or 
revocation of its HMSP under 49 CFR 385.421(a).
    If a carrier fails to comply with the applicable regulations, or an 
order issued under those regulations, indicating that the carrier is 
not fit to transport hazardous material that requires a HMSP, such 
conduct could similarly trigger a proposed suspension or revocation 
under Sec.  385.421(a)(5), (6), (7), (8), or (10). It should be noted 
that a proposed suspension or revocation under 385.421(a)(5) would be 
based on serious instances of non-compliance, a less than satisfactory 
safety rating, or loss of operating authority. The proposed suspension 
or revocation would be subject to the 30-day notice requirement in 
Sec.  385.421(c)(2), and the carrier would have an opportunity to take 
corrective action and/or to apply for administrative review under Sec.  
385.423 before FMCSA took final action.

[[Page 35255]]

    If a carrier's non-temporary HMSP is denied, suspended or revoked 
pursuant to Sec.  385.421, the carrier will have various options for 
seeking administrative review and providing evidence of corrective 
action. If the suspension or revocation is based on a less than 
satisfactory safety rating, the carrier may request administrative 
review of the proposed rating under Sec.  385.15, or may request 
upgrade of a proposed safety rating based on corrective action under 
Sec.  385.17, as provided in Sec.  385.423(a). The carrier may seek 
administrative review of other grounds for a proposed suspension or 
revocation as provided in Sec.  385.423(c). A proposed suspension or 
revocation under Sec.  385.421(c)(2) will not become effective during 
the pendency of a request for administrative review that is timely-
filed during the 30-day timeframe from the date of service of the 
written notice of proposed suspension or revocation. The 30-day 
effective date and the tolling of this date by a request for 
administrative review of proposed suspensions or revocations that are 
not related to a less than satisfactory safety rating allows the 
carrier time to take and submit evidence of corrective action.
    The second recommendation in the HMSP Report to Congress was for 
FMCSA to institute an ongoing requirement to more closely monitor HMSP 
carriers with insufficient SMS data--that is, HMSP carriers that rarely 
undergo roadside inspections and have a safety rating over 4 years old. 
Because of the lack of information and oversight on these carriers, 
FMCSA will conduct comprehensive investigations for HMSP carriers when 
the carrier has insufficient data to calculate a percentile in SMS 
during any month of the previous 48-month period. HMSP carriers will 
not be allowed to operate for more than four years without either 
having enough safety performance data to confirm compliance, or having 
received a compliance review that results in a satisfactory rating. By 
instituting a specific 4-year investigation cycle for non-temporary 
HMSP carriers with insufficient safety data, these carriers will become 
subject to increased oversight.
    These changes will be effective August 18, 2015.

    Issued on: June 8, 2015.
T.F. Scott Darling, III,
Chief Counsel.
[FR Doc. 2015-15091 Filed 6-18-15; 8:45 am]
 BILLING CODE 4910-EX-P

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