The goal of the FMCSA and the idea behind its Safety Management System (“SMS”) is that through better carrier safety management programs, crashes can be prevented. To this end, the FMCSA collects data on the number and frequency of violations of approximately nine hundred different safety regulations. The violations are broken into six categories known as Behavior Analysis and Safety Improvement Categories (“BASICs”). The regulatory violations are then entered into FMCSA’s Motor Carrier Management Information System (“MCMIS”). A seventh BASIC looks at crashes over the preceding two-year period and assigns weight based upon crash severity and length of time since the crash. The SMS then pulls data directly from the MCMIS. The SMS assigns relative weights to each of the BASICs based upon the relevancy of a type of violation to the likelihood of a future crash. The SMS also assigns weight to the frequency of violations. The SMS attempts to group similar carriers together into peer groups, which is largely done by size and type of operations. Within each peer group, the BASICs for each carrier are ranked from low to high, and each carrier is assigned a percentile rank. A high BASIC percentile is less desirable than a lower score within the same peer group. The FMCSA has set thresholds within each BASIC group, that when surpassed, can flag a carrier for further action. The overall goal of the system was to allow the FMCSA to prioritize its enforcement resources toward those carriers the system identified.

Because of the importance of SMS percentiles on a carrier’s operations, many in the industry voiced concerns about how the SMS functions. Hearing these concerns, Congress enacted Sections 5221 and 5223 of the Fixing America’s Surface Transportation (FAST) Act. The FAST Act requires the FMCSA to remove the score from public view and to commission a study to investigate the SMS to evaluate the accuracy and sufficiency of the SMS and to assess whether alternatives would be more effective in identifying high-risk carriers.

The FMCSA commissioned the National Academy of Sciences (“NAS”) to conduct the study. On June 27, 2017, NAS issued a report detailing its findings. Though the study concluded the SMS was not a wholesale analytical catastrophe, NAS determined the program is not based upon a scientific approach. NAS recommended the following improvements:

  1. Develop an item response theory (IRT) model over the next two years. NAS recommends replacing the current SMS with the IRT model if it more effectively identifies higher risk carriers. The study suggest the IRT model will have advantages over the current system, including: incorporating useful aspects from the SMS; enhancing transparency of the system; no more giving weight to certain factors simply because there was a subjective determination a factor should be given more weight; evaluating how data insufficiency could impact safety ratings of carriers; and better categorization of regulatory violations into BASICs.
  2. Improve exposure and crash data. The study determined these are the two most important areas in which improvements can be made to the information collected by MCMIS. NAS recommends the FMCSA undertake to obtain “higher-quality vehicle miles traveled” by state and by month. For crash data, NAS recommends the FMCSA work with states to universally adopt the Model Uniform Crash Criteria for reporting of crashes and to develop codes that can easily extract the complete crash data from accident reports into the MCMIS system.
  3. Collect additional carrier characteristics in MCMIS. The study concluded that because SMS is based, in part, on the belief that crashes are caused by carrier operations, more data on carrier operations is required. NAS recommends the FMCSA collect the following carrier characteristics in MCMIS:
    1. Turnover rate;
    2. The type of cargo carried;
    3. Method and compensation level for drivers; and
    4. Better information on exposure by using standardized methods to obtain from state taxing authorities the vehicle miles traveled or through ELDs.
  4. Develop a user-friendly version of the MCMIS. NAS believes this would increase transparency of the system. It also recommends creating a user-friendly computer code to compute SMS elements, which would be available to the public.
  5. Use both an absolute and a relative score. NAS recommends calculating the SMS percentile ranks computed by peer group and an absolute rank. This “hybrid” method would provide a rank to a carrier within its peer group, while also providing the carrier with a score against a set standard established by the FMCSA.

Importantly, NAS took no position on whether SMS percentile ranks should be made public. Instead, it recommended the FMCSA undertake another study to better understand how the calculation and publication of the percentile ranks affect carrier operations prior to reaching a decision on this hot-button issue.

A public hearing was held on September 8, 2017, where FMCSA accepted comments on the study. Within the industry, there was concern over the lack of details about how specifically the new IRT model would work. Some also voiced concerns that a “bare” turnover rate, without more, could be detrimental to companies that actively terminate lower performing or less safe drivers. It was also proposed that driver experience is an important factor that should be included in the new IRT model. Treatment of the new data, including whether it would be protected from FOIA requests was also raised. Not surprisingly, many industry stakeholders continue to raise concerns about publishing the percentile ranks, particularly until there is a better understanding of how the new IRT model would function and if it will adequately address some of the other concerns about the existing SMS.

In response, the FMCSA acknowledged these continuing concerns. It sought input from the industry on how to address these concerns, as well as how best to obtain some of the additional data recommended by the NAS study. Overall, the FMCSA suggests that the development of the new IRT model will be a process, and improvements in one of the areas, such as transparency, may alleviate other existing concerns.

The FMCSA has until December 5, 2017, to submit a corrective action plan to Congress responding to the deficiencies identified by the NAS study. From there, the Office of the Inspector General of the Department of Transportation will have 120 days to report to Congress on whether the corrective action plan properly addresses those deficiencies.

Only time will tell which of the recommendations the FMCSA adopts, and more importantly, how the FMCSA will implement those changes. The attorneys on Smith Moore Leatherwood’s Transportation and Logistics Team frequently represent motor carriers in enforcement actions by the FMCSA and are closely following these developments. Please contact our office should you have any questions about how these changes may affect your business.