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110th Congress                                                   Report
                        HOUSE OF REPRESENTATIVES
 2d Session                                                     110-833
======================================================================
 
TO PROHIBIT THE SECRETARY OF TRANSPORTATION FROM GRANTING AUTHORITY TO 
  A MOTOR CARRIER DOMICILED IN MEXICO TO OPERATE BEYOND UNITED STATES 
MUNICIPALITIES AND COMMERCIAL ZONES ON THE UNITED STATES-MEXICO BORDER 
                UNLESS EXPRESSLY AUTHORIZED BY CONGRESS

                                 _______

 September 9, 2008.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                               _______

Mr. Oberstar, from the Committee on Transportation and Infrastructure, 
                        submitted the following

                              R E P O R T

                        [To accompany H.R. 6630]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Transportation and Infrastructure, to whom 
was referred the bill (H.R. 6630) to prohibit the Secretary of 
Transportation from granting authority to a motor carrier 
domiciled in Mexico to operate beyond United States 
municipalities and commercial zones on the United States-Mexico 
border unless expressly authorized by Congress, having 
considered the same, report favorably thereon without amendment 
and recommend that the bill do pass.

                       PURPOSE OF THE LEGISLATION

    H.R. 6630 prohibits the Secretary of Transportation from 
granting authority to a motor carrier domiciled in Mexico to 
operate beyond United States municipalities and commercial 
zones on the United States-Mexico border unless expressly 
authorized by Congress.

                  BACKGROUND AND NEED FOR LEGISLATION

    On February 23, 2007, Secretary of Transportation Mary 
Peters announced a plan to grant authority to 100 motor carrier 
companies based in Mexico to conduct long-haul operations 
beyond the commercial zones as part of a one-year pilot 
program. Prior to the pilot program, trucks entering from 
Mexico had been limited to approximately 20-mile-wide 
``commercial zones'' along the U.S.-Mexico border.
    The Secretary's announcement was met with strong opposition 
in Congress. Some Members of Congress and other interested 
parties expressed serious concerns about the U.S. Department of 
Transportation's (``DOT'') legal authority to carry out the 
pilot program and to fully open the border, potential impacts 
of the pilot program on highway safety, and about reciprocity 
for U.S. carriers seeking access to Mexico.
    Congress legislated safeguards into DOT's proposed pilot 
program in the U.S. Troop Readiness, Veterans Care, Katrina 
Recovery, and Iraq Accountability Appropriations Act, 2007 
(P.L. 110-28). Section 6901 of the Troop Readiness Act required 
the DOT Inspector General (``IG'') to verify that DOT is 
prepared to enforce Federal motor carrier safety laws and 
regulations with respect to Mexico-domiciled carriers, required 
DOT to address any issues raised by the IG, and required DOT to 
submit a report to Congress detailing corrective actions taken 
before the start of the pilot program. The Inspector General 
submitted his report to Congress on September 6, 2007, raising 
questions about whether DOT had sufficient plans in place to 
carry out the Department's commitment to check every truck 
every time it crosses the border into the United States under 
the pilot program. Within a few hours of receiving the IG 
report, the Secretary submitted her report to Congress and 
granted operating authority to the first Mexican trucking 
company under the pilot program. Additional companies have been 
granted operating authority on a rolling basis.
    On December 26, 2007, Congress enacted a further 
prohibition on DOT action to implement the pilot program. 
Section 136 of the Consolidated Appropriations Act prohibited 
DOT from using funds to establish a cross-border motor carrier 
pilot program. DOT has continued its pilot program despite this 
funding prohibition, arguing that the language only prohibits 
future pilot programs and does not impact the program initiated 
in September 2007.
    After calls for additional information on the pilot program 
from Congress and the public, DOT published three notices in 
the Federal Register on May 1, 2007 (72 Fed. Reg. 23883), June 
8, 2007 (72 Fed. Reg. 31877) and August 17, 2007 (72 Fed. Reg. 
46263) outlining the details of the proposed pilot program. The 
May 1, 2007 notice specifically states that ``The demonstration 
project will terminate and all provisional operating authority 
certificates expire one year from the date FMCSA grants the 
first provisional certificate.'' However, despite the plain 
language of this statement, DOT issued a subsequent notice on 
June 8, 2007, which stated that ``[u]nder FMCSA regulations, 
all motor carriers receive provisional operating authority for 
18 months after receiving a USDOT number.'' DOT has issued 
provisional operating authority to pilot program participants 
for 18 months.
    On August 4, 2008, the Secretary of Transportation 
announced that the cross-border pilot program will be extended 
for an additional two years through September 2010.
    Federal Motor Carrier Safety Administration (``FMCSA'') 
data indicates that as of July 2008, 27 Mexican carriers 
operating 107 trucks had been granted authority under the pilot 
program to operate long-haul in the United States, and 10 U.S. 
carriers operating 55 trucks had been granted authority under 
the pilot program to operate in Mexico. Pilot program 
participants from Mexico crossed into the United States 9,776 
times. Only 1,337 of these crossings, or 14 percent, resulted 
in carriers traveling beyond the border zones. To monitor 
participants under the pilot program, FMCSA also paid to 
acquire and install Global Positioning Systems (``GPS'') on 
each truck participating in the pilot program. According to 
estimates provided to the Committee by FMCSA, the agency has 
spent $700,000 through July 2008 on hardware, installation, 
monthly fees for tracking, and support services for the GPS 
units.

                       SUMMARY OF THE LEGISLATION

Section 1. Limitation on long-haul cross border trucking operations

    Subsection (a) directs the Secretary of Transportation to 
terminate the one-year cross border demonstration project the 
Secretary started on September 6, 2007, no later than September 
6, 2008. The Committee expects that upon termination of the 
one-year cross border demonstration project, the Secretary will 
terminate the provisional operating authority of all motor 
carriers participating in the demonstration project to operate 
beyond United States municipalities and commercial zones on the 
United States-Mexico border after September 6, 2008, and ensure 
that such motor carriers cease long-haul operations in the 
United States.
    Subsection (b) prohibits the Secretary from initiating a 
new pilot program or otherwise granting new authority to a 
Mexico-domiciled motor carrier to operate beyond the border 
zones unless specifically authorized by Congress. The Committee 
notes that subsection (b) applies to Mexico-domiciled motor 
carriers, which includes both trucks and motorcoaches.

Section 2. Reports to Congress

    Section 2 requires three reports to Congress assessing the 
implementation of the pilot program within 60 days of 
enactment.
    The first report must be submitted to Congress by the 
Inspector General of the Department of Transportation, as 
required by section 6901(c) of the U.S. Troop Readiness, 
Veterans' Care, Katrina Recovery, and Iraq Accountability 
Appropriations Act, 2007 (P.L. 110-28). That section required 
the IG to report to Congress ``within 60 days after the 
conclusion of the pilot program'' on whether the Secretary of 
Transportation has established sufficient mechanisms to 
determine whether the pilot program is having any adverse 
effect on motor carrier safety; whether Federal and State 
monitoring and enforcement activities are sufficient to ensure 
pilot program participants are in compliance with all U.S. 
safety laws; and whether the pilot program consists of a 
representative and adequate sample of Mexico-domiciled carriers 
likely to engage in cross-border operations. The requirement in 
Section 2 ensures that the IG submits an evaluation of the one-
year pilot program to Congress independent of the requirement 
that it be done upon conclusion of the program in the 
appropriations law.
    The second report must be submitted to Congress by the 
independent review panel established by the Secretary, 
consisting of former DOT IG Kenneth Mead, former DOT Deputy 
Secretary Mortimer Downey, and former Congressman Jim Kolbe. As 
described in a May 1, 2007 Federal Register notice (72 FR 
23883), this panel is ``responsible for evaluating the safety 
impacts of allowing Mexico-domiciled motor carriers to operate 
on U.S. roads beyond the commercial zone.'' The notice further 
states that the panel's ``conclusions will be considered 
carefully before a decision is made on a permanent full 
implementation of the NAFTA trucking provisions.'' Because this 
review panel was not authorized in statute, there is currently 
no timeframe for reporting, and the independent review panel is 
not required to share its findings with Congress.
    Section 2 requires a third report to be submitted by the 
Secretary of Transportation. This report must include:
          the number and names of United States and Mexico 
        domiciled motor carriers that participated in the 
        demonstration project and the number of vehicles each 
        motor carrier utilized in the demonstration project;
          the number of border crossings by motor carriers 
        participating in the demonstration project, including 
        the number of crossings which resulted in a motor 
        carrier traveling beyond United States municipalities 
        and commercial zones on the United States-Mexico 
        border;
          an itemization of safety and operational violations 
        identified among motor carriers participating in the 
        demonstration project in pre-authorization safety 
        audits, compliance reviews, and roadside inspections, 
        including a review of the most frequent types of 
        violations;
          an analysis of the cost to the Federal Government and 
        State partners of implementing the demonstration 
        project, including administrative costs, safety 
        monitoring and enforcement costs, and the cost of 
        installing global positioning system units on 
        participating vehicles; and
          measures taken by the Secretary to terminate the 
        authority of motor carriers participating in the 
        demonstration project to operate beyond United States 
        municipalities and commercial zones on the United 
        States-Mexico border after September 6, 2008, and 
        ensure that such motor carriers cease long-haul 
        operations.

            LEGISLATIVE HISTORY AND COMMITTEE CONSIDERATION

    On March 13, 2007, the Subcommittee on Highways and Transit 
held a hearing, entitled ``U.S./Mexican Trucking: Safety and 
the Cross Border Demonstration Project,'' to examine the 
proposed pilot program and to assess the status of cross-border 
trucking operations between the U.S. and Mexico.
    On March 29, 2007, Representative Nancy E. Boyda introduced 
H.R. 1773, the ``Safe American Roads Act of 2007.'' On May 2, 
2007, the Committee on Transportation and Infrastructure 
ordered the bill, as amended, reported favorably to the House 
by recorded vote of 66-0. This legislation authorizes a three-
year cross border trucking pilot program, but only under a 
specific set of conditions and once all prerequisites are met 
to ensure safety. The bill includes mechanisms to shut the 
program down if the pilot program has any detrimental effect on 
safety. The bill also requires Congress to pass additional 
legislation for the border to open fully beyond the limited 
pilot program. On May 15, 2007, the House passed H.R. 1773 by a 
vote of 411-3. To date, the Senate has not taken action on the 
bill.
    On July 24, 2007, the House adopted an amendment to H.R. 
3074, the FY 2008 Transportation, Treasury, Housing, and 
Related Agencies Appropriations Act, sponsored by Subcommittee 
on Highways and Transit Chairman Peter A. DeFazio, to prohibit 
DOT from using funds to establish or implement a cross-border 
motor carrier pilot program.
    On July 29, 2008, Subcommittee Chairman DeFazio introduced 
H.R. 6630.
    On July 31, 2008, the Committee on Transportation and 
Infrastructure met in open session, and ordered H.R. 6630 
reported favorably to the House by voice vote with a quorum 
present.

                              RECORD VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires each committee report to include the 
total number of votes cast for and against on each record vote 
on a motion to report and on any amendment offered to the 
measure or matter, and the names of those members voting for 
and against. There were no recorded votes taken in connection 
with consideration of H.R. 6630 or ordering the bill reported. 
A motion to order H.R. 6630 reported favorably to the House was 
agreed to by voice vote with a quorum present.

                      COMMITTEE OVERSIGHT FINDINGS

    With respect to the requirements of clause 3(c)(1) of rule 
XIII of the Rules of the House of Representatives, the 
Committee's oversight findings and recommendations are 
reflected in this report.

                          COST OF LEGISLATION

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives does not apply where a cost estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974 has been timely submitted prior to the filing of the 
report and is included in the report. Such a cost estimate is 
included in this report.

                    COMPLIANCE WITH HOUSE RULE XIII

    1. With respect to the requirement of clause 3(c)(2) of 
rule XIII of the Rules of the House of Representatives, and 
section 308(a) of the Congressional Budget Act of 1974, the 
Committee references the report of the Congressional Budget 
Office included in the report.
    2. With respect to the requirement of clause 3(c)(4) of 
rule XIII of the Rules of the House of Representatives, the 
performance goals and objectives of this legislation are to 
direct the Secretary of Transportation to terminate a cross 
border motor carrier pilot program on September 6, 2008 and to 
prohibit the Secretary of Transportation from granting 
authority to a motor carrier domiciled in Mexico to operate 
beyond United States municipalities and commercial zones on the 
United States-Mexico border unless expressly authorized by 
Congress.
    3. With respect to the requirement of clause 3(c)(3) of 
rule XIII of the Rules of the House of Representatives and 
section 402 of the Congressional Budget Act of 1974, the 
Committee has received the enclosed cost estimate for H.R. 6630 
from the Director of the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, August 27, 2008.
Hon. James Oberstar,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 6630, a bill to 
prohibit the Secretary of Transportation from granting 
authority to a motor carrier domiciled in Mexico to operate 
beyond United States municipalities and commercial zones on the 
United States-Mexico border unless expressly authorized by 
Congress.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Sarah Puro.
            Sincerely,
                                          Peter H. Fontaine
                                   (For Peter R. Orszag, Director).
    Enclosure.

H.R. 6630--A bill to prohibit the Secretary of Transportation from 
        granting authority to a motor carrier domiciled in Mexico to 
        operate beyond United States municipalities and commercial 
        zones on the United States-Mexico border unless expressly 
        authorized by Congress

    H.R. 6630 would require the Department of Transportation 
(DOT) to terminate a pilot program that allows certain motor 
carriers based in Mexico to operate throughout the United 
States. CBO estimates that implementing H.R. 6630 would have no 
significant impact on spending subject to appropriation. 
Enacting the legislation would not affect direct spending or 
revenues.
    In addition to terminating the current pilot program, the 
bill would require Congressional approval for any similar 
program conducted after that date. The bill also would require 
DOT to submit three reports to the Congress about the program. 
According to the agency, the funds that are currently used to 
install global positioning system units on participating motor 
carriers would be used for other purposes, and in the absence 
of this program, DOT personnel would remain at the border to 
complete other functions. As a result, CBO estimates that 
implementing the legislation would have no significant impact 
on spending subject to appropriation.
    The bill contains no intergovernmental mandates as defined 
in the Unfunded Mandates Reform Act (UMRA) and would impose no 
costs on state, local, or tribal governments. H.R. 6630 would 
impose a private-sector mandate, as defined in UMRA, on certain 
motor carriers based in Mexico. By terminating the pilot 
program, those carriers that participate in the project would 
be prohibited from making long-haul trips beyond designated 
zones along the border. According to data collected by the 
Federal Motor Carrier Safety Administration (FMCSA), a small 
number of motor carriers participating in the project make only 
a few such long-haul trips. Based on this information, CBO 
estimates that the cost of complying with the mandate (measured 
as net income forgone) would fall below the annual threshold 
established in UMRA for private-sector mandates ($136 million 
in 2008, adjusted annually for inflation).
    The CBO staff contacts for this estimate are Sarah Puro 
(for federal costs) and Jacob Kuipers (for the the private-
sector impact). This estimate was approved by Theresa Gullo, 
Deputy Assistant Director for Budget Analysis.

                     COMPLIANCE WITH HOUSE RULE XXI

    Pursuant to clause 9 of rule XXI of the Rules of the House 
of Representatives, H.R. 6630 does not contain any 
congressional earmarks, limited tax benefits, or limited tariff 
benefits as defined in clause 9(d), 9(e), or 9(f) of rule XXI 
of the Rules of the House of Representatives.

                   CONSTITUTIONAL AUTHORITY STATEMENT

    Pursuant to clause (3)(d)(1) of rule XIII of the Rules of 
the House of Representatives, committee reports on a bill or 
joint resolution of a public character shall include a 
statement citing the specific powers granted to the Congress in 
the Constitution to enact the measure. The Committee on 
Transportation and Infrastructure finds that Congress has the 
authority to enact this measure pursuant to its powers granted 
under article I, section 8 of the Constitution.

                       FEDERAL MANDATES STATEMENT

    The Committee adopts as its own the estimate of Federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (Public Law 104-4).

                        PREEMPTION CLARIFICATION

    Section 423 of the Congressional Budget Act of 1974 
requires the report of any Committee on a bill or joint 
resolution to include a statement on the extent to which the 
bill or joint resolution is intended to preempt State, local, 
or tribal law. The Committee states that H.R. 6630 does not 
preempt any State, local, or tribal law.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act are created by this 
legislation.

                APPLICABILITY TO THE LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    H.R. 6630 makes no changes to existing law.