ADVOCATING, EDUCATING, AND PROMOTING THE TRUCKING INDUSTRY ISSUE 2 | 2024 OREGON TRUCK DISPATCH 14. OTA Spring Safety Conference Brings Trucking Professionals to Eugene 32. Women in Trucking INSIDE THIS ISSUE:
A publication of the Oregon Trucking Association, Inc. 4005 SE Naef Rd., Portland, OR 97267 503.513.0005 • 888.293.0005 Fax: 503.513.0008 • www.ortrucking.org Jana Jarvis President/CEO jana@ortrucking.org Christine Logue Vice President of Operations christine@ortrucking.org Gregg Dal Ponte Director of Regulatory Compliance gregg@ortrucking.org Adam Williamson Director of Training & Development adam@ortrucking.org Ligia Visan Director of Accounting accounting@ortrucking.org Christa Wendland Communications Consultant wendland@ortrucking.org Jennifer Sitton Communications Consultant jennifer@ortrucking.org Mark Gibson Government Relations Policy Advisor mark@ortrucking.org For information about OTA events and to register online, visit www.ortrucking.org. Published for OTA by LLM Publications PO Box 7137, Bend, OR 97708 503.445.2220 • www.llmpubs.com President Stephen Bloss Design Hope Sudol Advertising Sales Ronnie Jacko For information about advertising in the Oregon Truck Dispatch, please contact Ronnie Jacko at 503.445.2234 or ronnie@llmpubs.com. Thank you, advertisers! Your support makes this publication possible. Please support them and tell them you saw them in the OTA Dispatch. 2 OTA Chair’s Message 3 OTA New Members 6 OTA President’s Message 7 Event Calendar 8 OTA in Action Issue 2 2024 CONTENTS Stay Connected With Us @OTAOregon Oregon Trucking Association @ORTrucking @ORTrucking.org Events 1 0 2024 Legislative Session Saw Passage of Significant Policy Packages, Discussion of Highway Cost Allocation 1 4 OTA Spring Safety Conference Brings Trucking Professionals to Eugene 1 8 Repeat Grand Champion Dan Shamrell Takes Top Prize at 2024 Oregon Truck Driving Championships Featured 2 6 State of the Unions 3 0 ODOT to Face Budget Shortfall Following Gov. Kotek’s Decision to Delay Tolling Indefinitely 32 Women in Trucking 3 8 Maintenance Costs Ease in Q4, Report From TMC, Decisiv Finds Safety 40 Safety and Professional Recognition
Oregon Trucking Association, Inc. Oregon Truck Dispatch 2 Evan Oneto OTA Chair FROM THE EPA & ARB, PHASE 3, ACT AND ACF: A QUICK REVIEW OF UPCOMING TRUCK REGULATIONS AND MANDATES IF YOU ARE like many of my friends and colleagues in trucking, you may have seen or heard about some of the headlines regarding the U.S. Environmental Protection Agency’s (EPA) recent approval of their “Greenhouse Gas Emissions Standards for Heavy-Duty Vehicles— Phase 3,” more commonly known as the “Phase 3 Rule.” But like many busy trucking industry professionals, you likely haven’t had a chance to really sit down and digest the contents of the rule and its potential impact to the industry or your business specifically. Or perhaps you’ve heard bits and pieces about what the California Air Resources Board (CARB) has been up to lately but aren’t clear on the differences between the Advanced Clean Trucks Rule and the Advanced Clean Fleets Rule and where Oregon currently stands in reference to these rules. If you aren’t intimately familiar with the details of all these rules, don’t worry, you’re not alone. Most company owners and managers I know are simply focusing on keeping their head above water during these challenging economic times, and rightfully so. But, like it or not, understand it or not, regardless of potential electoral changes or legal challenges, it is likely that some forms of these rules are here to stay and are coming to Oregon. So, let’s take a quick review. EPA Phase 3 Rule The EPA Phase 3 Rule would require truck manufacturers to reduce their CO2 emissions from the previous Phase 2 standards established in 2016 by a set percentage, according to vehicle type, starting in 2027 and culminating in 2032. For example, new light-heavy vocational trucks (think Class 2b through Class 5 trucks) must reduce their CO2 emissions by 17% in 2027, ramping all the way up to 60% by 2032. Whereas day cab tractors must reduce their CO2 emissions by 40% in 2032. And while the EPA maintains that the rule is technology neutral, allowing manufacturers to achieve these reductions through a variety of potential technologies, many industry experts see the rule as a de facto battery electric vehicle (BEV) sales mandate given the limited ability to achieve such dramatic additional reductions through new internal combustion engines and the limited availability of hydrogen infrastructure and technology. The EPA’s Phase 3 emission reduction targets even resemble the mandated sales schedule for zero-emission vehicles (ZEVs) required under California’s Advanced Clean Trucks Rule, which requires 75% of medium duty trucks and 40% of Class 7–8 trucks sold in the state to be zero emission by 2035. The EPA cited the California rule often in their background explanation of the final Phase 3 Rule published in the Federal Register. They noted that ten other states in addition to California have already adopted the Advanced Clean Trucks Rule (Oregon being one of the first), with more likely on the way as part of a 17 state MOU establishing goals to support widespread electrification of the heavy-duty vehicle market. The Truck and Engine Manufacturers Association (EMA) opposed the Phase 3 Rule, stating, “The new GHG Phase 3 rule will require manufacturers to sell a set percentage of zero-emission vehicles, which is beyond their own ability to control.” However, the EMA also previously signed an agreement with CARB, agreeing to adhere to the terms of the Advanced Clean Trucks Rule in the state regardless of any subsequent legal challenges (which they agreed to abstain from in any state that adopts the rule), as well as meeting 100% ZEV sales in CA by 2036, and to make best efforts “to sell as many zero-emission trucks as reasonably The choice of how and how much to get involved is yours. But I do hope you get and stay engaged with OTA and encourage your peers to join if they’re not members as our industry navigates so much profound change during this vast technological transition.
www.ortrucking.org 3 Issue 2 | 2024 EXECUTIVE COMMITTEE Chair & ATA State VP Evan Oneto (FedEx) Vice Chair Erik Zander (Omega Morgan) Secretary/Treasurer Bart Sherman (Sherman Bros. Trucking) ATA State VP Nick Card (Blackwell Consolidation) Past Chair Andy Owens (A&M Transport) ISI Rep Diane DeAutremont (Lile Int. Co.) Chair Appointee Ron Riddle (Leavitt’s Freight Service) DIRECTORS-AT-LARGE Greg Galbraith (Market Express) Heather Hayes (Tradewinds Trans.) David Hopkins (TP Trucking) Charles Ireland (Ireland Trucking) Jeff Lorenzini (Old Dominion Freight Lines) Regional Representatives Central Oregon Ron Cholin (Stinger Transport) Eastern Oregon Roni Shaw (Bowman Trucking) Metro Region Tim Love (Carson Oil Co.) Southern Oregon Ryan Hutchens (F.V. Martin Trucking) Willamette Valley Dale Latimer (Ram Trucking) COUNCIL REPRESENTATIVES Safety Management Council (SMC) Jennifer King (WHA Insurance) Technology & Maintenance Council (TMC) Nicole Hawks-Morse (Kool PAK) Standing Committee Representatives Allied Trevin Fountain (Cummins) Government Affairs John Barnes (TEC Equipment) Highway Policy Kirk Watkins (Walmart) Image Michael Card (Combined Transport) Membership Nick Card (Combined Transport) Oregon TruckPAC Erik Zander (Omega Morgan) OTA in Action Mark Gibson (Siskiyou Transportation) Workforce Billy Dover (Tyree Oil) COMMITTEES Allied Government Affairs Highway Policy Image Membership Oregon TruckPAC OTA in Action Workforce To learn more about the committees or councils listed above, contact OTA at membership@ortrucking.org or 503.513.0005. 2023/2024 BOARD OF DIRECTORS OTA Welcomes the Following New Members! All members are listed in our online directory via the member portal. ATS—Anderson Trucking Service Cheema Freightlines Coastline Moving Columbia River Transport Cottingham & Butler RTC The Truck Shop – Portland Thermo Fluids possible in every state that has or will adopt CARB’s ACT regulations, even potentially exceeding any future U.S. EPA Phase 3 Greenhouse Gas requirements.” Some industry observers have speculated that this prior commitment may have even encouraged federal regulators to follow suit. California’s Advanced Clean Fleets Rule How does California’s Advanced Clean Fleets Rule passed last year fit into all of this? Well, it would require high priority fleets (defined as owning or operating 50 or more trucks) to purchase zeroemission trucks starting next year, when 10% of such fleets must be comprised of ZEVs, ramping up to 100% between 2035 and 2042, depending on the weight class. It also impacts drayage carriers, which would require all new trucks purchased to be ZEV starting this year until fleets reach 100% ZEV by 2035. Some industry experts estimate this could require double or more of the state’s current energy production needs by the full electrification deadline. Meanwhile, California has also passed a law requiring that all energy used in the state come from renewable sources by 2045, thus compounding the challenge of both energy production and transmission. And while both state and federal regulators point to recent public investments to help develop an electric charging infrastructure, all of them fall well short of the $1 trillion estimated costs to electrify medium and heavy-duty fleets nationally, as estimated by the American Transportation Research Institute (ATRI). Impacts on Trucking So, what does all this mean for you? Well, frankly that remains to be seen. The new EPA rules could face a legal challenge, or they could be amended or possibly even overturned in a future administration down the road. And likewise, the California Trucking Association is currently litigating the Advanced Clean Fleets Rule—something which Oregon administrators have indicated they do not intend to adopt currently. But until a final resolution is reached on some of these rules, manufacturers do have to plan their production and sales targets based on the rules as they exist today, not some future potential outcome, and that could have a very real impact on the market and your operation. What can you do about it? Get involved with the OTA and stay up to date on the latest developments and get actively involved in helping influence policymakers as these decisions continue to evolve. For example, you can come to OTA’s Call on Washington this fall and remind your federal lawmakers that: 1. Given the exponentially higher cost of a battery electric vehicle (BEV) relative to an internal combustion
4 Oregon Trucking Association, Inc. Oregon Truck Dispatch engine (ICE), the current federal excise tax on trucks wipes out any incentive for the purchase of a BEV provided by the Inflation Reduction Act. 2. According to ATRI, the use of renewable diesel achieves more than double the lifetime CO2 emissions reductions compared to a BEV, measured against the baseline of a current ICE vehicle. 3. Without any change to federal weight allowances, the increased weight of a BEV will require 1.343 BEVs to every one diesel truck to haul an equivalent amount of freight, thus worsening congestion and increasing the cost to transition. 4. Given the much longer refueling times with a BEV, most charging infrastructure will have to be installed at terminals, making the utility of public charging infrastructure investments limited. You can also come to OTA’s Trucking Day at the Capitol in Salem and remind policymakers why following in California’s footsteps for a purchase mandate would be a mistake. Want to know the latest bills introduced or environmental regulations proposed? Join OTA’s Government Affairs Committee and hear it straight from our experts as it happens. If you’re too busy for that, maybe you’d prefer to be part of OTA in Action, our grassroots advocacy program, where you can just occasionally make a phone call or send an email when called upon to explain how a new law or regulation would impact your business. Or come to our annual conference in August and learn how your peers are navigating these rules. The choice of how and how much to get involved is yours. But I do hope you get and stay engaged with OTA and encourage your peers to join if they’re not members as our industry navigates so much profound change during this vast technological transition. Chair Message, cont.
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6 Oregon Trucking Association, Inc. Oregon Truck Dispatch FROM THE PRESIDENT Jana Jarvis OTA President/CEO AS YOU READ through this edition of the Oregon Truck Dispatch, you will likely come to the conclusion that there are a wide variety of governmental policy regulations that will have significant impacts on the trucking industry in the coming years. From efforts to mandate electric truck purchases to small rebate programs to encourage these purchases, Oregon has adopted a number of California regulations aimed at significantly transforming our industry. These programs are fraught with issues ranging from having enough electric grid capacity to questions concerning the availability of charging equipment. And those questions don’t even address concerns over productivity due to the equipment not meeting our industry’s needs. It is clear that the environmental community sees the need to transform the trucking industry away from diesel as our primary power source. And at the same time, they have no interest in addressing our concerns over cost, energy constraints, productivity and application. “If you mandate it, they will change” seems to be the common underlying theme in policy discussions held at all levels of government. It is also clear that they are winning the public’s support with their one-sided narrative. We have much work to do to change this narrative. In the same vein, they are moving the needle in the public’s mind around the need to limit access to roads in an effort to address climate change. The recent efforts on the part of the Oregon Department of Transportation (ODOT) to implement tolling in the form of congestion pricing is an attempt to price people off our roadways. As someone who has sat through countless hours of discussion over tolling, it is interesting to see how the public has reacted. Largely as a result of the backlash from those communities who would be most affected by ODOT’s proposed plan, this tolling discussion has been tabled for the moment. But it will come back. ODOT has been meeting with policymakers for months, sharing their concern over their lack of funding. They bring charts indicating that 2025 is the year that their revenue significantly declines due to the transition to electric passenger vehicles that don’t pay road usage taxes in the form of gasoline taxes. For the past several years, ODOT has been contemplating implementing road usage fees, or VMTs, on passenger vehicles to capture additional revenue in addition to gasoline taxes. This need for revenue is not only driven by electric cars, but also by today’s vehicles that have significantly higher mileage efficiencies. For passenger vehicles, ODOT’s revenue has been flat, or even declining, while total miles driven have increased. Nationally, ODOT talks glowingly about Oregon’s weight-mile system of taxation for heavy vehicles and touts this approach as the way to help solve their funding shortages. For the trucking industry, however, the weight-mile system is fraught with problems. It is an extremely expensive form of tax collection for both the user and the government. Gas tax collection costs run less than 3% while tolling, VMTs and weight-mile tax collection can cost more than 30%. Evasion factors into this calculation as well. Travelers from out-of-state can easily ignore the tolling bill that shows up at their home after their trip. And we know from experience that there is a significant amount of evasion that factors into the weight-mile tax. In fact, your weight-mile tax rates are calculated using an assumed amount of evasion. If the number is 10%, then increase the rates. It is easily apparent why Oregon’s trucking taxes and fees are the highest in the nation and the spread is only increasing. It isn’t because our roadways are the OTA is “All In” to Protect Members from Upcoming Policy Regulations With this imbalance continuing to grow and legislative leadership unwilling to address this for several years, the OTA Board of Directors made the decision late last year to file a lawsuit.
7 www.ortrucking.org Issue 2 | 2024 ADVOCATING, EDUCATING, AND PROMOTING THE TRUCKING INDUSTRY EVENTS UPCOMING EVENTS best in the country. We have an expensive system of taxation that factors collection costs and evasion into the equation. On the positive side for trucking, Oregon passed a constitutional amendment over twenty years ago that requires the state to ensure that cars and trucks are each paying their fair share of the cost of Oregon’s roadways. I can assure you that this requirement has resulted in a complicated review process that takes place every two years and is based on a number of assumptions, but it has historically resulted in nearly perfect equity ratios of less than a 1% imbalance. Over the past three biennia however, these equity ratios began to show a larger imbalance. For the 2019–2021 period it showed that trucks were overpaying some 3.5%, and for the 2021–2023 period, the imbalance grew to 16%. The last report which was shared with the Legislature in 2023 showed a much larger imbalance of 32.4% for the 2023–2025 period which equates to trucking overpaying some $193 million per year! It also reflected that cars are underpaying 12%—so the dollar amount of the imbalance is even larger than $193 million. The constitutional requirement is for the Legislature to make an adjustment when there is an imbalance. However, with ODOT stating that they can’t afford to plow the snow from the roads during the recent winter storms, it has been virtually impossible to get leadership to make the necessary corrections to our costs. With this imbalance continuing to grow and legislative leadership unwilling to address this for several years, the OTA Board of Directors made the decision late last year to file a lawsuit. Prior to filing, several legislators took it upon themselves to propose a variety of solutions. They called for a special session to address this inequity and during the session they proposed legislation to reduce our tax rates. We chose to file our lawsuit just prior to the 2024 Legislative Session and we are moving forward with legal action. Lawsuits are complicated and lengthy. They limit clear communication and updates to OTA membership. But I want you to know that there are a number of ways that OTA is working to protect and improve your ability to do business in Oregon. We are involved in many policy battles on your behalf. Please help us by volunteering to serve on committees, write checks to TruckPAC, donate to our Legal Fund, and attend our training and events. We are all in. I hope you are too!
8 Oregon Trucking Association, Inc. Oregon Truck Dispatch Mark Gibson, Chair OTA in Action Committee/ President, Siskiyou Transportation ONE OF THE latest programs to be rolled out by the Oregon Department of Environmental Quality (DEQ) regarding zero-emission vehicles may help the trucking industry…well, kind of. For those of you who remember all the way back to 2017, the Oregon Legislature adopted House Bill 2017. You’ve all heard a lot about HB 2017 and that there was a lot more to it than just an increase in our weight-mile tax. It also authorized the DEQ to establish a rebate program for zero-emission vehicles (ZEVs). This first program was for lightduty vehicles only. Then, in 2018, the Legislature adopted HB 4059, which further clarified the plan for light-duty ZEVs. Then, in 2019, the Legislature adopted HB 2592, which further clarified and removed existing requirements for light-duty ZEVs. In 2021, the Oregon Legislature adopted HB 2165, which again changed the requirements for light-duty ZEVs. Finally, in 2023, the Oregon Legislature adopted House Bill 3409, which authorized the DEQ to establish a rebate program for medium and heavyduty zero-emission vehicles. This is good. We now have an incentive program in Oregon for medium and heavy-duty ZEVs, however, the Legislature only allocated $3 million for the program. When you look at the cost of a Class 8 ZEV, you realize $3 million doesn’t go very far. We also have to remember these funds are for both medium duty as well as heavy-duty ZEVs. The other factor to consider is that these funds are available for both private fleets as well as public fleets. As of the date this article was written, the program was still in the final phases of rulemaking and some changes are still likely. Following are some likely amounts in terms of rebates: • Medium-duty vehicles (Class 2b through Class 7) should see between $2,500 and $85,000 per qualifying vehicle. • Heavy-duty vehicles (those vehicles above 33,000 lbs.) should see a $120,000 rebate available per qualified vehicle. Vehicles must be registered in the state of Oregon and operate primarily within the state. Additionally, the qualifying vehicle must be retained by the purchaser for a period of 36 months, otherwise, the purchaser will be required to return a prorated amount to the DEQ. The program only applies to new ZEVs and each applicant will be limited to a maximum of five eligible vehicles to qualify for the rebate. One last stipulation for monies allocated by the DEQ is that DEQ will prioritize disproportionately burdened communities in the application process. A great deal has happened on the carbon reduction front in Oregon, and you can bet we will see many more programs introduced in the coming years. There are many challenges to the adoption of ZEVs, in addition to the high cost of acquisition range is an impediment, as well as a charging infrastructure, hydrogen refueling infrastructure, or any other potential switch from diesel fuel. Today’s trucks are cleaner than ever, and it would be in everyone’s best interest to look at all the alternatives along with their pros and cons before we continue down the mandated road. OREGON DEQ’S NEW MEDIUM AND HEAVY-DUTY ELECTRIC VEHICLE REBATE PROGRAM Today’s trucks are cleaner than ever, and it would be in everyone’s best interest to look at all the alternatives along with their pros and cons before we continue down the mandated road.
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10 Oregon Trucking Association, Inc. Oregon Truck Dispatch EVENTS 2024 Legislative Session Saw Passage of Significant Policy Packages, Discussion of Highway Cost Allocation Discussions set the stage for the development of a sizable transportation package in the 2025 Legislative Session By Jordan Bice, Oxley & Associates THE 2024 LEGISLATIVE Session concluded on March 7, ending what was arguably the most collaborative and cordial session in years. While the even year “short session” was originally created to address minor legislative fixes, legislators used this year’s session to tackle several significant policy packages, including a complex housing package, bipartisan campaign finance reform, and a major overhaul of Oregon’s addiction treatment system. Of the more than 161 bills introduced for the 2024 session, OTA’s advocacy team closely tracked 28 bills that had the potential to impact trucking. Below you will find summaries on some of the key bills to pass this session, as well as some of the bills from this session that had the greatest focus on trucking operations. Drug Criminalization Reform One of the most significant issues at play in the 2024 session was the increasing need for a reform of Oregon’s drug criminalization laws. When Oregon voters passed Ballot Measure 110 in 2020 to decriminalize small possession of most illicit drugs, it was anticipated that those experiencing addiction would have more access to recovery services without fear of further legal penalties. Unfortunately, the fentanyl crisis has exacerbated since the passage of the measure, and Governor Kotek, Multnomah County Chair Vega Pederson, and Portland Mayor Wheeler issued a 90-day emergency declaration on January 31 to address the fentanyl crisis. The legislature created the Joint Addiction and Community Safety Response Committee to push a bill that would end Oregon’s three-year experiment in drug decriminalization. Democratic leadership had to carefully balance the policy. Any proposed legislation would need to effectively reduce drug-related problems to avoid a November ballot measure to repeal BM 110. However, if it were too restrictive, it might not gain support from the majority of Democrats. After weeks of closed-door meetings and several hearings that went long into the night, legislators reached agreement and passed HB 4002 on strong bipartisan votes in both chambers. The new law creates a special class of misdemeanor for drug related crimes with more options for and access to recovery services. Oregonians will undoubtedly watch intently over the coming years in hopes that this improves the safety and livability of our state. Housing Package Governor Kotek entered the session with one priority, which was passing another housing package. Though significantly whittled down from her original $500 million proposal, the legislature approved a $376 million package to accelerate housing construction. It includes investments in infrastructure, homebuilding, homeless shelters and rent assistance, along with changes to state land use laws to make it easier for cities to build homes. Highway Cost Allocation On January 30, the Oregon Trucking Association, Combined Transport, A&M Transport, and Sherman Bros. Trucking filed a lawsuit against the State of Oregon, Governor Tina Kotek, the Oregon Department of Transportation, Senate President Rob Wagner, and House Speaker Dan Rayfield alleging trucks have unconstitutionally overpaid their fair share of highway taxes over several years. The suit asks for an immediate review
11 www.ortrucking.org Issue 2 | 2024 of weight mile taxes by the legislature and seeks a combined estimated relief of around $925,000. Trucks represent 15% of vehicle miles traveled in the state, but more than one-third of all taxes owed by Oregon motorists have been paid by trucking companies. ODOT estimates for the 2023–2025 study that heavy vehicles will overpay by approximately $193 million per year, according to court documents. Not only does this lawsuit seek to correct an imbalance in the system in accordance with the Oregon Constitution, but it places additional pressure on the legislature to act. With the 2025 transportation package on the horizon, the lawsuit provided an opportunity to drive discussion in the 2024 session about possible solutions. The Joint Transportation Committee was not given much flexibility by leadership for issues they could move forward in 2024. There was a small transportation omnibus bill, but that merely made tweaks to existing programs at ODOT and DEQ. Because of their limited scope of work this session, the committee primarily served as a venue for long-term transportation funding issues. ODOT presented multiple times to describe their work, funding woes, and how they hope to resolve them. The committee had plenty of opportunities to voice their concerns, and despite previously glossing over some of the agency’s missteps, ODOT was more upfront this year about their problems. The Director of ODOT plainly stated on the record that trucking has been overpaying, which is an improvement over other hearings that only broadly claimed that there was an imbalance in the system. In one hearing, time was given to call out the elephant in the room of heavy-duty vehicles overpayment. Three bills were discussed by members of the committee: • SB 1543, introduced by Sen. Findley (R-Eastern Oregon), would have lowered the weight-mile taxes and limited ODOT spending by an amount to be determined later. • SB 1519, introduced by Sen. Boquist (D-Polk County), would have lowered weight-miles taxes, and directed ODOT to adopt rules so they could issue refunds to taxpayers who overpaid weight-mile taxes in recent years. It also would have lowered ODOT spending as in SB 1543. • HB 4165, introduced by Rep. Boshart Davis (R-Albany), would have required ODOT to prepare and submit a report on the statutory changes needed to balance costs between light and heavy vehicles. Even though legislative leadership did not have the appetite to address these issues head-on this session, it is now more apparent than ever that the legislature needs to rectify the imbalance and give clear direction to ODOT for how to operate and manage their system. OTA will be at the head table in helping negotiate a transportation package in 2025 that addresses these issues and finishes the promises of the 2017 transportation package. Warehouse Regulations About halfway into the 2023 Legislative Session, Rep. Ricki Ruiz (D-Gresham) introduced a bill that would have created a series of burdensome requirements on a wide range of industries with warehouse workers. In the wake of bills in New York, Washington, and other states, the bill targeted the quota system at Amazon distribution centers. However, it was so overreaching that it would have considered trucks as if they were rolling warehouses. The bill died last year, and the sponsor spent the interim working
12 Oregon Trucking Association, Inc. Oregon Truck Dispatch with industry to craft a more narrowly tailored bill that could pass in the 2024 short session. HB 4127 (2024) requires an employer of warehouse workers to provide information to their employees about any quota to which the employee is subject. It stipulates that the employer may not take an adverse action against an employee for failure to meet a quota for which the employee did not receive written documentation. Employees may request records if they are disciplined for failure to meet a quota, and it requires the employer to provide such records free of charge. Drivers are not included under the bill. Especially given how problematic last year’s bill was and how well negotiated this year’s bill was, industry was neutral on the bill, and it passed through the final chamber on the last day of session. Paid Family and Medical Leave Act SB 1514 was introduced as a Senate Labor and Business Committee bill to ensure the Paid Leave Oregon program fund remains sustainable. Oregon’s Paid Family and Medical Leave Act was passed in the 2019 session and employers began making contributions in January 2023. Nine months later, the program began seeing benefits being paid to employees who qualify. While the existing law includes some measures to address the solvency of the fund should issues arise, Sen. Kathleen Taylor (D-Portland) wanted to ensure the program would continue to serve Oregonians well into the future. SB 1514 requires the Director of the Oregon Employment Department (OED) to conduct regular assessments of the program fund and to take action if the fund is not sufficient to cover six months of anticipated costs. There are guardrails in place that require OED to provide advanced public notification of the changes and specifies that these changes can only be effective for up to five years. The policy had been negotiated with the business community ahead of session and no changes were made throughout the legislative process. The bill sailed through both chambers, receiving a 27-0-3 and a 50-3-7 vote in the Senate and House respectively. SB 1515 also addressed Oregon’s Paid Family Leave program, making several technical changes that: • Require the OED to report to the legislature on the payment of benefits to seasonal employees. • Require OED and the Bureau of Labor and Industries (BOLI) to 2024 Legislative Session, cont.
13 www.ortrucking.org Issue 2 | 2024 jointly report on the apportionment of duties between the two entities as it relates to the program. • Removes duplicative leave purposes when they are also covered by the federal Family and Medical Leave Act or Paid Leave Oregon. • Rectifies conflicts with scheduling provisions seen in both Paid Leave Oregon and Oregon’s Family Leave Act. Similarly, this bill was heavily negotiated by the business community, who engaged in a workgroup process facilitated by the Chair of the Senate Labor and Business Committee, Sen. Taylor. The bill was amended to change some of the operative dates in the bill, but no specific policy concepts were significantly altered. SB 1515 easily passed both chambers, and when signed by the governor, the bill will be effective immediately. Employee Retention and Hiring Bonuses HB 4050, a bill to functionally allow employers to provide retention bonuses, was brought back for the second time in 2024 after failing during the 2023 session. Oregon’s pay equity law currently makes it illegal for an employer to offer a hiring bonus, as increased compensation can only be based on certain bona fide factors like seniority, merit, piece rate, education, etc. The bill sought to expand the list of factors to include business necessity, which would allow for hiring bonuses to address challenges like workforce shortages. The bill received broad support from over 50 business trade associations and companies, who all cited the need to allow for bonuses to address the persistent workforce shortage. Oregon’s unions, including SEIU, PCUN, AFSCME and AFT-Oregon all came out in strong opposition. These groups argued that “business necessity” was an overly broad term and could undermine the spirit of Oregon’s pay equity law and allow for bonuses that may marginalize certain classes of workers. Despite its bipartisan and bicameral cosponsors, the bill was not scheduled for a work session and died at the first legislative deadline. Campaign Finance Reform One big surprise from the session was the passage of campaign finance reform. For years, Oregon has been one of the only states without campaign finance limits, and after countless attempts to reach agreement on reform, the legislature passed a bill to refer to the voters in November a solution that would cap giving at $3,300 from individuals to candidates for statewide office, the state House and Senate and district attorney per election. “Small donor committees,” which would include union PACs, could give $10 for every one of their donors for statewide candidates and $5 per donor for state lawmakers and local elections. Though neither business nor union entities are completely satisfied with the proposal, it is seen as a preferable alternative to a competing ballot measure that could have had the support to pass in November. Should this referral pass in November, the limits would begin in 2027. What to Expect Going Forward Now that drug crime reform, housing reform, semiconductor manufacturing incentives, and campaign finance reform have successfully passed the legislature, there are few looming issues that could dominate the conversation in the 2025 Legislative Session. One of the few priorities of the 2025 session will be passing a transportation funding package. The last transportation package was passed in 2017 after multiple years of failed attempts. It resulted in the trucking industry accepting a 53% tax increase to help pay for several large infrastructure projects, including the Rose Quarter freeway improvement project. With that project still just in the planning phases, increased concern around tolling, and a Department of Transportation that is on the verge of insolvency, the urgency for passing a transportation package in 2025 will be great. Legislators and advocacy groups alike will transition their focus for the remainder of the year toward campaign season. Three major statewide offices will be up for election in November 2024 including State Treasurer, Secretary of State, and Attorney General. In the Oregon Senate, at least eight seats will turn over because of retirements and the Supreme Court ruling that those who walked out in the 2023 Legislative Session to deny quorum and halt bills from moving forward would not be allowed to run for reelection. That ruling affirmed the intent of Ballot Measure 113 from 2022, which said that any legislator who has 10 or more unexcused absences would be ineligible to run again for office. OTA will remain engaged in the election process as campaign season heats up. If you’re interested in getting involved in the political process, or making a donation to TruckPAC to support candidates who recognize the important role trucking plays in Oregon’s economy, please contact Christine Logue at christine@ortrucking.org. or Jana Jarvis at jana@ortrucking.org. In the Oregon Senate, at least eight seats will turn over because of retirements and the Supreme Court ruling that those who walked out in the 2023 Legislative Session to deny quorum and halt bills from moving forward would not be allowed to run for reelection.
14 Oregon Trucking Association, Inc. Oregon Truck Dispatch OTA Spring Safety Conference Brings Trucking Professionals to Eugene
15 www.ortrucking.org Issue 2 | 2024 THE 2024 OTA Spring Safety Conference was held May 1–3 in Eugene. The annual event, hosted by the Safety Management Council (SMC) brings together industry professionals who are responsible for fleet and team management, as well as those involved in HR and health/safety. Attendees at this year’s event heard from speakers including Dan Horvath, American Trucking Association’s Vice President of Safety Policy, and Deborah Jeffries, Vice President of HR Answers. Breakout sessions at the conference included: Safety Resources 101; Nuances of HOS Rules; FMCSA Audits; Best Practices—What to Secure After a Collision; and Preparing Your Fleet & Safety Committees for OSHA. The Oregon Fleet Safety and Safety Professional of the Year awards were presented during the awards luncheon at the Safety Conference. 2024 Fleet Safety Awards Private Carrier UNDER 1.5 Million Miles 1. Roseburg Forest Products 2. Pepsi Northwest Beverages 3. Consolidated Supply Co. Private Carrier OVER 1.5 Million Miles 1. Charlie’s Produce 2. Organically Grown 3. WinCo Foods Specialized Carrier UNDER 0.5 Million Miles 1. Lile 2. IDI Specialized Carrier OVER 0.5 Million Miles 1. Hattenhauer Transportation 2. Space Age Fuel Common Carrier Truckload UNDER 2 Million Miles 1. Ram Trucking 2. George Van Dyke Trucking 3. Redding Lumber Transport Common Carrier Truckload 2 to 4 Million Miles 1. Terrain Tamers 2. Tradewinds Transportation Common Carrier Truckload OVER 4 Million Miles 1. TP Trucking 2. A&M Transport 3. Market Express Common Carrier Less Than Truckload UNDER 10 Million Miles 1. Peninsula Truck Lines 2. Kool Pak 3. ABF Freight Common Carrier Less Than Truckload OVER 10 Million Miles 1. Old Dominion Freight Line 2. Fed Ex Freight
16 Oregon Trucking Association, Inc. Oregon Truck Dispatch Fleet Safety Professional Jessica Nelson, Peninsula Truck Lines Congratulations to the 2023–24 Northwest Fleet Safety Graduates! Daphne Alexander – Pepsi Northwest Beverages Jeffry Aman – Roseburg Forest Products Sunny Baird – Aggregate Resource Industries Dale Fenters – Fenters Trucking Kacey Funk – Ram Trucking Jason Karsten – Tyree Oil Russell Mathiasen – Western Heavy Haul Cassie Smith – Western Heavy Haul Angie Vachter – Pepsi Northwest Beverages Cheri Van Dyke – George Van Dyke Trucking OTA Spring Safety Conference, cont.
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18 Oregon Trucking Association, Inc. Oregon Truck Dispatch Repeat Grand Champion Dan Shamrell Takes Top Prize at 2024 Oregon Truck Driving Championships MORE THAN 90 drivers showed off their skills in front of family, friends, and colleagues at the Oregon Truck Driving Championships (TDC) on Saturday, April 27. The annual competition and celebration of Oregon’s truck drivers and their commitment to safety was held at FedEx Freight in Portland this year. Participating drivers must have had a clean, accident-free record for at least one year prior to the competition, emphasizing the industry’s commitment to safety. Drivers started the day with a written examination, followed by a pretrip inspection test and a driving skills test. They had the option to compete in one or more of the nine competition categories including Straight Truck, Three-Axle Tractor-Semitrailer, Twin Trailers, and Step Van. FedEx Freight’s Daniel Shamrell took home the top prize of the day, earning his second Grand Champion award in as many years. The repeat Grand Champion also took home the top prize in the Three- Axle category. Dan has said that he enjoys participating in TDC because it gives drivers an opportunity to celebrate safety with their family, friends, and coworkers. With a large number of rookies competing this year, Carlos Diaz Baltazar faced stiff competition from his fellow new drivers, but ultimately came away with the top title in the Rookie category. Spectators, attendees, and volunteers helped cheer on their favorite drivers, while celebrating the industry, and the important role it plays in moving Oregon’s economy. The Southwestern Oregon Workforce Investment Board’s (SOWIB) truck driving simulator was on hand to give spectators a first-hand view from the (simulated) driver’s seat to see what drivers experience in their rigs every day, a highlight for some of the event’s youngest attendees! First place winners in each category at Oregon TDC will go on to represent the state at the National Truck Driving Championships in Indianapolis, IN at the end of August. 2024 Truck Driving Championships Winners Grand Champion Daniel Shamrell – FedEx Freight Rookie Carlos Diaz Baltazar – Old Dominion Three-Axle 1. Daniel Shamrell – FedEx Freight 2. Michael Owings – UPS 3. Elfego Delgado – Walmart Four-Axle 1. Kurt Kasitz – Old Dominion 2. Carlos Diaz Baltazar – Old Dominion 3. Juan Calvillo Rosas – Walmart 2024 Oregon Truck Driving Grand Champion Daniel Shamrell from FedEx Freight.
19 www.ortrucking.org Issue 2 | 2024 Five-Axle 1. Kevin Broadhead – Albertson’s 2. Pete Jones – Albertson’s 3. Tim Melody – ABF Freight Flatbed 1. Heladio Fernandez – FedEx Freight 2. James Varley – TP Trucking 3. Russ Skinner – TP Trucking Sleeper Berth 1. Thomas Crawford – Walmart 2. Kirby Ferber – FedEx Freight 3. Admir Mujezinovic – FedEx Ground Straight Truck 1. Gurinder Dhaliwal – FedEx Freight 2. Kenneth Alanis – Old Dominion 3. Troy Edwards – XPO Tank 1. Ronald Zieser – FedEx Freight 2. Coby Nicar – FedEx Freight 3. Scotty Hubbard – Tradewinds Transportation Twins 1. Steve Huntington – Old Dominion 2. Christopher Outen – FedEx Freight 3. Andrew Park – FedEx Ground Step Van 1. Travis Hutchinson – FedEx Ground 2. Mitchell Joslin – FedEx Ground 3. Paul Goldsmith – Old Dominion Money Stop 1. Joel Zamora – Old Dominion 2. Kirby Ferber – FedEx Freight 3. Christopher Outen – FedEx Freight
20 Oregon Trucking Association, Inc. Oregon Truck Dispatch
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22 Oregon Trucking Association, Inc. Oregon Truck Dispatch
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24 Oregon Trucking Association, Inc. Oregon Truck Dispatch AUGUST 19 - 21, 2024 ANNUAL OTA LEADERSHIP CONVENTION & EXHIBITION Updates & Insights from Industry Experts Committee Meetings Networking Opportunities Allied Partner Exhibition Riverhouse on the Deschutes Bend, OR ...and much more ortrucking.org/events
25 www.ortrucking.org Issue 2 | 2024 Diamond Level Gold Level Silver Level Bronze Level ANNUAL SPONSORS
26 Oregon Trucking Association, Inc. Oregon Truck Dispatch State of the Unions What a resurgence of organized labor means for trucking By Prasad Sharma, Scopelitis, Garvin, Light, Hanson & Feary, P.C. A BRIEF TOUR of headlines over the past year suggests relations between companies and their workers are tumultuous. From the threat of a strike by UPS workers and West Coast port workers to actual strikes by Hollywood writers, actors, and auto workers at the Big Three, organized labor has grabbed the spotlight. Organized labor has been aided by a White House led by the self-proclaimed “most pro-union President ever.” At the same time, only 10.1% of wage and salary workers were union members in 2022 compared to 20.1% in 1983, when the Bureau of Labor Statistics started tracking the data. In trucking, the decline in union membership is even more precipitous. When first negotiated in 1964, the Teamsters-negotiated National Master Freight Agreement covered 450,000 truckers across 16,000 companies. With Yellow’s recent closure, there are now less than 40,000 Teamsters workers covered. What does organized labor’s reinvigorated approach mean for the trucking industry, which is still in the grips of a seemingly endemic driver shortage? While the future remains largely unknowable, this article hopes to provide some observations to inform and prepare trucking companies for choppy waters ahead.1 Trends in wealth disparity may help explain why organized labor feels it has the wind at its back. A September 2022 analysis of trends in the distribution of family wealth by the Congressional Budget Office, a nonpartisan arm of Congress, found that between 2010 and 2019, the total family wealth held by the bottom 50% increased from $1.4 trillion to $2.3 trillion (just under $1 trillion). By comparison, the total family wealth held by the top 10% increased from $56.7 trillion to $82.4 trillion (over $25 trillion). While the wealth gap has been increasing, so has public support for unions. Some findings from a recent survey by Gallup on Americans’ approval of labor unions are telling. A record-high 61% of respondents said unions help rather than hurt the U.S. economy. In 2009, just 39% of respondents felt that way. Forty-three percent of respondents favored unions having more influence than they do today. By comparison, only 25% shared that sentiment in 2009. Wealth disparity may also explain the surge in economic populism—once almost exclusively the realm of Democrats but increasingly explored by Republicans. The same Gallup poll referred to above found that among Republican respondents, 47% approved of labor unions compared to just 29% of Republican respondents in 2009. Perhaps it is no coincidence that we are seeing a smattering of Republican legislators support measures like a ban on non-competes and renegotiating trade agreements to provide more worker protections, or that we recently saw workers at a Volkswagen plant in solidly red Tennessee vote to unionize. Perceived changes in public perception combined with a pro-labor Executive branch makes for a potent elixir that promises to pose challenges to trucking companies’ relationship with their workforce in the near-term. The National Labor Relations Board (NLRB), with a 3-1 Democrat majority, has been zealously acting to make unionization easier, the U.S. Department of Labor (USDOL) finalized a regulation that will make it more difficult that its predecessor regulation to classify owneroperators as independent contractors, and even the Federal Motor Carrier Safety Administration (FMCSA) is pursuing organized labor’s agenda in unprecedented ways. And that’s just at the federal level. Labor continues to push for draconian California AB 5-like legislation intended to all but eliminate the independent contractor model. All this, despite median truckload driver wages increasing as a market response to the driver shortage by 18% from 2019 to 2021, and from $46,084 in 2013 to $69,687 in 2021. As mentioned, the NLRB has been busy of late. Notably, the NLRB decided a case, The Atlanta Opera, overruling an earlier 2019 decision setting forth the test for determining whether a worker is an employee or independent contractor
27 www.ortrucking.org Issue 2 | 2024 under the National Labor Relations Act (NLRA) in favor of a test that lessens the importance of entrepreneurial opportunity. The NLRB also enacted a rulemaking that would reduce the time between filing a petition for a representation election and the actual election to as little as 20 days, thus giving employers less time advocate their views. In another decision, Cemex Construction Materials Pacific, LLC, the NLRB offered up something just short of the cardcheck legislation organized labor has long sought in Congress. Under Cemex, an employer presented with signed authorization cards from the majority of a bargaining unit generally has the option of recognizing and bargaining with the unit or having to itself file a petition for election withing 14 days. This effectively shifts the burden of demonstrating whether the union has majority support. Moreover, if the NLRB finds an employer commits an unfair labor practice during the time after the authorization cards are presented, the NLRB can order bargaining and forego the election. And finally, the NLRB has issued a joint employer rule that will make it easier to find entities with indirect or intermediate control over a single essential term or condition of employment to be a joint employer subject to bargaining. Just as the UAW has said it will target nonunion companies, trucking companies should take steps to be prepared for the Teamsters to target non-union companies. The USDOL, staffed with political appointees who share the belief voiced by the Wage and Hour Division Administrator during the Obama administration that basically every worker is an employee, finalized a rulemaking to repeal and replace a regulation setting forth the test for determining worker status under the Fair Labor Standards Act (FLSA). Labor and its allies pressed the USDOL and its acting Secretary, former California Labor Commissioner and AB five proponent, Julie Su, to fashion a test more likely to result in an employee status
28 Oregon Trucking Association, Inc. Oregon Truck Dispatch determination. From labor’s perspective, a finding that a worker is an employee for purposes of the FLSA will make it difficult for companies to maintain independent contractor status under the NLRA. Coincidentally, workers have to be employees to be covered by the NLRA and its protections for collective bargaining. Moreover, bringing class action lawsuits for misclassificationrelated claims has been a staple for plaintiffs’ attorneys. As compared to the increased certainty of its predecessor regulation, DOL’s final rule will pose challenges for the trucking industry. For example, although a worker’s investment in their business is a common indicator of independence, the proposal measures a worker’s investment in the business relative to the putative employer’s investment in the business. Under this relative comparison, a small investment would be indicative of employee status. In another example, measures implemented to comply with safety standards or customer requirements may be considered employer-like control. Organized labor often argues it is protecting the health and safety of workers, so it seems odd to discourage motor carriers from requiring safety standards that protect the worker. The final rule also considers whether the work performed by a worker (driver) is integral to the potential employer’s (carrier’s) business. Some may recognize this as the dreaded “B” prong of the California AB’s ABC test. At least under DOL rule, a finding that they are in the same line of business does not result in a determination of employee status. One would expect labor advocates to be active and influential at the NLRB and the USDOL, but their influence is impacting an agency closer to home for trucking—the FMCSA. After years of dealing with class action lawsuits alleging failure to provide additional breaks under state meal and rest break laws (e.g., California and Washington), FMCSA found those laws preempted in 2018 and 2020, respectively. In updating its Hours of Service regulations, FMCSA had already addressed what breaks were necessary for driver health and safety. The Teamsters opposed FMCSA’s preemption determination and challenged it in court, where the California preemption determination was upheld by the U.S. Court of Appeals for the Ninth Circuit. Last summer, while under pressure from the Teamsters for not doing more to step in to save Teamster jobs at Yellow, FMCSA took the remarkable step of inviting parties to submit petitions for a waiver from its preemption determinations. In essence, FMCSA understands its preemption determination to be legally sound but invited the Teamsters and others to initiate a new way to get around their conclusion. The absence of data proving the preemption determination has caused a degradation in motor carrier safety suggests this is a political, not safety, undertaking. This FMCSA has also demonstrated a new-found willingness to wade into economic issues. Admittedly at Congress’s direction, FMCSA has convened a Truck Leasing Task Force (TLTF) that, in a fairly pre-judged manner, is examining how trucking equipment leases are inequitable. Having convened several meetings, the TLTF is still struggling to distinguish between an equipment lease and an operating lease agreement regulated by 49 C.F.R. Part 376, the latter of which Congress did not authorize the task force to address. Some might say it is mission creep. The same can be said for FMCSA’s study of detention time—an economic issue with unproven links to motor carrier safety. In some states, the independent contractor model that has a long and important history of being a part of trucking remains under siege, because there is a belief that independent contractors, despite their intentional choice, need to be wrapped in a cocoon of employee status. This notion persists despite data indicating that independent contractors are very satisfied with the independence they have at work and can generally earn more net income on average than company employee drivers earn in wages. Again, organized labor’s interests are served when more workers are categorized as employees than independent contractors. That does not mean that an individual worker’s interests are similarly served. Perhaps more slowly than some would have liked, the trucking industry has reacted to the market demands of a driver shortage by increasing pay and making intentional efforts to provide drivers more home time. Trucking companies will continue to have to respond to market dynamics. However, in the current political climate where organized labor appears resurgent, and with a willing partner in the Biden White House, trucking companies will also have to prepare for and respond to market distortions induced by laws and regulations. That may range from ensuring plans are in place to rapidly and appropriately respond to a potential union organizing campaign to routinely re-assessing contracts, policies, and procedures for carriers utilizing independent contractors. So, yes, the future is largely unknowable, but we do know the current environment will present challenges to trucking companies and their workforce. This article was originally published in Arkansas Trucking Report Volume 28, Issue 6 and has been updated. 1. Any opinions expressed herein are solely those of the author and not necessarily those of Scopelitis, Garvin, Light, Hanson & Feary. State of the Unions, cont.
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