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Tuesday Jul 22, 2014 - Truckers Sue FMCSA Over Motor Carrier Management Information System
A group of truck drivers has filed a federal lawsuit against the Federal Motor Carrier Safety Administration and the U.S. Transportation Department over records the agency keeps on carriers and drivers.

The Boston Business Journal reports the drivers claim the release of some data from the government's Motor Carrier Management Information System, known as MCMIS, to potential employers is inappropriate and interferes with their ability to get jobs.

The suit claims the agency has released driver violations that are not that serious, violating U.S. Transportation Department regulations, with as many as 10,000 truckers having had records of relatively minor violations released.

The Plaintiffs are seeking class action status and a $1,000 for each alleged release of minor infractions by FMCSA. There is no indication over how many alleged infractions this totals by the agency, according to the story.

When contacted about the case, the FMCSA told, “As a matter of agency policy, we do not comment on litigation.”

Read more about the case from the Boston Business Journal.

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Tuesday Jul 22, 2014 - Traders Use Trucks, Trains to Ease West Texas Oil Glut
By Dan Murtaugh

Traders are turning to trains and trucks to clear a glut of crude in West Texas that’s threatening to keep prices in the largest U.S. oil basin depressed for months.

West Texas Intermediate crude in Midland, Texas, has averaged $7.15-a-barrel less this year than the same grade in Cushing, Oklahoma, the delivery point for New York-traded oil futures. The gap was $9 today, and is on pace to be the largest annual discount in data compiled by Bloomberg dating to 1991. Crude loading has increased in recent months at Watco Companies LLC ’s 30,000 barrel-a-day terminal in Pecos, according to Allan Roach, a senior vice president.

The price gap has emerged as directional drilling and hydraulic fracturing have nearly doubled Permian production in the past five years, overwhelming pipeline capacity. The glut will continue until Plains All-America Pipeline LP completes an 80 mile-long line connecting Midland to Colorado City, where larger pipes ship crude out of the region. For now, the oil will have to be sold cheaply enough to allow buyers to ship it on trains to the Gulf and West Coasts, or truck it up to Cushing.

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“The discounts could last longer than many in the market have anticipated given the significant production increases that are occurring in the Permian Basin,” said Andy Lipow, president of Lipow Oil Associates LLC in Houston.

Output in the Permian, the largest onshore oil field in the U.S., has jumped by 91 percent since August 2009 to 1.63 million barrels a day, Energy Information Administration data show.

Pipeline Capacity

Current pipeline capacity out of the region is 1.27 million barrels a day, according to Pioneer Natural Resources Ltd.’s July investor presentation. Magellan Midstream Partners LP (MMP:US) and Occidental Petroleum Corp. (OXY:US) are filling a new pipeline, BridgeTex, that will add 300,000 barrels a day of space.

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BridgeTex starts in Colorado City, about 80 miles northeast of Midland. Right now there are two pipelines connecting the cities, Basin and Mesa, which can ship a combined 800,000 barrels a day. Basin extends to Cushing, carrying as much as 450,000 barrels a day, and Sunoco Logistics Partners LP (SXL:US)’s West Texas Gulf line can move 400,000 barrels a day to the Houston area.

That means BridgeTex can’t relieve the glut at Midland until Plains completes the 250,000-barrel-a-day Sunrise line. Construction began May 1, according to a filing with the Railroad Commission of Texas, and the company expects it to start operating in early 2015.

Critical Piece

“One of the big additions that we’re having to make, going east out of Midland, which is becoming a critical piece to feed a lot of that is basically going up to Colorado City,” Mark Gorman, executive vice president of Houston-based Plains, said on a June 5 conference call. “That corridor has completely fallen. It’s a critical corridor to feed some of the new pipeline expansions that’ll be coming on.”

STORY: California Drivers Pay a Lot for Costly Alaskan Oil
Until the pipeline comes online, Midland prices will need to be discounted enough to support other forms of transportation, Rangeland Energy LLC’s vice president for business development, Pat McGannon, said July 16 at the American Business Conference’s Permian Basin Takeaway Capacity & Product Market Conference in Houston.

Midland prices need to be about $8.50 a barrel less than Light Louisiana Sweet in St. James, Louisiana, to make rail shipments economic, he said. The differential was $15.45 today.

West Texas Sour, a high-sulfur crude traded in Midland, needs to be about $10.50 a barrel less than Alaska North Slope crude to make it worth railing to California. It was $13 today.

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When Midland prices are $6 or $7 below Cushing, it can be economic to truck crude from the Permian to the Oklahoma oil hub about 500 miles away, Brian Melton, vice president for pipeline marketing and business development for Blueknight Energy Partners LP (BKEP:US), said July 16 in Houston. Blueknight made shipments for producers late last year and this year, he said.

To contact the reporter on this story: Dan Murtaugh in Houston at

To contact the editors responsible for this story: David Marino at Stephen Cunningham

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Tuesday Jul 22, 2014 - Trucking company asking court to limit Indiana agency's billing for repairs of highway damage

INDIANAPOLIS — A trucking company wants the state appeals court to limit the Indiana Department of Transportation's authority to sue over damage done to state highways.

The challenge is in court as the highway agency is trying to collect more from those blamed for property damage, increasing its billing more than 50 percent in the past year to about $7 million, the Indianapolis Business Journal reported ( ).

Tennessee-based Averitt Express Inc. is appealing a ruling by a judge in western Indiana's Putnam County that it owes almost $60,000 for guardrail and pavement damage from a 2011 crash on Interstate 70 in which a driver for the company was killed.

Averitt maintains that the transportation department's police of charging for routine highway repair work is illegal because those repairs are already paid for by tax money.

Other courts observe the rule that governments cannot recover the cost of routine functions through civil suits when those costs are already funded through taxation, company attorney Michael Langford wrote in an appeals court brief.

"This rule expresses the common-sense principle that taxpayers should not be asked to fund the same government functions twice," he said.

Langford said Averitt paid $1.9 million in taxes in Indiana from 2010 to 2013, and also that days before the accident, the highway department contracted for repairs to that same section of I-70, according to the company's court filings.

While the Legislature authorized the transportation department to recover highway-repair costs arising from violations of size and weight restrictions, there was no such violation in the 2011 crash, according to the company.

The Indiana attorney general's office argues the state can seek payment for damage caused by negligence regardless of whether a company pays taxes.

Deputy Attorney General Kristin Garn said in a court filing the consequence of Averitt's argument is "untenable" and cited the Putnam County judge who asked in his ruling, "Does the defendant believe that there is going to be no recovery (for) a municipality when someone (knocks) out a stoplight? The examples could go on and on, but the answer is obvious."

The appeals court hasn't yet scheduled oral arguments on the case.

Cities and states commonly bill motorists for damage to their property. Purdue University researchers studied other states' billing practices in 2010 as part of a project aimed at helping the transportation department become more efficient at recovering the cost of crash damages.

The agency's intensified collection efforts only increased the chance that someone would mount a serious legal challenge, said Lonnie Johnson, a Bloomington attorney who represents other trucking companies.

"A lot of times a practice will go on for years before anyone has the time or money to take it up on appeal," he said.

Information from: Indianapolis Business Journal,

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Monday Jul 21, 2014 - Farmer Cooperative Cited, Fined by OSHA for Truck Driver Death

Following the death of a truck driver at Midwest Farmers Cooperative's grain handling facility in Tecumseh, Neb., the U.S. Department of Labor's Occupational Safety and Health Administration has cited the company for 12 serious safety violations and proposed $62,101 in penalties.
The driver, who was not provided a respirator or personal protective clothing, was overcome by anhydrous ammonia vapors while transferring the liquid from a semi truck to bulk storage tanks, according to OSHA.

In the lungs, liquid anhydrous ammonia causes destruction of delicate respiratory tissue. Exposure to ammonia vapor may cause convulsive coughing, difficult or painful breathing, congestion and death. The worker later died at the hospital from complications related to the ammonia inhalation.

On March 20, a 250-gallon water-bleeder tank ruptured, releasing anhydrous ammonia into the atmosphere and exposing the 63-year-old driver, who had worked at the facility for more than 10 years, to an ammonia vapor cloud.

A second employee of Midwest Farmers Cooperative walked into the cloud and was treated and released from a local medical facility. An employee of Burlington Northern Santa Fe Railroad, who was performing maintenance on the adjacent railroad tracks, and a deputy sheriff responding to the scene, were also exposed, requiring medical evaluation.

The Tecumseh grain-handling facility stores and sells corn, wheat and soybeans. The facility has an anhydrous ammonia storage capacity of 400,000 pounds. The cooperative sells the ammonia to area farmers.

Because of the investigation, OSHA said it cited Midwest Farmers Cooperative with 12 serious violations. Several violations involved OSHA's storage and handling of anhydrous ammonia standards, such as failing to provide an ammonia control system; provide employees with chemically impervious clothing; inspect and maintain ammonia equipment and piping to prevent potential leaks and system failure; and develop and train workers in an emergency response plan. The company was cited for storing the chemical in tanks located within 100 feet of a mainline railroad track.

Other violations involved respiratory protection standards, such as failing to ensure self-contained breathing apparatus and atmospheric monitoring equipment were provided and used for response to an emergency, as well as for failing to medically evaluate and fit test workers required to use respirators.

Greenwood Farmers Cooperative merged with Waverly Farmers Cooperative in January 2014 and operates as Midwest Farmers Cooperative. Before this inspection, OSHA previously cited the company twice in 2011, resulting in the issuance of eight citations, according to OSHA.

The company has contested the citations and requested a hearing before the independent Occupational Safety and Health Review Commission.

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Monday Jul 21, 2014 - Linehaul rate talks still ‘not favorable’ for shippers
By Kevin Jones @KevinJonesCCJ on July 21, 2014

Truckload linehaul rates paid by North American shippers in June were 5.2 percent higher than in June of last year, according to the Cass Truckload Linehaul Index, a measure of market fluctuations in per-mile truckload linehaul rates. (Slide 1)

The June index ticked upward 0.4 percent from May to 119.1, but still lags April’s all-time high of 121.3. The index uses January 2005 as its base month, with an initial reading of 100. (Slide 2)

“As demand continues to increase while capacity exits the marketplace, this year’s procurement events and contract negotiations have not, in general, been ending favorably for shippers,” says the report, published by Cass Information Systems along with the securities analysts at Avondale Partners. “For the remainder of this year, expect stronger industrial production, increased consumer spending, and the continued recovery in housing to continue to squeeze capacity.”

June spot market freight soars on economic upturn: 6 slides

Freight availability on the spot market was 50 percent higher in June compared to the same month the previous year, continuing a pattern of elevated activity in 2014, according to the DAT North American Freight ...

The Cass Intermodal Price Index, meanwhile, slipped 4.9 percent in June from the previous month to 126.6, the lowest reading since November 2013. The index, however, is still 3.9 percent higher than the year before. (Slide 3)

“Although intermodal costs seem to have peaked for this year and have been falling over the last couple of months, they remain considerably high compared to the last several years,” the Cass report says. “On average for 2014, intermodal costs have been up 2.1 percent year-over-year, with the difference greater in the last three months, partially due to rising diesel costs. For the most part though, it’s supply and demand.”

The Association of American Railroads has reported that U.S. intermodal volumes are up significantly over last year: 9 percent in April, 8 percent in May, and 7 percent in June.

And speaking of shippers and rate negotiations, 3PL and supply chain technology company Transplace recently hosted a webinar on truckload sourcing best practices, and breaks out a list of Top 10 Tips into three main stages: better planning, better bidding and better decision making. (Slide 4)

“Shippers are risk adverse and would rather align with core carriers to keep service high,” says Cindy Bosecker, director of Engineering for Transplace.

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Sunday Jul 20, 2014 - Trucking Company Owner Pleads Guilty in Missouri to Cargo Theft Scheme
A Memphis, Tenn., business owner pleaded guilty in federal court to his role in a cargo theft scheme that included a theft in West Plains, Mo.

Tammy Dickinson, United States Attorney for the Western District of Missouri, announced that Earl Stanley Nunn pleaded guilty to theft of an interstate shipment.

Nunn, the owner of Nu World Trucking LLC, was the leader of a cargo theft ring that used the resources of Nu World Trucking to steal cargo in various states. They did so by “bob-tailing” (meaning they traveled in a road tractor truck, without a semi-trailer attached) through truck stops and service stations located on or near interstate highways, looking for semi-trailers that had been left parked and unattended, and were not coupled to road tractors, the U.S. attorney’s office said.

When they located a semi-trailer that appeared to be unattended, they would steal the semi-trailer and the goods it contained by coupling their road tractor truck to it and driving off. After having stolen a semi-trailer and its contents, they usually transported the stolen goods to the Chicago, Ill., and Detroit, Mich., areas to be “fenced” or sold, according to Dickinson.

Nunn’s co-conspirators included his nephew, Michael Lee Sherley of Memphis, Tenn. (who pleaded guilty on March 19, 2014), his son, Roderick Nunn (who pleaded guilty in a related case in the Western District of Michigan) and others.

The government plans to establish that co-conspirators committed thefts in various states, including Arkansas, Illinois, Indiana, Iowa, Kansas, Kentucky, Maryland, Michigan, Missouri, Nebraska, Ohio, Tennessee, Texas and Virginia.

The specific charge to which both Nunn and Sherley pleaded guilty involves a theft that occurred on May 11, 2013, at the Snappy Mart Truck Stop in West Plains.

Nunn and Sherley stole a 2000 Wabash trailer (valued at $7,500), which contained a load of Green Giant canned corn (valued at $73,008). The trailer, owned by Bryant Freight, LLC, was in transit from Minnesota to a food bank in Arkansas.

Nunn and Sherley admitted that they traveled through Missouri and Indiana with the stolen cargo before being apprehended in Michigan.

Under federal statutes, Nunn and Sherley are each subject to a sentence of up to 10 years in federal prison without parole, plus a fine up to $250,000. A sentencing hearing will be scheduled after the completion of a presentence investigation by the United States Probation Office.

This case is being prosecuted by Assistant U.S. Attorney Steven M. Mohlhenrich. It was investigated by the FBI’s Memphis Cargo Theft Task Force, the U.S. Marshal’s Service, the West Plains, Mo., Police Department and the Michigan State Highway Patrol.

Source: United States Attorney for the Western District of Missouri

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Sunday Jul 20, 2014 - Carmel to truck drivers: Stay off our roads
The closure of U.S. 31 has brought an unexpected menace to the land of roundabouts — 18-wheelers.

They tear up the pavement, tie up traffic and struggle — sometimes comically — to navigate Carmel's unique traffic grid.

But city leaders are no longer amused.

Within the next several weeks, police will start ticketing truck drivers who stray from state-designated detours under a new ordinance passed this month by the Carmel City Council. The measure bans trucks larger than 19,500 pounds from some local roads that have absorbed displaced traffic while U.S. 31 is closed.

Most are natural local detours off U.S. 31, such as Illinois and Old Meridian streets. But the ban also extends to Main Street, which runs through Carmel's Arts and Design District. Trucks making local deliveries will not be affected by the ordinance.

Council members, who approved the ordinance unanimously, said they've seen an influx of semitrailer trucks on local roads since the Indiana Department of Transportation shut down a stretch of U.S. 31 in April for eight months of construction.

"Drivers of large vehicles, mostly tractor-trailers ... are just not believing that sign up north of us that says 'no through traffic, divert to Keystone,' Councilman Rick Sharp said. "By the time they find out the sign is for real, they're stuck."

Mayor Jim Brainard, who supports the new ordinance, said one truck driver was caught trying to pull a U-turn on a small roundabout on Main Street.

Not surprisingly, the driver failed. The attempt was immortalized — and mocked — on social media.

"He almost made it," Brainard quipped.

Jokes aside, council members say they have more serious concerns. Sharp said he saw one truck run a red light about 7 seconds late. The council also is worried about heavy trucks tearing up the city's roads.

"This is not an ordinance searching for a problem to fix," Sharp said. "These are very real problems that we're having right now."

Gary Langston, president of the Indiana Motor Truck Association, said he wasn't familiar with the specifics of Carmel's proposal, but he typically pushes for tolerance when cities consider banning large trucks from certain areas. Trucks, he said, are the only way companies have to get goods to consumers.

He suspects few truck drivers are mingling with local traffic on purpose.

"The last thing that a trucker wants to do is get caught in a congested area," Langston said. "Congestion costs billions of dollars a year to the trucking industry."

Given truckers' natural aversion to local roads, it remains unclear how much of an effect Carmel's new ordinance will have. Langston, for one, hasn't heard of much confusion among truckers about how to navigate the U.S. 31 detour, unlike a past closure of the I-65 and I-70 interchange.

Come Thanksgiving, Carmel will have a new challenge: retraining truck traffic to use U.S. 31. When the highway reopens, the designated detour, Keystone Avenue, will resume its own prohibition on large trucks.

Call Star reporter Brian Eason at (317) 444-6129. Follow him on Twitter: @brianeason.

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Sunday Jul 20, 2014 - Werner Enterprises Investing in Chinese Carrier
Nebraska-based trucking and logistics company Werner Enterprises said Friday its Werner Global Logistics subsidiary has signed an agreement in principle to make an equity investment in Hercules Logistics, a logistics and asset-based transportation company headquartered in Shenzhen, China.
Hercules, founded in 2001, is one of the largest and fastest growing logistics companies in China, according to Werner and is recognized as one of the top 100 logistics companies in the country. Hercules provides logistics and transportation services in the areas of long haul and port dray trucking services, forwarding and freight management, contract logistics, integrated supply chain, warehouse distribution and customs brokerage.

“Throughout the last six years, we have expanded our business relationship and worked closely with Ken Mei, chairman and CEO of Hercules, and his management team. We understand the needs of our customers to better manage their supply chains involving the Asian market, as well as their desire to further expand into China’s growing domestic market,” said Derek Leathers, Werner’s president and chief operating officer “The strategic and operational fit between Werner and Hercules creates a compelling asset-based solution to our customers’ needs.”

Werner entered China’s transportation and logistics market in 2006 when Werner Global Logistics, Shanghai Company was formed. The combined network of Werner Global Logistics and Hercules will represent more than 20 office, warehouse and logistics centers in China and a combined network of over 1,000 trucks operating in China and approximately 7,100 trucks and over 23,000 trailers operating within North America.

“We see significant opportunities to serve our diverse customer base, particularly in North America, with Werner as an integrated part of our global network,” said Ken Mei, chairman and CEO of Hercules.

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Friday Jul 18, 2014 - Trucking Rates Dropped Slightly
BLOOMINGTON, IN — Freight transportation forecasting firm FTR said modest recovery growth and slow contract rate increases in the U.S. now come with a side of increased labor and recruiting overhead costs.

“Capacity is tight but has moderated from the critical level that we operated in during and just after the winter months. Freight rates seem to be a tale of two cities with contract rates very stable and only showing modest growth, yet spot rate activity has been quite strong since winter hit and has not let off since then,” said Jonathan Starks, FTR’s director of transportation analysis.

FTR’s Trucking Conditions Index in May, at a reading of 5.74, shows that what it called "a near capacity crisis environment" through May is expected to have eased somewhat in June. While still in solidly positive territory, the index outlook has moderated.

Starks said that if economic growth continues to remain modest, “then we would expect the status quo to persist for some time; however, if the economy finally shows a strong growth spurt in 2014 there isn’t sufficient surge capacity in the truck market to be able to easily accommodate that growth.”

When combined with the inability to quickly add more drivers into the industry, Starks said FTR then expects rate growth to accelerate in both the spot and contract markets.

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Friday Jul 18, 2014 - Police accuse trucker of firing handgun at motorist on Oklahoma City highway

An Oklahoma trucker was arrested after he was accused of firing a handgun from his driver’s seat window at another vehicle while traveling down an Oklahoma City highway, police reported.

Benny Newcomb, 55, was jailed on complaints of discharging a firearm from a vehicle and shooting with intent to kill, according to a police report.

About 3:30 p.m. Wednesday, police were called to a gas station at SW 15 and S MacArthur Boulevard, where a man reported a road rage incident. The man told officers he was driving west on State Highway 152 approaching the MacArthur exit when a man with what looked like a gun pulled up beside him, driving a truck with no trailer attached. Seconds later, he heard a noise and his window exploded, the report stated.

The man reported the name of the trucking company to police. Officers located the truck using the company’s GPS. Police found a loaded 9 mm pistol and ammunition inside the truck, the report stated.

Newcomb, of Chandler, told police the man, who suffered redness and bruising on his left arm, nearly ran him off the road before the incident.

Newcomb was booked into Oklahoma County jail where he remained Thursday in lieu of $90,000 bail, a jail spokeswoman said.

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