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Testimony: 

Before the Subcommittee on Highways and Transit, Committee on 
Transportation and Infrastructure, House of Representatives: 

United States Government Accountability Office: 

GAO: 

For Release on Delivery Expected at 2:00 p.m. EDT: 

Wednesday, July 11, 2007: 

Motor Carrier Safety: 

Preliminary Information on the Federal Motor Carrier Safety 
Administration's Efforts to Identify and Follow Up with High-risk 
Carriers: 

Statement of Susan A. Fleming, Director: 
Physical Infrastructure Issues: 

GAO-07-1074T: 

GAO Highlights: 

Highlights of GAO-07-1074T, a testimony before the Subcommittee on 
Highways and Transit, Committee on Transportation and Infrastructure, 
House of Representatives 

Why GAO Did This Study: 

The Federal Motor Carrier Safety Administration (FMCSA) has the primary 
federal responsibility for reducing crashes involving large trucks and 
buses. FMCSA uses its “SafeStat” tool to select carriers for reviews 
for compliance with its safety regulations based on the carriers’ crash 
rates and prior safety violations. FMCSA then conducts these compliance 
reviews and can place carriers out of service if they are found to be 
operating unsafely. 

This statement is based on a recent report (GAO-07-585) and other 
nearly completed work. GAO assessed (1) the extent to which FMCSA 
identifies carriers that subsequently have high crash rates, (2) how 
FMCSA ensures that its compliance reviews are conducted thoroughly and 
consistently, and (3) the extent to which FMCSA follows up with 
carriers with serious safety violations. GAO’s work was based on a 
review of laws, program guidance, and analyses of data from 2004 
through early 2006. 

What GAO Found: 

FMCSA generally does a good job in identifying carriers that pose high 
crash risks for subsequent compliance reviews, ensuring the 
thoroughness and consistency of those reviews, and following up with 
high-risk carriers. 

SafeStat is nearly twice as effective (83 percent) as random selection 
in identifying carriers that pose high crash risks. However, its 
effectiveness could be improved by using a statistical approach 
(negative binomial regression), which provides for a systematic 
assessment to apply weights to the four SafeStat safety evaluation 
areas (accidents and driver, vehicle, and safety management violations) 
rather than FMCSA’s approach, which relies on expert judgment. The 
regression approach identified carriers that had twice as many crashes 
in the subsequent 18 months as did the carriers identified by the 
current SafeStat approach. FMCSA is concerned that adopting this 
approach would result in it placing more emphasis on crashes and less 
emphasis on compliance with its safety management, vehicle, and driver 
regulations. GAO believes that because (1) the ultimate purpose of 
compliance reviews is to reduce the number and severity of truck and 
bus crashes and (2) GAO’s and others’ research has shown that crash 
rates are stronger predictors of future crashes than is poor compliance 
with FMCSA’s safety regulations, the regression approach would improve 
safety. 

GAO’s preliminary assessment is that FMCSA promotes thoroughness and 
consistency in its compliance reviews through its management processes, 
which meet GAO’s standards for internal controls. For example, FMCSA 
uses an electronic manual to record and communicate its compliance 
review policies and procedures and teaches proper compliance review 
procedures through both classroom and on-the-job training. Furthermore, 
investigators use an information system to document their compliance 
reviews, and managers review these data, helping to ensure thoroughness 
and consistency between investigators. For the most part, FMCSA and 
state investigators cover the nine major applicable areas of the safety 
regulations (e.g., driver qualifications and vehicle condition) in 95 
percent or more of compliance reviews, demonstrating thoroughness and 
consistency. 

GAO’s preliminary assessment is that FMCSA follows up with almost all 
carriers with serious safety violations, but it does not assess the 
maximum fines against all serious violators that GAO believes the law 
requires. FMCSA followed up with at least 1,189 of 1,196 carriers (99 
percent) that received proposed unsatisfactory safety ratings from 
compliance reviews completed in fiscal year 2005. For example, FMCSA 
found that 873 of these carriers made safety improvements and it placed 
306 other carriers out of service. GAO also found that FMCSA (1) 
assesses maximum fines against carriers for the third instance of a 
violation, whereas GAO reads the statute as requiring FMCSA to do so 
for the second violation and (2) does not always assess maximum fines 
against carriers with a pattern of varied serious violations, as GAO 
believes the law requires. 

What GAO Recommends: 

In June, GAO recommended that FMCSA use a regression model approach to 
identify high-risk carriers. FMCSA agreed that this approach looks 
promising but is concerned that it results in less emphasis on other 
regulatory areas. GAO is considering several recommendations, including 
that FMCSA assess maximum penalties in situations which GAO believes 
the law requires. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-1074T. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Susan A. Fleming at (202) 
512-2834 or flemings@gao.gov. 

[End of section] 

Mr. Chairman and Members of the Subcommittee: 

We appreciate the opportunity to participate in this hearing to discuss 
the Federal Motor Carrier Safety Administration's (FMCSA) oversight of 
motor carriers that pose high crash risks. This is an important issue 
because each year about 5,500 people die as a result of crashes 
involving large commercial trucks or buses,[Footnote 1] and about 
160,000 more people are injured. These crashes may result from errors 
by truck, bus, or passenger vehicle drivers; vehicle condition; and 
other factors. Effective oversight is important because of the large 
size of the motor carrier industry (over 700,000 carriers are 
registered with FMCSA[Footnote 2]) compared to the number of compliance 
reviews--reviews of carriers at their bases of operations for 
compliance with FMCSA's safety regulations--that FMCSA and its state 
partners are able to conduct each year (about 15,000 in 2006). As a 
result, it is crucial that FMCSA identify the most unsafe carriers so 
that the carriers either improve their operations or are put out of 
service. 

My remarks are based on work we have recently completed for this 
Subcommittee and the full committee[Footnote 3] and on the preliminary 
results of our ongoing work for the Chairman of the full committee. 
This latter work is nearing completion, and we expect to report on our 
final results on these and other topics later this summer. 
Specifically, we have been assessing (1) the extent to which FMCSA 
identifies carriers that subsequently have high crash rates, (2) how 
FMCSA ensures that its compliance reviews are conducted thoroughly and 
consistently, and (3) the extent to which FMCSA follows up with 
carriers with serious safety violations. 

Our work was based on a review of laws, regulations, program guidance, 
analyses of data, and discussions with FMCSA. To determine the extent 
to which FMCSA identifies carriers that subsequently have high crash 
rates, we analyzed data from FMCSA's Motor Carrier Management 
Information System for its June 2004 assessment of carriers and 
compared it to data on crashes the carriers experienced over the 
subsequent 18 months (July 2004 through December 2005).[Footnote 4] To 
assess how FMCSA ensures that its compliance reviews are completed 
thoroughly and consistently, we identified our key internal control 
standards related to the communication of policy, documentation of 
results, and monitoring and reviewing of activities and 
findings.[Footnote 5] We gathered information on these key internal 
controls through discussions with FMCSA officials in its headquarters 
as well as in 7 of FMCSA's 52 field division offices and reviews of 
policy documents and reports. To assess the extent to which FMCSA 
follows up with carriers with serious violations and assesses maximum 
fines in certain situations, we reviewed regulations and FMCSA policies 
directing how FMCSA must follow up and track these violators, analyzed 
data to determine if FMCSA had met these requirements, and held 
discussions with FMCSA officials. As part of our review, we assessed 
internal controls and the reliability of FMCSA's data on motor 
carriers' safety history and compliance review and enforcement 
activities pertinent to this effort. While there are known problems 
with the quality of the crash data reported to FMCSA, we determined 
that the data were sufficiently reliable for our use, which was to 
assess whether different approaches to categorizing carriers could lead 
to better identification of carriers that subsequently have high rates 
of crashes. We conducted our work from February 2006 through July 2007 
in accordance with generally accepted government auditing standards. 

By and large, FMCSA does a good job of identifying carriers that pose 
high crash risks for subsequent compliance reviews, ensuring the 
thoroughness and consistency of those reviews, and following up with 
high-risk carriers. That being said, we have identified areas that 
could be improved. In summary: 

* Overall, the data-driven model that FMCSA uses to identify carriers 
that pose high crash risks--the Motor Carrier Safety Status Measurement 
System (SafeStat)--does a good job of identifying carriers that pose 
high crash risks. In this regard, we found that it is nearly twice as 
effective (83 percent better) as random selection in identifying 
carriers that pose high crash risks. Thus, in our view, it has value 
for improving safety. However, we believe that its effectiveness could 
be improved through either of two enhancements that we analyzed. One 
enhancement entails applying a statistical approach, called the 
negative binomial regression model, to the four SafeStat safety 
evaluation areas (accidents and driver, vehicle, and safety management 
violations) instead of its current approach, which relies on expert 
judgment to assign weights to each of the four areas.[Footnote 6] The 
other enhancement--the results of which are preliminary--uses the 
existing SafeStat overall design but places greater weight on carriers 
that scored among the worst in the accident safety evaluation area. 
Both enhancements performed better than the current SafeStat approach. 
For example, the regression approach identified carriers that had twice 
as many crashes in the subsequent 18 months as the carriers the current 
SafeStat approach identified. We believe that the negative binomial 
regression model approach offers a greater potential for improving 
safety over the other enhancement that we analyzed and the current 
SafeStat approach because it provides for a systematic assessment of 
the relative contributions of accidents and driver, vehicle, and safety 
management violations rather than the use of expert judgment to apply 
weights to these areas. FMCSA agreed that our approach looks promising 
but believes that placing more emphasis on crashes is 
counterproductive, in part, because it would have to place less 
emphasis on compliance with its safety management, vehicle, and driver 
regulations. We disagree because the ultimate purpose of compliance 
reviews is to reduce the number and severity of truck and bus crashes, 
and high crash rates are stronger predictors of future crashes than is 
poor compliance with safety regulations. 

* Our preliminary assessment showed that FMCSA's management of its 
compliance reviews meets our standards for internal controls, thereby 
promoting thoroughness and consistency. FMCSA records its compliance 
review policies and procedures in an electronic operations manual and 
distributes the manual to investigators and managers. FMCSA also trains 
investigators on these policies and procedures. Investigators we spoke 
with found both the electronic manual and the training to be effective 
means of communicating policies and procedures. FMCSA and state 
investigators use an information system to document the results of the 
compliance reviews. This information system supports thoroughness and 
consistency by alerting investigators if they are not following key 
policies or if data appears suspect; the system also provides managers 
readily available data to review. For the most part, FMCSA and state 
investigators cover the nine major applicable areas of the safety 
regulations (e.g., driver qualifications and vehicle repair and 
maintenance) in 95 percent or more of compliance reviews, demonstrating 
thoroughness and consistency. 

* Our preliminary assessment showed that FMCSA follows up with many 
carriers with serious safety violations, but it does not assess maximum 
fines against all serious violators, as we believe is required by law. 
FMCSA followed up with at least 1,189 of 1,196 carriers (99 percent) 
that received a proposed safety rating of unsatisfactory following 
compliance reviews completed in fiscal year 2005. For example, FMCSA 
found that 873 of these carriers made safety improvements and it placed 
306 other carriers out of service. FMCSA monitors carriers to identify 
those that are violating out-of-service orders, but in fiscal years 
2005 and 2006, it cited only 26 of 768 carriers that its monitoring 
showed had a roadside inspection or crash while subject to an out-of- 
service order. An FMCSA official told us that some of the 768 carriers, 
such as carriers that were operating intrastate,[Footnote 7] may not 
have been violating the out-of-service order and that FMCSA did not 
have enough resources to determine whether each of the carriers was 
violating an out-of-service order. Finally, we found that while FMCSA 
assesses maximum fines against carriers that repeat a serious 
violation, it does not, as we believe federal law requires, assess 
maximum fines against carriers with a pattern of serious violations. In 
addition, FMCSA assesses maximum fines only for the third instance of a 
violation. We read the statute as requiring FMCSA to assess the maximum 
fine if a serious violation is repeated once--not only after it is 
repeated twice. 

In our June report we recommended that FMCSA use a negative binomial 
regression model approach to identify carriers that pose high crash 
risks. We are considering making several recommendations based on our 
ongoing work, including that FMCSA assess maximum fines, as discussed 
above, in circumstances that we believe the law requires it to do so. 
Finally, we have also reported on other aspects of FMCSA's operations 
within the past 18 months. These products are listed at the end of this 
statement. 

Background: 

In the United States, commercial motor carriers account for less than 5 
percent of all highway crashes, but these crashes result in about 13 
percent of all highway deaths, or about 5,500 of the approximately 
43,000 nationwide highway fatalities that occur annually. In addition, 
about 160,000 of the approximately 3.2 million highway injuries per 
year involve motor carriers. While the fatality rate for trucks has 
generally decreased over the past 30 years, it has been fairly stable 
since 2002. (See fig. 1.) The fatality rate for buses decreased 
slightly from 1975 to 2005, but it has more annual variability than the 
fatality rate for trucks due to a much smaller total vehicle miles 
traveled. 

Figure 1: Commercial Motor Vehicle Fatality Rate, 1975 to 2005: 

[See PDF for image] 

Source: GAO analysis of Department of Transportation data. 

Notes: Fewer buses are involved in fatal or non-fatal accidents than 
large trucks, but they tend to involve more people. The latest year for 
which data were available was 2005. 

[End of figure] 

FMCSA's primary mission is to reduce the number and severity of crashes 
involving large trucks and buses. FMCSA relies heavily on the results 
of compliance reviews to determine whether carriers are operating 
safely and, if not, to take enforcement action against them. FMCSA 
conducts these on-site reviews to determine carriers' compliance with 
safety regulations that address areas such as alcohol and drug testing 
of drivers, driver qualifications, driver hours of service, vehicle 
maintenance and inspections, and transportation of hazardous materials. 

FMCSA uses a data-driven analysis model called SafeStat to assess 
carriers' risks relative to all other carriers based on safety 
indicators, such as their crash rates and safety violations identified 
during roadside inspections and prior compliance reviews. A carrier's 
score is calculated based on its performance in four safety evaluation 
areas: accidents and driver, vehicle, and safety management violations. 
(See fig. 2.) 

Figure 2: FMCSA's Safety Oversight Approach: 

[See PDF for image] 

Source: GAO and FMCSA. 

[End of figure] 

FMCSA assigns categories to carriers ranging from A to H according to 
their performance in each of the safety evaluation areas. (See table 
1.) Although a carrier may receive a value in any of the four safety 
evaluation areas, the carrier receives a SafeStat score only if it is 
deficient in two or more safety evaluation areas. The calculation used 
to determine a motor carrier's SafeStat score is: 

SafeStat Score = 2 x accident value + 1.5 x driver value + vehicle 
value + safety management value: 

Table 1: SafeStat Categories: 

Deficient in two or more areas. 

Category: A; 
Condition: Deficient in all 4 safety evaluation areas or deficient in 3 
safety evaluation areas that result in a weighted SafeStat score of 350 
or more; 
Priority for compliance review: High. 

Category: B; 
Condition: Deficient in 3 safety evaluation areas that result in a 
weighted SafeStat score of less than 350 or deficient in 2 safety 
evaluation areas that result in a weighted SafeStat score of 225 or 
more; 
Priority for compliance review: High. 

Category: C; 
Condition: Deficient in 2 safety evaluation areas that result in a 
weighted SafeStat score of less than 225; 
Priority for compliance review: Medium. 

Deficient in one area only. 

Category: D; 
Condition: Deficient in the accident safety evaluation area (area value 
between 75-100); 
Priority for compliance review: Low. 

Category: E; 
Condition: Deficient in the driver safety evaluation area (area value 
between 75-100); 
Priority for compliance review: Low. 

Category: F; 
Condition: Deficient in the vehicle safety evaluation area (area value 
between 75-100); 
Priority for compliance review: Low. 

Category: G; 
Condition: Deficient in the safety management safety evaluation area 
(area value between 75- 100); 
Priority for compliance review: Low. 
Not deficient in any area. 

Category: H; 
Condition: Not deficient in any of the safety evaluation areas; 
Priority for compliance review: Low. 

Source: GAO summary of FMCSA data. 

[End of table] 

Based on the results of a compliance review, FMCSA assigns the carrier 
a safety rating of satisfactory, conditional, or unsatisfactory. The 
safety rating, which is distinct from a carrier's SafeStat category, 
reflects FMCSA's determination of a carrier's fitness to operate 
safely. FMCSA issues out-of-service orders to carriers rated 
unsatisfactory, and these carriers are not allowed to resume operating 
until they make improvements that result in an upgraded safety rating. 
Carriers rated conditional are allowed to continue operating, but FMCSA 
aims to conduct follow-up compliance reviews on these carriers. 
Regardless of a carrier's safety rating, FMCSA can assess a fine 
against a carrier with violations, and it is more likely to assess 
higher fines when these violations are serious. 

SafeStat Identifies Many High-risk Carriers, but Enhancements Could 
Identify Carriers with Even Higher Risks: 

SafeStat identifies many carriers that pose a high risk for crashes and 
is about twice as effective (83 percent) as randomly selecting carriers 
for compliance reviews. As a result, it has value for improving motor 
carrier safety. However, two enhancements that we analyzed could lead 
to FMCSA identifying carriers that pose greater crash risks overall. 
These approaches entail giving more weight to crashes than the current 
SafeStat model does. FMCSA has concerns about these approaches, in 
part, because placing more emphasis on accidents would require it to 
place less emphasis on other types of problems. FMCSA recognizes that 
SafeStat can be improved, and as part of its Comprehensive Safety 
Analysis 2010 reform initiative--which is aimed at improving its 
processes for identifying and dealing with unsafe carriers and drivers-
-the agency is considering replacing SafeStat by 2010. 

Using Either a Statistical Approach or Modifying Existing SafeStat 
Categorization Rules Could Improve Identification of High-risk 
Carriers: 

In June 2007, we reported that FMCSA could improve SafeStat's ability 
to identify carriers that pose high crash risks if it applied a 
statistical approach, called the negative binomial regression model, to 
the four SafeStat safety evaluation areas instead of its current 
approach.[Footnote 8] We used this approach to determine whether 
systematic analyses of data through regression modeling offered 
improved results in identifying carriers that pose high crash risks 
over FMCSA's model, which uses expert judgment and professional 
experience to apply weights to each of the safety evaluation areas. The 
negative binomial model results in a rank order listing of carriers by 
crash risk and the predicted number of crashes. This differs from 
SafeStat's current approach, which gives the highest priority to 
carriers that are deficient in three or more safety evaluation areas or 
that score over a certain amount--SafeStat categories A and B. (See 
table 1.) 

The other enhancement that we analyzed--the results of which are 
preliminary--utilized the existing SafeStat overall design but examined 
the effect of providing greater priority to carriers that scored among 
the worst 5 percent of carriers in the accident safety evaluation area 
(SafeStat category D). We chose this approach because we found that 
while the driver, vehicle, and safety management evaluation areas are 
correlated with the future crash risk of a carrier, the accident 
evaluation area correlates most with future crash risk.[Footnote 9] 
This approach would retain the overall SafeStat framework and 
categorization--categories A through G for carriers with safety 
problems--but would substitute carriers in category D (the accident 
category) for carriers in categories A and B that have either (1) lower 
overall SafeStat scores or (2) lower accident area scores. 

We compared the performance of our regression model approach and 
placing greater weight on carriers that scored among the worst 5 
percent of carriers in SafeStat category D to the current SafeStat 
model. The comparison showed that both these approaches performed 
better than the current SafeStat approach. (See table 2.) For example, 
the regression model approach identified carriers with an average of 
111 crashes per 1,000 vehicles over an 18-month period compared with 
the current SafeStat approach, which identified carriers for compliance 
reviews with an average of 102 crashes per 1,000 vehicles. This 9 
percent improvement would have enabled FMCSA to identify carriers with 
almost twice as many crashes in the following 18 months as those 
carriers identified in its current approach (19,580 v. 
10,076).[Footnote 10] Placing greater emphasis on carriers in category 
D provided superior results to the current SafeStat approach both in 
terms of identifying carriers with higher crash rates (from 6 to 9 
percent higher) and greater numbers of crashes (from about 600 to 800 
more). In addition, the regression approach performed at least as well 
as placing greater emphasis on carriers in category D in terms of 
identifying carriers with the highest crash rates and much better in 
identifying carriers with the greatest number of crashes. 

Table 2: Regression Model Approach Compared With Refined 
Categorizations of SafeStat Results and with Current SafeStat Approach: 

Approach: Regression model approach; 
Crash rate[A]: 111.4; 
Number of crashes in 18 months: 19,580. 

Approach: Refined categorization alternative 1: substitute SafeStat 
category D (accident) carriers for category A and B carriers with the 
lowest overall SafeStat scores; 
Crash rate[A]: 111.0; 
Number of crashes in 18 months: 10,682. 

Approach: Refined categorization alternative 2: substitute SafeStat 
category D (accident) carriers for category A and B carriers with the 
lowest accident area scores; 
Crash rate[A]: 107.8; 
Number of crashes in 18 months: 10,887. 

Approach: Current SafeStat approach; 
Crash rate[A]: 102.2; 
Number of crashes in 18 months: 10,076. 

Source: GAO analysis of FMCSA data. 

[A] Crash rates are crashes per 1,000 vehicles in the 18 months 
following the June 2004 SafeStat categorization. 

Note: The relationship between number of crashes and the crash rate is 
not linear because the different analyses identified carriers with 
different fleet sizes as posing a high crash risk. 

[End of table] 

Because both the approaches that we analyzed would identify a larger 
number of carriers that pose high crash risks, FMCSA would choose the 
number of carriers to review based on the resources available to it, 
much as it currently does. 

We believe that our statistically based regression model is preferable 
to placing greater weight on carriers in category D because it provides 
for a systematic assessment of the relative contributions of accidents 
and driver, vehicle, and safety management violations. We recommended 
that FMCSA adopt such an approach. By its very nature the regression 
approach looks for the "best fit" in identifying the degree to which 
prior accidents and driver, vehicle, and safety management violations 
identify the likelihood of carriers having crashes in the future, 
compared to the current SafeStat approach, in which the relationship 
among the four evaluation areas is based on expert judgment. In 
addition, because the regression model could be run monthly--as is the 
current SafeStat model--any change in the degree to which accidents and 
driver, vehicle, and safety management violations better identify 
future crashes will be automatically considered as different weights to 
the four evaluation areas are assigned. This is not the case with the 
current SafeStat model, in which the evaluation area weights generally 
remain constant over time.[Footnote 11] 

FMCSA agreed that use of a negative binomial regression model looks 
promising but officials said that the agency believes that placing more 
emphasis on the accident area would be counterproductive. First, FMCSA 
is concerned that this would require placing correspondingly less 
emphasis on the types of problems the compliance review is designed to 
address so that crashes can be reduced (i.e., the lack of compliance 
with safety regulations related to drivers, vehicles, and safety 
management that is captured in the other evaluation areas). Along this 
line, FMCSA said that compliance reviews of carriers in SafeStat 
category D have historically resulted in fewer serious violations than 
compliance reviews of carriers in SafeStat category A or B. We agree 
with FMCSA that the use of the approaches that we are discussing here 
today could tilt enforcement heavily toward carriers with high crash 
rates and away from carriers with compliance issues. We disagree, 
however, that this would be counterproductive. We found that while 
driver, vehicle, and safety management evaluation area scores are 
correlated with the future crash risk of a carrier, high crash rates 
are a stronger predictor of future crashes than poor compliance with 
safety regulations. FMCSA's mission--as well as the ultimate purpose of 
compliance reviews--is to reduce the number and severity of truck and 
bus crashes. 

Second, FMCSA officials said that placing more emphasis on the accident 
evaluation area would increase emphasis on the least reliable type of 
data used by SafeStat--crash data--and in so doing, it would increase 
the sensitivity of the results to crash data quality issues. However, 
in June 2007 we reported that FMCSA has made considerable efforts to 
improve the reliability of crash data. The report also concluded that 
as FMCSA continues its efforts to have states improve crash data, any 
sensitivity of results from our statistically based model to crash data 
quality issues should diminish. 

FMCSA Is Considering Replacing SafeStat with a New Tool by 2010: 

As part of its Comprehensive Safety Analysis 2010, a reform initiative 
aimed at improving its processes for identifying and dealing with 
unsafe carriers and drivers, FMCSA is considering replacing SafeStat 
with a new tool by 2010. The new tool could take on greater importance 
in FMCSA's safety oversight framework because the agency is considering 
using the tool's assessments of carriers' safety to determine whether 
carriers are fit to continue operating. In contrast, SafeStat is 
primarily used now to prioritize carriers for compliance reviews, and 
determinations of operational fitness are made only after compliance 
reviews are completed. FMCSA also plans to develop a tool to assess the 
safety status of individual drivers, along with tools for dealing with 
unsafe drivers. Even though FMCSA is considering replacing SafeStat, we 
believe that implementing either of the approaches discussed in this 
statement would be worthwhile because it would be relatively easy to do 
and result in immediate safety benefits that could save lives. 

FMCSA's Management of Its Compliance Reviews Promotes Thoroughness and 
Consistency: 

Our preliminary assessment is that FMCSA manages its compliance reviews 
in a way that meets our standards for internal control, thereby 
promoting thoroughness and consistency in the reviews.[Footnote 12] It 
does so by establishing compliance review policies and procedures 
through an electronic manual and training, using an information system 
to document the results of its compliance reviews, and monitoring 
performance. We also found that compliance reviews cover most of the 
major areas of the agency's safety regulations. 

FMCSA Communicates Its Compliance Review Policies and Procedures 
through an Electronic Manual and Training: 

FMCSA's communication of its policies and procedures related to 
conducting compliance reviews meets our standards for internal control. 
These standards state that an organization's policies and procedures 
should be recorded and communicated to management and others within the 
entity who need it and in a form (that is, for example, clearly written 
and provided as a paper or electronic manual) and within a time frame 
that enables them to carry out their responsibilities. FMCSA records 
and communicates its policies and procedures electronically through its 
Field Operations Training Manual, which it provides to all federal and 
state investigators and their managers. The manual includes guidance on 
how to prepare for a compliance review (for example, by reviewing 
information on the carrier's accidents, drivers, and inspections), and 
it explains how this information can help the investigator focus the 
compliance review. It also specifies the minimum number of driver and 
vehicle maintenance records to be examined and the minimum number of 
vehicle inspections to be conducted during a compliance review. FMCSA 
posts updates to the manual that automatically download to 
investigators and managers when they connect to the Internet. In 
addition to the manual, FMCSA provides classroom training to 
investigators and requires that investigators successfully complete 
that training and examinations before they conduct a compliance review. 
According to FMCSA officials, investigators then receive on-the-job 
training, in which they accompany an experienced investigator during 
compliance reviews. Investigators can also take additional classroom 
training on specialized topics throughout their careers. 

FMCSA Investigators Use an Information System to Document the Results 
of Compliance Reviews: 

FMCSA's documentation of compliance reviews meets our standards for 
internal control. These standards state that all transactions and other 
significant events should be clearly and promptly documented, and the 
documentation should be readily available for examination. FMCSA and 
state investigators use an information system to document the results 
of their compliance reviews, including information on crashes and any 
violations of the safety regulations that they identify. This 
documentation is readily available to FMCSA managers, who told us that 
they review it to help ensure completeness and accuracy. FMCSA 
officials told us that the information system also helps ensure 
thoroughness and consistency by prompting investigators to follow 
FMCSA's policies and procedures, such as requirements to meet a minimum 
sample size. The information system also includes checks for 
consistency and reasonableness and prompts investigators when the 
information they enter appears to be inaccurate. FMCSA said managers 
may assess an investigator's thoroughness by comparing the rate of 
violations the investigator identified over the course of several 
compliance reviews to the average rate for investigators in their 
division office; a rate that is substantially below the average 
suggests insufficient thoroughness. 

FMCSA Monitors the Performance of Its Compliance Reviews and Has Taken 
Actions to Address Identified Issues: 

FMCSA's performance measurement and monitoring of its compliance review 
activities meet our standards for internal control. These standards 
state that managers should compare actual performance to planned or 
expected results and analyze significant differences. According to 
FMCSA and state managers and investigators, the managers review all 
compliance reviews in each division office and state to ensure 
thoroughness and consistency across investigators and across compliance 
reviews. The investigators we spoke with generally found these reviews 
to be helpful, and several investigators said that the reviews helped 
them learn policies and procedures and ultimately perform better 
compliance reviews. 

In addition to assessing the performance of individual investigators, 
FMCSA periodically assesses the performance of FMCSA division offices 
and state agencies and conducted an agencywide review of its compliance 
review program in 2002. According to officials at one of FMCSA's 
service centers, the service centers lead triennial reviews of the 
compliance review and enforcement activities of each division office 
and its state partner. These reviews assess whether the division 
offices and state partners are following FMCSA policies and procedures, 
and they include an assessment of performance data for items such as 
the number of compliance reviews conducted, rate of violations 
identified, and number of enforcement actions taken. The officials said 
that some reviews identify instances in which division offices have 
deviated from FMCSA's compliance review policies but that only minor 
adjustments by the division offices are needed. The officials also said 
that the service centers compile best practices identified during the 
reviews and share these among the division offices and state partners. 

FMCSA's review also concluded that most investigators were not 
following FMCSA's policy requiring them to perform vehicle inspections 
as part of a compliance review if the carrier had not already received 
the required number of roadside vehicle inspections.[Footnote 13] Since 
conducting its 2002 review, FMCSA changed its policy so that inspecting 
a minimum number of vehicles is no longer a strict requirement--if an 
investigator is unable to inspect the minimum number of vehicles, he or 
she must explain why in the compliance review report.[Footnote 14] 

Each of the Major Applicable Areas of the Safety Regulations Is 
Consistently Covered by Most Compliance Reviews: 

From fiscal year 2001 through fiscal year 2006, each of the nine major 
applicable areas of the safety regulations was consistently covered by 
most of the approximately 76,000 compliance reviews conducted by FMCSA 
and the states. (See table 3.) For the most part, 95 percent or more of 
the compliance reviews covered each major applicable area in the 
agency's safety regulations. 

Table 3: Percentage of Compliance Reviews for Fiscal Years 2001 through 
2006 That Covered Each of the Major Applicable Areas of the Safety 
Regulations: 

Regulatory area: Procedures for handling and evaluating accidents; 
Percent: 97. 

Regulatory area: Drivers' qualifications; 
Percent: 96. 

Regulatory area: Drivers' hours of service; 
Percent: 96. 

Regulatory area: Inspection, repair, and maintenance of vehicles; 
Percent: 96. 

Regulatory area: Drug and alcohol use and testing; 
Percent: 95. 

Regulatory area: Commercial driver's license standards; 
Percent: 95. 

Regulatory area: Driving of motor vehicles; 
Percent: 94. 

Regulatory area: Minimum insurance coverage; 
Percent: 90. 

Regulatory area: Vehicle parts and accessories necessary for safe 
operation; 
Percent: 80. 

Source: GAO analysis of FMCSA data. 

[End of table] 

An FMCSA official told us that not every compliance review is required 
to cover these nine areas. For example, follow-up compliance reviews of 
carriers rated unsatisfactory or conditional are sometimes streamlined 
to cover only the one or a few areas of the regulations in which the 
carrier had violations. As another example, minimum insurance coverage 
regulations apply only to for-hire carriers and private carriers of 
hazardous materials; they do not apply to private passenger and 
nonhazardous materials carriers. 

However, according to an FMCSA official, the area of these regulations 
that had the lowest rate of coverage--vehicle parts and accessories 
necessary for safe operation--is required for all compliance reviews 
except streamlined reviews. Vehicle inspections are supposed to be a 
key investigative technique for assessing compliance with this area, 
and an FMCSA official said that the lower rate of coverage for the 
parts and accessories area likely reflects the small number of vehicle 
inspections that FMCSA and the states conduct during compliance 
reviews. 

FMCSA Follows Up with Many Carriers with Serious Safety Violations but 
Does Not Assess Maximum Fines for All of the Violations Required by 
Law: 

Our preliminary assessment is that FMCSA placed many carriers rated 
unsatisfactory in fiscal year 2005 out of service and followed up with 
nearly all of the rest to determine whether they had improved. In 
addition, FMCSA monitors carriers to identify those that are violating 
out-of-service orders. However, it does not take additional action 
against many violators of out-of-service orders that it identifies. 
Furthermore, FMCSA does not assess maximum fines against all carriers, 
as we believe the law requires, partly because FMCSA does not 
distinguish between carriers with a pattern of serious safety 
violations and those that repeat a serious violation.[Footnote 15] 

FMCSA Followed Up with Almost All Carriers That Received a Proposed 
Safety Rating of Unsatisfactory: 

FMCSA followed up with at least 1,189 of 1,196 carriers (99 percent) 
that received a proposed safety rating of unsatisfactory following 
compliance reviews completed in fiscal year 2005. These follow-ups 
resulted in either upgraded safety ratings or the carriers being placed 
out of service. Specifically, 

* Based on follow-up compliance reviews, FMCSA upgraded the final 
safety ratings of 658 carriers (325 to satisfactory and 333 to 
conditional). 

* FMCSA assigned a final rating of unsatisfactory to 309 carriers. 
FMCSA issued out-of-service orders to 306 of these carriers. An FMCSA 
official told us that it did not issue out-of-service orders to the 
remaining three carriers either because the agency could not locate 
them or because the carrier was still subject to an out-of-service 
order that FMCSA issued several years prior to the 2005 compliance 
review. 

* After FMCSA reviewed evidence of corrective action submitted by 
carriers, it upgraded the final safety ratings of 214 carriers (23 to 
satisfactory and 191 to conditional). 

* Due to an error in assigning the proposed safety rating to one 
carrier, FMCSA upgraded its final safety rating to conditional. 

For the remaining 14 carriers, FMCSA did not (1) provide us information 
on whether and how it followed up with 7 carriers in time for us to 
incorporate it in this statement and (2) respond to our request to 
clarify its follow-up approach for another 7 carriers in time for us to 
incorporate it in this statement. 

Under its policies, FMCSA is generally required to assign the carrier a 
final rating of unsatisfactory and to issue it an out-of-service order 
after either 45 or 60 days, depending on the nature of the carrier's 
business.[Footnote 16] Of the about 300 out-of-service orders that 
FMCSA issued to carriers rated unsatisfactory following compliance 
reviews conducted in fiscal year 2005, FMCSA told us that 89 percent 
were issued on time, 9 percent were issued between 1 and 10 days late, 
and 2 percent were issued more than 10 days late. We are working with 
FMCSA to verify these numbers. An FMCSA official told us that in the 
few instances where an out-of-service order was issued more than 1 week 
late, the primary reason for the delay was that the responsible FMCSA 
division office had difficulty scheduling follow-up compliance reviews 
and thus held off on issuing the orders. 

FMCSA Monitors Carriers to Identify Those That Are Violating Out-of- 
Service Orders, but It Does Not Take Additional Action against Many of 
the Violators It Identifies: 

FMCSA uses two primary means to try to ensure that carriers that have 
been placed out of service do not continue to operate. First, FMCSA 
partners with states to help them suspend, revoke, or deny vehicle 
registration to carriers that have been placed out of service. FMCSA 
refers to these partnerships as the Performance and Registration 
Information Systems Management program (PRISM). PRISM links FMCSA 
databases with state motor vehicle registration systems and roadside 
inspection personnel to help identify vehicles operated by carriers 
that have been issued out-of-service orders. As of January 2007, 45 
states had been awarded PRISM grants and 27 states were operating with 
PRISM capabilities. 

Second, FMCSA monitors carriers for indicators--such as roadside 
inspections, moving violations, and crashes--that they may be violating 
an out-of-service order and visits some of the suspect carriers to 
examine their records to determine whether they did indeed violate the 
order. FMCSA told us it is difficult to detect carriers operating in 
violation of out-of-service orders because its resources do not allow 
it to visit each carrier or conduct roadside inspections on all 
vehicles, and we agree. In fiscal years 2005 and 2006, 768 of 1,996 
carriers (38 percent) that were subject to an out-of-service order had 
a roadside inspection or crash; FMCSA cited only 26 of these 768 
carriers for violating an out-of-service order. An FMCSA official told 
us that some of these carriers, such as carriers that were operating 
intrastate or that had leased its vehicles to other carriers, may not 
have been violating the out-of-service order. He said that FMCSA did 
not have enough resources to determine whether each of the carriers was 
violating an out-of-service order. 

FMCSA Conducted Compliance Reviews on About Half of All High-risk 
Carriers That It Was Required to By Statute: 

From August 2006 through February 2007, FMCSA data indicate that the 
agency performed compliance reviews on 1,136 of the 2,220 (51 percent) 
carriers that were covered by its mandatory compliance review 
policy.[Footnote 17] The Safe, Accountable, Flexible, Efficient 
Transportation Equity Act: A Legacy for Users act requires that FMCSA 
conduct compliance reviews on carriers rated as SafeStat category A or 
B for 2 consecutive months. In response to this requirement, FMCSA 
implemented a policy in June 2006 requiring a compliance review within 
6 months for any such carrier unless the carrier had received a 
compliance review within the previous 12 months. An FMCSA official told 
us that the agency did not have enough resources to conduct compliance 
reviews on all of the 2,220 carriers within 6 months. 

In April 2007, FMCSA revised the policy because it believes that it 
required compliance reviews for some carriers that did not need them, 
leaving FMCSA with insufficient resources to conduct compliance reviews 
on other carriers that did need them. Specifically, FMCSA believes that 
carriers that had already had a compliance review were targeted 
unnecessarily after they had corrected identified violations, but these 
violations continued to adversely affect their SafeStat rating because 
SafeStat penalizes carriers for violations regardless of whether they 
have been corrected. The new policy requires compliance reviews within 
6 months for carriers that have been in SafeStat category A or B for 2 
consecutive months and received their last compliance 2 or more years 
ago (or have never received a compliance review) and offers some 
discretion to FMCSA division offices. For example, division offices can 
decide not to conduct a compliance review if its SafeStat score is 
based largely on violations that have been corrected or on accidents 
that occurred prior to the carrier's last compliance review. We believe 
that these changes are consistent with the act's requirement and give 
FMCSA appropriate discretion in allocating its compliance review 
resources. 

FMCSA Does Not Assess Maximum Fines for All the Violations Required by 
Law: 

FMCSA does not assess the maximum fines against all carriers as we 
believe the law requires. The law requires FMCSA to assess the maximum 
allowable fine for each serious violation by a carrier that is found 
(1) to have committed a pattern of such violations (pattern 
requirement) or (2) to have previously committed the same or a related 
serious violation (repeat requirement).[Footnote 18] However, FMCSA's 
policy on maximum fines does not fully meet these requirements. FMCSA 
enforces both requirements using what is known as the "three-strikes 
rule," applying the maximum allowable fine when it finds that a motor 
carrier has violated the same regulation three times within a 6-year 
period. FMCSA officials said they interpret both parts of the act's 
requirements to refer to repeat violations, and because they believe 
that having two distinct policies on repeat violations would confuse 
motor carriers, it has chosen to address both requirements with its 
single three-strikes policy. 

FMCSA's interpretation does not carry out the statutory mandate to 
impose maximum fines in two different cases. In contrast to FMCSA, we 
read the statute's use of the distinct terms "a pattern of violations" 
and "previously committed the same or a related violation" as requiring 
FMCSA to implement two distinct policies. A basic principle of 
statutory interpretation is that distinct terms should be read as 
having distinct meanings. In this case, the statute not only uses 
different language to refer to the violations for which maximum fines 
must be imposed but also sets them out separately and makes either type 
of violation subject to the maximum penalties. Therefore, one carrier 
may commit a variety of serious violations and another carrier may 
commit the same or a substantially similar serious violation as a 
previous violation; the language on its face requires FMCSA to assess 
the maximum allowable fine in both situations--patterns of violations 
as well as repeat offenses. 

FMCSA could define a pattern of serious violations in numerous ways 
that are consistent with the act's pattern requirement. Our assessment 
of eight potential definitions shows that the number of carriers that 
would be subject to maximum fines depends greatly on the definition. 
(See table 4.) For example, a definition calling for two or more 
serious violations in each of at least four different regulatory areas 
during a compliance review would have made 38 carriers subject to 
maximum fines in fiscal year 2006. In contrast, a definition calling 
for one or more serious violations in each of at least three different 
regulatory areas would have made 1,529 carriers subject to maximum 
fines during that time.[Footnote 19] 

Table 4: Number of Motor Carriers That Would Have Been Subject to 
Maximum Fines under Various Definitions of a Pattern of Serious 
Violations, Fiscal Years 2004 through 2006: 

Regulatory areas with serious violations: 2 or more; 
Number of carriers in 2004 with: 1 or more serious violations per area: 
2,935; 
Number of carriers in 2004 with: 2 or more serious violations per area: 
177; 
Number of carriers in 2005 with: 1 or more serious violations per area: 
3,004; 
Number of carriers in 2005 with: 2 or more serious violations per area: 
158; 
Number of carriers in 2006 with: 1 or more serious violations per area: 
3,348; 
Number of carriers in 2006 with: 2 or more serious violations per area: 
225. 

Regulatory areas with serious violations: 3 or more; 
Number of carriers in 2004 with: 1 or more serious violations per area: 
1,372; 
Number of carriers in 2004 with: 2 or more serious violations per area: 
64; 
Number of carriers in 2005 with: 1 or more serious violations per area: 
1,430; 
Number of carriers in 2005 with: 2 or more serious violations per area: 
58; 
Number of carriers in 2006 with: 1 or more serious violations per area: 
1,529; 
Number of carriers in 2006 with: 2 or more serious violations per area: 
114. 

Regulatory areas with serious violations: 4 or more; 
Number of carriers in 2004 with: 1 or more serious violations per area: 
494; 
Number of carriers in 2004 with: 2 or more serious violations per area: 
16; 
Number of carriers in 2005 with: 1 or more serious violations per area: 
557; 
Number of carriers in 2005 with: 2 or more serious violations per area: 
25; 
Number of carriers in 2006 with: 1 or more serious violations per area: 
530; 
Number of carriers in 2006 with: 2 or more serious violations per area: 
38. 

Regulatory areas with serious violations: 5 or more; 
Number of carriers in 2004 with: 1 or more serious violations per area: 
83; 
Number of carriers in 2004 with: 2 or more serious violations per area: 
2; 
Number of carriers in 2005 with: 1 or more serious violations per area: 
115; 
Number of carriers in 2005 with: 2 or more serious violations per area: 
9; 
Number of carriers in 2006 with: 1 or more serious violations per area: 
115; 
Number of carriers in 2006 with: 2 or more serious violations per area: 
7. 

Source: GAO analysis of FMCSA data. 

[End of table] 

We also interpret the statutory language for the repeat requirement as 
calling for a "two-strikes" rule as opposed to FMCSA's three-strikes 
rule interpretation. FMCSA's interpretation imposes the maximum fine 
only after a carrier has twice previously committed such violations. 
The language of the statute does not allow FMCSA's interpretation; 
rather, it requires FMCSA to assess the maximum allowable fine for each 
serious violation against a carrier that has previously committed the 
same serious violation.[Footnote 20] 

In fiscal years 2004 through 2006, more than four times as many 
carriers had a serious violation that constituted a second strike than 
carriers that had a third strike. (See table 5.) For example, in fiscal 
year 2006, 1,320 carriers had a serious violation that constituted a 
second strike, whereas 280 carriers had a third strike. 

Table 5: Number of Motor Carriers That Would Have Been Subject to 
Maximum Fines under Two-strikes and Three-strikes Repeat Violator 
Policies, Fiscal Years 2004 through 2006: 

Policy: Two strikes; 
2004: 1,251; 
2005: 1,292; 
2006: 1,320; 
Total: 3,863. 

Policy: Three strikes[A]; 
2004: 269; 
2005: 284; 
2006: 280; 
Total: 833. 

Source: GAO analysis of FMCSA data. 

[A] FMCSA's policy currently assesses the maximum fine for 3 violations 
in the same regulatory area. 

[End of table] 

Carriers that commit a pattern of violations may also commit a second 
strike violation. For example, three of the seven carriers that had two 
or more serious violations in each of at least five different 
regulatory areas also had a second strike in fiscal year 2006. Were 
FMCSA to make policy changes along the lines discussed here, we believe 
that the new policies should address how to deal with carriers with 
serious violations that both are part of a pattern and repeat the same 
or similar previous violations. 

Mr. Chairman, this concludes my prepared statement. I would be pleased 
to respond to any questions that you or other Members of the 
Subcommittee might have. 

GAO Contacts and Staff Acknowledgement: 

For further information on this statement, please contact Susan Fleming 
at (202) 512-2834 or flemings@gao.gov. Individuals making key 
contributions to this testimony were David Goldstein, Eric Hudson, and 
James Ratzenberger. 

[End of section] 

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FOOTNOTES 

[1] Large trucks are those with a gross vehicle weight greater than 
10,000 pounds. A bus is a motor vehicle that is used to carry more than 
8 people. 

[2] This figure includes an unidentified number of carriers that are 
registered but are no longer in business. Carriers continually enter 
and exit the industry. Since 1998, the industry has increased in size 
by an average of about 29,000 interstate carriers per year. 

[3] GAO, Motor Carrier Safety: A Statistical Approach Will Better 
Identify Commercial Carriers That Pose High Crash Risks Than Does the 
Current Federal Approach, GAO-07-585 (Washington, D.C.: June 11, 2007). 

[4] FMCSA requires that states report crashes within 90 days. Sometimes 
states report crashes late. To allow for this occurrence, we analyzed 
data on crashes occurring from July 2004 through December 2005 that may 
have been reported as late as June 2006. 

[5] GAO, Internal Control: Standards for Internal Control in the 
Federal Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: Nov. 1999). 
In assessing the extent to which FMCSA's management of its compliance 
reviews is consistent with our internal controls, we were not able to 
verify the statements made by FMCSA and state officials and 
investigators about their performance and management of compliance 
reviews because doing so was not practicable given our time and 
resource constraints. 

[6] Negative binomial regression is often used to model count data 
(e.g., crashes). 

[7] Except for carriers of hazardous materials, FMCSA does not have the 
authority to prohibit motor carriers from operating intrastate. 

[8] GAO-07-585. 

[9] These results corroborate studies performed by the Volpe National 
Transportation Systems Center and Oak Ridge National Laboratory. See 
GAO-07-585. 

[10] On average, the negative binomial regression model approach 
identified larger motor carriers than did SafeStat, which is how a 9 
percent increase in the crash rate translated into 9,500 additional 
crashes. 

[11] The weights on the safety evaluation areas have remained unchanged 
since September 1999, when the weight on the driver area was increased 
from 1.0 to 1.5. 

[12] See GAO/AIMD-00-21.3.1. 

[13] The required number of inspections is based on the number of 
vehicles operated by the carrier and subject to federal regulations. 

[14] An inspector would not be able to inspect the minimum number of 
vehicles if, for example, fewer than the minimum number of vehicles 
were available on-site for inspection. 

[15] In December 2005, we reported more fully on FMCSA's enforcement 
activities. See GAO, Large Truck Safety: Federal Enforcement Efforts 
Have Been Stronger Since 2000, but Oversight of State Grants Needs 
Improvement, GAO-06-156 (Washington, D.C.: Dec. 15, 2005). 

[16] Under certain circumstances (for example, if the carrier is making 
good faith efforts to improve its safety), FMCSA may allow a carrier 
with a proposed rating of unsatisfactory to continue to operate for a 
limited time. 

[17] An FMCSA official told us that the agency believes that these data 
overestimate the number of carriers that were required to but did not 
receive a compliance review, primarily because FMCSA has indications 
that some carriers are actually inactive. 

[18] Motor Carrier Safety Improvement Act of 1999, Pub. L. 106-159, § 
222(b)(2), 113 Stat. 1748, 1769 (49 U.S.C.A. § 521 Note). 

[19] Our definitions are for analysis purposes only. We are not 
suggesting which, if any, of these pattern definitions FMCSA should 
adopt as its policy, nor is our exclusive focus on patterns involving 
only violations identified during a single compliance review meant to 
suggest that the definition of pattern could not require that serious 
violations occur over multiple compliance reviews. 

[20] The statute (section 222(c)) does allow the Secretary to determine 
and document that extraordinary circumstances merit a lower than 
maximum fine in a particular case, if for example a carrier can 
establish that repetition was not a result of its failure to take 
appropriate remedial action. 

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