WASHINGTON — The Federal Motor Carrier Safety Administration has named representatives from the trucking industry to assess the prevalence of predatory leasing agreements by carriers against owner-operators and follow up with recommendations to Congress.
FMCSA’s Truck Leasing Task Force, authorized by the Infrastructure Investment and Jobs Act (IIJA) in 2021, will address areas “that have long needed intense focus,” according to the agency. It will include providing best practices to help drivers weigh the potential costs of entering leasing agreements.
The panel will also recommend changes to laws to promote fair leasing arrangements.
“At a time when our country needs truck drivers more than ever, we must do everything we can to support the men and women who work in this vital industry,” said U.S. Transportation Secretary Pete Buttigieg. “The Truck Leasing Task Force is taking a hard look at leasing agreements as part of our effort to ensure every truck driver in this country has good working conditions and can make a good living.”
FMCSA Administrator Robin Hutcheson said leasing “can have a major impact on people choosing trucking as their career, and protecting drivers is of the utmost importance.”
The nine members of the task force are:
- Tamara Brock, Brock Logistics/Lewis & Lewis Logistics (independent owner-operator).
- Paul Cullen, The Cullen Law Firm (attorney).
- Troy Hawkins, TTOH Consulting & Logistics (independent owner-operator).
- Jim Jefferson, Owner-Operator Independent Drivers Association (consumer protection).
- Joshua Krause, OTR Leasing (business).
- Kaitlyn Long, Teamsters union (labor).
- Steve Rush, Carbon Express Inc. (carrier).
- Lesley Tse (attorney).
- Steve Viscelli, University of Pennsylvania (educator).
According to the IIJA, the task force will examine:
- Common truck leasing arrangements available to truck drivers, including lease-purchase agreements, and the terms of those agreements.
- The existence of inequitable leasing agreements and terms in the trucking industry, whether any inequitable terms and agreements affect the frequency of maintenance performed on trucks subject to those agreements, and whether those terms and agreements affect whether a truck is kept in good repair.
- Specific agreements available to drayage drivers at ports relating to the Clean Truck Program or similar programs aimed at reducing emissions at ports.
- The impact of truck leasing agreements on driver compensation, including port drayage drivers.
- Whether truck leasing agreements properly incentivize safe operations, including driver compliance with hours-of-service regulations.
- Resources to assist drivers in assessing the financial impacts of leasing agreements.
- Opportunities by which drivers can use equitable leasing agreements to start or expand trucking companies.
FMCSA noted that truck leasing “is an important step that many owner-operators in the trucking industry take to get started in the business,” but agreements with inequitable terms can discourage drivers from working in the industry.
Lewie Pugh, executive vice president of the Owner-Operator Independent Drivers Association, recommends against it for those trying to get started.
“Don’t lease-purchase,” Pugh urged in his keynote address at FreightWaves’ Small Fleet & Owner-Operator summit last week.
“There are exceptions to every rule — some lease-purchases are fair and pretty good, but the vast majority of those fail. [New owner-operators] buy a truck and then they don’t make enough money to cover the cost.”
Click for more FreightWaves articles by John Gallagher.