TIA Statement on Passage of Bipartisan Infrastructure Package

MEDIA CONTACT:

Matthew Evans | evans@tianet.org | 202.498.5919

AUGUST 10, 2021 – ALEXANDRIA, VA Transportation Intermediaries Association (TIA), the voice of the third-party logistics industry, issued the following statement in response to the Senate’s bipartisan passage of the Surface Transportation Reauthorization Bill:

The United States Senate today passed the bipartisan surface transportation reauthorization bill on a 69-30 vote. Included in the final language passed by the Senate is $550 billion in needed funding for our traditional infrastructure projects, including money for roads, bridges, transit, Amtrak, and more.

“TIA is proud to support this bipartisan measure; the U.S. economy and supply chain deserve to have the best infrastructure and most robust surface transportation in the world,” noted Chris Burroughs, TIA Vice President of Government Affairs. “This legislation delivers on that goal, and with more the $11 billion dedicated to safety, TIA is proud to call upon the U.S. House of Representatives to pass this bill and for President Biden to sign it into law.”

Built into the legislation are three provisions TIA fully supports and is proud to present to its members. First, a provision that clarifies the role of a dispatch service in the supply chain. Second, language which asks for a full review of the Federal Motor Carrier Safety Administration (FMCSA) National Consumer Complaint Database and the subsequent action taken by the Federal Government. Included in this review is a mandate to include brokers in the process. Finally, a new apprenticeship pilot program for under 21-year-old drivers seeks to increase the carrier selection pool. This is a huge issue in the supply chain as the driver shortage continues to hamper transportation.

TIA applauds the work of the bipartisan group of U.S. Senators that put partisan politics aside and delivered on a surface transportation reauthorization that addresses our crumbling infrastructure and provides much-needed legislative clarity for the 3PL and freight brokerage industries.

To hear more about this legislation and TIA’s positions, please watch the video below.


The Transportation Intermediaries Association (TIA) is the professional organization of the $214 billion third-party logistics industry. TIA is the only organization exclusively representing transportation intermediaries of all disciplines doing business in domestic and international commerce. TIA is the voice of transportation intermediaries to shippers, carriers, government officials, and international organizations. To learn more about TIA, please call us at (703) 299-5700 or at www.tianet.org.

TIA Releases Updated Co-Broker Model Contract

MEDIA CONTACT:

Matthew Evans | evans@tianet.org | 202.498.5919

JULY 22, 2021 – ALEXANDRIA, VA Transportation Intermediaries Association (TIA), the voice of the third-party logistics industry, is pleased to announce the release of their updated Co-Broker Agreement. This updated contract is just one of the many model contracts offered exclusively to TIA Members via the Member Resource Library.

The TIA Contracts Committee began working on the updated model contract earlier this year to confirm the most relevant and recent contractual terms and conditions were reflected in the model agreement. There were additions made that focused on the current legal and insurance landscapes that directly affect the third-party logistics industry and TIA Members.

“TIA is honored to continue to provide these invaluable resources for our members, as a member benefit. I applaud the Contracts Committee and the leadership of Chairman James Lee for their tireless efforts in keeping these model agreements updated and relevant for our members,” stated Chris Burroughs, TIA Vice President of Government Affairs.

To view the latest version of the Co-Broker Agreement, please visit the member’s only section of the TIA website.


The Transportation Intermediaries Association (TIA) is the professional organization of the $214 billion third-party logistics industry. TIA is the only organization exclusively representing transportation intermediaries of all disciplines doing business in domestic and international commerce. TIA is the voice of transportation intermediaries to shippers, carriers, government officials, and international organizations. To learn more about TIA, please call us at (703) 299-5700 or at www.tianet.org.

TIA Applauds New C-TPAT Legislation

MEDIA CONTACT:

Matthew Evans | evans@tianet.org | 202.498.5919

JULY 16, 2021 – ALEXANDRIA, VIRGINIA – Transportation Intermediaries Association (TIA), the voice of the third-party logistics industry, released today the following statement on the introduction of legislation that would finally allow Department of Transportation (DOT) licensed property brokers to participate in the Customs-Trade Partnership Against Terrorism (C-TPAT) program. Since the program’s inception back in 2006, TIA Members have not been allowed to participate not because of their merits but because of a bias against DOT licensed property brokers.

“For years TIA Members were inexplicably omitted from a program that was developed in the aftermath of the 9/11 terrorist attacks,” said TIA President & CEO Anne Reinke. “C-TPAT does a great job securing our homeland and defending our supply chain. We will continue to impress upon CBP that 3PLs add value to this effort and we look forward to doing our part to ensure that freight that is being transported cross-border is done to the highest safety standards.”

S. 2322, also known as the “C-TPAT Pilot Program Act” is bipartisan legislation introduced by Senators Cornyn (R-TX), Menendez (D-NJ), Scott (R-SC), and Carper (D-DE). Under the legislation, 10 previously neglected companies will be granted the chance to participate in a pilot program that will give applicant companies C-TPAT certification if they meet the minimum requirements.

“This is a common-sense approach to a problem that never should have taken place. The status quo is contrary to legislative intent. Our members play an integral role in national security. This legislation is about national security, jobs, and fairness,” said Chris Burroughs, Vice President of Government Affairs for TIA.

For more information on TIA’s government affairs and advocacy efforts, please visit us online.


The Transportation Intermediaries Association (TIA) is the professional organization of the $214 billion third-party logistics industry. TIA is the only organization exclusively representing transportation intermediaries of all disciplines doing business in domestic and international commerce. TIA is the voice of transportation intermediaries to shippers, carriers, government officials, and international organizations. To learn more about TIA, please call us at (703) 299-5700 or at www.tianet.org.

TIA Signs DOT Anti-Human Trafficking Pledge

Becomes Latest Industry Partner to Join DOT’s Transportation Leaders Against Human Trafficking Initiative

 

MAY 11, 2021 – ALEXANDRIA, VIRGINIA – Transportation Intermediaries Association (TIA), the voice of the third-party logistics (3PL) industry, announced today that it has signed the U.S. Department of Transportation’s (DOT) Transportation Leaders Against Human Trafficking (TLAHT) pledge. In becoming a TLAHT signatory, TIA joins with our partners across the transportation industry to stop the flow of human trafficking.

“Human trafficking is an issue that transcends borders, race, gender, and politics; it is a global scourge that is often overlooked but demands attention and action,” said TIA President & CEO Anne Reinke. “As the voice of the 3PL industry and a leader in the larger transportation ecosystem, it is incumbent upon us as an organization to provide our members with the education, tools, and resources needed to identify and prevent the further spread of this heinous crime. We are honored to stand with the DOT and the transportation industry in support of this momentous initiative.”

TIA made the announcement of its signing the TLAHT pledge during the Day 1 Opening Session of the TIA 2021 Capital Ideas Conference in front of an audience of more than 300 virtual attendees from across the 3PL and freight brokerage industry. TIA President & CEO Anne Reinke was joined by Outgoing TIA Board Chair Brian Evans, CTB, in making the announcement to attendees.

“The U.S. Department of Transportation is proud to work, through its Transportation Leaders Against Human Trafficking Initiative, with the private and public sector across all modes of transportation on critical counter-trafficking efforts, including training front line workers to recognize and report possible instances of human trafficking,” said Julie Abraham, Director of the Office of International Transportation and Trade, whose office leads the Department’s human trafficking initiative.

With as many as 24.9 million men, women, and children sold into prostitution, domestic servitude, or other forced labor globally, human trafficking is one of the greatest atrocities of our time. While it may seem like a problem beyond our borders, human trafficking takes place every day in communities across America – rural, suburban, red, and blue.

“Through the strength of our unified 1,600 member companies, TIA is ready to meet the challenge and lend our network resources to eliminate human trafficking,” stated Brian Evans, CTB, Chairman of the TIA Board of Directors. “As we stand united in our efforts, we are honored to join the Department of Transportation, along with all other organizations, that are working tirelessly to combat this issue in the United States.”

Human traffickers are using America’s roadways, railways, waterways, and skies to traffic their victims. We cannot allow our transportation system to be an enabler in such awful acts. As part of TIA’s efforts in support of the TLAHT initiative, the Association will implement a five-prong approach in support of our pledge focused on leadership engagement, industry education and training, policy development, public awareness, and information sharing and analysis. To learn more about the TLAHT initiative, please visitwww.transportation.gov/TLAHT.

 


Transportation Intermediaries Association (TIA) is the professional organization of the $214 billion third-party logistics industry. TIA is the only organization exclusively representing transportation intermediaries of all disciplines doing business in domestic and international commerce. TIA is the voice of transportation intermediaries to shippers, carriers, government officials and international organizations.

Down the Road, the 117th Congress and Transportation

Scott Marks | Government Affairs Manager | TIA

The 2nd session of the 116th Congress has been a whirlwind, packed with a marathon markup of a $2 trillion infrastructure package, COVID-19 response packages, and a lot of pettifogging by both sides of the aisle. Coming up in a couple of weeks will be Infrastructure Week. This is a dedicated week focused on the shared transportation priorities between the Executive and Legislative Branches of the Federal Government to fix America’s crumbling roads, bridges, and other infrastructure needs.

This Infrastructure Week feels a lot like the past ones as once again, the United States Congress has yet to send to the President’s desk a new sweeping, comprehensive surface transportation reauthorization. Instead, it will most likely pass a continuing resolution which means carrying over the spending levels from the previous authorizing legislation. Our United States freight system is about four million miles of highways and roads; 140,000 miles of rail lines; 25,000 miles of inland and coastal waterways; 2.8 million miles of pipelines; and more than 5,000 public airports. We must pass into law a piece of legislation that is just as powerful as the system it looks to overhaul.

Next Congress needs to feel the urgency to pass a sweeping, up-to-date, surface transportation bill that takes into consideration all aspects of the supply chain, shippers, brokers, and carriers. The bill needs to be expansive, while at the same time, empowering states to fix their non-federal highways. Studies are conclusive and substantive on the issue of dollars lost because of the crumbling infrastructure, and as the Department of Transportation’s newly released National Freight Strategic Plan states, the issue will continue to worsen: 

“Freight shipments are expected to increase by 22.4 percent over the next 20 years. Investments in infrastructure capacity and operational improvements will be required to meet rising demand for freight. Yet, freight system performance can be hindered by regulatory, financial, and institutional barriers that raise the economic costs of freight movements.”

Our message to Congress: you must empower states with grants, fund federal programs to expedite construction while at the same, making regulatory changes, we know that pumping money into a problem does fix the underlying issue. Lay out a roadmap for brokers and 3PL’s to certify what a safe carrier is (this is especially crucial as trucks move 72% of Americas Freight), throw out the current audit safety rating system, overall the process to include data from states (that is fair to motor carriers and determines fault for crashes), and continue to allow the transportation industry to be fair, open and competitive without bogging it down with burdensome transparency regulations.

There is a lot to be done for the rest of the Congress and in the 117th Congress, TIA Government Affairs looks forward to working closely with our members, Members of Congress and their staff, the Department of Transportation, and other key players in the Executive Branch and private sector key stakeholders.


If you have any questions, concerns, or want to learn more about TIA’s Advocacy efforts, please contact TIA Government Affairs at Advocacy@tianet.org.

DOL Notice Of Increase Minimum Wage For Those Individuals Involved In Contracts With The Government

Scott Marks | Government Affairs Manager | TIA

February 12, 2014: President Barack Obama signs and issues Executive Order 13658. This order raises the wages of those individuals who are used to facilitate contracts with Government entities. This minimum wage was to be $10.10 at the time of the Executive order.

On September 19, 2019, the Department of Labor published an additional Notice in the Federal Register to announce that, the notice stated beginning January 1, 2020, the Executive Order 13658 minimum wage rate is increased to $10.80 per hour (84 FR 49345). This Executive Order minimum wage rate generally must be paid to workers performing work on or in connection with covered contracts.

In order to stay competitive, keeping up with inflation and deter constant turnover among employees, moving forward on, Jan 1, 2021 “workers performing work on or in connection with federal contracts covered by the aforementioned Executive Order 13658, Establishing a Minimum Wage for Contractors (the Executive Order or the Order), beginning January 1, 2021. Beginning on that date, the Executive Order minimum wage rate that generally must be paid to workers performing work on or in connection with covered contracts will increase to $10.95 per hour.”

For the TIA Members who handle government freight, if they have sales associates that they use to enter contracts with the Government, they would have to pay them the updated rate of $10.95. Please find the Department of Labor (DOL) poster that outlines the new regulations here or view the newly released rule here.

Blog 6 – GSA Drops Major National Security Rule, TIA Members Are Affected

Scott Marks | Government Affairs Manager | TIA

Starting August 13, 2020, members will no longer be able to both enter into contracts for service with the government and have in their operations what are called “covered telecommunications.” Member companies must begin now to certify that their internal processes do not contain any one of a multitude of malicious Chinese companies. This regulation comes from legislation that passed in 2018, H.R. 5515, the John S. McCain NDAA, specifically section 889 parts (A) and (B).

Part (A), while important, is not directly germane to the TIA membership base. This part has to do with procurement and acquisition. The head of a government agency may not move forward with any acquisition of services or technology that has “covered technology.”

Part (B) directly impacts our members, it can’t be stressed enough, if you are a member of TIA starting August 13th if you have use a covered service in your operations you will not be able to move freight for the government.

A covered telecommunication technology means the following: Any service and equipment produced by Huawei Technologies Company or ZTE Corporation (or any subsidiary or affiliate of those entities) and certain video surveillance products or telecommunications equipment services produced or provided by Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, or Dahua Technology Company (or any subsidiary or affiliate of those entities).

Members must take the time, review internal procedures, and ensure they do not use one of the technologies in their office. A contractor may certify that it does not use covered equipment or services if its “reasonable inquiry” does not identify such use. A “reasonable inquiry” is one “designed to uncover any information in the entity’s possession about the identity of the producer or provider” of covered equipment or services used by the entity.

It is important to note, reasonable inquiry does not require an internal or third-party audit, it just means you must be able to show affirmatively that you took steps to uncover if the entity is in possession of covered telecommunications technology. This will be a deciding factor for contracts starting August 13, 2020.

The government agencies implementing this regulation have asked for broad feedback as they fine-tune the rule to be more business-friendly while still posturing the regulation as a national security tool. If you’re interested in providing feedback as to how this will impact your business, do not hesitate to reach out.

Like all legislative action, TIA Government Affairs will monitor, track, and respond in real-time. We work directly with our conferences and committees and the organization at large to ensure our members are up to speed.

To view our resource on this rule, click here

To view the rule in its entirety, click here


If you have any questions, concerns, or want to learn more about TIA’s Advocacy efforts, please contact TIA Government Affairs at Advocacy@tianet.org.

AB5: Pending Compliance for Uber and Lyft could impact operations in the State

On Monday, August 10th, a Superior Court Judge in California ruled that drivers of Uber and Lyft must be classified as employees, essentially giving the companies ten days to make the necessary changes and abide with AB5. This was obviously a key blow to the company’s efforts to push back on the notorious AB5 Bill that become state law, a little over seven months ago, that attacks the independent contractor model. The companies have been arguing that they are technology companies rather than transportation companies and because of that, their drivers are not core to their platforms. The battle is far from over and will ultimately head to lengthy appeals process.

Because of the Superior Court Judge’s decision, Uber and Lyft have threatened to shut down their operations in the state of California completely. The main concern from the companies is the cost of doing business with their drivers and the impact to their business model that allows them to offer quick low-cost rides by maximizing the number of drivers on their platforms.

There was an unscientific survey done a few months ago that citied that 70% of the 734 respondents identifying themselves as drivers said they did not want to be classified as employees and enjoy the work of the “gig” business and working on their hours.

In the upcoming election in November there is a ballot measure Proposition 22 that will let the California people decide (at least for now) on the applicability of AB5 and if companies like Uber and Lyft should be required to classify their employees as employees rather than independent contractors. This could be a potential bailout for Uber and Lyft or another nail in their coffin, at least in California.

TIA Government Affairs will continue to monitor the AB5 issue and potential implications to our members who utilize independent sales agents in the state of California.

If you have any questions, please contact TIA Advocacy (advocacy@tianet.org).

Market Economics in Tough Times

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Market Economics in Tough Times

An In-Depth Look from TIA’s Chief Economist Noël Perry

 

Truck Rates Are Tumbling. Who’s to Blame?

Earlier today, the Federal Government released its initial estimate of 2020:1 economic growth.  That was an important event because 2020:1 is the first quarter to contain any of the effects of the economic shutdowns imposed by governments in their attempts to contain the COVID-19 virus.

The value of -4.8% is the worst U.S. quarterly economic performance since the Great Recession, and that negative figure is largely the result of only the last month of the quarter. I estimate that the March number was -13.8%. Unfortunately, that March number will probably be topped in April, and perhaps May. If so, the second quarter will come in at -15% or worse, making it the worst economic quarter in U.S. history.

Why is that important? When the economy tanks, so does trucking. When trucking tanks, so do rates.  That is what markets do. So, why are rates doing what the Truckstop.com numbers in the accompanying graph shows? It’s the economy stupid; or more specifically, it’s the shutdowns from COVID-19 control measures.

I write this piece, an update of something I wrote last fall, because being human, when something goes bad, we look for a scapegoat. As usual, in trucking, when something goes bad, people frequently point their fingers at my friends in the brokerage space. People are always suspicious of people that “arrange” things rather than “do” things, even if the “arranging” is a necessary part of the doing. After all, a broker’s work is basically work outsourced from shippers and carriers. The work must be done for every trucking transaction.

In around a quarter of cases, people find it more efficient to pay a broker to do that work rather than take the time and money it takes to do it one’s self.  Nonetheless, during tough times it is common practice to badmouth the brokers. Somebody must be at fault here, right? Well, somebody may be at fault here, or maybe it is just the virus. But it sure isn’t the brokers. Here’s why:

  1. What Did Adam Smith Teach Us? The North American brokerage market is as freely open a market as any in the world, regardless of commodity or service. There are no pricing regulations and precious few barriers to entry. If a broker is regularly mistreating carriers (carriers that, in many cases, they have been working with for years), the carriers need simply to shift to another of the 16,000 licensed brokers – all of whom are hungry for business, especially now.
  2. What Goes Up Eventually Goes Down? People often cite the tendency of broker margins to increase in tough times as evidence of the broker’s greed. Indeed, broker margins do sometimes increase during times of low pricing, but not from greed – but rather from a long-standing and well-known fact of truckload pricing economics. In softening markets, carrier prices usually fall moderately faster than shipper prices, with broker margins rising. Of course, in rising markets, the reverse happens: carriers’ rates rise more rapidly than shippers’ rates and broker margins fall. Using the broker-bashers’ logic, brokers must have been scrimping on their profits to help the carriers in 2017 and the first half of 2018 when rates were rising. My broker friends value their carriers, but not that much!
  1. Accounting 101: The cycle in broker margins is primarily an accounting issue. Market economics tells us that scarcity or surplus of assets affects the pricing of assets and the cost of services provided by those assets. Intermediaries, like brokers, add a relatively fixed cost to facilitate the match of assets and demand and execute the accompanying transactions. It follows that such a fixed cost will occupy a smaller portion of a total rate, in a tight market with high rates than in a soft market with low rates. The numerator, the broker’s fee, doesn’t change while the denominator, the price of the load, does. The percent represented by the broker’s fixed fee does change. A simple calculation using average rates for the period 2018:2 to 2019:2 shows an increase in broker’s margin of 306 basis points using a fixed absolute value for the broker’s take. That example yields the same internal broker dollar return in both cases: same service, same absolute broker payment, same “profit.” Note importantly that, recently, broker margins have been falling in a falling market, indicating a significant reduction in broker profit. Brokers have been sharing the pain this time around and will continue to do so in these tough times until our governments reopen the economy.
  1. Volatile Markets Increase the Value of Broker Services: Finally, and perhaps more importantly, brokers exist because they can solve the tough problems of matching spot and other difficult freight to capacity. The regular freight that gets covered by contracts is the easy stuff. Do a deal in January, and the freight moves for a year with no additional transactional work. Not so with the spot market. In volatile times like these, when freight volumes and shipper and carriers’ strategies change radically, the number of tough problems wanting solutions skyrockets. Yes, the price of the move may fall (or rise when the economy recovers), but the difficulty of the work is greater when the market is changing. We need brokers more than ever – right now!

Here’s the Point:

Pointing fingers during a time of stress has little value. Carriers, and shippers, would be best served by focusing on the best ways to get their loads moved and trucks full. For at least a quarter of freight, that process benefits from, or more powerfully, “needs” brokers. Brokers exist and have a growing share of the market because they provide a useful service to shippers and carriers.

Those services retain their value throughout the business cycle, even if carriers are happy at the top and unhappy at the bottom, and shippers are unhappy at the top and happy at the bottom.  The notion that an entire group of market participants is operating to the market’s detriment is a preposterous claim that provides no insight to carriers, shippers, or any rational actor in this market.

 

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The Transportation Intermediaries Association (TIA) is the professional organization of the $214 billion third-party logistics industry. TIA is the only organization exclusively representing transportation intermediaries of all disciplines, doing business in domestic and international commerce. TIA is the voice of the 3PL industry to shippers, carriers, government officials, and international organizations. TIA is the United States member of the International Federation of Freight Forwarder Associations, FIATA.

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