Monday, April 23, 2007

UCRA Replaces SSRS And It Will Affect You

Congress dipped into the alphabet soup of federal motor carrier law and came out with a new acronym – “UCRA”, which stands for the Unified Carrier Registration Agreement. UCRA, which was established as part the “Safe, Accountable, Flexible, Efficient Transportation Equity Act: A Legacy for Users” (“SAFETEA-LU”), replaces the Single State Registration System (“SSRS”) and, if you are a private, for-hire or exempt carrier, or if you are a broker, freight forwarder or leasing company, the UCRA will affect YOU.


“SSRS” was a program that was designed to ensure that interstate motor carriers maintained appropriate liability insurance. Regulated for-hire motor carriers were required to register their authority and proof of insurance with their base state and fees, calculated based on a per-truck and per-state basis, were collected by the base state and then transmitted to the other states.

However, effective January 1, 2007, Congress repealed the SSRS and replaced it with …nothing. You may not long for the days of SSRS, but the states that previously participated in the program surely do, as the abolishment of the system also meant the disappearance of the substantial state revenue, including approximately 2.6 million dollars per year for Michigan.

This was not the intent of Congress, but the new program simply was not ready on time. Though UCRA, the program designed to replace SSRS, is not complete, there are guidelines that give a good indication how the new program will work. It is not too soon to consider how these guidelines will impact you.

Life under UCRA

The concept for UCRA is to have a more streamlined system of collecting fees. Under SSRS, carriers paid fees on a per-state, per-commercial motor vehicle basis, and each state established a different per vehicle charge. Under UCRA, the fee will be per carrier, based on carrier size, and the fee will be the same for all states. Carriers will no longer pick and choose states. Instead, one fee structure will be used for every state.

A recently proposed fee schedule ranges from an annual fee of $39 for carriers with 0-2 commercial motor vehicles, to $37,500 annually for carriers with over 1,000 vehicles. The Board of Directors, who are empowered to establish the UCRA, have stated that they hope to have a fee structure in place by June of 2007.

Another significant change is that more companies will be subject to the requirements of the UCRA than under the old SSRS. Although only regulated for-hire motor carriers were subject to the SSRS, the UCRA will also govern: (1) private carriers, (2) exempt carriers, (3) brokers, (4) freight forwarders, and (5) leasing companies. The fees for companies that do not operate commercial motor vehicles (such as brokers, freight forwarders, and leasing companies) are expected to be levied at the same rate as the smallest motor carriers.

When Will The UCRA Take Effect

The answer to “when” the UCRA will take effect is unclear, although some commentators project that the system will be implement by the summer of 2007.

What Does It All Mean

We do not know all of the requirements you will face under the UCRA, but we do know that it will cover many more companies than were subject to the old SSRS. The best advice is to watch for future developments in order to give yourself time to prepare for the new regulations. There will be fees you have not yet paid this year. There will be new forms and regulations. It will take time for everyone to understand and comply with these rules and we expect there will be penalties if you do not comply.

A Board of Representatives is currently developing the UCRA requirements and you can monitor the developments at the following website:

The web address is lengthy, but it is worth the effort as it provides helpful information including who is on the Board, notes from board meetings and a downloadable question and answer sheet.

Be aware that change is coming, and the changes under UCRA will be broader than the specific topics addressed in this article. Most important, remember that the burden is on you to know and comply with the law, even as the law is evolving. If you have any questions about how it will impact your business, contact me or your transportation attorney.



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