Final Report Draft 4.docx

Addressing Fatigue in the

Commercial Trucking Industry Prepared for Anthony Foxx, Secretary of the

Department of Transportation

Prepared by Nathaniel R. Miller

4/26/2015

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Table of Contents

Executive Summary ……………………………………………………………………………………………………………….… ii

Introduction ………………………………………………………………………………………………………………………...…. 1

A Brief History of Commercial Transportation Regulation …………………………………………………….…. 1

Background of Recent Rule Changes …………………………………………………………………………………….…. 3

Goals of a Policy ………………………………………………………………………………………………………………….…...4

To Whom Hours-of-Service Regulations Apply ………………………………………………………………………… 5

Policy Alternatives ……………………………………………………………………………………………………………….….. 5

Alterative 1: Current Policy ..……………………………………………………….……………………………….. 5

Property-Carrying Drivers ………………………………………………………………………………... 5

Passenger-Carrying Drivers …………………………………………………………………………....… 6

Alternative 2: 10-Hour Driving Limit ………………………………………………………………………….…. 7

Property-Carrying Drivers ………………………………………………………………………………... 7

Passenger-Carrying Drivers …………………………………………………………………………....… 7

Alternative 3: 11-Hour Driving Limit and Electronic Logging Devices ………………………….… 8

Property-Carrying Drivers……………………………………………………………………….…….….. 8

Passenger-Carrying Drivers ………………………………………………………………………....…... 9

Expected Policy Impacts ………………………………………………………………………………………………………..… 9

Alterative 1: Current Policy …………………………………………………………………………………….….. 10

Alternative 2: 10-Hour Driving Limit ……………..………………………………………………………….… 10

Alternative 3: 11-Hour Driving Limit and Electronic Logging Devices ………………………….. 10

Recommendation ………………………………………………………………………………………………………………….. 11

Appendix A: Policy Alternatives Matrix .………………………………………………………………………..……….. 13

Appendix B: Table of 2012 Summary Statistics .……………….………………………………………………….... 14

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EXECUTIVE SUMMARY

According to the Bureau of Labor Statistics, about 1.5 million workers make their living

by driving freight trucks. These workers tend to be paid by the mile and have deadlines for

delivery, and they see time not spent driving as money lost. As a result, drivers tend to stay

awake for long periods of time, usually to the detriment of their health. In the 1980’s,

deregulation brought fiercer competition and fostered a work environment that pressured

drivers to cover more ground in less time. When drivers push themselves to stay awake on

extreme schedules, they are more prone to fatigue that can cause an accident. In order to

minimize the number of deaths and injuries while maintaining the transportation benefits to

society, I recommend that the current 11-hour driving limit be supplemented with mandatory

electronic logging devices (ELDs).

A desirable policy should minimize the number of crashes involving heavy trucks and

maximize benefits to society as a whole. Crashes that result in death have significant cost to

society because there is a general desire to preserve life. Crashes that result in injury have a

significant impact on the budget and livelihood of the victims. As current rules stand, drivers

may drive a maximum of 11 hours per day after 10 consecutive hours off duty, and not more

than 60 hours in 7 consecutive days or 70 hours in 8 consecutive days, the limit being

dependent on the class of business. A driver may restart a 7 or 8 consecutive day period after

taking 34 or more consecutive hours off duty. A 10-hour limit would force drivers with the most

extreme schedules to rest longer, but with a large cost to society in shipping costs. ELDs use

GPS to track the miles and speed of each truck, as well as do robotic maintenance checks,

saving drivers up to an hour per day in paperwork. Requiring these devices would be enforced

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through a $10,000 fine on firms whose trucks are involved in an accident and who do not have

an ELD installed.

In 2012, there were 3,921 deaths and about 104,000 injuries from crashes involving

large trucks. The current 11-hour driving limit rule is expected to decrease the number of

deaths by about 19 and injuries by about 560. While the implementation cost of requiring

electronic logging devices is high at $520 million, the benefits to society in the long run cannot

be ignored. This cost of implantation will be completely paid for in the industry within two

years, as the annual benefit of such a policy is expected to be $395 million. Not only is this

policy expected to save an additional 20 lives and reduce injuries by 434, but it will also

increase driver health. The net benefits of such a policy are too large to ignore at $875 million

annually. Thus, I strongly recommended that electronic logging devices be required.

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INTRODUCTION

According to the Bureau of Labor Statistics, about 1.5 million workers make their living

by driving freight trucks.1 These workers tend to be paid by the mile and have deadlines for

delivery, and therefore they see time not spent driving as money lost. As a result, drivers tend

to stay awake for long periods of time, usually to the detriment of their health. The issue of

sleep-deprived truck drivers has come to the forefront again with an incident involving an 18-

wheeler crashing into a van with actor Tracy Morgan and Mr. Morgan’s friend inside on the

New Jersey turnpike. Mr. Morgan survived with serious injuries while his friend did not.

Accidents from drowsy driving such as these are not an uncommon occurrence. Is it possible to

reduce the number of accidents from fatigue? Can this be done without negatively impacting

the economy? I will address these questions by outlining two alternatives to the current rules

regarding commercial trucking.

A BRIEF HISTORY OF COMMERCIAL TRANSPORTATION REGULATION2

Beginning in the late 19th century, the federal government was forced to intervene in

the transportation industry to prevent rail companies from charging unnecessarily high rates for

the movement of freight. This also protected transportation companies from unfair

competition. In 1935 Congress passed the Motor Carrier Act which gave the Interstate

Commerce Commission (ICC) the power to regulate motor carriers and drivers involved in

interstate commerce. This was done through the distribution of operating permits, the approval

1 “53-3032 Heavy and Tractor-Trailer Truck Drivers.” U.S. Bureau of Labor Statistics. U.S. Bureau of Labor Statistics, n.d. Web. 26

Apr. 2015. 2 This section takes from the summary table given on the IRS website: “Trucking Industry Overview-History of Trucking.”

Trucking Industry Overview-History of Trucking. Internal Revenue Service, n.d. Web. 26 Apr. 2015

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of trucking routes, and the institution of tariffs. At that time a universal tariff was imposed

resulting in a uniform rate. As a result, there was nearly no price competition. The Department

of Transportation was instituted in 1967 and became responsible for a number of

transportation requirements including braking standards, driver licensing, maximum work

hours, and overall safety fitness of interstate carriers. The 1980 Motor Carrier Act substantially

deregulated the commercial trucking industry. The resulting increased competition induced an

increase in employer pressure to have drivers work longer hours to increase profits. Ten years

later about a third of the 100 biggest trucking firms were out of business, providing a surplus of

drivers for the smaller number of jobs available. Thus, the workload of the smaller number of

trucking firms led to an incentive to overload trailers and increase the pressure on drivers to

driver further distances in less time. To prevent the overloading of trailers and to decrease the

wear on the infrastructure, the Surface Transportation Act of 1982 set uniform size and weight

limits. Weight was capped at 80,000 pounds (about 36.3 metric tons), which is still the

maximum today.

The 1990’s brought many changes directly related to the issue at hand. In 1994, the

North American Free Trade Agreement (NAFTA) was passed, resulting in a trade boom with

Mexico. Further deregulation contributed to the existing culture that pushes drivers to work

longer hours. As a result, the Motor Carrier Safety Improvement Act of 1999 outlawed Mexican

trucking companies from leasing their vehicles within the United States as well as established

the Federal Motor Carrier Safety Administration (FMCSA). The purpose of this agency is to

reduce the number and severity of crashes involving large trucks. The FMCSA conducts carrier

compliance reviews, expedites completion of rules, engages in enforcement, conducts sound

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research, and undertakes commercial motor vehicle and driver inspections. In addition, it uses

effective commercial driver’s license testing, record keeping, and sanctions. The continuation of

these policies brought new hours of service rules at the beginning of 2004. These rules

effectively reduced the on-duty time for drivers and increased the amount of time drivers must

take off between shifts. The limitations to how long and how often truckers may work in a given

period were bolstered again in the summer of 2013, affecting only the most extreme schedules.

BACKGROUND OF RECENT RULE CHANGES

As there is no official data on the number of crashes involving large trucks since the

most recent rule changes, it is necessary to put the possible effect of these changes in context

by looking at the state of the industry just before the rules were put in place. In 2012, there

were 3,921 deaths and about 104,000 injuries from crashes involving large trucks. From 2003-

2012, there was an average of 4,220 cashes resulting in death per year, and an average of

about 73,100 crashes resulting in injury per year.3 Assuming that all property is lost when there

is a crash, there is an average of about 31.5 tons lost per crash. The Centers for Disease Control

and Prevention has estimated that the average cost of an emergency department visit for

victims of a crash is about $3,300 and the average cost of victims being hospitalized as a result

of a crash to be $57,000.4 According to the United States Department of Transportation, using

2012 as a baseline, the Value of a Statistical Life (VSL) ranges from $5.2 million to $12.9 million,

and “empirical studies published in recent years indicate a VSL of $9.1 million… for analyses.”5

3 National Highway Traffic Safety Administration And U.S. Department of Transportation. 2012 Data: Large Trucks (2014): n. pag. National Highway Traffic Safety Administration. U.S. Department of Transportation, 1 May 2014. Web. 26 Apr. 2015. 4 "Motor Vehicle Crash Injuries." Centers for Disease Control and Prevention. Centers for Disease Control and Prevention, 07 Oct. 2014. Web. 26 Apr. 2015. 5 Trottenberg, Polly, and Robert S. Rivkin. “Guidance on Treatment of the Economic Value of a Statistical Life (VSL) in U.S. Department of Transportation Analyses.” Department of Transportation. N.p., 28 Feb. 2013. Feb. 26 Apr. 2015.

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Using the death count from 2012, this would put the total cost to society from deaths alone to

be about $35.7 billion. A table of summary statistics can be found in appendix B.

GOALS OF A POLICY

When entertaining the possibility of changing the rules governing commercial trucking,

there are two main goals policy should promote. First, a new policy should minimize the

number of crashes involving heavy trucks. Within this goal there are two impact categories that

deserve attention: crashes that result in death and crashes that result in injury. Crashes that

result in death involve significant cost to society insofar as there is a general desire to preserve

life. Crashes that result in injury have a significant impact on the budget and livelihood of the

victims. Minimizing pain and loss of life are the main drivers relevant to the goal of a policy to

minimize crashes as a whole.

Second, a policy should maximize benefits to society as a whole. Among the benefits to

consider are the total net benefit annually, the improvement to drivers’ health, and the total

cost of implementation. In every crash, equipment has to be replaced, and services often

delayed for the customer. When people are injured, there are often large costs to the

individuals and their families. Reducing crashes reduces medical expenses. The cost to society

when a crash results in death is also great, as society is made up of people who at least value

their own lives. These parameters are outlined in appendix A in a policy-alternative matrix

format.

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TO WHOM HOURS-OF-SERVICE REGULATIONS APPLY6

It important to define which companies are responsible for adhering to Hours-of-Service

regulations. Drivers are subject to these regulations if they drive a commercial motor vehicle

(CMV). A CMV is defined as a vehicle that is used as part of a business and is involved in

interstate commerce. Further, if it weighs, has a gross vehicle weight rating of, or a gross

combination weight of 10,001 pounds or more it is considered a CMV. If the vehicle does not

weigh over 10,001 pounds in any way, but is carrying 16 or more passengers, including the

driver, without compensation, or is carrying 9 or more passengers, including the driver, for

compensation, it is to be considered a CMV. Finally, if a vehicle is transporting hazardous

materials in a quantity requiring placards, it is considered a CMV.

POLICY ALTERNATIVES

As there are two types of CMVs, each policy alternative has two sections outlining

requirements for property-carrying and passenger-carrying drivers.

Alternative 1: Current Policy7

Property-Carrying Drivers

As the current regulations stand, drivers may drive a maximum of 11 hours per day after

10 consecutive hours off duty. However, as drivers have other responsibilities, there is also a

limit on driving beyond the 14th consecutive on-duty hour following 10 consecutive hours off

6 “Hours of Service.” Federal Motor Carrier Safety Administration. U.S. Department of Transportation, 2 Apr. 2015. Web. 26 Apr.

2015. 7 "Hours of Service of Drivers; Final Rule." Federal Register 76.248 (2011): n. pag. U.S. Government Publishing Office. Web.

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duty. Off-duty time does not extend the 14-hour period. Regarding rest breaks, drivers may

only drive if 8 hours or less since the end of the driver’s last off-duty or sleeper berth period of

at least 30 minutes. In other words, within an 8-hour period in a driver’s shift, the driver must

take a 30 minute break off-duty. Drivers may not drive after 60 hours in 7 consecutive days or

70 hours in 8 consecutive days, the limit being dependent on the class of business of the

employer. A driver may restart a 7 or 8 consecutive day period after taking 34 or more

consecutive hours off duty. Finally, drivers using the sleeper berth provision must take at least 8

consecutive hours in the sleeper berth, plus a separate 2 consecutive hours either in the

sleeper berth, off duty, or a combination of the two in order to reach the 10 hour requirement

before being allowed to drive another 11 hours.

Passenger-Carrying Drivers

Current policy allows drivers to drive a maximum of 10 hours after 8 consecutive hours

off duty. Because they are not required to perform daily maintenance checks or unload

property at their destination, there are not as many responsibilities for passenger-carrying

drivers as property-carrying drivers. Following 8 consecutive off-duty hours, passenger-carrying

drivers may not drive after being on duty for 15 hours. Off-duty time is not included in the 15-

hour period. Drivers may not drive after 60 hours in 7 consecutive days or 70 hours in 8

consecutive days, the limit being dependent on the class of business of the employer, but there

is no 34 consecutive hours off-duty requirement to reset the 7 or 8 consecutive day period.

Finally, drivers using a sleeper berth must take at least 8 hours in the sleeper berth, and may

split the sleeper berth time into two periods provided neither is less than two hours.

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Alternative 2: 10-Hour Driving Limit8


Under this alternative, drivers may drive a maximum of 10 hours per day after 10

consecutive hours off duty. To allow drivers another hour to perform their other

responsibilities, there would also be a limit on driving beyond the 14th consecutive hour after

coming on duty following 10 consecutive hours off duty as is the case in the current policy. Off-

duty time would not extend the 14-hour period. Drivers may only drive if 8 hours or less have

passed since the end of the driver’s last off-duty or sleeper berth period of at least 30 minutes.

Thus, within an 8-hour period in a driver’s shift, the driver must take a 30 minute break off-

duty. Drivers may not drive after 53 hours in 7 consecutive days or 73 hours in 8 consecutive

days, the limit being dependent on the class of business of the employer. A driver may restart a

7 or 8 consecutive day period after taking 34 or more consecutive hours off duty. Finally, drivers

using the sleeper berth provision must take at least 8 consecutive hours in the sleeper berth,

plus a separate 2 consecutive hours either in the sleeper berth, off duty, or a combination of

the two in order to reach the 10 hour requirement before being allowed to drive another 10

hours.


This alternative does not change the current rules governing passenger-carrying drivers

for a few reasons. First, there are far fewer passenger-carrying CMVs on the road than

8 "Hours of Service of Drivers; Final Rule." Federal Register 76.248 (2011): n. pag. U.S. Government Publishing Office. Web.

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property-carrying. Second, most passenger-carrying CMV drivers that use interstate roads do

not match the limit of 10 hours of driving in a day. Third, and most importantly, most

passenger-carrying CMV drivers that do match the 10 hour limit are not long-haul drivers; it is

more likely that a driver would drive extensively for a few days at most to their destination and

back having no long-term impact on their health or short term effect on their passenger’s well-

being.

Alternative 3: 11-Hour Driving Limit and Electronic Logging Devices


This third policy keeps current regulations intact. What sets this alternative apart from

the current policy is the requirement that each truck be outfitted with an Electronic Logging

Device (ELD). These devices use GPS to track the miles and speed of each truck. These data are

uploaded to a server automatically for record keeping. In addition to speed and miles, ELDs also

automatically log the status of the vehicle. These devices typically require a smartphone, tablet,

or a producer-made device. As most people already have these sorts of devices, the only cost

would be of the original installation and not for the secondary device. ELDs would allow drivers

to save time by eliminating paperwork before and after a shift logging miles and doing daily

maintenance checks. A problem arises in incentivizing the adoption of these devices, however.

While ELDs would open up time in a driver’s shift, firms may be reluctant to purchase them as

they would effectively eliminate the opportunity for falsifying logs to bend the rules for the

sake of profit. It would be advisable to make these devices mandatory in all trucks, but there

would still be an issue of enforceability. To enforce their use, a fine should be set at $10,000 for

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each accident involving a CMV that does not have an ELD installed effective January 1, 2018,

giving firms enough time to acquire such devices.9 This would provide low-cost enforcement as

the punishment is not imposed until a firm is possibly responsible for not complying, and it

could still allow firms that do not have fatigue related incidents as a concern to decide if the

cost of these devices are worth the risk of the fine.


This policy leaves passenger-carrying driver rules unchanged from the status quo for

the same reasons previously mentioned in alternative 2. First, there are far fewer passenger-

carrying CMV’s on the road than property-carrying. Second, most passenger-carrying CMV

drivers that use interstate roads do not match the limit of 10 hours of driving in a day. Third,

and most importantly, most passenger-carrying CMV drivers that do match the 10 hour limit

are not long-haul drivers; it is more likely that a driver would drive extensively for a few days at

most to their destination and back having no long-term impact on their health or short term

effect on their passenger’s well-being. These vehicles won’t need ELDs as they neither need to

log miles nor do daily maintenance checks.

EXPECTED POLICY IMPACTS

For a summary of impacts from the stated policy alternatives, see the policy alternatives

matrix in appendix A.

9 This $10,000 fine was calculated assuming a $360 per year subscription fee for an ELD service. This fine is more than paying for a subscription for 25 years, thus it should serve as a strong deterrent to non-compliance.

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Alternative 1: Current Policy


large trucks. The 11-hour driving limit is expected to decrease the number of deaths by about

19 and injuries by about 560, putting the expected number of deaths at 3,902 and injuries at

103,440.10 According to a report released by the Department of Transportation, this will have

an annualized benefit to society of $480 million. In respect to drivers’ health, there is an

expected benefit of $150 million annually. This policy has no incremental implementation costs

as it is already in effect.

Alternative 2: 10-Hour Driving Limit

The report released by the Department of Transportation states that decreasing the

maximum number of hours a driver can drive in a day to 10 would result in 17 fewer deaths and

445 fewer injuries per year than an 11 hour limit for an estimated total of 3,885 deaths and

102,995 injuries. While this result may seem more favorable, the net benefit to society would

actually be an annual $70 million loss, despite an increase in driver health valued at $170

million. The estimated cost of implementation is $40 million for any policy change to cover

costs of drafting, salaries of bureaucrats, other paperwork within the system, etc.

Alternative 3: 11-Hour Limit and Electronic Logging Devices

As this alternative maintains the 11-hour driving limit, the death and injury expectations

remain the same when considering the limit alone at 3,902 and 103,440, respectively. However,

10 “New Hours-of-Service Safety Regulations to Reduce Truck Driver Fatigue Being Today.” Department of Transportation. U.S.

Department of Transportation, 1 July 2013. Web. 26 Apr. 2015.

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by implementing ELDs drivers can save up to an hour of their time on-duty by avoiding

paperwork. If one assumes that this extra hour is then used to sleep, drivers’ health benefits

would be comparable to the 10-hour limit, or $170 million. The increase in hours slept would

then have comparable effects in the death and injury rate. Indeed, the use of such devices are

expected to decrease the number of deaths annually by 20, and injuries by 434 according to the

Department of Transportation.11 That is to say, there is expected to be 3,882 deaths and

103,006 injuries per year. These devices are also expected to save the industry an additional

$395 million annually by saving drivers’ time, for a total net benefit to society of $875 million.

One of the largest drawbacks to this alternative is that if every driver was required to have a

device in his or her truck, the industry would face a cost of about $490 million just to purchase

the devices. With the addition of the previously mentioned $40 million cost of a policy change,

the total cost of implementation could be closer to $530 million.

RECOMMENDATION


large trucks. The current 11-hour driving limit rule is expected to decrease the number of

deaths by about 19 and injuries by about 560. While the implementation cost of requiring

electronic logging devices is high at $520 million, the benefits to society in the long run cannot

be ignored. This cost of implantation would be completely paid for in the industry within two

years, as the annual benefit of such a policy is expected to be $395 million. Not only is this

policy expected to save an additional 20 lives and reduce injuries by 434, but it would also

11 “DOT Proposes Use of Electronic Logbooks to Improve Efficiency, Safety in Commercial Bus & Truck Industries.” Department of Transportation. The United States, 13 Mar. 2014. Web. 26 Apr. 2015.

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increase driver health. The net benefits of such a policy are too large to ignore at $875 million

annually. Thus, I strongly recommend that mandatory electronic logging devices be required.

If my recommendation is adopted, a first step moving forward would be to decide which

devices would qualify as an ELD. There are a number of models on the market that each have

pros and cons. Another step that would need to be taken is outfitting government agencies that

handle driver logs with servers to store, maintain, clean, and analyze the data, or if the servers

are stored on the servers owned by the manufacturers, ensure that the agencies are allowed

access to the data. Furthermore, a rule would need to be made in order to solidify the

legitimacy of the policy. This requires a proposition of such a rule and time for comment from

the public according to the requirements of the Administrative Procedures Act. To ensure this

rule is made smoothly, it may be necessary to develop a website and information brochures to

convince the public that the policy’s long-term benefits are worth its short-term costs.

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APPENDIX A:

Policy Alternatives Matrix

Policy Alternatives

Goals Impact Category Current Policy2

(11-hour limit)

10 hour limit2 Current Laws +

Electronic Logging

Devices (ELDs)3

Minimize

Crashes

Involving

Heavy Trucks

Deaths1 No Data

Expected: 3,902

Estimate: 3,885

Difference: 17

Expected: 3,882

Difference: 20

Injuries1 No Data

Expected: 103,440

Expected: 102,995

Difference: 445

Expected: 103,006

Difference: 434

Maximize

Benefits

To Society – Net

Average

(Summation of

Damages,

Medical

Expenses, loss of

life)

$480 Million

Annually

-$70Million

Annually

Total Benefit: $410

Million Annually

+$395 Million

Annually

Total Benefit: $875

Million Annually

To Driver Health $150 Million

Annually

+ $170 Million

Annually

+$170 Million

Annually4

Implementation

None

Status Quo

Small

$40 Million for

implementation

High

$530 Million in

Purchases of ELDs5

1: Base data can be found in the “background” section, summarized in table format in appendix B.

2. “Hours of Service of Drivers.” Federal Register 76.248 (2011): n. pag. National Archives and Records Administration, 27 Dec. 2011. Web. 26 Apr. 2015.

3. “DOT Proposes Use of Electronic Logbooks to Improve Efficiency, Safety in Commercial Bus & Truck Industries.” Department of Transportation. The United States, 13 Mar. 2014. Web. 26 Apr. 2015.

4: Assuming that the use of such devices will save drivers half an hour’s worth of paperwork at the beginning and end of each shift, and drivers use this extra hour for rest as assumed in the 10-hour alternative, this should net the same benefits as that alternative annually.

5: This was estimated by taking the price of a standard ELD ($300) and multiplying it by the number of commercial truck drivers plus the estimated cost of implementation ($40 million)

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APPENDIX B:

Table of 2012 Summary Statistics

Crashes Resulting in Deaths1 3,802 Heavy Trucks

Average 2003-2012: 4,220

Crashes Resulting in Injuries1 77,000 Heavy Trucks

Average 2003-2012: 73,100

Millions of Tons Shipped by Truck2 13,182 tons

Mean Lost Freight (Tons)

Max. Legal Weight: 80,000 lbs

63,160 lbs per crash assuming all freight involved in

crash becomes waste3

Medical Expenses Over Lifetime4 ED visit: $3,300

Hospitalization: $57,000

1: National Highway Traffic Safety Administration. "Traffic Safety Facts 2012." 2012 Data: Large Trucks (n.d.): n. pag. U.S. Department of Transportation, May 2014. Web.

2: United Sates of America. U.S. Department of Transportation. Federal Highway Administration. Freight Facts and Figures 2013. Page 3. Web. 3: Calculated by author by taking total amount of weight shipped divided by total number of trucks. 4: "Motor Vehicle Crash Injuries." Centers for Disease Control and Prevention. Centers for Disease Control and Prevention, 07 Oct. 2014. Web. 26 Apr. 2015.

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