IRP Leased Vehicles
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1 IRP Leased Vehicles International Committee IRP Leased Vehicle • The International Committee has created a sub committee to look into the issues that may exist for the removal of Section 900 of the plan. • Over the past several months we have been gathering information and we would like your input in a few areas.
Transcript of IRP Leased Vehicles
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IRP Leased Vehicles
International Committee
IRP Leased Vehicle
• The International Committee has created a sub committee to look into the issues that may exist for the removal of Section 900 of the plan.
• Over the past several months we have been gathering information and we would like your input in a few areas.
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IRP Leased Vehicle
Section 900 – BASE JURISDICTION FOR RENTAL FLEET A rental company applying to register a Rental Fleet under the Plan shall select a Base Jurisdiction for the Fleet according to Section 305; except that when the term of the Lease of the Vehicles in the Fleet is greater than 60 days, the Lessee must (1) have an Established Place of Business in the Base Jurisdiction selected, and (2) the Fleet must accrue distance in the Base Jurisdiction selected.
Leasing Overview
According to the Truck Rental and Leasing Association, truck leasing is a $25 billion industry
TRALA has over 400 full time members
These companies purchase 40 percent of all new commercial trucks annually
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Leasing
• Section 900 of The Plan mandates additional qualifications on leasing companies not required by other motor carriers
• Currently leasing companies must meet all the provisions as a registrant and qualifications of Section 305(a) Selection of Base Jurisdiction
Vehicle Owner as Registrant
Removal of section 900 offers leasing companies the same opportunity administratively as any other motor carrier:
• Selection of a base jurisdiction for which the leasing company is the registrant and has an established place of business and accrues actual mileage
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Leasing Company as Registrant
• Must be licensed by the base jurisdiction to conduct leasing business
• Is responsible for the records maintenance
• Is the party which the base jurisdiction audits
• Is bound by jurisdictional laws regarding tax
• Is the owner of the equipment binding all liability to them
• Carries motor vehicle liability insurance coverage
• Provides maintenance services
Leasing Company as Registrant
✘NOT a Service Bureau
✘NOT a Freight Broker
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Lease Vehicle
Lease Vehicle
29 Day Rental Long Term Lease
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A jurisdiction in the US or CanadaThat can provide:
PLAIN PAPER CAB CARDS
ELETRONIC FUNDING
ACCEPTS OUT OF STATE OWNERSHIP
SELF ISSUANCE LICENSE PLATES
ON-LINE WEB BASED SYSTEM 24 HOURS
SAME DAY ISSUANCE
TEMPORARY PERMITS
CARRIER MANAGED
PERMANENT PLATES
NO VALIDATION DECAL
HAS ADEQUATE STAFFING
LICENSE PLATE TRANFERABILITY
Benefits of Removing Section 900
• Jurisdictions– Continues to receive
registration $$
– Eases staffing concerns
– Lessens workload
– Carrier maintains database
– Carrier still responsible for compliance
– Reduces management costs
• Leasing Company– Administrative efficiency
– Asset utilization
– Provides the human resources
– Responsible for compliance
– Improves turnaround
– Plate fees re-utilization
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Misconceptions
• Jurisdictions
– Loss of title revenues
– Loss of tax revenues
– Unmanageable audits
• Leasing company
– Leases drivers
– Avoid taxation
– Avoid audits
Leased Vehicle Survey
• Majority of Canadian Jurisdictions have concerns on how the safety of commercial carriers will be conducted or enforced
• US Jurisdictions do not seem to have as many concerns with the removal of Section 900 from the Plan.
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87% of Canadian Jurisdictions say “Yes”
Survey Results
Is it necessary to treat leased vehicles differently than non leased vehicles?
87% of US Jurisdictions say “No”
87% of Canadian Jurisdictions say “Yes”
Survey Results
Are there administrative concerns unique to long term rental fleets?
75% of US Jurisdictions say “No”
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87% of Canadian Jurisdictions say “Yes”
Survey Results
Would removing Section 900 have a negative effect on highway safety?
94% of US Jurisdictions say “No”
Effect on Safety in Canada
• NSC will become less effective
– Inability to monitor hosted vehicles
– Lack of international data sharing
– Driver/carrier can evade poor safety rating
• Inspection programs will be compromised
– Inspections accepted (both quality and frequency) for hosted vehicles may be less than host jurisdiction
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National Safety Code
• NSC is both Federal & Provincial
• Administered separately by each province (not federal government)
• Federal legislation aligns NSC programs
• Carrier will have a NSC number issued by the province where vehicle is plated
• Province regulates their own NSC carriers
NSC challenges in Canada
Canada based carrier leasing US plated vehicle
BC based Carrierleasing vehicle with NS Plate
in
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Intra-jurisdictional operations
Intra + Inter = Inter = prorateIntra + {Inter Intent} = prorate
Intra + {inaction} = prorateIntra (if <18 months) = prorate
Next Steps
CCMTA project group (2005) struck to look at rental/lease vehicle issues.
• Recommendations
– US vehicles in Canada to be registered under NSC (ON & QC do this, others don’t/can’t)
– North American Data exchange (stalled)
– Enhance IRE to allow enquiries of US vehicles
– Plan to require suspension of IRP credential for NSC or USDOT order
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Minimizing impact on Canada
Rental/lease vehicles operated beyond 30 days by Canadian based carrier:
• Have a CDN NSC #
• The name of the carrier be included on the registration
• Are registered/credentialed in the province where the Canadian carrier is based
Next steps
CCMTA, IRP and Industry need to work together to:
– Explore options and impacts
– Prevent erosion of NSC effectiveness
– Minimize safety impacts
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US Survey Results
• Need to define requirements for basing of long term vs. short term leasing
• How is sales/use tax being paid
• Resources for auditing of large carriers
• Resources needed to administer a large fleet
US Survey Results
• Accountability of distance reporting
• Estimating distance
• Loss of revenue due to base jurisdiction shopping
• Enforcement challenges
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US Survey Results
• Difficulty to track and monitor lessee (the end user)
• Insurance concerns
• How would a large fleet be audited
Compliance Audits
• The purpose of auditing for the Plan:
• Determine if source documents are compliant with the Plan
• Verify reported distance that results from source documents being processed by Registrants’ distance reporting systems.
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Survey Results: Audit Concerns
• Very large Registrants could be placed in jurisdictions where resources are not available to audit the Registrants
• A very high volume of registrations could be placed in jurisdictions where resources are not available to satisfy increased quota demands
Survey Results: Audit Concerns
• Who will maintain the registration records and where will they be presented?
• What will the Lessor know about the Lessee’s operation when it is time to conduct an audit?
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Survey Results: Audit Concerns
• How do we track vehicles that might be in separate leases during a registration year?
• How do we efficiently determine if the requirement of “Intent” has been met?
Questions
1. Is it necessary to treat leased vehicle fleets any differently than non-leased vehicle fleets?
2. Do you have administrative concerns that are unique to long term leased vehicle fleets?
3. What concerns if any do you have if the lessee is located in a different jurisdiction than the lessor?
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• Working group to gather all the information you have provided us today
• Analyze this information
• Canadians to work to find solutions to safety concerns
• Establish ways to identify and address all concerns
• Possible Ballot for 2013
