SB 350, As Passed Senate

SB-0350, As Passed Senate, December 7, 2006

SUBSTITUTE FOR

SENATE BILL NO. 350

A bill to amend 1933 PA 254, entitled

"The motor carrier act,"

by amending section 1 of article I, sections 5, 6, 7, and 10 of

article II, section 6 of article III, and section 2 of article V

(MCL 475.1, 476.5, 476.6, 476.7, 476.10, 477.6, and 479.2), section

1 of article I, sections 5 and 7 of article II, and section 6 of

article III as amended by 1993 PA 352, sections 6 and 10 of article

II as amended by 1982 PA 399, and section 2 of article V as amended

by 1996 PA 76, and by adding section 7 to article V.

THE PEOPLE OF THE STATE OF MICHIGAN ENACT:

ARTICLE I

Sec. 1. The words and phrases used in this act shall be

construed as follows, unless the context shall otherwise require:

(a) "Motor vehicle" means any automobile, truck, trailer,

semitrailer, truck tractor, road tractor, or any self-propelled or

motor or mechanically driven vehicle, or any vehicle in anywise

attached to, connected with, or drawn by any self-propelled or

motor or mechanically driven vehicle, used upon any public highway

of this state for the purpose of transporting property.

(b) "Public highway" means any public highway, road, street,

avenue, alley, or thoroughfare of any kind, or any bridge, tunnel,

or subway used by the public.

(d) "Person" means any individual, partnership, association,

or corporation, and their lessees, trustees, or receivers appointed

by any court.

(e) "For hire" means for remuneration or reward of any kind,

paid or promised, either directly or indirectly.

(f) "Motor common carrier of property" means any person who

holds himself or herself out to the public as being engaged in the

business of a for hire common carrier as at the common law, either

directly or through any device or arrangement, including but not

limited to those who operate over fixed routes or within 1 mile of

a fixed route or between fixed termini, in the transportation by

motor vehicle from place to place upon or over the highways of this

state, the property, or any property, or any class of property of

others who may choose to employ the person.

(g) "The public" means that part or portion of the general

public which the motor carrier is ready, able, willing, and

equipped to serve.

(h) "Motor contract carrier of property" means any person

providing motor vehicle transportation upon the highways of this

state for a series of shipments under continuing agreement of not

less than 1 year with a person which agreement provides for the

assignment of motor vehicles exclusively for each such person while

the vehicle is in the service of such person and which agreement is

designed to meet the distinct needs of each such person. Lower

rates, in and of themselves, shall not constitute a distinct need.

A motor contract carrier that possesses a motor common carrier

certificate of authority of that class set forth at section 5(6)(a)

of article II may commingle authorized contract carrier shipments

while providing common carrier service over fixed routes, without

assigning any vehicle exclusively for the person or persons for

whom contract service is provided. A motor contract carrier

authorized to transport packages or articles weighing 70 pounds or

less for 1 or more contract shippers may commingle such authorized

packages or articles weighing 70 pounds or less in the same vehicle

with commodities transported as a common or contract carrier,

without assigning any vehicle exclusively for the person or persons

for whom contract service is provided. A motor contract carrier

authorized to transport coin, currency, or food stamps for 1 or

more contract shippers, may commingle such authorized coin,

currency, or food stamps in the same vehicle with commodities

transported as a common or a contract carrier, without assigning

any vehicle exclusively for the person for whom contract service is

provided.

(i) "Motor carrier" means both motor common carriers of

property and motor contract carriers of property. Motor carrier

does not include a private carrier.

(j) "Certificate of authority" means a certificate issued to a

motor common carrier authorizing a transportation service that

serves a useful public purpose responsive to a public demand or

need, which certificate is issued under the terms of this act.

(k) "Permit" means the permit issued to motor contract

carriers under the terms of this act.

(l) "Through any device or arrangement" means any and all

methods, means, agreements, circumstances, operations, or

subterfuges under which any person undertakes for hire to conduct,

direct, control, or otherwise perform the transportation by motor

vehicle of property upon the public highways of this state.

(m) "Modified procedure" means that administrative procedure

by which the commission may consider evidence and testimony

submitted in the form of verified statements in motor carrier

matters without the necessity for an oral hearing.

(n) "Occasional accommodative service" means service limited

to operations conducted by persons not regularly engaged in the

transportation business of a motor common carrier or a motor

contract carrier.

(o) ~~"Required~~ "Useful public purpose" means a purpose for

which an applicant can provide adequate, economic, safe, effective,

competitive, and equitable motor carrier service to satisfy a

demonstrated public ~~necessity, without creating excess service~~

need.

(p) "Fit", as applied to a proposed motor carrier service,

means safe, suitable, and financially responsible as determined by

the commission.

(q) "Private carrier" means any person engaged in the

transportation of property by motor vehicle upon public highways

where the transportation is incidental to, or in furtherance of,

any commercial enterprise of the person, other than transportation.

(r) "General rate" means a rate applicable to 2 or more motor

carriers which rate is filed pursuant to section 6b of article V.

(s) "Base rate, fare, or charge" means that nondiscounted

rate, fare, or charge specified in a carrier's rate schedule on

file with the commission.

(t) "Predatory rate" means a rate that is below its fully

allocated costs. As used in this subdivision, "fully allocated

costs" means total costs, including variable costs, plus an

allocation of fixed costs.

(u) "Household goods" means personal effects and property used

or to be used in a dwelling when a part of the equipment or supply

of that dwelling. Household goods do not include property moving

from a factory or store, except such property as the householder

has purchased with intent to use in his or her dwelling and that is

transported at the request of the householder, the carrier's

transportation charges for which are paid by that householder.

(v) "Local move" means a household goods shipment of 40 miles

or less, from point of origin to point of destination, as

determined by actual miles traveled by the motor carrier and

verifiable by odometer reading or mileage guide in general public

use.

ARTICLE II

Sec. 5. (1) Except as provided in this section, the commission

shall issue a certificate of authority to an applicant authorizing

that it provide transportation subject to the jurisdiction of the

commission under this article as a motor common carrier of property

if the commission finds all of the following:

(a) The character and condition of the vehicles proposed to be

operated by the applicant is such that they may be operated safely

upon the public highways.

(b) That the applicant is fit, willing, and able to provide

the transportation to be authorized by the certificate and to

comply with this act and rules and regulations of the commission.

proposed will serve a ~~required~~ useful public purpose. ~~, unless~~

~~the commission finds that the transportation to be authorized by~~

~~the certificate would create excess service by endangering the~~

~~ability of the present carriers to provide adequate, economical,~~

~~safe, and efficient service.~~

(d) That the service proposed is consistent with the

transportation policy set forth in section 2 of article I.

(2) In making a finding under subsection (1), the commission

shall consider and, to the extent applicable, make findings on at

least all of the following:

(a) The transportation policy set forth in section 2 of

article I.

~~(b) The existing available and adequate service in relation to~~

~~the character and volume of available traffic.~~

~~(c) Whether the service proposed will create excess service~~

~~inconsistent with the public interest. The commission shall not~~

~~find diversion of revenue or traffic from an existing motor carrier~~

~~to be in and of itself inconsistent with the public interest.~~

(b) ~~(d)~~ The character of the bond or insurance proposed to

be given to insure the protection of the public.

provide service commensurate with the extent of the certificate

sought.

(3) A motor carrier may not protest an application to provide

transportation filed under this section unless all of the following

requirements are met:

(a) The protest is filed with the commission not later than 20

days following publication of the notice of the filing of the

application in the biweekly bulletin.

(b) The motor carrier possesses a certificate of authority or

permit authorizing it to handle, in whole or in part, the traffic

for which an application is made.

that meets the reasonable needs of the shippers involved.

(d) The motor carrier has performed service within the scope

of the application during the previous 12-month period.

(4) The commission may grant leave to intervene to a person

other than a motor carrier or an applicant for a certificate of

authority or permit upon a showing of other interests that are

consistent with the transportation policy set forth in section 2 of

article I. A petition to intervene shall not be granted unless

filed with the commission not later than 20 days following

publication of the notice of the filing of the application in the

biweekly bulletin except for good cause shown.

(5) Any motor carrier having timely filed a protest or any

intervenor having timely filed a petition to intervene may

participate in person or by counsel, cross-examine witnesses, and

offer testimony in support of, or in opposition to, the grant of a

certificate of authority.

(6) Certificates of authority issued to motor common carriers

of property under this act shall be of 3 classes:

(a) Certificates issued to motor carriers as may be operating

over fixed routes or within 1 mile of a fixed route or between

fixed termini.

(b) Certificates issued to motor carriers providing a

transportation service within an 8-mile radius of a city having a

population of 500,000 or more and including each city or village, a

part of which is located within the 8-mile radius.

property.

(7) The burden of proof shall be on the protestant to meet the

requirement of subsection (2)(c).

Sec. 6. (1) ~~All~~ Except as otherwise provided in subsection

(2), all motor common carriers of property subject to this act,

shall before engaging in business, print and file with the

commission and keep open to public inspection in its principal

place of business and have available upon request, schedules

showing all rates, fares and charges for transportation of property

between different points on its route, and also between points on

its own route and on the route of any other motor common carrier

when a through route and joint rate have been established. When the

commission grants a new authority to a motor common carrier, that

carrier shall not charge a predatory rate. A predatory rate is a

rate found to be below its fully allocated cost by the Michigan

public service commission. The commission shall make this

determination prior to the issuance of a certificate and

commencement of operations. If a joint rate over the through route

has not been established the several motor carriers shall file,

print, and keep open for public inspection as described in this

section, the separately established rates, fares, and charges

applied to the through transportation, and shall likewise print,

file, and keep open to the public inspection all other charges,

privileges, or rules which in anywise change, affect, or determine

any part of the rates, fares, charges, or the value of the service,

and other information as required by the commission in its rules.

In addition, a motor carrier shall keep the facilities of the motor

carrier open to public inspection. A motor common carrier shall not

receive or accept any person or property for transportation upon

the highways until in compliance with the requirements of this

section.

(2) This section does not apply to local moves of household

goods.

Sec. 7. (1) All rates, fares, and charges made by any motor

common carrier shall be just and reasonable, and shall not be

unjustly discriminatory, prejudicial, or preferential. Contract

motor carrier rates, fares, and charges made by common motor

carriers holding both common carrier and contract carrier authority

shall not be considered by the commission to be unjustly

discriminatory, prejudicial, or preferential in determining

compliance with this section. Existing carriers will be permitted

to meet competitive rates without further justification to the

commission. The commission shall take into account reasonable

estimated or foreseeable future costs in determining whether rates,

fares, and charges meet the requirements of this subsection.

(2) A motor common carrier shall not charge, demand, collect,

or receive a greater or less or different remuneration for the

transportation of property, or for any service in connection

therewith, than the rates, fares, and charges which have been

legally established and filed with the commission.

(3) A motor common carrier shall not refund or remit in any

manner or by any device any portion of the rates, fares, and

charges required to be collected by the tariffs on file with the

commission or ordered by the commission.

(4) Nothing in this act shall prohibit a carrier from

operating both as a motor common carrier and a motor contract

carrier.

(5) This section does not apply to local moves of household

goods.

Sec. 10. (1) The commission shall supervise and regulate all

motor common carriers of property and regulate and determine

reasonable and sufficient rates, fares, charges, and

classifications; regulate the facilities, accounts, service, and

safety of operations of each motor common carrier. To insure

adequate transportation service to the territory traversed by the

motor common carriers, the commission may require the coordination

of the service and schedules of competing motor common carriers;

require the filing of annual and other reports, tariffs, schedules,

and other data by the motor common carriers where that information

is considered by the commission to be necessary for the

administration or enforcement, or both, of this act; supervise and

regulate motor common carriers in all matters affecting the

relation between the motor carriers, and the public and between

motor carriers; and promulgate rules for the purpose of promoting

safety upon the highways and the conservation of their use to the

end that the provisions of this act may be fully and completely

carried out. The commission, by general order or otherwise, shall

promulgate rules in conformity with this act applicable to all

motor common carriers, and to do all things necessary to carry out

and enforce this act.

(2) In the exercise of its jurisdiction under subsection (1),

the commission shall not regulate and determine reasonable and

sufficient rates, fares, charges, and classifications, or require

the filing of tariffs and schedules, for local moves of household

goods.

ARTICLE III

Sec. 6. (1) The commission shall supervise and regulate all

motor contract carriers of property; ~~, require the filing of~~

~~annual and other reports and other data by the motor contract~~

~~carriers;~~ promulgate rules covering the filing with the commission

of the charges, and the operations of motor contract carriers in

competition with motor common carriers over the highways of this

state; and promulgate rules for the purpose of promoting safety

upon the highways and the conservation of their use, to the end

that the provisions of this act may be fully and completely carried

out. The commission, by general order or otherwise, shall

promulgate rules in conformity with this act applicable to all

motor contract carriers, and to do all things necessary to carry

out and enforce the provisions of this act. The commission may also

request the filing of annual reports, and other reports in specific

cases, where that information is considered by the commission to be

necessary for the administration or enforcement, or both, of this

act.

(2) Each motor contract carrier, in a form as the commission

prescribes and in accordance with the rules as the commission

promulgates, shall establish and file with the commission actual

rates and practices and rules of the contract carrier related to

those rates. A motor contract carrier shall not be required with

rate filings to submit evidence of the revenues and expenses to be

realized in the performance of its authorized functions. A motor

contract carrier shall make available to the commission its

complete contract or contracts, but shall not be required to file

such contract or contracts with the commission. A member of the

commission, or a clerk, officer, or employee of the state shall not

divulge or make known, in any manner whatsoever not provided by

this section, to any person the rate filings of a contract carrier,

unless a complaint has been brought by order of the commission

against a contract carrier alleging that a rate of a contract

carrier or practice or rule of the contract carrier related to the

rate or value of service under that rate is predatory and in

violation of this act. Rate filings of a contract carrier are

exempt from disclosure under the freedom of information act, ~~Act~~

~~No. 442 of the Public Acts of 1976, being sections 15.231 to 15.246~~

~~of the~~ ~~Michigan~~ ~~Compiled Laws~~ 1976 PA 442, MCL 15.231 to 15.246,

unless a complaint has been brought by order of the commission

against a contract carrier pursuant to this section. The commission

shall review all rate filings to determine that such rate filings

are not predatory. When the commission finds that a rate of a

contract carrier or practice or rule of the contract carrier

related to the rate or the value of service under that rate is

predatory and in violation of this act, the commission shall

prescribe the minimum rate or practice or rule. In making a

predatory rate determination and when prescribing a minimum rate or

practice or rule related to a rate for a motor contract carrier,

the commission shall consider all of the following:

(a) All revenues and costs associated with 1 specific contract

or appendix to that contract.

(b) The effect of a prescribed minimum rate or practice or

rule on the movement of traffic by that carrier.

(3) A motor contract carrier shall not receive or accept

property for transportation upon the highways until the statement

of charges has been filed with the commission.

ARTICLE V

Sec. 2. (1) This act shall not apply to any of the following:

(a) A vehicle, other than a vehicle transporting household

goods, operated entirely within a city or village of this state; or

to a motor carrier of property, other than a motor carrier of

household goods, whose operations may extend a distance of not more

than 8 miles beyond the boundary of a city or village having a

population of less than 500,000, if the origin and destination of

the property being transported is within an 8-mile radius of the

city or village. The territory within the external corporate limits

of a city, even though it includes and embraces the area of 1 or

more separately organized and existing cities, shall be considered

a single city. Notwithstanding any other provision of this

subdivision, a certificate or permit issued under this act is

required for the operation of a vehicle of a motor carrier,

including a vehicle transporting household goods, other than a

vehicle exempted under subdivisions (b) to ~~(p)~~ (q), in the

transportation of property between a city having a population of

500,000 or more and a city or village located within the commercial

zone of a city having a population of 500,000 or more, or between

cities or villages within that commercial zone. As used in this

subdivision, "commercial zone" means the area within an 8-mile

radius of a city having a population of 500,000 or more and

includes all cities and villages, any part of which are located

within that 8-mile radius.

(b) A vehicle owned or operated by the state or the United

States, or by a state or federal corporation, agency, or

instrumentality.

village, or school district, or by a county or township in the

state or by a corporation, agency, or instrumentality of the state,

for governmental purposes.

(d) A vehicle used exclusively for carrying United States

mail.

(e) A vehicle used for the transportation of farm products,

including livestock, when transported by other than the owner, from

the farm to the market in the raw state, or used for the

transportation of milk from the farm to milk stations, or trucks

owned by a farmer bearing a farm truck license issued under section

801(1)(c) of the Michigan vehicle code, ~~Act No. 300 of the Public~~

~~Acts of 1949, being section 257.801 of the Michigan Compiled Laws~~

1949 PA 300, MCL 257.801, when being used by the farmer in hauling

farm produce, livestock, or farm equipment, and supplies for other

farmers for remuneration in kind or in labor, but not for money.

(f) A vehicle used for the transportation of fruits, eggs,

poultry, fish and seafood, grain, vegetables, seeds, nursery stock,

horticultural products, and sugar beets. This subdivision shall not

exempt a vehicle transporting the commodities described in this

subdivision in other than the raw state.

(g) A vehicle used for occasional accommodative service

including seasonal transportation of perishable commodities even

though the cost of the accommodative service and seasonal

transportation of perishable commodities may be paid by the person

accommodated.

(h) A dump truck having not more than 4 axles or any dump

vehicle moving directly to and from a public highway, airport, or

railroad or bridge construction site, when used for the

transportation of sand, gravel, slag, stone, limestone, crushed

stone, marl, pebbles, cinders, bituminous aggregates, asphalt,

blacktop, dirt, or fill material, or any dump vehicle transporting

commodities generally transported in the dump vehicle operating

within an 8-mile radius of a city having a population of 500,000 or

more and including all other cities or villages, any part of which

is located within the 8-mile radius.

(i) A vehicle used to transport a vehicle that is temporarily

disabled from a point within an 8-mile radius of a city having a

population of 500,000 or more and including all other cities or

villages, any part of which is located within the 8-mile radius to

another point within that radius.

(j) A vehicle used for the transportation of pulpwood, logs,

wood chips, bark, and sawdust when the vehicle is being used to

move the commodities from a forest, woodlot, cutting site, sawmill,

or chipping site to a market or railroad siding of not more than a

140-mile radius from the place where the vehicle is loaded.

(k) A vehicle having a manufacturer's rating of not more than

1-1/2 tons capacity or the equivalent gross vehicle weight rating

used for the transportation of newspapers.

(l) A vehicle towing a disabled motor vehicle from the location

at which it was disabled to another location or a vehicle towing a

motor vehicle involved in an accident from the location of the

accident to another location.

(m) A vehicle used in the transportation of livestock, poultry

feed, chemicals, pesticides, and fertilizers on movements directly

to a farm for use in agricultural production.

(n) A vehicle used for the transportation of property for

compensation provided by a person who is a member of a corporate

family for other members of the corporate family, if all of the

following conditions are met:

(i) The parent corporation notifies the commission annually of

its intent or the intent of 1 of its subsidiaries to provide the

transportation.

(ii) The notice described in subparagraph (i) contains a list of

participating subsidiaries and an affidavit that the parent

corporation owns directly or indirectly a 100% interest in each of

the subsidiaries.

(iii) The notice described in subparagraph (i) is accompanied by

a fee of $100.00.

(iv) The commission publishes the notice described in

subparagraph (i) in the biweekly bulletin.

(v) A copy of the notice described in subparagraph (i) is

carried in the cab of all vehicles conducting the transportation.

(o) A vehicle transporting animal and poultry feed or feed

ingredients to sites of agricultural production or to a business

enterprise engaged in the sale to agricultural producers of goods

used in agricultural production.

(p) A vehicle transporting recyclable materials to or from a

resource recovery facility. The terms "recyclable materials" and

"resource recovery facility" have the meanings attributed to these

terms in part 115 ~~(solid waste management)~~ of the natural

resources and environmental protection act, ~~Act No. 451 of the~~

~~Public Acts of 1994, being sections 324.11501 to 324.11549 of the~~

~~Michigan~~ ~~Compiled Laws~~ 1994 PA 451, MCL 324.11501 to 324.11550,

except that the term recyclable materials does not include

industrial scrap metal. This subdivision shall not be construed to

exempt from this act a vehicle transporting new products.

(q) A vehicle transporting property for, or on behalf of, a

nonprofit charitable institution or for a house of public worship.

(2) As used in subsection (1)(n), "corporate family" means a

group of corporations consisting of a parent corporation and all

subsidiaries in which the parent corporation owns directly or

indirectly a 100% interest.

(3) None of the exemptions in this section, where applicable,

apply to a vehicle entering this state from another state, foreign

country, or subdivision of a state or foreign country that does not

extend similar exemptions to vehicles from this state entering the

state, foreign country, or subdivision.

Sec. 7. (1) A carrier providing transportation of household

goods subject to jurisdiction of this act shall issue a receipt or

bill of lading for property it receives for transportation under

this article. That carrier, as well as any other carrier that

delivers the property and provides transportation of household

goods subject to jurisdiction of this act, is liable to the person

entitled to recover under the receipt or bill of lading. The

liability imposed under this subsection is for the actual loss or

injury to the property caused by the carrier over whose line or

route the property is transported in Michigan and applies to

property reconsigned or diverted by a tariff under this act.

Failure to issue a receipt or bill of lading does not affect the

liability of the carrier.

(2) A carrier may not provide, by rule, contract, or

otherwise, a period of less than 3 months for filing a claim

against it under this section and a period of less than 2 years for

bringing a civil action against it under this section. The period

for bringing a civil action is computed from the date the carrier

gives a claimant written notice that the carrier has disallowed any

part of the claim specified in the notice.

(3) For purposes of this subsection, the following apply:

(a) An offer of compromise shall not constitute a disallowance

of any part of the claim unless the carrier, in writing, informs

the claimant that such part of the claim is disallowed and provides

reasons for such disallowance.

(b) Communications received from a carrier's insurer shall not

constitute a disallowance of any part of the claim unless the

insurer, in writing, informs the claimant that the part of the

claim is disallowed, provides reason for the disallowance, and

informs the claimant that the insurer is acting on behalf of the

carrier.