A Blog

A Blog

Trucking Company Charged With Illegal Transport of Hazardous Materials

 FROM THE US DOT Office of Inspector General
On January 23, 2019, Wiley Sanders Truck Lines (Wiley Sanders) was charged by information in U.S. District Court, Central District California, Los Angeles, with three counts of willfully and recklessly transporting hazardous materials (hazmat), specifically, lead-contaminated plastic chips.
The information alleges that on three dates—August 10, 2013; November 1, 2013; and March 13, 2014—the company transported more than 40,000 pounds of lead-contaminated plastic battery chips from a battery recycling facility in Vernon, California, in a semi-truck trailer without authorized packaging. In total, Wiley Sanders trucks illegally transported 128,840 pounds of the hazmat—a byproduct of the battery recycling process.
DOT-OIG is conducting this case with the Environmental Protection Agency (EPA)–Criminal Investigation Division and the California Department of Toxic Substance.
Note: Indictments, informations, and criminal complaints are only accusations by the Government, and all defendants are presumed innocent until proven guilty.

Truckers: Don’t Take DBE Participation Credit for Your Work Until You Read This

Truckers who don’t understand how their DBE certification benefits the prime contractor or government agency who hires them are driving blind.

After suffering through the painstaking process of obtaining their DBE certification, and subjecting themselves to the audits and regulatory scrutiny that come with it, many truckers don’t know exactly how they’re helping meet the DBE contracting goals set for a construction project.

But you can’t blame them.

Applying the federal regulation (49 CFR § 26.55) can be tricky because the arrangements truckers make with respect to owning or leasing their vehicles vary.

We’re going to walk you through the requirements of this regulation, and describe for you, in plain English, what they mean for your business.

The first thing to understand is that before a trucker, or the prime contractor who hired her, even gets to the point of counting the trucker’s participation in the contract work toward the DBE goals established for the project, the trucker must satisfy some important prerequisites. The big one, the prerequisite that the USDOT uses to assess whether a trucker is actually working, really contributing its labor or materials to the project, truly performing with its own equipment and personnel a service that is required in order for the contract work to progress, is the requirement that the trucker perform a Commercially Useful Function, or “CUF,” a handy acronym that’s now become common parlance in the industry.

The regulations say what a CUF is, and what it is not. Pay attention to the CUF concept, because understanding it will help truckers avoid situation that may raise the red flags of DBE fraud—more on that in the next article. A trucker must manage and supervise her entire trucking operation, and there cannot be a contrived arrangement for the purpose of meeting DBE goals. Exactly what kinds of arrangements might appear to regulators to be “contrived,” would be good to know. We cover that in part 2 of this article.

Also, to be performing a CUF, a trucker must own and operate at least one fully licensed, insured and operational truck. Of course this implies that the trucker can lease other trucks to use on the contract, even when the drivers of those trucks are employed by another company. But be careful here because leasing affects how the DBE participation credit is counted, more on that below.

So if a trucker is performing a CUF, if she is responsible under a written contract to execute the work identified therein, if she is actually performing, managing and supervising that work, if she is deciding what materials, supplies and equipment are needed and negotiating their price, if the amount she’s being paid for her work is commensurate with industry standards, if she is not a “pass-through,” that is, not an extra participant in a transaction through which funds are passed, if she performs at least 30% of her contract with her own workforce (which means that she can subcontract 70% if her prime contract permits), if she does all of this, then she can claim DBE participation credit for work she actually performs.

Now let’s talk about how that credit is counted.

A DBE performing a CUF can claim credit for the total value of transportation services it provides on the contract when the DBE uses trucks that it owns and insures and employs the drivers. What about leasing arrangements? Well, if you lease trucks from another DBE, you get full credit for the total value of the transportation services provided with the leased trucks, as if they were your own.

Leasing trucks from a non-DBE is different, when the drivers of those leased trucks are not employed by your company. In that scenario, the DBE participation credit you claim for the non-DBE trucking services can’t exceed the credit you claim for your own trucking services. So let’s say you outsourced 70% of your trucking contract to a non-DBE firm, and are performing the other 30%, which you must, in order to be performing a CUF. You can only take DBE participation credit for 30% of the non-DBEs’ transportation services, because the non-DBE credit can’t exceed the DBE participation credit you get for your own services.

On the remaining 40% of the work performed by non-DBE truckers, you cannot take full DBE participation credit for the value of their work, but you can take DBE participation credit for any fees or commissions you earn under the leases.

And significantly, if you lease trucks from a non-DBE but employ your own drivers to operate them, you can take full DBE participation credit for the work performed with those trucks. Make sure that these leases give you exclusive use and control of the trucks, that they display the name and number of your DBE, that during the lease term, the trucks can only be used by others with your consent, and that you have first priority to use the trucks.

The regulation has its own hypothetical examples to guide you. The USDOT also has a helpful cheat sheet concerning how DBE participation credits should counted. If you’re still fuzzy on the details, it might be worth checking out these resources, because knowing how to maximize the value of your DBE certification is important not only to the success of your business, but also to the success of government programs designed to create opportunities for a demographic of business owners who have been historically excluded from participation in government contracts.

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JetBlue Seeks MWBE Partners for JFK Expansion Project

JetBlue announced a potential opportunity for Minority and Women-Owned Business Enterprise (MWBE) investors to help finance the expansion and redevelopment of Terminals 6 and 7 at New York’s JFK International Airport. This represents a critical early step in achieving New York Governor Andrew Cuomo’s 30 percent MWBE participation goal for the multi-billion dollar transformation of JFK Airport.
JetBlue, New York’s Hometown Airline and the second-largest carrier operating at JFK, was designated by the Port Authority of New York and New Jersey to build a 1.2 million square foot terminal featuring up to 12 international gates, approximately 74,000 square feet of commercial dining and retail amenities, as well as world-class lounges and recreational spaces.
Accredited MWBE investors with expertise in infrastructure investments can request information on how to qualify for this potential opportunity at JetBlue-JFK-T6-7@omm.com. After obtaining this information, interested respondents must submit their investor qualification by February 25, 2019.
To deliver this world-class terminal project, JetBlue is working with JFK Millennium Partners, a private consortium comprised of Vantage Airport Group – an industry leading airport developer and manager known for projects including the new Terminal B at LaGuardia Airport, and RXR Realty – an industry leader in developing multi-billion projects across the New York region.
‘We’re excited to help transform the JFK airport experience, securing our long-term position in our hometown of New York and at JFK,’ said Lisa Reifer, Vice President Infrastructure, Properties and Development, JetBlue. ‘Aligned with our mission of inspiring humanity, it’s important to us to provide equal access to opportunities reflecting the diverse makeup of the customers and communities we serve. Our JFK expansion project is a great opportunity for minority and women investors to help shape the travel experience at JFK, a major international gateway.’
This opportunity builds on the momentum of MWBE investments in other major New York infrastructure projects which began with Governor Cuomo’s August 2017 announcement of JLC Infrastructure’s investment in LaGuardia Gateway Partners, the company redeveloping LaGuardia Airport’s Terminal B – a first in state history.
The multi-billion dollar plan to transform JFK into a unified, world-class gateway will continue to offer compelling opportunities for MWBE involvement in all elements and stages of the project, from investment to construction, concession and operations contracts, offering local employment and community involvement opportunities.