Report: Unsafe motorcoach carriers "reincarnate' to resume risky service

Posted on September 14, 2009 by METRO Staff

A U.S. Government Accountability Office (GAO) report said that 20 of the 220 motorcoach operators ordered to stop service by the Federal Motor Carrier Safety Association (FMSCA) in 2007 and 2008 remained in business by re-registering - in some cases under the same name as the company that was barred.

The GAO was asked to launch the probe following the August 2008 motorcoach crash in Sherman, Texas, which killed 17 passengers. In the investigation that followed the tragic crash, it was determined that the motorcoach company "reincarnated" using the same mailing and email addresses even after being ordered to cease operations two months prior.

"We were asked to take a look to see if that was the only case of a reincarnate carrier or if the system was vulnerable to others, who also had safety record problems, being able to get back in the system undetected by the U.S. Department of Transportation (U.S. DOT)," said Greg Kutz, managing director, forensic audit and special investigations, at the GAO.

Kutz, who served as one of the leads on the report, explained that the GAO's investigation included data matches of multiple characteristics, such as accumulating data for carriers that were placed out of service for safety violations during the two-year period and matching it against carriers that began service during that same period.

"We matched things like the name of the company, the address, the employee ID number for individual companies, social security numbers and cell phone numbers," added Kutz. "The presumption being that several matches of those meant it was highly probable the same company that was kicked out of service simply changed their name and started a new business with similar characteristics."

The GAO also conducted field investigations to verify information, and the same report found 500-plus trucking companies that had reincarnated during the same two-year period.

"The industry has long been aware of the problem, and we routinely receive calls from operators complaining of carriers reinventing themselves," commented Ken Presley, vice president, industry relations for the United Motorcoach Association (UMA). "It is difficult to determine if the number is actually higher than identified. FMCSA correctly points out there are many legitimate reasons someone with previous or existing operating authority may pursue new operating authority."  

American Bus Association (ABA) President/CEO Peter J. Pantuso said that the issue of enforcement, in particular those companies that continue to operate despite bad safety records or through reincarnating, has been a long-time concern for the industry.

"It's not only making sure the companies aren't reincarnating, but making sure that anyone who is unsafe is put out of business and taken off the road immediately," said Pantuso. "Maybe that means locking the buses down, maybe it means securing the facility, but whatever it takes to make sure those buses aren't operating, if they're not operating safely, is a critical step."

Kutz agreed that enforcement is an issue, since the GAO report also found that many operators who were put out of service simply kept operating without the need for reinvention. "All they do is just keep operating, and when they get caught again the only penalty by the U.S. DOT is a fine that never gets paid," he said. "There is not really a whole lot of teeth behind putting somebody 'out of service.'"  

The 20 cases identified by the GAO as likely reincarnations were registered with FMCSA at the time it did not have any dedicated controls in place to prevent motorcoach carriers from reincarnating, according to the report. In 2008, the FMCSA instituted a process to identify violators by checking applicant information against those of poor-performing carriers, however, the report added that even if the FMCSA could identify a new entrant had similar information, such as the name of the company or owner, the FMCSA would still face legal hurdles, including proving corporate successorship, to deny the company the authority to operate.

Out of the 20 reincarnated cases found by the GAO, Kutz said that it appeared there were five still operating. Those five companies were referred to the U.S. DOT in hopes the agency would prioritize and do something to shut them down before more injuries occur. 

Although the GAO report did not make recommendations for solving the issue, Kutz, like Pantuso, said that perhaps going in and physically shutting down operators that break the rules is the answer.  

Pantuso and Presley also suggested a more stringent new entrant program since a new operator can go up to 18 months before being inspected. "Before the first wheel ever turns and the first passenger ever boards, those companies ought to be inspected and deemed to be safe," said Pantuso.

Added Presley: "We think the problem is relatively easy to fix once everyone understands that individuals are responsible for managing bus operations, not companies. The UMA advocates that individuals applying for operating authority pass an exam that demonstrates proficiency and a thorough understanding of the Federal Motor Carrier Safety Regulations."


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