April 1993: Reader Responses
We obviously hit a nerve in discussing the PIE Nationwide case ("Discount Suits," January, [Article link]), which exposed bankrupt carriers' practice of back billing for the difference between negotiated rates and the rates on file with the Interstate Commerce Commission (ICC). Here's a taste of the many responses, one adding sources of help for shippers hurt in the back-billing bust-up, the other scuttling notions that the trucking industry is deregulated.
There are two other sources for shippers trapped in the middle: The National Industrial Transportation League (703-524-5011) lobbies for deregulation and other political interests of shippers at the state and federal levels. The Coalition for an Undercharge Relief Bill -- which includes shippers' organizations, the American Trucking Associations, and individual companies -- supports efforts in Congress to pass a law solving the undercharge problem. Write the coalition at 2020 Pennsylvania Ave., Suite 626 N.W., Washington, DC 20006.
Freight Control Services
North Kingstown, R.I.* * *
You left out the underlying reason for this back-billing problem, and its long-term solution.
In its decision on the legality of a trucker's not filing the negotiated rate and then applying the full rate retroactively, the Supreme Court made clear that Congress must ask why rates and tariffs are filed in the first place. Current statutes cite "public interest" reasons. Yet how many shippers would want to read a general-rate schedule?
The Motor Carriers Act let shippers negotiate the actual rates they pay for certain shipments but still required the carrier to file its rates with the ICC. Carriers quickly adapted to the "free market," and many shippers were under the false impression that the industry had been deregulated. As long as a carrier has filed a general-rate schedule (tariff), a change must still be filed. The legislation dealing with back billing simply provides for a settlement procedure and doesn't tackle the harder issue of eliminating the problem.
Many carriers support reform, but unless shippers demand Congress stop coddling the teamsters and the motor carriers that prefer the comfort of regulation, the negotiated-rate problem will linger.
Director of Government Regulation
National Association of Manufacturers