Broker bond increase challenge gets new backer

| February 26, 2013
Overdrive reporting on efforts to raise the broker minimum surety requirements in June 2012. Read that story here. For subsequent reporting on the bond increase, visit this page.
Overdrive repored on efforts to raise the broker minimum surety requirements in June 2012. Read that story here. For subsequent reporting on the bond increase, visit this page.

Joining the Association of Independent Property Brokers and Agents in efforts to repeal the increased broker and freight forwarder surety requirements written into last year’s MAP-21 highway bill is the National Association for Minority Truckers, the associations said in a joint release issued Monday, Feb. 25. The news came on the heels of the Federal Motor Carrier Safety Administration’s recent release of a broker and freight-forwarder FAQ on its website that in effect adopts the MAP-21-mandated deadline of Oct. 1 for compliance with the increased surety requirements. Download a copy of the FAQ here.

“The NAfMT concurs with the AIPBA that the $75,000 freight broker bond will serve as an unreasonable barrier to entry for would-be entrepreneurs,” said NAfMT CEO Kevin Reid, “and will prevent our owner-operator members who currently broker out excess freight lawfully under their broker licenses from being able to continue to do so due to the corresponding rising cost of this new financial security.”

AIPBA says it is pursuing legislation to repeal the requirement. In the event of such legislation’s failure, the association plans court action “challenging the Constitutionality of the new bond,” the association said, a measure it feels is anticompetitive in nature and which it believeswill mean business failure for many small brokerages.

Said Reid, “The unintended consequences of this new law in terms of supply and demand will include owner-operators being paid less…, shippers paying more for transportation, and a corresponding increase in consumer prices for all Americans.”

  • David Wilson

    CEO Kevin Reid, “and will prevent our owner-operator members who currently broker out excess freight lawfully under their broker licenses???

    A motor carrier doesn’t need a broker licenses to give freight to other carriers? I know the new law had something in it about changing this, but the LTL carriers will not go along with this.

  • Rodney

    If they can’t afford the additional bond they should keep working at Walmart!All they will have is cheap freight anyways.And the bond is to insure the carrier gets paid to some degree.

  • bobloblaw

    Bonding should be tied to the amount of payables a brokerage holds. The slower they pay and more they owe the higher the bond should be. Thus quicker paying brokerages with less payables should have lower bonding. How many loads will $75k cover with a major broker like CH Robinson. The rule is a joke.

  • JaxJag

    So they’re against it because it hinders their ability to double-broker a load? Laughable.

  • jj mcclure

    The dems that back illegals will most likely protest

  • jj mcclure

    ban brokering all together

  • http://www.facebook.com/channel19todd Todd Dills

    That would shake things up…

  • http://www.facebook.com/channel19todd Todd Dills

    I don’t think that’s what they mean, Jax, but I hear you. Is that where double-brokering is most common in your experience — among owner-operators brokering freight as a side business?

  • martymarsh

    You want to deal in frieght, buy a truck. But the bad part of this is it will not effect the large brokers that move frieght for nothing.

  • Tom

    Learn how to sell and beat me instead of cry.

    You do not have a right for freight to just fall onto your truck.

    Apparently you do have a right for the government to steal other people’s money to insure your credit decisions.

    Who knew so many anti-Obama southern folks in transportation were socialists.

  • Tom

    I said socialist above, but its really a fascist ploy.

    This is the marriage of industry and government, with government doing the bidding of a specific industry sector.

    You know who makes sure I get paid. ME!!! It’s called capitalism. YOU are responsible for your own credit decisions. I am not responsible for your credit decisions.

    I’m responsible for my decisions. I’m apparently also responsible for yours.

  • Tom

    $10,000 fine, and I’ll be filing as many complaints as possible. And I am going to start a non-profit to specifically search load boards to find illegal brokering. And we’ll put all your information on our site and advertise to shippers who may incur liability for these people’s illegal behavior.

  • Tom

    Funny. Yet you support the bond? A collectivist scheme which holds other people responsible for your decisions?

    Nothing but a social program on my money. Scum.

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