Full Reciprocity - Proposal Before IRP Jurisdictions
The membership of the International Registration Plan, the USA's 48 contiguous states and 10 Canadian provinces, are faced with a proposal to provide full reciprocity to interstate/interprovencial motor carriers. If passed, a carrier's cab card would list every member state and province, authorizing operation in each.
The Full Reciprocity Plan: Introductory Q & A - (Most asked. See above for the full document)
By the International Registration Plan Full Reciprocity Task Force
How would the FRP work?
In the first registration year of a fleet’s operation, the fleet would pay a composite IRP fee to all IRP member jurisdictions. In return, the fleet would be granted registration privileges in all the IRP members, and would be issued cab cards showing all of the jurisdictions. In subsequent years, the fleet would (1) still automatically be granted registration in all member jurisdictions, and (2) would pay its apportioned fees based on the distance it traveled in the preceding year.
Under the FRP, would there be any reconciliation of fees (a “true-up”) following a registrant’s first year?
No. This is felt to be unnecessary, just as there has never been a true-up under the current estimated distance mechanism. A fee reconciliation would involve a system of credits and refunds that would likely be complicated and confusing for jurisdictions and registrants alike. Instead, under the FRP a new registrant simply pays the first-year fee and in subsequent years pays on the basis of actual distance traveled.
What would an IRP cab card look like under the FRP?
The cab card for a vehicle in any registrant’s fleet would look approximately the same as it does now for a vehicle in a fleet that today is apportioned in all jurisdictions. All jurisdictions would be listed on the face of the card, along with the maximum registration weights for each one, the registrant’s identity, the enforcement dates, and so forth.
How would apportioned fees be calculated under the FRP?
Basically, in the same manner as today, except that, unlike today, (1) fees would be due to all jurisdictions in which a registrant traveled in the preceding year, whereas now, dropped jurisdictions receive nothing, and (2) no fees would be due on the basis of estimated distance.
Under the FRP, will jurisdictions lose trip permit fees?
Although it is probable that most or all jurisdictions issue more trip permits for vehicles that are not IRP vehicles than for IRP vehicles that are not registered in the jurisdiction, some revenue from the latter source would be eliminated under the FRP. Some of this potential loss would be offset by higher apportioned fees with respect to those vehicles.
How would registration in all jurisdictions affect a registrant’s insurance costs?
Insurance companies that insure motor carriers consider various factors in setting premiums. To some extent, they may be expected to react differently to the implementation of the FRP. In general, however, it appears that insurance premiums, to the degree they are determined by which jurisdictions a carrier travels in, depend on a fleet’s actual operations more than on where a carrier may hold operating authority or where its vehicles may be registered to travel. If this is the case, the implementation of the FRP, under which an IRP registrant is automatically registered in all member jurisdictions, should affect insurance premiums little if at all, except to the extent the carrier’s actual operations expand as a result. However, there may be a transition period, before insurance underwriters have adjusted to the new registration rules, when carriers will have to be careful to explain to their insurance agents just what the changes connected with the FRP mean and what they don’t mean about their operations and the associated risks. There is some indication that this area may cause transitional problems in Canada more than in the United States. The FRP Task Group would appreciate more input in this area.
Why should the IRP eliminate estimated distance?
One of the basic questions that had to be answered when the Plan was first drafted was how to calculate the fees of first-year registrants, who have no history of distance traveled on which to base the necessary apportionment. The answer in 1973, when the Plan began, was to allow estimated distance. This was recognized as a compromise at the time, and the mechanism has never worked very well. It adds substantial complexity to the Plan, increases state and provincial administrative costs, penalizes many registrants – especially smaller, irregular-route operations, and provides incentives to base-state shop (and hop) and to avoid record-keeping and the payment of proper fees through the repeated declaration of new-registrant status.
Under the FRP, how would a registrant’s first year fees be calculated?
With the FRP, under which all registrants are automatically granted full reciprocity, and pay fees only on the basis of actual travel, it seems necessary to require first-year registrants to pay some fee to all member jurisdictions, reflecting the fact that they are purchasing a privilege in each one. Currently, the FRP concept is to have a first-year registrant pay fees on the basis of the average distance traveled in each jurisdiction by all the registrants based in the first-year registrant’s base state. These same numbers are currently reflected in jurisdictions’ estimated distance charts, making the transition to the FRP easier. However, these values may not be equitable for many new operations. The FRP Task Group especially needs input on this issue.