Hometown California

Episode 02- An Interview with the California Trucking Association

August 03, 2020 Rural County Representatives of California (RCRC) Season 1 Episode 2
Hometown California
Episode 02- An Interview with the California Trucking Association
Hometown California
Episode 02- An Interview with the California Trucking Association
Aug 03, 2020 Season 1 Episode 2
Rural County Representatives of California (RCRC)

Our host, Paul A. Smith, talks with Eric Sauer, Senior Vice President of Government Affairs for the California Trucking Association. Listen in to hear how the trucking industry has been meeting the challenges of the pandemic to ensure essential goods and services are available to remote, rural areas of the state. Gain insight into the role of trucking, the intersection of the industry with rural jurisdictions, and a variety of issues facing the trucking industry.

Show Notes Transcript

Our host, Paul A. Smith, talks with Eric Sauer, Senior Vice President of Government Affairs for the California Trucking Association. Listen in to hear how the trucking industry has been meeting the challenges of the pandemic to ensure essential goods and services are available to remote, rural areas of the state. Gain insight into the role of trucking, the intersection of the industry with rural jurisdictions, and a variety of issues facing the trucking industry.

INTRO: [00:00:01] 
Welcome to hometown California production of the Rural County Representatives of California, advocating for California's rural counties for nearly 50 years. Hometown California tells the rural story through the eyes of those live, work, and play in the rural communities of the Golden State. 

PAUL: [00:00:26] 
This is hometown California. I'm your host, Paul Smith. Joining me today is Eric Sauer, the Senior Vice President of Governmental Affairs for the California Trucking Association. Eric, welcome to RCRC's podcast. 

ERIC SAUER, CTA: [00:00:39] 
Thanks for having me, Paul. 

PAUL: [00:00:41] 
Pleasure that you're able to join us. We're excited to learn about the Trucking Association and the industry you represent, and kind of at the intersection of that industry works with rural California and quite frankly, all of California and the nation. So, glad you're joining us here today.  I understand you've been with the California Trucking Association for over 15 years, and I think you're going to be able to provide some insights. 

Before I kind of throw some questions and let you chat about it, I do want to say on behalf of rural California and the millions that live there, I want to say thank you to the industry for stepping up and bringing so many consumer products to market during this pandemic. Remember, in the early days, we were all worried about getting our toilet paper and our shampoos and our bacon and all the other consumer goods that we rely on. And so, big shout out to the truckers, trucking companies, and everyone in the industry who's moving goods to take care of the people of California and the rest of the world. 

CTA is one of the largest trucking associations in the state. Maybe you should just tell our listeners about your association and a little bit about the industry and what comprises your membership. 

ERIC: [00:01:42]
Sure. Will do. And thank you so much for the acknowledgment on what the industry provides to this great state and nationally as well. We really appreciate those kind words. 

The California Trucking Association, we've been around for 86 years. We provide advocacy on state, local, and in some cases federal issues when we need to get called in on a California kind of related issue. We make the trek back to D.C. and also engage with our congressional representatives. 

Our membership is eleven hundred carrier members. So those are what you see, the truckers on the road trucking up and down the state. We also have 400 allied members and those provide products and services to our member trucking companies. We are the largest state trucking association in the United States. Our membership ranges from one truck owner-operator to family owned trucking companies. And we also count most of the large national carriers that operate in the state as well. 

Geographically, we're represented statewide by our membership units. So we have what we call member units that are at the very northern part of the state all throughout Northern California, Central, Central Valley, Central Coast, San Joaquin, Southern California, and all the way down to San Diego. We have 13 geographical units. 

ERIC: [00:03:08] 
A little bit about the trucking industry in California as a whole. The trucking industry does service over 80 percent of California communities. So California communities, those 80 percent, depend solely on trucks to get their products and services. There's also 70,000 companies that have operating authority to move freight in California. Those are through operating authority, through the Department of Motor Vehicles. There's over 1.8 Million trucks that are operating in California. Now that applies to all truck classes. So you're looking at the regular 53-foot trailer all the way down to delivery trucks that have operating authority to operate in California. So there's quite a large number of trucks that you see out there on the road. You know, we'd like to have those 70,000 companies as members, but we do have a pretty large representation of the trucking companies that do service California. 

PAUL: [00:04:09] 
So like a FedEx or a U.P.S., would those be entities that are in your association? Would Safeway,  Ralph's, Kroger, supermarket chains?

ERIC: [00:04:19] 
Yes, all of those that you hit, I believe most, if not all, are members of the organization. So we represent, you know, FedEx, U.P.S., C.R. England, Swift, Werner, a lot of the national carriers. But the majority of our members are the family owned smaller companies. Our average member has, I believe it's thirty-two trucks in their fleet. So we have a very broad and diverse membership here at the California Trucking Association. 

PAUL: [00:04:48] 
Right. And so I assume you've got people who haul gravel, people who haul livestock. Every commodity that is shipped by truck, I assume comes into your association?

ERIC: [00:04:57] 
Correct. And we do have conferences that are set up for specific segments of the industry. For example, we have a heavy, specialized carrier's conference. Those are the oversize load that you see traveling up and down the road with escorts or pilot cars. Actually, one of our members- I've got a poster in my office- they moved the space shuttle to the museum down in Southern California. So, we also have an agricultural carrier conference, intermodal conferences (those are the carriers that pull boxes in and out of the port), and then the national carrier conference. We have lots of conferences and different segments of the industry that from time to time will have issues that pop up, and that's where we get engaged and try and work on finding solutions to those issues. 

PAUL: [00:05:42] 
With California being so diverse and what needs to be shipped and what freight needs to be moved up and down and through the state, you've got a lot of challenges. Talk about a little about California's geography and some of the challenge that brings for your members. You've got massive mountain ranges once you head into either Nevada or Oregon or even Arizona, and then you've got, obviously, challenges with topography and whatnot internally if you're just staying [in California]. Got to be pretty a difficult road, no pun intended, for your members to navigate through. 

ERIC: [00:06:09] 
Yeah, and first things first. You know, obviously, these routes that they travel on, whether it's the national network or state routes in the urban areas, there has to be approved truck routes where trucks can travel on. And there's been times where there's been routes that have been deemed a safety concern and they've had to find alternative routes for those to make sure that trucks can operate safely on those routes.  As far as a national network that's open to all trucks to be able to traverse on and travel through those routes. 

From time to time, we'll get some applications from our members that we assist them on, working with Caltrans and local authorities, on getting a route approved to be able to make a delivery. It's called "truck access" so they're able to safely maneuver and get to the business that they're servicing. There's a process in place in the California vehicle code that allows businesses and/or trucking companies to apply for truck access route, and it can only be denied for safety or engineering concerns. So, I've been at CTA for 19 year- actually, 18 years- actually, my 19 year anniversary is tomorrow. Throughout those years, I've worked with our members and local municipalities on getting those truck routes approved. And if there are safety issues, that's something that our membership is very cognizant of and safety is paramount to their operations. We used to always say we don't want to go where we're not welcome or wanted, and that applies to safety issues. So we work hand-in-hand with those local municipalities and Caltrans on making sure those routes are safe and adequate for trucks to be able to get in and out of. 

PAUL: [00:07:50]
Yeah, I guess a lot of people don't realize that state and local officials are dealing with both designating routes and dealing with the roads and the conditions to move that. But also maybe talk a little about distribution centers. I assume that a lot of your members operate, maybe even lease distribution centers, challenges with running those and intersecting that with the actual fleets, and kind of the role of local governments in siting those types of facilities.

ERIC: [00:08:14]
Yeah, it's a good question. We a lot of our members have been located in the same town or city for many, many years. We have a fourth generation member. They've been in the same location for many years. Those members have diversified their operations to handle more logistics and warehousing. This would include having additional locations in the state and those are looked at geography-wise. And if it's actually the local municipality is going to allow these facilities to be built, they are placed in locations that serve their customers and make operational sense. From a planning perspective, the access to and from these facilities is always critical and paramount to that. And also, the proximity to the national network system plays a huge factor as well. 

We're seeing growth in certain areas of the state for distribution centers. Just down the road from our office, the business park near the airport is expanding. We've had numerous conversations and calls with Caltrans and SACOG on talking about routes and making sure that there's adequate and safe routes to get those trucks in and out of there. But it is something that, you know, our members have grown their operations over the years to where they went from small terminal and they've got multiple locations throughout the state, and it more or less makes sense for them to be able to service their customers the best way they can.

PAUL: [00:09:39] 
So how have your members found working with local governments? As you know, RCRC, the sponsor of this podcast, is comprised of elected supervisors making land use decisions every day. How's interaction been particularly with rural county supervisors, but also just general local government?

ERIC: [00:09:54] 
From time to time, we do get involved in those types of planning and decisions and weighing in on truck parking issues or route issues. For the most part, we do enjoy a good relationship with local municipalities. I always encourage our members to make friends more or less, or be involved with local elected officials, encourage them to come and take a tour or take a look at your business. Let them know that you're an employer of X amount of employees in their region. You're providing jobs, you're providing products and services to their constituents and just do the best you can to create a working, collaborative relationship with those folks.

PAUL: [00:10:36]
So I kind of hinted at the very beginning, a big shout out and big thank you to the industry during this pandemic. And I'm assuming the work is continuing. Can we talk a little bit about the pandemic and what it's done, how it's impacted your members, both from an internal standpoint about running a business, but also the volume of freight you guys were moving? 

I understand there were some exemptions on weight classifications, and perhaps hours, to get product to market to keep up with the demand and all the things that came, particularly in the early days of the pandemic, but also throughout even up to today, where we still find ourselves immersed in unfortunate virus that seems to not end. I think a lot of our listeners just want to know what were the big challenges, what did you need, and what do you think you're going to continue to need to make sure consumers have access, but also wholesalers and commodity producers that rely on trucking to get their products in or out?

ERIC: [00:11:25] 
Sure. And appreciate the question. Right off the bat, the federal government identified the trucking industry, its support staff, and employees or folks that provide support to the trucking industry as they were included in the critical infrastructure sector. So to make sure there was enough essential products and goods and services that were able to get to the marketplace, the federal government waived hours of service for trucking companies that were delivering those essential products. 

There was a provision that was passed in, I believe it was, 2015 that allowed for states to grant a permit to trucking companies or haulers of essential goods in response to a presidential declaration of emergency. And essentially, what you see as far as permitted loads on the roads are oversize, overweight, or what we call "extra legal loads". 

Well in this case, to make sure that you got more bottled water or medical supplies, so Caltrans came up with a permitting process to grant them a weight tolerance for those types of haulers that are transporting those essential goods. And companies were able to obtain permits where they could haul 10 percent more of what they were allowed previously. And the program sunsetted on July 11th. 

And there was a nexus between local municipalities on that, because when you get off the national network, you're subject to their rules and regulations. And so some counties were able to grant permits to trucking companies to traverse through their municipalities, and in other cases where there could be some safety concerns, we worked in concert with Caltrans. 

ERIC: [00:13:11] 
You know, other state agencies that we worked with, one of them was the Department of Motor Vehicles. We've enjoyed a very collaborating partnership with the department for, I would say, the last 12 to 15 years. We've always been able to work on issues together, find efficiency improvements. And this was at the forefront of our conversations after the pandemic hit. 

Once the field offices were closed, you would have drivers that would have nowhere to go to be able to get their testing done. And so we worked with the DMV on a federal waiver that was the first of its kind, I think, that allowed for third party testing. The DMV has what they call an employer testing program. And if you're a trucking company or transportation company that is a part of the employer testing program, which means you have your own training and testing program in place, you can do almost everything to be able to get a driver licensed. But the last portion of that test is the written test that can only be conducted by the DMV. So we hit a roadblock. 

We worked collaboratively with the DMV and a couple of our member carriers on putting together a waiver that would allow these companies that are in the ETP to be able to proctor those exams on behalf of the DMV. And so that's in place right now and it's good until September 30th. It's helped tremendously. But also from that, from the response from the pandemic with the DMV, we're looking at doing some online testing for drivers, you know, making things a little bit more efficient, making things to where the traffic at the DMV field offices can be thinned out. We've been extremely pleased with the response from the DMV, Caltrans, and the California Highway Patrol. 

We've also, as an organization, at the very beginning of the pandemic, we were having weekly calls with Secretary David Kim, the secretary of the California Transportation Agency, on what's working, what's an issue, how can we help. And I gotta really tip my cap to the state as far as the responsiveness on working with the trucking industry to make sure that the industry was able to get those goods and services and products to the shelves that were much needed during that time. 

In a smaller county, I forget which one, but it was one up in the northern part of the state secretary's office called us and said, "hey, we are getting calls from a local market up at the northern part of the state that has not been able to get some deliveries there. Can you maybe look into that with your membership?" We were able to work with our members and make sure that trucks were able to get up there and make sure that those goods were being delivered. 

PAUL: [00:16:02] 
If I remember right, I think it was Trinity County, way up in the very, very north end. We have just a few more minutes here. Eric maybe touch upon three things that I think are also high on the radar screen for the industry, and that is the status of independent contractors, issues about mandating electric vehicles, and the condition of the road, because I think they're on the horizon. They obviously have profound changes in how we get products to market, products out of California as well. 

The independent contractor status, AB 5, has the industry weighed in on that. And what are the concerns there, if any? 

ERIC: [00:16:34] 
Yes, the Trucking Association, we were extremely engaged throughout the legislative process. The independent contractor model has been in existence for 70 plus years. When there's capacity issues, you contract out with independent contractors or other fleets to be able to move the products that need to get moved. And so this was extremely problematic. We were trying to work on some amendments that would have amended the trucking industry out of AB 5. Unfortunately, we weren't able to obtain that carve out. And so immediately following the signature of AB 5, we refiled our litigation, citing a federal preemption that we were exempt by federal law from AB 5. And the judge granted an injunction on it and agreed with our argument. And so there's been an injunction in place on the enforcement of AB 5 on the trucking industry. The State did appeal that decision, so September 1st, that's going to be reheard. But as an organization and as an industry, we're pretty confident that we're going to prevail on it. 

PAUL: [00:17:47] 
And then real quickly, last one on the mandated electric vehicles. Is the industry prepared for this? Are the manufacturers prepared for this? What's the desire to get off diesel-powered, fossil fuel-powered vehicles and try to get them either electrified or some alternative fuel source? 

ERIC: [00:18:02]
What we would recommend to rural municipalities, especially those dealing with infrastructure issues that are related to wildfires and utility upgrades, please pay close attention to this. As an organization, we obviously have extreme concerns about the reliability of this equipment, the cost of this equipment, and how the sheer volume of these types of trucks can be developed and get out to the market and, most importantly, be reliable. 

PAUL: [00:18:34] 
Eric, really appreciate your time today. And let me reiterate again on behalf of RCRC to your members, thank you for the work you've been doing for these last several months. I mean, the work you do day-to-day for decades has been awesome, but especially in this pandemic, it's been a godsend to have the trucking industry help California. So thanks for your time today. Really appreciate it. Stay safe, stay healthy and give our best to all those hardworking men and women in the industry who are delivering these products for California. 

ERIC: [00:19:00]
Thanks, Paul. Stay well and be safe. 

OUTRO: [00:19:07] You've been listening to Hometown California, a production of the Rural County Representatives of California. Subscribe now so you don't miss an episode. Be sure to read and review this podcast. I'm your host, Paul Smith. And thanks for listening.