The Voice of Trucking in Illinois

 

 ILLINOIS TRUCKING THIS WEEK

October 10, 2014

COOK COUNTY TO START PAYING REFUNDS

(Courtesy of Bob Pitcher, American Trucking Associations)

As we reported in August, the Illinois Appellate Court has held that the use tax Cook County levied earlier this year on non-titled property violated the state constitution.  (See the ITTW dated 8/29/2014.)  An Illinois circuit court has now told the county to start making refunds of any use tax it collected, whether or not a payment was made under protest.  Anyone who paid the tax to the county has four years from the date of payment to claim a refund.  As of this writing, we see nothing on the website of the county's revenue department to indicate the refund process is actually under way, but if you paid the tax, you might keep an eye on it here:  http://www.cookcountyil.gov/department-of-revenue/, or call the department at 312.443.5500.  NOTE that the county also imposes a tax on titled property purchased outside the county but located and used within it.  That tax has not been held invalid; however, the county follows the same rules on the taxation of motor carrier rolling stock as the state - that is, rolling stock is generally exempt if it is regularly used interstate.

ITA ELECTS OFFICER FOR 2015/2016 - TONY SCHMIDT ELECTED CHAIRMAN

DAVE SCHULTZ, LAURA NUSSBAUM, JOHN BIDOCHKA JOIN THE ITA BOARD

Illinois Trucking Association members elected officers for 2015/2016 at the ITA Annual Meeting. Tony Schmidt, President of Mr. Bult's Inc., was elected Chairman of the ITA for 2015-2016. Schmidt will officially take over as Chairman of the ITA on January 1 after Kevin Lhotak, President of Reliable Transportation Specialists, Inc., completes his successful term as Chairman of the ITA.

Nick Urso, President of Bear Cartage, was elected as President of the ITA. Brian Wasowicz, President of Triple G Enterprises, was elected 1st Vice President. Melanie Burnham, CFO of Hercules Forwarding, was elected 2nd Vice President. Bob Stock, President of Stock Transport, was elected 3rd Vice President. Randy Vaughn, Vice President at Superior Bulk Logistics, was elected Secretary/Treasurer. Jerry Cooper, of Scopelitis, Garvin, Light, Hanson, & Feary continues on as Legal Counsel and Matt Hart also continues on as Executive Director for the Association.

ITA also elected David Schultz from Prairie Creek Logistics as an Executive Board Member. He joins Alan Detmers (Double D Express), Ray Drake (UPS), Mike Burton (C&K Trucking), Dave Moss (Bedford Motor Service), David Burk (Con-way), and Aaron Tennant (Tennant Truck Lines) as representatives at large on the ITA Executive Board.

ITA members also elected two new members to the General Board of Directors: Laura Nussbaum from CIT Group, Inc. and John Bidochka from JX Peterbilt. Nussbaum and Bidochka are joined on the General Board of Directors by Rocky Caylor (Caylor Consulting), Jan Hamblin (JJ Keller), John McGovern (Osco Oil), Bryan Ahern (Cassidy Tire), Jim Rys (House of Trucks), Rob Rimmele (Joe Morton & Son), Bill Prester (HNi Truck Group), and Duke Tomei (USI Insurance).

TRUCK CONVOY FOR SPECIAL OLYMPICS

The Illinois Trucking Association was pleased to participate once again in the World's Largest Truck Convoy for Special Olympics on October 3.  117 trucks participated in this year's convoy, which raised $43.000 for Special Olympics.  The Illinois Trucking Association presented Special Olympics with $1,000 that was donated by Triple G Express and Hercules Forwarding when they won the Super Jackpot Raffle at the ITA Annual Meeting.  For more info on the Illinois Convoy, please visit www.soill.org.

HOURS OF SERVICE TOPS 2014 LIST OF INDUSTRY ISSUES

On Monday, the American Transportation Research Institute (ATRI), unveiled its list of the top ten critical issues facing the North American trucking industry.  Operational impacts being experienced across the supply chain from the changes to the Hours-of-Service (HOS) rules that went into effect in 2013 once again propelled the HOS rules to the top of the list in ATRI's annual survey of more than 4,000 trucking industry stakeholders.  The ATRI Top Industry Issues report also solicited and tabulated specific strategies for addressing each issue.

Coming in a close second to the HOS rules in terms of industry concern is the growing driver shortage, which replaced the Federal Motor Carrier Safety Administration (FMCSA) Compliance, Safety, Accountability (CSA) program as the number two issue.  However, a number of challenges still exist with CSA, which ranked third overall on the 2014 list.  

Related to the driver shortage, driver retention moved to fourth place from seventh place in 2013 as trucking fleets work to retain their most experienced and qualified drivers. Finally, industry concern over the timing and specifics of the pending FMCSA Final Rule on electronic logging devices (ELDs) caused this issue to round out the top five industry issues of 2014.  For more details on the industry's top issues, please visit www.atri-online.org.

FREIGHT RISES AGAIN IN AUGUST 

The Freight Transportation Services Index (TSI), which is based on the amount of freight carried by the for-hire transportation industry, rose 0.6 percent in August from July, rising for the second consecutive month, according to the U.S. Department of Transportation's Bureau of Transportation Statistics' (BTS). The August 2014 index level (120.9) was 27.8 percent above the April 2009 low during the most recent recession. 

The level of freight shipments in August measured by the Freight TSI (120.9) reached its all-time high. BTS' TSI records begin in 2000. The July index was revised to 120.1 from 119.6 in last month's release. Monthly numbers for February through June were revised up slightly. 

The Freight TSI measures the month-to-month changes in freight shipments by mode of transportation in tons and ton-miles, which are combined into one index. The index measures the output of the for-hire freight transportation industry and consists of data from for-hire trucking, rail, inland waterways, pipelines and air freight. 

Analysis: The increase in freight in August was driven by continued gains in trucking and water, and by pipelines, which rebounded from a July decline. Rail and air gave back some July gains. The rise in freight took place despite a decline in industrial production, but accompanied growth in personal income and in inventories of manufactured goods. Overall employment grew, as did transportation employment, although more slowly. 

Trend: August was the third month in which the Freight TSI exceeded the levels that had been attained prior to the weather-related downturn in the early part of the year to reach its highest level ever. The increase in the index continues the return to growth after the decline in June. After dipping to 94.6 in April 2009, the index rose by 27.8 percent in the succeeding 64 months.

ATA STATE LAWS NEWSLETTER

(courtesy of Bob Pitcher, American Trucking Association) 

Date for IRP Full Reciprocity Can Vary - Readers of the SLN will know that the International Registration Plan has adopted full reciprocity (often abbreviated FRP), effective with the renewal of a carrier's IRP fleet registration taking effect on or after January 1, 2015.  IRP registrants with FRP will automatically have all the IRP states and provinces on their cab cards, and will be authorized automatically to travel into any of them (as far as registration goes, that is - there may be other requirements unrelated to registration).  No need for them to buy permits for states added during the year, no estimated miles, no additional fees for new states.  But not all IRP fleets' registration years end with the end of the calendar year on December 31.  Many states have adopted what's called staggered registration, and fleets based in those states will have registration effective dates later in the year, and therefore full reciprocity will not be effective for those fleets until later on in 2015, when their years expire.

IRS Provides Guidance on Like-Kind Exchanges - The federal Internal Revenue Service has held that a taxpayer who engaged in a series of like-kind exchanges under Section 1031 of the Internal Revenue Code, where some of the properties were later found ineligible for such treatment, was allowed to rematch eligible properties.  The taxpayer here sold and rented equipment, and regularly replaced the pieces it rented, using LKEs under Section 1031 in order to postpone capital gains.  An IRS audit found that certain equipment the taxpayer replaced in its LKEs was ineligible because it had been held primarily for sale rather than for use in the business.  The taxpayer, since it had eligible equipment it had not been able to match in LKEs in that time period, sought to rematch those pieces.  IRS's examination division argued it could not do so, but was bound by its earlier choices.  IRS has now ruled that a rematch is not only possible, but that Section 1031 requires it, provided there are eligible properties available, as there were here.  The section, IRS points out, is mandatory (always provided the circumstances meets the section's detailed criteria for an exchange ); the benefits of the section are the taxpayer's no matter how the taxpayer actually reported the transaction.  IRS Technical Advice Memorandum no. 201437012, released September 12, 2014, and available on-line here:   http://www.irs.gov/pub/irs-wd/201437012.pdf.