AIPBA Petitions Court To Save Independent Freight Brokerage Companies

FORT LAUDERDALE, Fla., Nov. 25, 2013 /PRNewswire/ --  The Association of Independent Property Brokers & Agents (AIPBA) has filed a motion in the U.S. Court of Appeals for the 11^th Circuit for an injunction that could prevent thousands of small business owners across the U.S. who operate freight brokerage companies from having to shut down on December 1, 2013.  These independent companies, who arrange for transportation between manufacturers and carriers, could be forced out of business the day after Thanksgiving because of a provision in last year's transportation bill signed by President Obama on July 6, 2012.  If this loophole isn't closed, up to seventeen thousand small businesses could be wiped out – and consumer prices will likely rise significantly as a result.

The "Moving Ahead for Progress in the 21st Century" Act makes sweeping changes to the laws governing transportation in the United States and commits 105 billion taxpayer dollars to union labor projects.  Hidden deep within the new 600 page transportation bill, Section 32918 requires FMCSA to raise the bond requirement for freight brokers from the traditional $10,000 amount to at least $75,000. 

On October 1, 2013, FMCSA issued a new rule in an attempt to enforce the transportation bill without public participation. AIPBA's action in the U.S. Court of Appeals for the 11^th Circuit asserts that FMCSA's manner of enforcing the new bond amount was done improperly, and FMCSA should have to go through proper rulemaking and fact-finding before FMCSA enforces a new bond amount.

Under the new rule, small business owners must put down $75,000 in cash collateral– the same as international conglomerates -- or otherwise secure credit-based bonding-- or they will lose their operating licenses starting Sunday, December 1st.  Many of these brokers are family businesses who will no longer be able to compete with large companies that can easily secure the $75,000 bond to stay in business. Others employ numerous agents, making this purported "jobs bill" a job killer for tens of thousands of Americans.

James Lamb, president of AIPBA, says, "The new $75,000 bond requirement will force the overwhelming majority of these small companies out of business on the eve of the holiday retail rush.  With fewer competitors, big brokers will be able to dictate higher shipping costs.  As the cost of shipping rises, consumers will see higher prices for just about everything sold in the U.S.

"'Black Friday' is indeed to be quite 'black' this year.  Without the Court's timely intervention, it will be 'lights out' for tens of thousands of Americans who will be headed for the unemployment lines.  If this is allowed to go into effect, the winners will be the big multinational brokers.  The losers will be small American business owners and American consumers.  AIPBA is fighting for the survival of the independent broker," Lamb continued.

The 2,000-member Association of Independent Property Brokers & Agents ("AIPBA") is an independent, not-for-profit trade group, a "business league" under IRC 501(C)(6). Its mission is to promote the common business interests and improve the business conditions for small and mid-sized independent property brokers, as defined in 49 CFR Part 371, who are authorized to conduct business by the Federal Motor Carrier Safety Administration ("FMCSA") and enjoy annual revenues of $14m or less, and the duly appointed agents of such property brokers. The AIPBA seeks to encourage ethical business practices among members. It also attempts to lobby legislatures, influence the activities of regulatory bodies, and, in general, influence public policy in a direction favorable to the group's members. AIPBA produces conferences and provides educational programs for members and business networking opportunities among members and the transportation industry at large. 

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SOURCE AIPBA