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Infrastructure in the News 10.3.16



Washington Post: Before Hoboken crash, investigators found dozens of safety issues at N.J. Transit

The New Jersey transit agency involved in a rail station crash that killed one person and injured more than 100 last week already was under scrutiny by federal authorities after dozens of safety violations were uncovered this summer. Despite high-profile crashes, rail is the safest mode of transportation

One person died and more than 100 people were injured Thursday when a commuter train crashed into a station in Hoboken, NJ.


Associated Press: New Jersey train engineer says he can’t remember crash

The engineer at the helm of a train that smashed into a New Jersey commuter rail terminal, killing a woman and injuring more than 100 others, told federal investigators he was going only 10 mph as he approached the station, but has has no memory of the crash, the National Transportation Safety Board said.


Associated Press: Official: 1st black box recovered from train wasn’t working

Here’s what is known about the investigation into a commuter train crash that killed one person and injured more than 100 others Thursday in Hoboken, New Jersey.




Buzzfeed: How Uber Plans To Conquer The Suburbs

With a pilot program in Summit, New Jersey, the ride-hail giant is looking to replace commuter parking lots.


Washington Post: California’s proposed rules for driverless vehicles take aim at Tesla

California regulators have proposed banning the word “autopilot” from electric-car pioneer Tesla’s advertising, teeing up an extraordinary conflict between state officials and the Silicon Valley powerhouse in an era of increasingly automated cars.


USA Today: American flips tech switch this weekend

American Airlines will make a big technology change this weekend involving planes and pilots, but passengers won’t notice a thing if all goes well.


New York Times Editorial: Trump Infrastructure Plan’s Fatal Flaw

Hillary Clinton and Donald Trump agree that the nation’s roads, bridges and other infrastructure need an expensive overhaul. But voters should not assume that the candidates are equally capable of delivering results.


New York Times Editorial: Ushering in a Safe, Driverless Future

The idea of getting into a car that drives itself — and may not even have a steering wheel — is enough to scare anyone who’s had a bad experience on the road or with technology. Those fears were made all the more real by a fatal crash involving a Tesla Model S that was traveling on autopilot in May.


Wall Street Journal: Volkswagen Agrees to $1.2 Billion Compensation for U.S. Dealers (full article follows Morning Transportation)

Volkswagen AG has agreed to pay as much as $1.2 billion to its 652 U.S. dealers as compensation for a long emissions-cheating scheme, deepening penalties the German auto maker faces.


Wall Street Journal Opinion: The Subprime Superhighway (full article follows Morning Transportation)

More government spending, particularly for infrastructure projects, is the mantra in Washington and other capitals. But two factors stand in the way.


STATE NEWS (New Jersey): A big problem for big trucks that just keeps getting bigger

At night they're where they aren't supposed to be — on the shoulder of the interstate, by highway on-and-off ramps, tractor-trailers parked in illegal spots.


New York Times: New Jersey Will Increase Gas Tax 23¢, Ending Long Political Stalemate

Gov. Chris Christie, who has long resisted raising any taxes, has battled with Democratic leaders since early summer over raising New Jersey’s gas tax, reaching an impasse that brought hundreds of highway and transit projects to a standstill that lasted months.


Waco-Tribune (Texas): Transportation officials again looking to traffic circles despite poor local examples

For Wacoans, the term “traffic circle” conjures the many-tentacled beast at La Salle Avenue that sucks up 26,000 cars a day and spits them out in five directions.


ABC4 (Utah): Washington Co. Voters Consider Transportation Sales Tax Hike

It's Washington County's turn to vote on Proposition 1. It's a measure that could increase sales tax to pay for transit and transportation improvements.


Statesman Journal (Oregon): Sen. Lee Beyer and Rep. Caddy McKeown: State needs a comprehensive transportation plan

Members of the Legislature’s Joint Committee on Transportation Preservation and Modernization spent much of the summer taking a close, first-hand look at Oregon’s transportation system.


USA Today (Wisconsin): Officials seek long-term transportation plan

Local government leaders joined forces Thursday night to ask state officials to find a long-term solution for transportation funding.


Washington Post: Metro’s multimillion-dollar mystery: Where have our riders gone?

The answers could be worth millions — even billions — of dollars: Where have Metro’s riders gone, and will they ever come back?


Washington Post: Federal inspectors report a mixed bag on Metro SafeTrack improvements

As federal regulators continue to monitor Metro’s SafeTrack maintenance work, persistent problems remain among the improvements, reports show.


Associated Press: Philly regional rail returns to schedule after 3 months

The Philadelphia area’s commuter rail service is resuming a normal schedule three months after a third of its coaches were sidelined due to suspension system defects.


By Brianna Gurciullo | 10/03/2016 05:42 AM EDT

With help from Lauren Gardner and Tanya Snyder

HOBOKEN INVESTIGATION INCHES ALONG: Details continue to trickle out about the crash at NJ Transit's Hoboken Terminal, but investigators still don't know how fast the train was traveling before it smashed into the station last Thursday, killing a woman on the platform and injuring scores. NTSB investigators have interviewed the conductor and the engineer, and both say nothing unusual happened that morning before the collision and that the train was running normally.

Engineer has no memory: The engineer, who news outlets have identified as 48-year-old Thomas Gallagher, does not remember the accident, NTSB Vice Chairwoman Bella Dinh-Zarr said Sunday afternoon in Hoboken. Gallagher recalls reaching the end of the platform, sounding the horn, checking the speedometer - which he says showed the train was going 10 miles per hour when entering the station - and ringing the bell in the cab, Dinh-Zarr said. When asked later whether it's possible the train was going as slow as Gallagher says, Dinh-Zarr declined to speculate without knowing the data contained in the train's event recorder.

Black box troubles: The event data recorder NTSB recovered from the rear cab of the train wasn't working during the trip, Dinh-Zarr said. Trains are required to have working data recorders in the front end of the consist, so investigators are hopeful that one - which they haven't yet extracted because of the precariousness of the accident scene - will contain the information they need to determine what exactly happened. The malfunctioning recorder was manufactured in 1995, Dinh-Zarr said, while the front-end cab was built in the early 2000s and likely contains a newer device.

Under the microscope: Meanwhile, The Wall Street Journal reported Saturday that FRA officials found dozens of safety violations at NJ Transit during an audit of the commuter system earlier this year. The feds began studying the railroad after noticing an uptick in safety issues.

From the WSJ report: "The agency spent weeks investigating the railroad's operations at its facilities, people familiar with the matter said. Authorities examined past safety-related incidents and potential violations in rail yards, one official said. Federal authorities are drafting a formal conclusion, which could include a compliance agreement and possibly a requirement for future federal monitoring."

Documentation from the audit will be part of NTSB's fact-finding process, Dinh-Zarr said. An FRA spokesman didn't respond to a request for comment on the report.

HAPPY MONDAY: Good morning and thanks for tuning in to POLITICO's Morning Transportation, your daily tipsheet on all things trains, planes, automobiles and ports.

Please send tips, feedback and, of course, song lyrics to or @brigurciullo.

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AVIATION EMISSIONS DEAL ALMOST READY FOR TAKEOFF: The UN's International Civil Aviation Organization is nearing an agreement on rules for emissions from airplanes. Transportation Secretary Anthony Foxx has said the pact would be "one of the most significant policies adopted worldwide," and airlines agree. But environmental groups argue that the agreement, as is, wouldn't go beyond what the industry would already do by itself, Pro Energy's Eric Wolff and your MT host report for Pros. This week, among other proposals, delegates in Montreal are looking at setting a carbon standard for aircraft built after 2020 and establishing a cap on emissions at 2020 levels that would require airlines to buy offsets in a global market if they exceed that threshold.

Industry calls for celebration: Nancy Young, vice president for environmental affairs at Airlines for America, said the ICAO standard would create "an increment" of carbon emissions improvement on top of what would already happen without it. "We should celebrate instead of continuing to grind the ax," Young said. U.S. airlines could face more stringent domestic requirements in the future, as the EPA has promised that its coming carbon rule for aircraft will be "at least" as strict as ICAO's. But Young argued that a tougher rule would put U.S. airlines at a competitive disadvantage.

N.J. LEADERS PROPOSE 23-CENT GAS TAX HIKE: Deadlock over New Jersey's exhausted Transportation Trust Fund came to an end Friday when Gov. Chris Christie and legislative leaders announced a deal to hike the state's gas tax by 23 cents, the first increase since 1988. The proposed legislation also includes a series of tax cuts and would put thousands of construction workers back on the job after they were laid off because of a freeze on non-emergency transportation projects, POLITICO New Jersey's Matt Friedman and Katherine Landergan reported . Christie said the legislation, if passed, would create the longest-lasting funding source for the TTF since its inception in 1984. The state's gas tax is now the second-lowest in the country at 14.5 gets per gallon.

TECH, TAKE THE WHEEL: Nearly 40 European and Asian companies on Friday unveiled an alliance with nations across the European Union to try out driverless and connected cars, Chris Spillane reported for POLITICO Pro Europe. "Early goals include remote-controlled parking, automated driving on highways and smart trucking to help improve road safety, reduce pollution and tighten data security," Chris reported. "By early next year a truck could in theory drive with little human assistance along the 1,000-mile journey from London through France, Belgium, the Netherlands, Germany to Warsaw in Poland."

Expensive upgrades will need to come first: "For the technology to succeed, Europe must upgrade virtually all of its cable and wireless networks so that cars and trucks can respond instantly and consistently to hazards on highways," Chris reported. "The European Union must also ensure that the next generation of communication, called 5G, is unified across the bloc to prevent dead zones on highways and roads."

DRIVERLESS CAR HEARINGS 'IN THE WORKS': A staff member on the House Energy and Commerce Committee said the panel plans to hold a hearing during the lame duck on driverless car technology. "It's possible it could slip," the staffer told our Tanya Snyder. "But it's been in the works for months." The Senate Commerce Committee held a hearing in March exploring the future of autonomous vehicle technology, and at least one minority committee member has suggested that hearings are called for again now that NHTSA has released guidance to carmakers and states. The House Transportation Committee doesn't have anything planned yet, according to a spokesperson.


Tuesday - The two-day U.S. Air Cargo Industry Affairs Summit begins. The NTSB holds a meeting to determine the probable cause of a multi-vehicle crash near Chattanooga, Tenn. Chris Gerdes, chief innovation officer at DOT, speaks at Government Executive Media Group's "Fedstival."

Wednesday - William Ford Jr., the executive chairman of Ford Motor Company, speaks at the Economic Club of Washington D.C.

Thursday - The FAA's Research, Engineering and Development Advisory Committee holds a meeting.

LIGHTING THE WAY: The country's first solar roadway was unveiled in Sandpoint, Idaho, this weekend. The installation took a little longer than planned, but onlookers got to see a sample of a road surface made of solar panels. "It's part of the work being done to create the infrastructure of the future," FHWA Administrator Greg Nadeau said at a K&L Gates-Consumer Technology Association event Friday. LED lights on the panels can be configured by computer into changeable lane markings and parking boxes. The panels contain heating elements that can prevent icing. "It's possible that one day electric cars could be charged by driving over these panels," Nadeau said.

CRASH-RISK PROGRAM STILL IRKING TRUCKERS: The trucking industry and the federal government are eagerly awaiting the results of a study examining the risk algorithms of the FMCSA's Compliance, Safety, Accountability program. Trucking groups have attacked the program's methodologies for years, complaining that they inaccurately mark carriers as "high risk," as our Tanya Snyder reported for Pros. The FAST Act ordered the National Research Council of the National Academies of Science to conduct the study, which is expected to be released in mid-June. If the study finds flaws, DOT will have to send a corrective action plan to Congress.

FAA ORDERS RESTRICTION ON BATTERY MAKER: In a rare action against a single company, the FAA ordered manufacturer Braille Battery to stop offering to ship by airplane lithium ion batteries that don't comply with DOT and international standards. The emergency order comes after the Florida company didn't follow regulations when it shipped batteries and kept offering shipping for batteries that weren't tested correctly, according to FAA. The agency also found that the company's "overall conditions and practices constitute an imminent hazard." FAA sent a safety alert to air carriers about the dangers of handling the company's batteries. Braille Battery faces criminal charges and civil penalties if it violates FAA's order.

NEW BILL ALERT: Senate Commerce Committee member Richard Blumenthal introduced a bill to require airlines to give flight attendants 10 hours of rest between duty periods. Domestic flight attendants can get as small as eight-hour blocks of rest time, while pilots are promised 10 hours. The Connecticut Democrat also wants air carriers to include flight attendants in fatigue risk management plans, which only cover pilots now.


- "A peek at the secret English farm where Amazon tests its drones." The New York Times.

- Kelly's defense lays into Wildstein's checkered past. POLITICO New Jersey.

- "A big problem for big trucks that just keeps getting bigger."

- "California's proposed rules for driverless vehicles take aim at Tesla." The Washington Post.

- "How Uber plans to conquer the suburbs." BuzzFeed News.

- "Federal inspectors report a mixed bag on Metro SafeTrack improvements." The Washington Post.

- "American Airlines weekend technology transfer appears to go well." The Wall Street Journal.

THE COUNTDOWN: DOT appropriations run out in 67 days. The FAA reauthorization expires in 361 days. The 2016 presidential election is in 35 days. Highway and transit policy is up for renewal in 1,461 days.


Nothing on our radar for today.

Did we miss an event? Let MT know at

To view online:

Stories from POLITICO Pro

Countries near aviation emissions deal, but greens see few gains Back

By Eric Wolff and Brianna Gurciullo | 10/03/2016 05:00 AM EDT

International negotiators are close to setting the first-ever global rules for carbon emissions from commercial aircraft, and though the Obama administration and airlines are hailing the pact, greens complain it won't curb the growth in aviation emissions beyond what the industry is already doing.

The Paris climate change agreement struck late last year committed nations to taking action to cut greenhouse gas pollution, but it left out aviation emissions, which account for 5 percent of human-induced warming, according to recent research. The task has been left to the U.N.'s International Civil Aviation Organization, which has been working for three years to produce carbon-limiting proposals.

But like the discussions for the climate deal in Paris, negotiators have struggled to strike a consensus that appeals to the developed nations seeking to address climate change and the poorer countries eager to see their aviation industries grow.

Now, at talks taking place in Montreal, delegates are pushing a multi-pronged approach that includes promoting the development of aviation biofuels and more efficient aircraft operations, setting a carbon standard for aircraft built after 2020 and creating a cap on emissions at 2020 levels that would require airlines to buy offsets in a global market if they exceed that threshold.

A draft carbon standard for engine emissions emerged in February is expected to be finalized in March 2017, and market-based measures to further curb emissions growth are likely to be approved this week at the ICAO assembly. Transportation Secretary Anthony Foxx has praised the effort as a historic step in fighting climate change, which has been a top agenda item for President Barack Obama in his final years in office.

"If we cross our fingers and click our heels, we'll have one of the most significant policies adopted worldwide to reduce climate emissions of airplanes across the world," Foxx said at a conference last week. "It is a big deal, and is a big piece of business and a big priority for the president."

But environmental groups fear that the new provisions won't do anything to reduce pollution from aircraft any faster than efficiencies that are already expected from technological innovations.

"What's been recommended would not reduce emissions beyond business as usual," said Dan Rutherford, who heads the aviation and marine program at the International Council for Clean Transportation.

Airlines already have a strong economic incentive to cut their fuel use, and are always pushing for the engine-makers to deliver maximum efficiency. But environmentalists like Bill Hemmings, director of aviation and shipping for Brussels-based Transport and Environment, said the ICAO standard, which applies to aircraft produced after 2020, fails to push efficiencies "beyond what market forces would do."

The U.S. airline industry, which EPA says contributes 3 percent of the total U.S. carbon footprint, contends that green groups are missing the big picture.

"These two pieces in one year would be a marvelous achievement," said Nancy Young, vice president for environmental affairs at the trade group Airlines for America. "We should celebrate instead of continuing to grind the ax."

She contends the standard would create "an increment" of carbon emissions improvement beyond what would happen without it.

"We're not saying it's Star Trek technology, but it brings an additional reduction," she said.

Still, airline miles traveled are expected to keep growing, especially in the developing world, and ICAO concedes in its proposals that expected improvements in engines and operations need more time and won't stop growth of carbon dioxide emissions after 2020. To fill the gap, ICAO has proposed market-based measures.

These measures are designed less to create economic incentives for airlines to lower emissions than to help fund carbon reduction technologies in other sectors of the global economy through purchase of offsets in international markets, like the one operating in the EU. In its first 10 years, the cost of offsets for emissions beyond 2020 levels would be shared across the industry. That means the low-growth airlines in developed nations would subsidize the emissions of fast-growth airlines in developing nations.

In a further concession to developing nations, the program would be voluntary for its first six years. ICAO has been collecting promises to join the early phases of the program, and nations representing at least 61 percent of post-2020 emissions growth have indicated they would participate, according to the Environmental Defense Fund.

Nonetheless, China, Brazil and India balked at the plan last week, leading them to engage in a round of one-on-one discussions with the Australian chair of the meeting. ICAO officials hope to get consensus on the proposal and move it before a plenary session for approval this week. Sources in Montreal said that China is demanding more from the U.S., and they don't expect the issue to be ready for public debate until Tuesday at the earliest.

While U.S. airlines support the ICAO proposals, they may eventually face stricter requirements in their home market. EPA and FAA, the two agencies responsible for implementing the ICAO standards, finalized an endangerment finding in July that said emissions from aircraft contribute to climate change, the first step toward a carbon rule for aircraft, and EPA has promised its own standard would be "at least" as stringent as ICAO's.

A schedule for that rulemaking will likely be published this fall in the administration's regulatory schedule.

The airlines have said that going beyond the international standard would put U.S. airlines at a competitive disadvantage, and Young said any regulations in the U.S. should be in line with the ICAO rule.

Still, it's not clear that FAA or EPA have the legal authority to impose some parts of the ICAO agreement in the U.S., especially the authority for a market-based offset program. FAA is authorized to implement ICAO's safety and technical rules, but requiring U.S. airlines to participate in the carbon offset market may require Congress to rewrite some statutes related to international emissions-trading programs.

"We think that can be easily handled in a tailored sort of way though the existing legislation," Young said.

Tanya Snyder contributed to this report.


Transportation funding deal struck with 23-cent gas tax increase Back

By Matt Friedman and Katherine Landergan | 09/30/2016 06:13 PM EDT

New Jersey leaders have struck a deal that would increase the state's gas tax for the first time since 1988.

At a hastily announced Statehouse press conference late Friday afternoon, Gov. Chris Christie, Senate President Stephen Sweeney and Assembly Speaker Vincent Prieto announced they've resolved a months-long impasse over the state's Transportation Trust Fund (TTF), which has been broke since they failed to come to a resolution about funding it when passing the budget in July.

"That will be good for the state's economy, that will be good for the citizens of our state and I think it's something all three of us are very, very proud of," Christie said.

The deal includes a series of tax cuts in addition to the gas tax hike, and would put back to work thousand of construction workers laid off by the lack of funding and a state freeze on non-emergency transportation projects.

And it would mean $1.4 billion less in revenue to the state budget by 2021, when the legislation is fully phased in.

If approved by the state Senate and Assembly, the $16 billion, eight-year deal will produce the longest-lasting funding source for the TTF since it was created in 1984, Christie said.

New Jersey's gas tax is currently 14.5 cents per gallon - the second-lowest in the nation. The deal pairs a number of tax cuts with the 23-cent gas tax increase in what Christie called "tax fairness."

The 7 percent state sales tax would be reduced by 3/8 of a point - down from a full point in a deal that Christie and Prieto cut in June, but which the state Senate would not consider.

The estate tax, which currently has a threshold of $675,000, would see that limit increased to $2 million in January. By January 2018, the estate tax would be eliminated entirely.

The Earned Income Tax Credit for low-income workers would also increase from 30 percent to 35 percent. And the amount of retirement income eligible for tax exclusion would increase from the current $15,000 to $75,000 for a single taxpayer, from $20,000 to $100,000 for married couples filing jointly, and from $10,000 to $50,000 for married couples filing separately. Veterans would also be able to claim a personal exemption.

"All of these things are going to lead to a more affordable state for the people of our state, and they're going to lead to infrastructure that is even better than what we have today," Christie said.

Christie did not take questions or give an analysis about how big a hole the plan would blow in the state budget's general fund.

An earlier plan backed by Sweeney and Prieto was estimated to produce a roughly $900 million shortfall. The sales tax cut plan struck between Christei and Prieto would have resulted in an estimated $1.7 billion shortfall. None of the leaders gave a specific estimate of this plan's budget cost.

"For me what's exciting is the investments we're going to make," said Sweeney, touting the funding will jump-start long-awaited projects like an extension of the Hudson-Bergen Light Rail into Bergen County and a new Camden and Gloucester County light rail project.

"You're going to see a project actually get built, because there's going to be $32 billion - not just $16 billion - because of the federal match," Sweeney said.

It's a nice package, it's a nice combination and everybody got something," Prieto said.

Although several legislators issued statements of support of the compromise - including Assembly Republican Leader Jon Bramnick and a bipartisan pair of state senators who crafted the Senate's original plan - not everyone is on board.

State Sen. Jennifer Beck, a Republican long outspoken against a gas tax increase, called it a "recycled plan that tinkers around the edges and doesn't change the fact that the public massively opposes a 23 cent per gallon gas tax hike."

Criticism came from the left as well, where advocates were not happy about the plan's estate tax cut that benefits the wealthy, even if supporters have argued that in an expensive state like New Jersey, $675,000 is not particularly rich.

"As a final goodbye to the state which he has crippled to the point where it lags the rest of the nation, Governor Christie and legislative leadership have struck a massively disappointing deal in which the state stands to lose billions in the long term, siphoning critical funds from education, the environment, and all other priorities the state may have had," said NJ Working Families director Analilia Mejia.

But New Jersey Chamber of Commerce president Tom Bracken, who led a nonprofit group that pushed for a TTF solution, called the deal "marvelous."

"Nobody liked the fact that it took as long as it did but every component will bode well for the future of New Jersey," Bracken said. "The end product is very good. It's done and its over with. We can move on."

It won't technically be done and over with until it's passed both the Senate and Assembly and been signed by Christie.

Sweeney and Prieto said they will start the legislative process next week.


Driverless car guidance leaves key questions open - on purpose Back

By Tanya Snyder | 09/20/2016 07:03 PM EDT

The DOT's new driverless car guidance is a document that leaves unanswered many more questions than it resolves - and that's by design.

In general, DOT's much awaited policy document maintains existing authorities and attempts to avoid stifling the burgeoning industry by taking too heavy a hand.

"We're intentionally not being prescriptive about how these safety areas need to be fulfilled," a senior DOT official said in a briefing with reporters Tuesday. "That could stifle innovation. ... DOT is not saying we know all the right answers. This is still very much developing."

In fact, many of the steps necessary to move the country toward a driverless car future will have to be taken by Congress, states and auto manufacturers.

But the very patchwork of state-by-state regulations the agency hopes to avoid could end up being created by leaving so many questions up to individual states.

"DOT published what it could, and it could not go farther because of all the unknowns of this technology," said Timothy Carone, a professor of data science and artificial intelligence at the University of Notre Dame Mendoza College of Business, who studies autonomous systems. "Left to the states, there should be an expectation of patchwork regulations."

For instance, at least for now, cars will still be required to have steering wheels and brake pedals because they're required by federal standards. However, the DOT has an exemption process manufacturers can go through, and officials have made it clear that they're moving toward a vision of fully autonomous vehicles that don't require human intervention.

Although steering wheels and brake pedals are still required, DOT so far is staying away from mandating the presence of a licensed driver capable of using them. Issues of licensing are left to the states, as are several of the most persistent questions about driverless cars, including the crucial issue of who is liable in the case of a crash or moving violation.

Traditional state laws governing motor vehicle operation apply when a human driver is in control. Federal guidance kicks in when the vehicle is operating autonomously. With some hybrid systems, control could constantly be shifting between the vehicle and the driver, meaning the regulatory authority would be constantly shifting as well.

Meanwhile, state endeavors to regulate self-driving cars - in California, for example - have helped spur action at the federal level. "California has a proposal only," said NHTSA Administrator Mark Rosekind. "That's why this was needed now."

Part of the new guidance makes it clear that the administration will likely come to Congress seeking at least some additional authority, such as the ability to approve designs before they come to market - a "sea change" for the agency that would require an influx of new resources.

Congress would also need to give the green light to "cease and desist" authority for NHTSA, or the ability to expand its exemption program from the current 2,500 vehicles per year it's allowed.

The power to require software changes to cars already on the street would also need to get the go-ahead from Congress. Such power could simulate a 100 percent recall rate in case of a problem, with safety improvements issued electronically to cars without owners having to drive them to a lot for upgrades.

Congress could also help determine what kinds of tests are sufficient and whether a car developed in California could be used without modifications in Chicago, said Carone.

For now, lawmakers still seem to be trying to figure out where they fit in.

"I think our role is oversight," said Sen. John Thune (R-S.D.), chairman of the Senate Commerce Committee. "We'll figure out a little bit more what that role is and how we can engage in the process."

Carone said he isn't optimistic that Congress is up to the task.

"These new business models and technologies will be complex and evolve too quickly for Congress to do much at all," he said. He also cautioned that Congress will feel pressure to "do something" in the case of a fatality involving a driverless car. "They will be reactive," he said.

Industry groups by and large seem relieved to have any guidelines at all, and praised the process for being participatory and flexible.

Former NHTSA Administrator David Strickland - now general counsel for the Self-Driving Coalition for Safer Streets, a network of automakers working on autonomous vehicles - says "the agency has stepped into the void with this guidance and given itself the flexibility and the ability to evolve."

Strickland indicated that the 15-point safety assessment for vehicles did not include any surprises that deviated from what the agency had already telegraphed about its plans.

The guidance doesn't touch on vehicle-to-vehicle (V2V) technologies, which would share information about roadway conditions among all cars on the road. However, officials acknowledged that that V2V would be "very complementary to the future of autonomous vehicles."

While NHTSA's guidance takes effect immediately, DOT is opening a 60-day comment period and plans to update the guidance annually - at least until a rulemaking on the 15-point safety assessment for autonomous vehicles is complete. With a new administration taking over in just four months, it's anyone's guess when a final rule could be issued.

Jennifer Scholtes contributed to this report.


Trucking industry continues to chafe under DOT's crash-risk program Back

By Tanya Snyder | 09/30/2016 09:38 AM EDT

The scuffle over DOT's crash-risk program for the trucking industry may be at a low boil, but the long-running fight between industry and the feds is far from over, with both sides hotly awaiting the results of a study looking at the program's risk algorithms.

At issue is the Federal Motor Carrier Safety Administration's Compliance, Safety, Accountability program, the agency's attempt to use data to target inspection efforts toward carriers at greatest risk of causing a crash. This, in turn, helps the agency leverage scarce resources.

But for the last six years, the trucking industry has angrily denounced the program - and tried to chip away at it on Capitol Hill - saying its methodologies inaccurately flag carriers as "high risk."

Carriers' critiques of FMCSA's metrics have been bolstered the GAO, which said not enough data was collected to accurately identify safety risks; and the American Transportation Research Institute, which found too many carriers were getting low ratings based on crashes outside of their control.

The way the program assesses fault - primarily, the fact that CSA penalizes a truck involved in a crash, even if the other driver was at fault - is one of the biggest complaints the trucking industry has, and they're in good company. "Everyone we talk to on Capitol Hill admits that that's wrong," American Trucking Associations President and CEO Chris Spear said. "That's a sore point with all members, Republicans and Democrats alike."

But new research may vindicate FMCSA's position. A soon-to-be-released study by the Insurance Institute for Highway Safety will find that an interstate carrier's recent historical crash rates are predictive of future crash risk, regardless of which driver was at fault in a crash.

Beyond helping FMCSA assign inspection resources based on risk, shippers also use CSA scores to decide which companies to hire and which to avoid - and that's just the problem, according to the trucking industry.

"If you're going to shut somebody's business down, it has to be based on something more than, 'We believe...'" said Todd Spencer, vice president of the Owner-Operator Independent Drivers Association. "If you put lots of time, lots of money and lots of effort into something, you don't want to say it doesn't work. But it doesn't work."

After a lobbying blitz, lawmakers included language in the FAST Act ordering FMCSA to remove CSA safety alerts and percentile scores from public view, though the underlying data is still available. But that didn't satisfy the industry.

"The horse has left the barn," said Sean Garney, director of safety policy at ATA. "They were public for so long."

It's not that the trucking industry wants to conceal poor safety records, officials are quick to say. "We believe in using data to help law enforcement," Garney said. "If law enforcement uses data and comes to a carrier and says, 'Hey, I think you've got a safety problem' - great, let's talk about it. But third parties don't want to talk to you about it. They'll just stop contracting with you."

Beyond carriers' concerns about CSA's impact on their bottom lines, the program may actually be causing FMCSA to misallocate resources. The GAO found that FMCSA "identified many carriers as high risk that were not later involved in a crash, potentially causing FMCSA to miss opportunities to intervene with carriers that were involved in crashes."

But FMCSA argues that the CSA system is having an impact.

"We've seen violation rates go down significantly - more than we've ever seen," one official said. "Where safety and violations and inspections were things that were worried about by drivers and dispatchers and maybe safety managers before, now companies are paying attention."

The Trucking Alliance, an industry group that focuses exclusively on safety, is an outlier on this issue. Managing Director Lane Kidd acknowledges that the system "could be improved," but supports making CSA ratings public, calling them "a critical barometer of a carrier's relative safety performance."

"Taking the CSA dark really serves the interests of carriers with poor ratings," Kidd said.

The industry and DOT are now awaiting a study from the National Research Council of the National Academies of Science, which the FAST Act ordered to review the CSA program's methodology. The NAS is halfway through the 18 months it was granted to complete the study and report back.

Michael Cohen, NAS's chief researcher working on the CSA study, said his team is evaluating FMCSA's algorithm for determining risk and comparing it to alternatives - including doing nothing.

Multiple layers of complexity make it tricky to find an easy solution. States evaluate violations differently - not to mention geographic differences in weather conditions and road quality - meaning it could be preferable to stratify by state. Major variations in carrier size and types of cargo - schoolchildren on one hand, hazardous materials on the other - also present enough apples-to-oranges scenarios to pose a challenge as the study proceeds.

Cohen also said FMCSA weighs the 899 roadside inspection violations differently based on severity, but "it's unclear that the linkage between the weights and their predictive value for future crashes makes complete sense." Some, like driver fatigue and poor truck maintenance, are obvious safety flags, but relatively minor violations - think side lights that don't work - shouldn't result in major safety flags, he said.

NAS has held two public meetings to gather comments and will hold another one Dec. 15. Cohen said the report will go to an academy review in late March to get ready for a mid-June release.

Once that's done, DOT must submit a corrective action plan to Congress addressing any flaws the study finds.

Meanwhile, trucking lobbyists aren't just waiting around for NAS to release its findings. They're working with FMCSA to give trucking companies extra credit for going above and beyond basic safety compliance. They're also keeping the pressure on the agency to remove crashes where the carrier was clearly not at fault from their CSA profile and score.

"I think it's clever to think of violation data as having some linkage to future crashes," said Cohen of NAS. "FMCSA deserves some credit for trying to do this. Do they get an A+ for what they're doing? Probably not."


Kelly's defense lays into Wildstein's checkered past Back

By David Giambusso | 09/30/2016 04:46 PM EDT

NEWARK - After two days of comparatively dry testimony at the Bridgegate trial, the lawyer for defendant Bridget Anne Kelly launched a broadside into the prosecution's star witness, David Wildstein, on Friday, painting him as a habitual liar and a high-level operative for Gov. Chris Christie.

Michael Critchley, Kelly's lawyer, embarked on what he repeatedly referred to as Wildstein's "path of lies and deception." Through a series of pointed questions, he tried to characterize Wildstein as someone who boasted of his reputation for political skullduggery and lied when it suited his interests - implying that he was lying again about Kelly's role in the George Washington Bridge lane conspiracy to protect himself from extended jail time.

"Over the course of your life when you were a young adult to 2013, there were times when you engaged in lies and deception when it was in your self-interest," Critchley said. "Those lies and those deceptions didn't only occur when you were in your 20s ... They continued on into your 50s ... You can't lie every time you speak, correct?"

Critchley cited known episodes in Wildstein's past, such as when he stole Frank Lautenberg's jacket before a U.S. Senate debate, dumped ballot petitions to undermine an unsuspecting opponent, and concocted a story about diverting minority voters during an election day.

Critchley also resurrected stories from Wildstein's most recent past as a political operative for the Christie administration. Among the most damning, aside from the lane-closure scandal itself, was an allegation that Christie leaked secret grand jury testimony in order to further his political ambitions, according to testimony Friday.

Wildstein testified that in 2010 Christie wanted to remove a Port Authority employee who had been involved in a corruption investigation and replace him with Gerard Speziale, then Democratic sheriff of Passaic County.

"Gov. Christie directed that he be offered that job," Wildstein said Friday. "Christie told me and others that he was trying to win a sheriff's race in Passaic County."

While discussing the moves, Christie, who as U.S. Attorney for New Jersey had overseen a corruption investigation involving Democratic power broker John Lynch, mentioned that the Port employee he wanted removed had perjured himself during grand jury testimony in the Lynch case, according to Wildstein's testimony and previously reported documents relating to the case.

Wildstein testified that Speziale was offered the job for roughly $198,000 a year.

"Didn't an attorney who worked at the Port Authority, when he found out about Speziale, say the FBI is going to come knocking on your door for what you did," Critchley asked Wildstein. "Because it was a quid pro quo."

The prosecution objected and Critchley left off the line of questioning, but not before lobbing relentless attacks on Wildstein's character throughout the day.

Kelly, who is charged with former Port official Bill Baroni as a co-conspirator in the lane closures, has portrayed herself as a low-level functionary in the Christie machine, not as someone capable of executing a move as audacious as closing lanes for political retribution.

Critchley told jurors throughout the day that Wildstein not only had the power to effect the lane closures but delighted in serving as Christie's henchman.

He cited numerous examples of Wildstein advising Bill Stepien, Christie's 2013 campaign manager, on everything from voter turnout, to using flags from the World Trade Center to give to important political players in Iowa and New Hampshire, to deploying Lt. Gov. Kim Guadagno to popular bus stops around the state to target voters.

Assured of re-election as governor, the play all along was to get Christie to the White House - a bid that likely failed in part because of the scandal surrounding the lane closures.

"You were committed to Chris Christie and you were committed to the presidential campaign," Critchley said.

"I most definitely would have enjoyed working in a Christie administration in Washington," Wildstein said.

Critchley's cross-examination was a stark departure from that of Michael Baldassare, the attorney for Baroni. Baldassare stopped often in his questions to confer with his team and retrieve documents. Throughout, Wildstein dodged, said he did not recall, or said he did not understand the questions he was being asked.

Critchley, a veteran litigator, was relentless in his attacks, citing Wildstein's litany of alleged misdeeds. After a break he began again by saying, "Let's continue down the path of lies and deception."

When Wildstein said he did not understand questions, Critchley openly mocked him, drawing laughter at several moments from the gallery and an admonition from the prosecutor for "editorializing."

In an email sent to Kelly on Aug. 12, 2013, just a day before Kelly sent the now-infamous "time for some traffic problems in Fort Lee" email, Wildstein wrote, "I have an issue to discuss with you. Extremely weird even by my standards."

But in testimony, Wildstein claimed to have no recollection what the email was referring to.

"Now you testified about having a very good memory about events going back to the 1970s [but] you don't remember what this email was?" Critchley said. "Isn't that a fib? You know what you talked about. You know what you talked about. A convenient lapse of memory."

Pressing Wildstein about the contents of another email, the witness replied, "Sometimes you write a quick email or a quick text message and the wording gets a little off."

Critchley made Wildstein repeat that statement.

Cross-examination of Wildstein continues Tuesday.

Wall Street Journal: Volkswagen Agrees to $1.2 Billion Compensation for U.S. Dealers


Volkswagen AG has agreed to pay as much as $1.2 billion to its 652 U.S. dealers as compensation for a long emissions-cheating scheme, deepening penalties the German auto maker faces.


Dealers will receive an average payout of $1.85 million apiece in the settlement, according to filings made Friday in U.S. District Court in San Francisco.


Volkswagen over the summer agreed to pay as much as $15 billion in a separate settlement with federal regulators and consumers, and the additional $1.2 billion was disclosed in the Friday filings.


Franchised dealers have been stuck holding inventory since the emissions scandal emerged and shouldered other financial burdens, including a potential decline in dealership value or damaged reputations.


A year ago, Volkswagen halted sales of diesel-powered vehicles in the U.S. amid claims that so-called defeat devices allowed hundreds of thousands of vehicles to cheat on emissions tests.


In a separate court filing Friday, attorneys for consumers said more than 311,000 of the 475,000 eligible to join say they want to take advantage of the terms in a $10 billion settlement with U.S. drivers of 2.0-liter diesel-engine vehicles.


The filing urged the court to give final approval to the deal, which could come as soon as a scheduled Oct. 18 hearing. Volkswagen and the U.S. Justice Department also asked the court to approve the deal in Friday filings.


The settlement offers consumers a choice of selling back their diesel-engine vehicle, or getting it modified by an as-yet-undetermined fix to reduce emissions levels. All consumers will also get additional compensation on top of either choice. Plaintiffs’ lawyers said in the Friday filing that the terms will compensate the average driver with a minimum of nearly 113% of the retail value of their vehicle before the scandal broke in September 2015.


If approved in its current form, drivers will still have until fall 2018 to officially join the class-action deal.


Drivers of larger, 3.0-liter vehicles affected by the emissions crisis are still waiting for their own deal.


Wall Street Journal: The Subprime Superhighway


More government spending, particularly for infrastructure projects, is the mantra in Washington and other capitals. But two factors stand in the way. First, the governments of most developed economies are broke. According to their own government figures for 2015, the total public debt of European Union members as a share of GDP is 85%, U.S. debt is 101% and Japanese debt is 229%. Second, the rates of return on infrastructure investments are generally low. As European Central Bank President Mario Draghi said in an interview last October, “There aren’t many public investments with a high rate of return.”


With infrastructure spending so popular and government coffers so empty, the appeal of subverting private wealth to serve government objectives has become even more attractive. The latest scheme to do so is the European Union’s attempt to “incentivize” more insurance investment in public infrastructure as part of its “Solvency II” regulatory regime. In January the EU lowered capital standards for infrastructure investments by as much as 40% but cited no major errors in the old risk model or any new empirical evidence to justify the change. Instead, the EU repeatedly emphasized its need for “€2 trillion in [infrastructure] investment” by 2020.


The U.S. seems set to follow Europe’s lead. The Treasury Department’s new Federal Insurance Office released a report last year encouraging “state insurance regulators to assess the current [risk-based capital] approach and explore appropriate ways to increase incentives for infrastructure investments by insurers.”


Haven’t we seen this movie before? Didn’t lowering capital standards in the mortgage industry have a bad ending? Remember the subprime-mortgage meltdown and the 2007-08 financial crisis?


The most infamous modern effort to make private wealth serve government goals began on Sept. 12, 1992, when candidate Bill Clinton called for private pension funds to “invest” in government priorities, such as affordable housing and infrastructure. As President Clinton’s point man on harnessing private wealth for public use, then-Labor Secretary Robert Reich drooled over the sheer size of private-pension wealth. “In all, America’s pension funds hold assets that total $4.6 trillion,” he said in 1994 congressional testimony. “If $4.6 trillion worth of one-dollar bills were laid end-to-end, they would stretch a distance equal to 907 round-trip journeys from Washington, D.C., to the moon.”


In a 1994 letter to this newspaper, Mr. Reich promised “competitive, risk-adjusted rates of return” for pensions “plus ancillary benefits, such as affordable housing, infrastructure improvements and jobs.” Yet even the unions, the Clinton administration’s most reliable allies, flatly rejected sacrificing their life savings for government goals.


Despite losing the battle to raid pensions to fund affordable housing, the Clinton administration won the war by using Housing and Urban Development quotas and the little-known Community Reinvestment Act (CRA) to force Fannie Mae and Freddie Mac and banks to serve government goals. HUD housing quotas ultimately required that 55% of all loans purchased by Fannie and Freddie had to be subprime-type loans. President Clinton’s financial regulators used the CRA to force banks to make subprime loans.


As former Federal Reserve Chairman Alan Greenspan said in 2008 congressional testimony, the “early stages of the subprime market . . . essentially emerged out of the CRA.” By the time the crisis broke, federal regulators had used the CRA and HUD quotas to destroy mortgage-credit standards and fill the financial system with 31 million subprime-type mortgages. No less than 76% of those mortgages were issued, held or guaranteed by the federal government.


The EU and the U.S. seem determined to repeat this sad history, only this time lowering capital standards and providing “incentives” for insurers to invest in roads, railways, airports and bridges. If U.S. insurers push back, it isn’t hard to imagine a future Treasury secretary questioning their “economic patriotism” and pressuring them to fund infrastructure. Thanks to the 2010 Dodd-Frank financial law, the Treasury Department already claims power over 30% of the insurance industry. This authority will expand as the Treasury and Federal Reserve work with international regulators to impose the G-7 Financial Stability Board’s international capital standards on U.S. insurers.


Those who question the threat faced by insurance policyholders need only remember that imposing Community Reinvestment Act on the insurance and securities industries was the greatest unfulfilled demand by Democrats in the debate on the 1999 Gramm-Leach-Bliley Act. Had they succeeded, the misery caused by the subprime crisis would have been even deeper and more widespread.


The European Commission’s impressment of the insurance industry to fund infrastructure sounds like predatory behavior. Last year the commission said that “if insurers were to increase their investment in infrastructure to even 0.5% of total assets, which seems achievable, this would mean an extra €20 billion of [infrastructure] investment.” The commission speaks as if it had found a pirate’s treasure map, and piracy seems what they have in mind.


Wealth cannot serve two masters. Individuals buy insurance to promote the well-being of their families. Pressuring or “incentivizing” insurance companies to do anything other than to protect policyholders steals wealth from its rightful owners. Now regulators want to gamble the insurance policy you purchased to protect your loved ones on the profitability of projects like the California High-Speed Rail Authority. We already know how this story ends.


Mr. Gramm, a former chairman of the Senate Banking Committee, is a visiting scholar at the American Enterprise Institute.