TOWN HALL MEETING

TOWN HALL MEETING 2010 Annual IFTA Business Meeting July 20, 2010 Toronto, ON

ALABAMA • The use of the internet to allow licensees to electronically file quarterly tax returns, renew their license or request additional decals. • It would be interesting to know how many jurisdictions allow electronic filing and if there are any jurisdictions that are considering mandatory electronic filing (like Alabama).

Some of the problems identified with mandating electronic filing and credentialing had to do with electronic payments from multiple agencies. Many jurisdictions are making their way towards electronic filing and credentialing similar to AL. Some have submitted pending legislature that would make these transactions mandatory or have an additional fee for paper submissions. It was observed that most jurisdictions have e-filing capabilities but not many mandate it at this time.

Nevada • Alternative Fuels • Any legislation on the horizon in other jurisdictions? • Vehicle Mileage Traveled (VMT) Taxation • Any studies being done in other jurisdictions?

Committees have been created to work on these issues. A federally funded project is currently focusing in the Baltimore, MD location. NH has also set up a committee that reviewed alternative fuels. This work led to discussions on VMT but it was determined that this would be a number of years in the future before being probable.

Maine • USDOT Numbers in the Clearinghouse (for Enforcement) • The USDOT number is an optional data item in the IFTA Clearinghouse. IFTA status is an optional item in the USDOT SAFER database. SAFER data is used to screen motor carriers for safety and credentials, primarily through the states’ Commercial Vehicle Exchange Windows (CVIEWs.)

In order to accurately and quickly identify a carrier, it is important to have accurate USDOT number information. • As we have been screening trucks at our weigh stations and roadside, we have discovered quite a few instances where the USDOT number on the IFTA license does not belong to the licensee. Often, the IFTA licensee is an owner/operator licensing in their own name.

However, they may be providing the USDOT number of the carrier to whom they are leased for safety purposes. • The owner/operator becomes suspended for failure to file. When the carrier’s USDOT number is checked roadside, it appears as if the carrier is IFTA suspended. It also may appear as if the carrier has multiple IFTA accounts, when, in fact, they may have one or none.

This is making the electronic screening process less efficient, and may result in “false positives” for suspended status. To mitigate this, we only take enforcement action when the USDOT and the FEIN both match the carrier. The converse of this is that any owner/operators who are suspended will not be identified, and will pass the screening.

It is a relatively easy process to validate the USDOT number using federal databases. • Shouldn’t jurisdictions validate the USDOT number on new licensees prior to issuing an IFTA license? • If a jurisdiction is unable to validate USDOT numbers, should they even capture USDOT numbers?

MO always validates the US DOT number. If states are responsible for updating NCS 150 that should resolve this situation. ATA agrees with the solution offered and pressure should be applied to take this “registrant only” out of the equation (database). UPS asks that both IRP and IFTA reconsider their position on the US DOT number … this will become an obstacle if the US DOT number is not there. Strongly encourage jurisdictions to include the US DOT number on the Clearinghouse data.

Have other CVISN states experienced this problem? • What is industry’s perspective? Have any carriers experienced delays or inconvenience?

Town Hall Discussion Toronto2010Ontario Trent Knoles, IL

Town Hall DiscussionToronto2010Ontario Topic: The “issued date” is not being captured on the IFTA license itself by every jurisdiction, and is not captured at the Clearinghouse Problem: Illinois has a penalty assessment for operating without a valid IFTA registration, but we cannot verify when the license was actually issued without contacting the carrier’s jurisdiction

Illinois Violations: • Failure to Display IFTA License (traffic offense - $75) • Failure to Display IFTA Decals (traffic offense - $75) • No Valid IFTA Registration (traffic offense - $75) - but also – civil assessment penalty - $1,000

Our Options Issue the $1,000 assessment • Let the carrier prove that he was in fact licensed prior to the ticket being written. Consequences • Carrier actually was licensed and should not receive the assessment. • Carrier is hounded by Illinois Collections until paid.

Possible Ballot (1)change to the IFTA Procedures Manual *P310 LICENSE The IFTA license shall be approximately 3-1/2 x 8-1/2 inches (9 x 21.5 centimeters), of a uniform format, and shall contain, but not be limited to, the following information: .100 Base jurisdiction identification; .200 Licensee's name and address and DBA, if different from owner, partner or corporate name; .300 Licensee's account identification number; and .400 Issue date (month, day, and year); and .400 .500 Expiration date (month, day and year).

Possible Ballot (2)change to the IFTA Articles of Agreement *R345 LICENSE RENEWAL .400 A renewal license and decals for the following calendar year will not be issued if the licensee fails to satisfy any outstanding motor fuel use tax liability due another member jurisdiction, provided that member jurisdiction notifies the carrier’s base jurisdiction of outstanding liabilities due them. Notice from the member jurisdiction shall be provided each year by October 1.

Something else to chew on… IFTA Articles of Agreement: • R215 Cancellation means the annulment of a license and its provisions by either the licensing jurisdiction or the licensee. From Oxford Dictionary: Annulment: the act of annulling something. Annul: to declare invalid.

Illinois questioned whether or not R215 needed to be reconsidered or clarified.

THANKS! QUESTIONS???

Illinois has a penalty assessment for operating without a valid IFTA registration, but we cannot verify when the license was actually issued without contacting the carrier’s jurisdiction. Possible Ballot language to add an issue date to the IFTA license or create new language to R345 (.400). Asking for show of support to whether there would be support for a ballot with this language. Favorable support was shown for adding an issue date to the current IFTA license. With that, there was some confusion as to what date would be necessary to be displayed when adding the issue date on the IFTA license. There was no support for the new language that would be added to R345. Queried as to whether this data could be provided through the Clearinghouse as opposed to being printed on the license. It was felt this would be a good compromise so long as the data provided was accurate.

MINNESOTA • There appears to be inconsistent, non-uniform data for the following Clearinghouse Demographic Data: • Information Status Date • Licensing Date • Create Date/Update Date • Update Date/Reinstatement Date • It would be helpful to have a definition of each of the dates so that each jurisdiction is sending consistent data and we are all clear on the meaning of the data.

Non uniform data in the Clearinghouse Definitions table is available for the demographic data, but IFTA, Inc. is aware that there is some non uniform data. The CAC will be reviewing this issue for quality control.

KANSAS • Sending decals to IFTA, Inc. • Not a requirement to send decals to various jurisdictions. KS likes idea of seeing all decals on the website for verification that they are all current and uniform. • Would like to have all jurisdictions forward their IFTA decal to IFTA, Inc. so that they are collected in one place and readily available for viewing by all.

MICHIGAN • Many years ago the purpose of IFTA was established so that the carrier could file one return, with all jurisdictions reporting the same way and not have to file numerous returns with individual jurisdictions. • The way the exemption database has evolved, and continues to evolve, requires the carrier to once again be aware of all of the individual jurisdiction exemptions and how they should be treated on the IFTA return.

In addition, the processing and audit staff in each jurisdiction need to know all of these exemptions as well and also need to know the exemptions historically for the statute of limitations. • Different jurisdictions are handling the exemptions and advising the carriers differently. • The definitions of the various exemptions should be discussed as well as how they are to be treated on the return

This issue is a result of a farm vehicle plate. The process of identifying and confirming independent jurisdiction exemptions is quite cumbersome. The exemption database might ask for what is exempt from the IFTA return, but … Exemption databases require additional information. Auditors and account examiners utilize this database. There is a difference between distance and fuel use exemptions. ON Trucking Assoc. broached this issue previously with Ontario. There is no readily available source for exemptions. How might we accommodate inserting certain information on the IFTA, Inc. website as it pertains to exemptions. Discussions tie in with the previous discussions of mandating the exemption database and organizing the data.

IFTA, Inc. • SAS 70 Audits • In a Type I report, the service auditor will express an opinion on (1) whether the service organization's description of its controls presents fairly, in all material respects, the relevant aspects of the service organization's controls that had been placed in operation as of a specific date, and (2) whether the controls were suitably designed to achieve specified control objectives.

In a Type II report, the service auditor will express an opinion on the same items noted above in a Type I report, and (3) whether the controls that were tested were operating with sufficient effectiveness to provide reasonable, but not absolute, assurance that the control objectives were achieved during the period specified.

IFTA, Inc. has been researching SAS 70 Audits. Asking membership what type of Audit would need to be conducted. For budgetary matters, a Type II audit should be completed but it is questionable as to how often the Type II needs to be completed. Recommended that the Type II be completed every 3 yrs and not annually. Requested that the question be sent by email to all members for their internal auditors to review and respond to. Costs range from $16,000 to $30,000 and are charged by the hour. Interviewing first organization from AZ following the ABM. IFTA, Inc. will forward this question to membership and include anticipated costs as quoted by the local representative. This will be forwarded to

Facing caps and reductions to budgets across the board in all jurisdictions. This includes a reduction in personnel. Committed to continued education and enforcement. A 3% audit requirement is becoming a concern in being met in these times. Offering credit for education and enforcement possibility Ballot language for a pilot project reflecting a 3 yr period limited at the start where credit would be applied toward the 3% for education and roadside enforcement. Not suggesting that the education and roadside enforcement be mandatory, but those who do have it should be awarded a 1% credit towards the 3% requirement. Ontario3% Audit Requirement

Citations. Missing requirements as opposed to not having the proper credentials. Rebuttal for a carrier not having credentials on hand as opposed to not having any credentials when stopped at the roadside. CT website – March Blitz – Failure to have a decal at time of stop. Not having a decal or license on hand does not equate to not obligating their tax liabilities. UPS

TOWN HALL MEETING