Hey, everybody. It's Patrick Escolas with another episode of Banyan's podcast, Tire Tracks. I am blessed to be joined here by Chris Burroughs, the VP of Government Affairs at TIA. Hey, Chris.

Hey, Patrick. Appreciate you having me on.

Hey, thank you very much. Glad to have you here. You're the second person we've talked to from TIA before, but you're the first person that has a government in their title. So you're a real official?

No, don't hold that against me.

I won't. We need government. Where and how? A lot of people debate. But, yes. This is a logistics industry, you're at TIA. First question I always like to ask is, and because, I found myself here from a myriad of different paths. How did you end up in the logistics space?

Yes. After graduating from college, I knew – always was kind of intrigued by politics, always enjoyed politics, kind of grew up in a political family in terms of, always talking about at the kitchen table. So I was super interested in it. Majored in political science and history.

Hold on for a second. You majored in political science. I majored in political science. Is it because you had an idea of what you were doing or because you're just really good at arguing?

I've got an idea of what I wanted to do.

All right. There you go.

So, yes. After that, obviously, went to the most – growing up and living in Northern Virginia, I went to the most logical place to practice my love for politics. My first job was with the US House of Representatives, right out of college for the Transportation Committee, go figure.

There you go.

So that was kind of how I stumbled into the world of transportation, spent a little bit of time there, went on the outside to a small boutique lobbying firm for a few years. TIA was actually one of our clients. I got to know the folks, got to know the leadership team there, and some of the members within the association. Then, 12 years ago, they brought me in house to handle some of the government affair stuff, and kind of grew through the ranks, and been Vice President of Government Affairs for a few years now.'

That's awesome. Right off the rip, you got into it. Is that just from circumstance that you stuck with it, it was everything you knew? Or what about it made you kind of keep continuing down the path? Obviously, government being a part of it, but I guess, you could have branched off or jumped into a different area of expertise? What made you stick with logistics and the industry in general?

Yes. I mean, transportation in general was just always something that was always intriguing to me. Obviously, like I mentioned, being from the Northern Virginia area, traffic pretty much sucks around here. Maybe it was just sitting in traffic on 66 nonstop, trying to get anywhere. Something [inaudible 0:03:06] transportation. But all kidding aside, obviously, with the committee, I really enjoyed that work. At the lobbying firm I worked at, obviously, we had a plethora of clients from telecom, to tax, to healthcare.

The thing that kind of drew me into the transportation side of things, especially, obviously, was having that background working on the committee. But also, there was, for the most part, transportation is bipartisan. We all want strong infrastructure, reliable infrastructure, less traffic, traffic mitigation. It cuts through a lot of the political noise that exist out there, certainly, that you'd run into with tax issues, health care, and some of the more contentious issues. When I worked on the Transportation Committee back in 2006, when I started, one of the very few committees, which there's not many at all anymore. But one of the few committees then that actually worked across the aisle, both sides got long-term transportation bills done to help everybody across the country. Again, just put this partisan politics aside, let's get done for the nation.

That's awesome and it's always interesting to hear it. I think one thing is, in common throughout everyone that I talked to is it, it doesn't matter where or what you do, your logistics and transportation is touching you or you're touching it. It's like debt and taxes, t's not going anywhere. I mean, it can shape and change. But, yes, it's something we're all a part of. And yes, it's here to stay. It's been here for a while. Now, within TIA and your role within Government Affairs, how is TIA involved in the legislation process from a whole –?

Yes, absolutely. Obviously, my main job is the VP of Government Affairs, and our manager that works alongside me, and obviously, our President/CEO, Anne Reinke as well. As you know, we're the voice of the logistics industry on Capitol Hill. The joke within DC is, there's literally an association for everything. There's actually an association for associations too.

Yes.

But everyone's up there, having their voice heard, having their issues brought forward to members in Congress and their staff. Us as the voice of the logistics industry, that's our job to get up and educate members of Congress on the important role that our members are playing, talking about the key issues that are impacting our folks, and just making sure that we're at the table during discussions, and providing feedback, providing expertise where we can, and just – a lot of ways being a resource for them on the education side of things, on the data side of thing, the market side of things. So that they get a better understanding what's going on. So when they go to make that informed decision, they think about the logistics industry for thinking about other stakeholders that are out there. In addition, to the other stakeholders.

Yes. As you say, you're the voice of transportation and logistics. What is that voice calling out for or calling against right now? What are some of the big things that you're shouting in on behalf of your members and industry?

Yes. I think the number one thing right now, and certainly anyone that's in this space, trucking and logistics would certainly understand this, is the rampant fraud that's going on in the marketplace. I mean, we hear about it nonstop from our members. We do a lot of coalition work with groups like [inaudible 0:06:35], and NASDAQ, and ATA. Everyone's feeling the pain of the rampant increase fraud that's going on with taking many forms from cargo theft, to identity theft, double brokering, triple brokering, all the way down the line. It's become crazy.

The Wall Street Journal did an article a few months ago. I think they estimated about $800 million annually that's costing the supply chain. That's cost to our members, that's cost to carriers, that's cost to shippers. Obviously, in the end, it's cost to consumers. Someone's got to front the bill for what's going on. But it's just – it's crazy right now. We're doing some things internally, that we're trying to help out. I mentioned, the outside work with the other groups, and trying to get the FMCSA to act on it a little bit more aggressively, as well. I would say, that's the biggest education piece right now on the Hill, we're really working on so.

Why is the fraud, the acts of fraud so rampant right now? Is this something that's been growing? Is this because of COVID happening, and there being such a market demand? Is because technology is a bigger player than it's ever been? Is there one thing you can point to, or is it a whole bunch, and it's organically gone come to a head?

Yes. I think it's a little bit of everything you mentioned, to be honest. We've been concerned about fraud for over 10 years. We can include some language back in 2012, in the [inaudible 0:08:09] legislation, which was the long-term [inaudible 0:08:12] Obama. To kind of address this in terms of, hey, if you're going to broker freight, you have to have a license to do so. 

It makes sense.

Easy. Yes. What we're seeing at that time was a lot of carriers who, for convenience reasons, we're brokering freight out. The kind of the general definition of [inaudible 0:08:31] broker and be well. That kind of – think back to anyone who helped with that, there's been limited enforcement on that, which is a problem. But I think because of COVID, really, was the ultimate catalyst. To your point about the increased volume in the space for sure, that that's really where it ramped up over the last few years. 

I think, again, knocking the agency, they've got limited resources. But if these folks know that they can continue to do this, and there's no legal actions can be taken. As we've dug into the issue, a lot of these companies based in the US – so I'm not – I mean, that obviously creates another layer of jurisdictional issues as well. With technology, it just makes it easier for them, and they're constantly evolving. We tell our guys, you got to be right every single time on your carrier selection process, and who you're going to use. They might be right one time, and they've got you for a load of Peloton bikes or whatever the case may be, and you're out a couple $100,000. 

Depending on the situation you're in, that could be make or break for everything you do, and let alone the relationship. Within that, as you guys are talking about this, all these bad players, who were you looking to regulate or have jurisdiction on this. Like you said, there's out of nation players here. Is this from a money and financial – someone finds you, and go through the taxes, or we talking about guys on the highway, check in every truck. What does that look like in order for prevention? Just because it seems like such a big picture, I mean, is there – obviously, there is a department for it, but would you need to almost create a whole new one?

Yes. I mean, that's one suggestion for sure. We've been working with a senator and a member of the House, who has proposed to the FMCSA to create a task force out of the Inspector General's Office dedicated just to this. But yes, I mean, it's a huge issue. There's not going to be one silver bullet that's going to fix everything, by any means. But I think, a lot of it stems from the registration side of things that are going on. Apparently, friends – let me give example. One thing we flagged at FMCSA a while back, and to their credit, they did some due diligence to it, took some action. But one of our members flagged on social media that they found an address in Wyoming that had 272 trucking companies using that address, one house. We did a little Google Maps, we saw it was a house. We're like, that seems strange. 

It's a really big backyard, though.

Really big backyard, yes. Yes, great parking for truck.

Yes. We sent it to the agency, and they came back and said, "We can confirm that there is 272 companies that are operating out of this. They have different suites, but we'll send an investigator to investigate" They went out and said, "There's no one operating on this building. It's a total hoax. We'll see what we can do." Stuff like that. I mean, going in, and changing phone numbers, and not having dual factor authentication, changing your pin online. There's some registration, things that could help. Obviously, on the front end. Then there's – there's several red flags, or not necessarily best practices that our members have put together for our folks and things to look at. Does these people have gone through this, unfortunately? There's a lot of commonalities that comes up in terms of indicators of, hey, this carrier may not necessarily be who they say they are.

Who they say they are, yes. What I'm hearing is, some of these cases are kind of like the fraud that's a cross industry, not necessarily just logistics. It could be somebody's Facebook and phone account getting hacked. It just happens to be someone doing this at the brokerage or the carrier side of things. Then, being able to get away with somebody's shit. Okay. No, that's – I hadn't thought, you know, we hear about double brokering so much that I kind of – didn't even think about the actual, the true fraud as if double brokering isn't. But where you're really out there pretending to be somebody you're not, or to be more of a player than you are, just in order to get somebody's goods or money. That's very interesting to me.

You said, so you guys have been working on this for 10 years, and it's really something you guys are working on now. What are some other things other than the fraudulent act? I know that carbon impact is a big one. Is that something that's come across the table or being talked about right now?

Yes, absolutely. The brokerage industry in general, is by nature, it's a very green industry. Obviously, we started as kind of the backhaul of things. The trucker was heading back home, didn't want to take empty load, empty miles wasted, emission. That's kind of where the broker kind of filled that void. We are an affiliate partner with EPA SmartWay program, with our members not owning assets, not owning trucks. There's not so much we can do on the truck's side of things. But obviously, as an affiliate partner of SmartWay, and we have a lot of members that submit their data in our Smart Way partners, with him as well. They obviously give preference to those trucks that may have take some extra steps in order to become a little bit more greener out there in the industry.

To be to be candid, something that our members do truck, but some of the stuff that's coming out of California, maybe a little bit too extreme in terms of –

What kind of things are coming out of California that are extreme?

I mean, we've been – there's three regulations that have – that have broker components out of the State of California that we've been tracking for a number of years. It really just boils down to – it really hurts business at the end of the day. Again, we're an industry that cares about green initiatives, reducing. But if we're putting these carriers in situations where they're leaving the state in droves, it kills capacity

Maybe it doesn't make sense.

It doesn't make sense from a business perspective. I understand that – I guess I understand what they're doing. We get it. But for the sake of making sure that our carrier partners are still operating on those states, sort of like the IC model. I mean, obviously, what we've seen in AB5, a lot of carriers are leaving the State of California, unfortunately. The same thing with these CARB and environmental regulations. There's a line between where we're comfortable, and then where it hurts business, and it hurts our carriers. 

Now, is it within the carbon footprint and offset? Is it more on kind of a carrot in the stick that's coming out? Or right now, is it just kind of on a reporting and getting the information? What is California doing that's driving people out? Is it making it so you have to have that information or that you'd have to pay if you're not offsetting?

Yes. I mean, there's a little bit of both. I mean, they're different regulations. There's some newer ones that are kind of in the reporting stages. But then, from the broker side of things, there's someone like the truck and bus rule, where a couple of our members who have assets a number of years ago got hit for a couple $100,000 fines for not utilizing a truck that didn't have a certain particulate matter exhaust filter on that –

Got you.

I can't remember the exact year. I think it was, 2035, I think California wants to be an entirely electric state in terms of the fleet. 

I didn't know that. Okay.

Are we there yet? I don't think so. It was 20 months ago the governor was telling people not to use their oven, between five and eight, because of the grid. There's a lot of infrastructure needs to go into that, but it's unfortunately becoming kind of an anti-business state. We have a ton of members out there, and other trucks out there that operate in states. We want to keep business moving in the great State of California.

No. Do you have –that's California in a state level, and within Government Affairs, I would assume you're working at the state and the federal. Would something like that, that California is doing – move federal? Or would it have to kind of gain traction in different states? Or where's that kind of battleground lie at? What does that look like for you and your involvement? Are you going to Nevada right next door and be like, "Hey, don't do what California is doing"? Are you go into the senators and say, "Hey, look at what California is doing. I know we might need to do something across the board nationally, but maybe not this model"?

Yes, a little bit of both, honestly. California is obviously the leader in a lot of these environmental issues. Then that does trickle over to local states, and trickles over to other states as well. But also, there's discussions and we continue to have meetings at the federal level as well, to make sure that these issues are addressed. California can do some of the broker and carrier regulations at an interstate commerce level. Because the federal EPA has given them a waiver to do so, to kind of enforce these greenhouse gas initiatives. Otherwise, when you're talking about cross border movements, where you have a company that's not even domiciled in the State of California, but they're arranging transportation to the state for instance. That brought under the umbrella because of this, because of this waiver that EPA granted them. There obviously is a federal component to it. Obviously, like I mentioned, they certainly lead and a lot of states do follow so.

Within that, we've talked about kind of this fraud, and the carbon, or the green side of things. That's just to – some of the bigger ones out there. How many different regulations are you guys tracking in a month or a year? Is it like, you pick five good ones to fight? Are you just in and out of ledgers or – what does that look like for you? One of your members tells you about it, or you got an AI going through, or you just got to lower the intern, trying to highlight every time somebody comes through something on a new government page. There's got to be so much information. You guys have to dig through to know where you should be involved or getting ahead of an issue.

Yes. Pretty much, it's quite a bit. Pretty much any issue that falls, that comes out of Department of Transportation. Obviously, anything that's on the Capitol Hill as well in terms of the Congress. We track everything, we don't necessarily always take a position on every issue. Speed limiters, for instance, it's something that we have not taken a position on, will likely remain neutral on that issue. That's a very contentious issue between the two trucking associations.

I like to go fast. So –

Right. Like I said, we're probably not going to play in. But it's quite a bit, and obviously, because – with any sort of association, we have committees internally, and a board of directors that run our policy side of things. We have a policy committee that develops kind of our policy goals for the year. I think in terms of initiatives for this congress alone, I think we had like 20 or 30 that we've gotten listed, things that we're tracking and being cognizant of, and advocating on behalf of, or against. We stayed pretty busy.

Yes, I can imagine, I can imagine you do. As far as that staying busy, and always kind of look into the future, where do you – you might get bogged down in the day in and day out. But I would assume that you probably have to have a finger on a pulse and an eye forward, especially as these things go. What do you see the next, I guess, topic, or battle to be? Or what's something that's a big deal, but isn't talked about maybe as upfront and in the media, as climate, and carbon, or the fraudulent, and the double brokering?

Yes, I would say. There's actually the agency, the FMCSA, just released an advance notice of rulemaking that are coming out with, we just got it this morning. It's something we've been talking about for quite a long time, that I don't think nearly gets enough press. The confusion, and the carrier selection process. 

Okay.

Obviously, the FMCSA gives trucking companies a safety rating. Still done by a physical system, where they don't have the resources to physically go out, and audit 500,000 roughly, for hire trucking companies,

One poor guy. They'll get to it.

Exactly. The limited investigators they have throughout the country, doing these non-stops. I think before COVID, they told us they probably did about 5,000 to 7,000 audits here. Obviously, through the COVID period, I would say that was probably cut in half, or maybe even a quarter. So it's created a situation where right now, 92% of trucking companies are unrated. 

Really?

What does that mean for our members and shippers that are going on selecting these carriers? Is we don't have that assurance from the federal government on are these carriers safe to utilize or not? They would like to deputize us to be kind of the police of that, and then take all the data that they put out there, and pick through it, and build an algorithm, and find something that correlates to safety. Because we're all on the same situation, and we all have the same shared goal of eliminating crashes out there. But with 92% of trucks being unrated, it's a complete failure of a system. The agency put out a proposed advance notice rule today, that they're looking to change the methodology. Something again, that we've been asking for for a number of years.

Let's just say, it sounds like a great idea. Yes.

Yes. And really get away from the physical system, because it doesn't work, and shift to something of data, something of potentially a virtual platform. Let's rate carriers based on – for the date instance, let's rate carries on all the data that's being fed in. Every time a truck is touched in a particular state, it's fed – DOT has that data. Every time they get cited, every time they go through a way inspection of time, they get a tier one, tier two, tier three, inspection, all that stuff, they have all that. 

The data is out there, we're just not using it to this end yet.

Yes. President Obama, to his credit, put a rulemaking out at the end of his second term to do this, and to eliminate the physical system, shift to one of data. It also eliminated the confusing four-tiered safety rating structure we currently have: conditional, satisfactory, unsat, and unrated. And said, let's just go red light, green light. You're either safe, or you're not safe. Conditional, you're not safe, but you're still going to operate.

I'm imagining the old national alerts where it was orange, we're in a yellow, or in a red. I don't know what color we're on, man. It's just a purple day. What's going on? Should we use you or should we not? Yay or nay?

Exactly. Up or down? Safe or not? He tried to put that forward, and obviously, or unfortunately, they got it rolled back and kind of put on hold. We were excited to see this morning, that was getting resurrected. Because like I said, for our guys that are slacking carriers. I mean, we need this information because for variety of reasons, Obviously, safety being first and foremost, that we're utilizing the safest carriers that are out there to minimize potential crashes, and fatalities, and injuries, and everything else that goes along with that.

Yes. I mean, that seems like paramount to what you guys are doing. I mean, business first, but then I guess, overall safety of it at a certain point. That overall safety is going to come back and affect business, so it's kind of hand in hand. It's mind-blowing to me, like you said, 92% is not hitting that. And that how few are getting manually audited? Nope. That sounds like a great thing that they're looking to change that. Good on you for being a loud voice on that. Hopefully, that gets something that moves – how fast is something like that move? That's a next question. I know, it's government.

Yes. Back to the government, glacier speed for sure. 

Yes, exactly.

Typically, they'll put it out. They haven't officially announced it yet, but they'll put it on the next day or two. Probably be open for 60, 90 days for the public to comment. We'll also read the comments as well. They have several correction they want, get people's feedback on, et cetera. They'll take all those comments, and then there's no – there's no set timetable, but roughly, probably six months to a year. They'll come back and say, "Hey, there's our notice [inaudible 0:25:44], and this is what we're suggesting we do." Then it goes, "Now a comment period," and then you can see this pattern here. 

Then, six months later, they come out with a final rule, which is what they're actually implementing. Then, after that, they still give typically, three, six months for kind of implementation period, to everybody kind of get their ducks in a row. It's a long process. Obviously, politics plays into this. Like I mentioned, President Obama tried it, President Trump came in and is part of his rollback. That was one of the things the guy cut. Then, it was four years of nothing happening. Everything with the government is very, very slow, no matter who's in the White House, it doesn't matter. 

Yes. No. It's funny to hear it that way, but it's not surprising. But at the same time, at least there's a process, I guess, within that. So you know where you are in the steps of it. Within that, where do you call that a success for your people? Is it just that it gets passed? Is it – are you looking at it, and then, pulling your people? How do you get the real consensus of TIA, or of the industry to really making sure you're not going for what you think is best for them, but what they actually want to see out of that?

Yes. It's heavily leaning on our volunteer leadership of our association. An issue like that will go before our Highway Committee. The Highway Committee will develop the policy position that we will take, and the necessary steps, and feedback, and comments to those particular questions that they're going to be posing. Our association is run by our members. There are bosses, so we work for them. No different than a Hill, obviously, when I worked on Capitol Hill for the House. It wasn't my name on the door, it was the member of Congress' name on the door. If you don't personally agree with it, he's the elected official, you're not.

That's fair. 

Yes. It's fair, and that's the way it should be, quite honestly.

Within that, in just recent, we've seen a few things play out in the industry as a whole, like with UPS almost going on strike, and then them finding an agreement. Then Yellow, just imploding. Does TIA get involved with that, or is that something you're just keeping an eye on? How does that all affect what you're doing within that, within the Government Affairs, and kind of TIA as a whole?

Yes. We certainly keep track of that from a market perspective, and what's the impact, obviously. A company like Yellow obviously had quite a bit of capacity. What's the impact to our members, if things like that would happen? Tracking some of the other logistic companies that may be struggling during this downturn in the freight recession, some people are calling it. From a market perspective, certainly, and obviously, as we build those relationships, and educate members of Congress, and particularly staff. They'll reach out to us and say, "Hey, what's the impact of – what's the potential impact of this Yellow thing that's going on? What happens if this particular port doesn't – actually strikes, and what's the impact?" All that.

If there was anything positive at COVID, which there probably wasn't, but there was a huge spotlight shine on the logistics industry and what the members are doing. It certainly created lots of interest, especially from my perspective in the Government Affairs' seat. But a lot of interest on the Hill being like, "Hey, can you come and explain really what's going on?" Our President, CEO, Anne has testified a few times now before Congress on that. Is like, "Hey, we're still coming out of this pandemic era." She did it once during the pandemic. What can government do to help address this? 

It's funny how that works when all of a sudden, things aren't getting to where they need to go, and you go, "Hold on a second. We forgot about the trucking industry. Yes, we should look into that a little more."

And most staffs are like, "Well, the truck just picks it up and brings it." "What do you mean? Or is just magically appears on the shelf?" I say, "Well, there's this whole industry you know nothing about. Let me explain it to you."

I'm going to say it, in their defense, a lifetime ago before I came into this same kind of thing. I'm like, "Yes, I see them when I'm driving. And generally, they are trucks." Then you get into it, and you're like, "Oh God. There's so much that I don't understand" or that's connected, and plays a part in everything there. No, this has been – it's been really helpful, and it sounds like you guys are doing a lot just for the industry as a whole. Obviously, for your members, first and foremost, because they are who you're committed to. But overall, it sounds like, within the landscape, within government, and with everything that's happening, you have – you're having that conversation. So we all don't have to get tied up in fun governmental processes that happen at the speed of glaciers.

I've taken a lot of your time here, Chris, but I always like to, and I've learned a lot, which is why selfishly, I love doing these because I get a lot of industry knowledge, I like educating myself. But I wanted to offer you a chance to anyone listening here, whether it's TIA members, or just the four people that listen to my podcast. This is kind of your soapbox, what's your message to anyone listening, whether that's from you as the VP of Government Affairs, or just Chris Burroughs, just a man that has an opportunity to talk to people? What is the message you have with this opportunity?

Yes. I would say, my message would be is, get involved in the process. Obviously, if you're a TIA member, get involved, get involved with us. If you're a member of another association, get involved with them. Or just, individually, get involved. That could be with the political process. These are members of Congress or elected officials. They're elected by you. You guys are the job builders, you're the constituents, you're the voters. They need to hear from you. So let's say, if you got an issue that you guys are passionate about, reach out to those folks. Kind of put their feet to the fire a little bit, and let them know that you're there. This is the important role that you're playing in the industry, and it's more as a just a transportation segment and industry as a whole. Not just the broker community, but the broker carrier, shipper community, all the way down the line. We need to be more united on kind of the front of, let's make sure that transportation has a voice, and it's heard loud on Capitol Hill.

There you go. Chris saying, say it loud, say it proud. If you've got 270 trucks and brokerages, try not to do it out of one house with no docks. I still like the idea of just so and being like looking at to it at Google Maps and be like, "This is strange" and be like someone else looking at a list of it. Like, "No checks out. There's an address for these." Something's missing there.

Chris, I really appreciate your time today. Appreciative of everything TIA is doing, and what you are doing within the government, and to help the government do the right thing for the industry as a whole. Thank you very much for the time. I really appreciate it. I learned a lot about it. For all the listeners out there, thanks for listening or watching another episode of Banyan's Tire Tracks podcast, and we'll see you next time. Thanks.