United States: US State Newsletter

IFTA & IRP Hold Audit Workshop

The International Fuel Tax Agreement and International Registration Plan held their annual joint Audit Workshop in Tempe, Arizona, January 6-8, 2001. The meeting was very well attended, with 46 states and 9 Canadian provinces represented and many industry attendees as well. Breakout sessions at the workshop featured detailed discussions of small carrier issues, the application of error factors, internal controls, and other matters. There were in addition separate breakouts for IRP and IFTA matters and meetings of the audit committees of both organizations. Over the past several years, the quality of these meetings and the work that has gone into their preparation have been truly impressive.

The first meeting of the new Industry Advisory Committee of the International Fuel Tax Agreement was held in Tempe, Arizona, following the IFTA/IRP Audit Workshop noted above. The Committee was formed to provide a formal way of presenting advice and counsel to the IFTA Board, the other IFTA Committees, and IFTA’s members. The Committee elected Bob Pitcher of Zuckert, Scoutt & Rasenberger the committee chair, Tom Klingman of UPS vice chair, and Donna Burch, Ryder; Page Dunnegan, Unigroup; Douglas Kading, Schneider National; and Rick Reeves, Allied Worldwide, to the IAC steering committee. A formal announcement from the IFTA Board as to the Committee’s 2001 membership is expected soon. The IFTA IAC now joins the IRP IAC as a means for industry to inform and cooperate with these two groups of state tax administrators. For more information, call Bob Pitcher at ZSR.

The New York State Division of Tax Appeals has held that a dairy that used owner-operators to deliver milk products was jointly and severally liable with their independent contractors for the state weight-distance tax because it owned the trailers in which the products were hauled. The administrative law judge found that the dairy was not acting as the carrier when it used owner-operators, and was not their lessee. The dairy did not control its contractors, and the contract between the owner-operators and the dairy made highway taxes the responsibility of the former. Nevertheless, the judge found that in these circumstances state statute applied joint and several liability to the owners of both units of a vehicle combination. Fairlawn Dairies, Inc., docket no. 817010, decided November 9, 2000

Under recent California legislation (SB 542) effective January 1, 2001, motor carriers using owner-operators must report their compensation to the state Employment Development Department. This includes all carriers, whether or not based in the state, that contract with or pay owner-operators from a California terminal. The law is intended to deal with the problem of delinquent child-support payments. Reports are due to the department within 20 days of making a payment of $600 or more to an independent contractor or entering into a contract worth $600 or more, whichever is sooner. There is a daily penalty for noncompliance.