Tire issues are percolating in Congress

June 25, 2015
Congress is feverishly holding hearings on reauthorization of the highway bill, which will mean changes to highway safety laws, including, possibly, to reporting requirements for tire retailers. In addition, Congress will at the same time have to legislate new sources of funding for the federal highway grant program.

Congress is feverishly holding hearings on reauthorization of the highway bill, which will mean changes to highway safety laws, including, possibly, to reporting requirements for tire retailers. In addition, Congress will at the same time have to legislate new sources of funding for the federal highway grant program. Congress might decide to reinstitute the long-ago federal excise tax (FET) on passenger tires (there is a current FET on truck tires).

The current highway bill expires at the end of May, and the highway trust fund, now solely dependent on gas taxes, is expected to run out of money by the end of August. Nearly everyone in Washington agrees that the fact that drivers are in much more fuel-efficient cars these days means that the gas tax must be increased or supplemented with other, new taxes.

So there are two things to watch out for: new regulations and new taxes.

In the first category, there may be a push to force tire retailers to report to the National Highway Traffic Safety Administration (NHTSA) tires sold in stores. This is not now required. Last year, the Obama administration introduced a highway reauthorization bill called the “Generating Renewal, Opportunity, and Work with Accelerated Mobility, Efficiency, and Rebuilding of Infrastructure and Communities throughout America Act” or “GROW AMERICA Act.” That bill went nowhere.

But that bill included a provision allowing NHTSA to "initiate a rulemaking to consider requiring a distributor or dealer of tires that is not owned or controlled by a manufacturer of tires to maintain records of the name and address of tire purchasers and lessors and information identifying the tire that was purchased or leased, and any additional records the Secretary deems appropriate. Such rulemaking may also consider requiring a distributor or dealer of tires that is not owned or controlled by a manufacturer of tires to electronically transmit such records to the manufacturer of the tire by secure means at no cost to tire purchasers or lessors."

Last December, the Rubber Manufacturers Association, which represents tire manufacturers, announced they were lobbying Congress to support such an amendment. The Obama administration has indicated it will reintroduce the bill. Of course, a bill introduced by the Obama administration probably has no chance of emerging from the Republican-controlled Congress intact, if it emerges at all. It is almost impossible at this early stage, with no transportation committee in either the House or Senate proposing much less passing a highway reauthorization bill, whether the tire dealer reporting provision has any support. Justin Harclerode, spokesman for the House Transportation and Infrastructure Committee, says the leaders of the committee have not taken a position one way or another on any possible provision in a reauthorization bill.

Kevin Rohlwing, senior vice president of training for the Tire Industry Association, says the TIA strongly opposes retailer reporting on tire sales and any reinstitution of an excise tax on either passenger tires or retreads. As to the possibility of those taxes, Rohlwing says, "We've heard it suggested." But there doesn't appear to be an actual provision on the horizon.

Rohlwing said he and the TIA are not concerned about the new NHTSA final rule changing the tire identification number (TIN) manufacturers must print in full on at least one sidewall. From its adoption in 1971, the TIN has consisted of up to four groups of numbers and letters.

The first is a plant code, formerly two symbols, now expanded to three by the final rule, to accommodate the new tire manufacturing plants that have been established. The second thing NHTSA did was to standardize the TIN at 13 symbols. The second and third groups could have been two and four numbers, so TINs were of different length. Hence the standardization around 13 symbols.

The National Transportation Safety Board wanted NHTSA to require manufacturers to print the 13-digit TIN on both sidewalls. NHTSA declined to do that, or any of the other enhancements the NTSB suggested. 

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